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UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, D.C.
    20549Form 10-K
  þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal
    period ended December 26, 2010ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to   Commission File Number
    001-34920
  BRAVO BRIO RESTAURANT GROUP,
    INC.
 (Exact name of registrant as
    specified in its charter)
  Ohio(State or other jurisdiction
    of
    incorporation or organization)

34-1566328(I.R.S. Employer
    Identification No.)777 Goodale Boulevard, Suite 100
    Columbus, Ohio(Address of principal
    executive office)

43212(Zip Code)   Registrants telephone number, including area code
    (614) 326-7944
   Former name, former address and former fiscal year, if
    changed since last report.
  Securities registered pursuant to Section 12(b) of the
    Act:
  Title of Each Class

Name of Each Exchange on Which RegisteredCommon Shares, no par value per share

NASDAQ Global Market   Securities registered pursuant to Section 12(g) of the
    Act:
  o þ
  o þ
  þ o
  Regulation S-T o o
  Regulation S-K Form 10-K Form 10-K.  Yes o o
  Rule 12b-2
  Large accelerated
    filer o

Accelerated
    filer o

Non-accelerated
    filer þ

Smaller reporting company o(Do not check if a smaller
    reporting company)   Rule 12b-2 o þ
      DOCUMENTS INCORPORATED BY REFERENCE
  Form 10-K




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##### 





Table of
    Contents:
   
 Item



PageForward-Looking Statements


3Basis of Presentation


4PART I1.

Business


51A.

Risk Factors


171B.

Unresolved Staff Comments


332.

Properties


343.

Legal Proceedings


344.

(Removed and Reserved)


35PART II5.

Market for Registrants Common Equity,
    Related Stockholder Matters and Issuer Purchases of Equity
    Securities


356.

Selected Financial Data


377.

Managements Discussion and Analysis of
    Financial Condition and Results of Operations


397A.

Quantitative and Qualitative Disclosures About
    Market Risk


518.

Financial Statements and Supplementary Data


529.

Changes in and Disagreements with Accountants on
    Accounting and Financial Disclosure


529A.

Controls and Procedures


529B.

Other Information


53PART III10.

Directors, Executive Officers and Corporate
    Governance


5311.

Executive Compensation


5312.

Security Ownership of Certain Beneficial Owners
    and Management and Related Stockholder Matters


5413.

Certain Relationships and Related Transactions,
    and Director Independence


5414

Principal Accounting Fees and Services


54PART IV15

Exhibits, Financial Statement Schedules


54Exhibit Index


75SIGNATURES


77EX-10.9EX-10.12EX-12.1EX-21.1EX-23.1EX-31.1EX-31.2EX-32.1




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Forward-Looking
    Statements  Form 10-K
  
    the success of our existing and new restaurants;
    our ability to successfully develop and expand our operations;
    changes in economic conditions, including continuing effects
    from the recent recession;
    our history of net losses;
    damage to our reputation or lack of acceptance of our brands;
    economic and other trends and developments, including adverse
    weather conditions, in those local or regional areas in which
    our restaurants are concentrated;
    the impact of economic factors, including the availability of
    credit, on our landlords and other retail center tenants;
    changes in availability or cost of our principal food products;
    increases in our labor costs, including as a result of changes
    in government regulation;
    labor shortages or increased labor costs;
    increasing competition in the restaurant industry in general as
    well as in the dining segments of the restaurant industry in
    which we compete;
    changes in attitudes or negative publicity regarding food safety
    and health concerns;
    the success of our marketing programs;
    potential fluctuations in our quarterly operating results due to
    new restaurant openings and other factors;
    the effect on existing restaurants of opening new restaurants in
    the same markets;
    the loss of key members of our management team;
    strain on our infrastructure and resources caused by our growth;
    the impact of federal, state or local government regulations
    relating to building construction and the opening of new
    restaurants, our existing restaurants, our employees, the sale
    of alcoholic beverages and the sale or preparation of food;
    the impact of litigation;
    our inability to obtain adequate levels of insurance coverage;
    the impact of our indebtedness;
    future asset impairment charges;
    security breaches of confidential guest information;
    inadequate protection of our intellectual property;
    the failure or breach of our information technology systems; 3




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
    a major natural or man-made disaster at our corporate facility;
    our ability to maintain adequate internal controls over
    financial reporting;
    the impact of federal, state and local tax rules;
    concentration of ownership among our existing executives,
    directors and principal shareholders may prevent other investors
    from influencing significant corporate decisions; and
    other factors discussed from time to time in our filings with
    the Securities and Exchange Commission (the SEC),
    including factors discussed under the headings Risk
    Factors, and Managements Discussion and
    Analysis of Financial Condition and Results of Operations
    of this annual report on
    Form 10-K.  Form 10-K.
 Basis of
    Presentation   4




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Part I  As used in this annual report on
    Form 10-K,
    unless the context otherwise indicates, the references to
    our company, the Company,
    us, we and our refer to
    Bravo Brio Restaurant Group, Inc. together with its
    subsidiaries.
  Item 1.
    Business.  Our
    Business
    BRAVO!
    Cucina Italiana
    made-to-order
      BRIO
    Tuscan Grille
   5




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made-to-order
        Our
    Business Strengths
  is to be the best Italian restaurant
    company in America by delivering the highest quality food and
    service to each guest...at each meal...each and every day
  Two Differentiated yet Complementary
    Brands.
   6




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Broad Appeal with Attractive Guest Base.
  Superior Dining Experience and Value.
  
    The Food.  We offer
    made-to-order
    menu items prepared using traditional Italian culinary
    techniques with an emphasis on fresh ingredients and authentic
    recipes. Our food menu is complemented by a wine list that
    offers both familiar varieties as well as wines exclusive to our
    restaurants. An attention to detail, culinary expertise and
    focused execution reflects our chef-driven culture. Each
    brands menu has its own distinctive flavor profile, with
    BRAVO! favoring the more classic Italian cuisine that includes a
    variety of pasta dishes and pizzas and BRIO favoring a broader
    selection of premium steaks, chops, seafood, flatbreads,
    bruschettas and pastas. All of our new menu items are developed
    by our Corporate Executive Chefs through a six month ideation
    process designed to meet our high standards of quality and
    exceed our guests expectations.
    The Service.  We are committed to delivering
    superior service to each guest, at each meal, each and every
    day. We place significant emphasis on maintaining high
    waitstaff-to-table
    ratios, thoroughly training all service personnel on the details
    of each menu item and staffing each restaurant with experienced
    management teams to ensure consistent and attentive guest
    service. An attention to detail, culinary expertise and focused
    execution underscores our chef-driven culture. Only trained,
    experienced chefs and culinary staff are hired and allowed to
    operate in the kitchen.
    Best-in-class
    service standards are designed to ensure satisfied guests and
    attract both new and repeat guest traffic.
    The Experience.  Lively, high-energy
    environments blending dramatic design elements with a warm and
    inviting atmosphere create a memorable guest experience.
    Signature architectural and décor elements include the
    lively theatre of exhibition kitchens, high ceilings, white
    tablecloths, a centerpiece bar and relaxing patio areas. In
    addition, the majority of our restaurants include attractive
    outdoor patios with full bar and dining areas at the front of
    our restaurants that create an exciting and inviting atmosphere
    for our guests. These elements, along with our superior service 7




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and value, help form a bond between our guests and our
    restaurants, encouraging guest loyalty and more frequent visits.  Nationally Recognized Restaurant Anchor.
  Compelling Unit Economics. cash-on-cash
  Management Team with Proven Track Record.
  Our
    Growth Strategies
    Pursue Disciplined Restaurant Growth.
    Grow Existing Restaurant Sales.
 8




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Maintain Margins Throughout Our Growth.
  Real
    Estate
  and/or percentage-of-sales
  Site
    Selection Process
      Design
   9




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New
    Restaurant Development
    Restaurant
    Operations
    
    Offer Italian Food and Wines.  We seek to
    differentiate ourselves from other multi-location restaurants by
    offering affordable cuisine prepared using fresh ingredients and
    authentic Italian cooking methods. To ensure that the menu is
    consistently prepared to our high standards, we have developed a
    comprehensive ten week management training program. As part of
    their skill preparation, all of our executive chefs perform a
    cooking demonstration. This enables our Corporate Executive
    Chefs to evaluate a candidates skill set. All executive
    chefs are required to complete ten weeks of kitchen training,
    including mastering all stations, ordering, receiving and
    inventory control. Due to our high average unit volumes, the
    executive chefs are trained throughout the ten weeks to ensure
    that their food is consistently prepared on a timely basis. In
    addition, all executive chefs are trained on product and labor
    management programs to achieve maximum efficiencies. Both of
    these tools reinforce our commitment to training our employees
    to run their business from a profit and loss perspective, as
    well as the culinary side.
    Deliver Superior Guest Service.  Significant
    time and resources are spent in the development and
    implementation of our training programs, resulting in a
    comprehensive service system for both hourly service people and
    management. We offer guests prompt, friendly and efficient
    service, keeping wait
    staff-to-table
    ratios high, and staffing each restaurant with experienced
    on the floor management teams to ensure consistent
    and attentive guest service. We employ food runners to ensure
    prompt delivery of fresh dishes at the appropriate temperature,
    thus allowing the wait staff to focus on overall guest
    satisfaction. All service personnel are thoroughly trained in
    the specific flavors of each dish. 10




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Using a thorough understanding of our menu, the servers assist
    guests in selecting menu items complementing individual
    preferences.  
    Leverage Our Partnership Management
    Philosophy.  A key element to our current
    expansion and success has been the development of our
    partnership management philosophy, which is based on the premise
    that active and ongoing economic participation (via a bonus
    plan) by each restaurants general manager, executive chef,
    assistant managers and sous chefs is essential to long-term
    success. The purpose of this structure is to attract and retain
    an experienced management team, incentivize the team to execute
    our strategy and objectives and provide stability to the
    operating management team. This program is offered to all
    restaurant management. This provides our management team with
    the financial incentive to develop people, build lifelong guests
    and operate their restaurants in accordance with our standards.  Sourcing
    and Supply
    and/or
   11




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Food
    Safety
    Marketing
    and Advertising
  ages 35-65,
  Local
    Restaurant Marketing
  point-of-sale
  e-blasts
  Advertising
    New
    Restaurant Openings
  e-marketing
 12




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E-Marketing &
    Social Media
  e-marketing e-applications
  Training
    and Employee Programs
  up-to-date E-learning
        Management
    Information Systems
  point-of-sale state-of-the-art
 13




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Government
    Regulation
         14




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multi-unit
       15




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Intellectual
    Property
  ® ® ® ® ® tm ®
  cease-and-desist
  Competition
     16




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Employees
    Available
    Information
  Form 10-K, Form 10-Q, Form 8-K,
  Item 1A.
    Risk
    Factors.  Form 10-K,
  Risks
    Relating to Our Business and Industry
  Our
    financial results depend significantly upon the success of our
    existing and new restaurants.
      
    declining economic conditions, including housing market
    downturns, rising unemployment rates, lower disposable income
    and consumer confidence and other events or factors that
    adversely affect consumer spending in the markets we serve;
    increased competition (both in the upscale affordable dining
    segment and in other segments of the restaurant industry);
    changes in consumer preferences;
    guests budgeting constraints and choosing not to order
    certain high-margin items such as desserts and beverages (both
    alcoholic and non-alcoholic);
    guests failure to accept menu price increases that we may
    make to offset increases in key operating costs; 17




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
    our reputation and consumer perception of our concepts
    offerings in terms of quality, price, value and service; and
    guest experiences from dining in our restaurants.    
    food and other raw materials costs, many of which we do not or
    cannot effectively hedge;
    labor costs, including wage, workers compensation, health
    care and other benefits expenses;
    rent expenses and other costs under leases for our new and
    existing restaurants;
    energy, water and other utility costs;
    costs for insurance (including health, liability and
    workers compensation);
    information technology and other logistical costs; and
    expenses due to litigation against us.    Our
    long-term success is highly dependent on our ability to
    successfully develop and expand our operations.
    
    our inability to generate sufficient funds from operations or to
    obtain favorable financing to support our development;
    identification and availability of, and competition for, high
    quality locations that will continue to drive high levels of
    sales per unit;
    acceptable lease arrangements, including sufficient levels of
    tenant allowances and construction contributions;
    the financial viability of our landlords, including the
    availability of financing for our landlords;
    construction and development cost management;
    timely delivery of the leased premises to us from our landlords
    and punctual commencement of build-out construction activities;
    delays due to the highly customized nature of our restaurant
    concepts and the complex design, construction and pre-opening
    processes for each new location;
    obtaining all necessary governmental licenses and permits on a
    timely basis to construct and operate our restaurants;
    competition in new markets, including competition for restaurant
    sites;
    unforeseen engineering or environmental problems with the leased
    premises;
    adverse weather during the construction period;
    anticipated commercial, residential and infrastructure
    development near our new restaurants; 18




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
    recruitment of qualified managers, chefs and other key operating
    personnel; and
    other unanticipated increases in costs, any of which could give
    rise to delays or cost overruns.    Changes
    in economic conditions, including continuing effects from the
    recent recession, could materially affect our business,
    financial condition and results of operations.
    We
    have had net losses in the past and our future profitability is
    uncertain.
   19




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Damage
    to our reputation or lack of acceptance of our brands in
    existing and new markets could negatively impact our business,
    financial condition and results of operations.
    foot-and-mouth
    Because
    many of our restaurants are concentrated in local or regional
    areas, we are susceptible to economic and other trends and
    developments, including adverse weather conditions, in these
    areas.
  ,
   20




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quarter-to-quarter
  The
    impact of negative economic factors, including the availability
    of credit, on our landlords and other retail center tenants
    could negatively affect our financial results.
      Changes
    in food availability and costs could adversely affect our
    operating results.
     21




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Increases
    in our labor costs, including as a result of changes in
    government regulation, could slow our growth or harm our
    business.
    and/or
        Labor
    shortages could increase our labor costs significantly or
    restrict our growth plans.
   22




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Guest
    traffic at our restaurants could be significantly affected by
    competition in the restaurant industry in general and, in
    particular, within the dining segments of the restaurant
    industry in which we compete.
    Legislation
    and regulations requiring the display and provision of
    nutritional information for our menu offerings, and new
    information or attitudes regarding diet and health or adverse
    opinions about the health effects of consuming our menu
    offerings, could affect consumer preferences and negatively
    impact our results of operations.
  multi-unit
   23




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Our
    marketing programs may not be successful.
    The
    impact of new restaurant openings could result in fluctuations
    in our financial performance.
    Opening
    new restaurants in existing markets may negatively affect sales
    at our existing restaurants.
   24




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Our
    business operations and future development could be
    significantly disrupted if we lose key members of our management
    team.
    Our
    growth may strain our infrastructure and resources, which could
    slow our development of new restaurants and adversely affect our
    ability to manage our existing restaurants.
    Restaurant
    companies have been the target of
    class-actions
    and other litigation alleging, among other things, violations of
    federal and state law.
  ,
 25




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Our
    insurance policies may not provide adequate levels of coverage
    against all claims, and fluctuating insurance requirements and
    costs could negatively impact our profitability.
    Our
    indebtedness may limit our ability to invest in the ongoing
    needs of our business.
    Our
    indebtedness could have important consequences to you. For
    example, it:
  
    requires us to utilize a substantial portion of our cash flow
    from operations to payments on our indebtedness, reducing the
    availability of our cash flow to fund working capital, capital
    expenditures, development activity and other general corporate
    purposes;
    increases our vulnerability to adverse general economic or
    industry conditions;
    limits our flexibility in planning for, or reacting to, changes
    in our business or the industries in which we operate;
    makes us more vulnerable to increases in interest rates, as
    borrowings under our senior credit facilities are at variable
    rates;
    limits our ability to obtain additional financing in the future
    for working capital or other purposes; and
    places us at a competitive disadvantage compared to our
    competitors that have less indebtedness.   26




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We may
    be unable to obtain debt or other financing on favorable terms
    or at all.
      We may
    be required to record additional asset impairment charges in the
    future.
  12-month
   27




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Security
    breaches of confidential guest information in connection with
    our electronic processing of credit and debit card transactions
    may adversely affect our business.
    We may
    not be able to adequately protect our intellectual property,
    which, in turn, could harm the value of our brands and adversely
    affect our business.
        Information
    technology system failures or breaches of our network security
    could interrupt our operations and adversely affect our
    business.
  point-of-sale
 28




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A
    major natural or man-made disaster at our corporate facility
    could have a material adverse effect on our
    business.
  Back-up
  We now
    incur increased costs and obligations as a result of being a
    public company.
        Federal,
    state and local tax rules may adversely impact our results of
    operations and financial position.
   29




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Risks
    Relating to Our Common Shares
  The
    price of our common shares may be volatile and you could lose
    all or part of your investment.
    
    our quarterly or annual earnings or those of other companies in
    our industry;
    changes in laws or regulations, or new interpretations or
    applications of laws and regulations, that are applicable to our
    business;
    the publics reaction to our press releases, our other
    public announcements and our filings with the SEC;
    changes in accounting standards, policies, guidance,
    interpretations or principles;
    additions or departures of our senior management personnel;
    sales of common shares by our directors and executive officers;
    sales or distributions of common shares by our private equity
    sponsors;
    adverse market reaction to any indebtedness we may incur or
    securities we may issue in the future;
    actions by shareholders;
    the level and quality of research analyst coverage for our
    common shares, changes in financial estimates or investment
    recommendations by securities analysts following our business or
    failure to meet such estimates;
    the financial disclosure we may provide to the public, any
    changes in such disclosure or our failure to meet such
    disclosure;
    various market factors or perceived market factors, including
    rumors, whether or not correct, involving us, our distributors
    or suppliers or our competitors;
    introductions of new offerings or new pricing policies by us or
    by our competitors;
    acquisitions or strategic alliances by us or our competitors;
    short sales, hedging and other derivative transactions in our
    common shares;
    the operating and stock price performance of other companies
    that investors may deem comparable to us; and
    other events or factors, including changes in general conditions
    in the United States and global economies or financial markets
    (including those resulting from Acts of God, war, incidents of
    terrorism or responses to such events).     30




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Future
    sales of our common shares in the public market could lower our
    share price.
      
    11,500,000 shares are shares that were sold in connection
    with our initial public offering and, unless purchased by
    affiliates, may be resold in the public market;
    44,564 shares are shares held by non-employee existing
    shareholders and are eligible for sale; and
    7,705,936 shares are restricted securities, as
    defined in Rule 144 under the Securities Act, and eligible
    for sale in the public market pursuant to the provisions of
    Rule 144, all of which are subject to
    lock-up
    agreements with the underwriters of our initial public offering
    and will become available for resale in the public market
    beginning April 19, 2011, unless earlier waived by the
    underwriters.    lock-up lock-up lock-up, lock-up lock-up
    If
    securities analysts or industry analysts downgrade our shares,
    publish negative research or reports, or do not publish reports
    about our business, our share price and trading volume could
    decline.
   31




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Certain
    provisions of Ohio law and our articles of incorporation and
    regulations may deter takeover attempts, which may limit the
    opportunity of our shareholders to sell their shares at a
    favorable price, and may make it more difficult for our
    shareholders to remove our board of directors and
    management.
    
    advance notice requirements for shareholders proposals and
    nominations;
    availability of blank check preferred shares;
    establishment of a classified board of directors so that not all
    members of our board of directors are elected at one time;
    the right of the board of directors to elect a director to fill
    a vacancy created by the expansion of the board of directors or
    due to the resignation or departure of an existing board member;
    the prohibition of cumulative voting in the election of
    directors, which would otherwise allow less than a majority of
    shareholders to elect director candidates; and
    limitations on the removal of directors.      Since
    we do not expect to pay any dividends for the foreseeable
    future, investors may be forced to sell their shares in order to
    realize a return on their investment.
    The
    concentration of our capital stock ownership with our sponsors
    and other insiders will likely limit an investors ability
    to influence corporate matters.
   32




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and/or
  Our
    reported financial results may be adversely affected by changes
    in accounting principles applicable to us.
    Our
    ability to raise capital in the future may be
    limited.
    Item 1B.
    Unresolved
    Staff Comments.   33




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Item 2.
    Properties.    Bravo

Brio

Total NumberLocation

Restaurants

Restaurants

of RestaurantsAlabama






1



1Arizona






2



2Arkansas


1







1Colorado






2



2Connecticut






1



1Delaware






1



1Florida


2



7



9Georgia






2



2Illinois


2



1



3Indiana


3







3Iowa


1







1Kansas


1







1Kentucky


1



1



2Louisiana


2







2Maryland






1



1Michigan


4



2



6Missouri


2



2



4Nevada






1



1New Jersey






1



1New Mexico


1







1New York


2







2North Carolina


2



2



4Ohio


10



6



16Oklahoma


1







1Pennsylvania


6







6Tennessee


1







1Texas


1



4



5Virginia


2



2



4Wisconsin


2







2Total


47



39



86     Item 3.
    Legal
    Proceedings.   34




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Item 4.
    (Removed
    and Reserved).  Part II  Item 5.
    Market
    for Registrants Common Equity, Related Stockholder Matters
    and Issuer Purchases of Equity Securities.    Quarter Ended

High

LowDecember 26, 2010

$
20.29


$
14.26   Dividend
    Policy
    Holders:
    Price
    Performance Graph
  ® Nations Restaurant News Stock
    Index
  
  10/21/2010


10/24/2010


11/21/2010


12/26/2010Bravo Brio Restaurant Group, Inc. (BBRG)


$
100.00



$
124.14



$
121.10



$
129.03NASDAQ
    Composite®

    (US) Index



100.00




101.48




101.11




107.89Nations Restaurant News Stock Index



100.00




102.80




104.90




104.84  35




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Unregistered
    Sales of Equity Securities and Use of Proceeds from Sales of
    Registered Securities
    Form S-1 No. 333-167951),
     36




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Item 6.
    Selected
    Financial Data.    BRAVO
    BRIO RESTAURANT GROUP, INC. AND SUBSIDIARIES
  Fiscal Year(1)Statement of Operations Data

2010


2009


2008


2007


2006(Dollars in thousands except per share data)Revenues

$
343,025


$
311,709


$
300,783


$
265,374


$
241,369Costs and ExpensesCost of sales


89,456



82,609



84,618



75,340



70,632Labor


114,468



106,330



102,323



89,663



81,054Operating


53,331



48,917



47,690



41,567



36,966Occupancy


22,729



19,636



18,736



16,054



14,072General and administrative expenses


37,539



17,280



15,271



17,230



15,760Restaurant preopening costs


2,375



3,758



5,434



5,647



4,658Asset impairment charges






6,436



8,506







3,266Depreciation and amortization


16,708



16,088



14,651



12,309



9,414Total costs and expenses


336,606



301,054



297,229



257,810



235,822Income from operations


6,419



10,655



3,554



7,564



5,547Loss on extinguishment of debt


1,300















Interest expense, net


6,121



7,119



9,892



11,853



5,643(Loss) income before income tax expense


(1,002
)


3,536



(6,338
)


(4,289
)


(96
)Income tax expense (benefit)


228



135



55,061



(3,503
)


613Net (loss) income


(1,230
)


3,401



(61,399
)


(786
)


(709
)Undeclared preferred dividends- net of adjustments(2)


(3,769
)


(11,599
)


(10,175
)


(8,920
)


(4,257
)Net loss attributed to common shareholders

$
(4,999
)

$
(8,198
)

$
(71,574
)

$
(9,706
)

$
(4,966
)Per Share Data(3)Net loss attributed to common shareholders  Basic and
    Diluted

$
(0.54
)

$
(1.13
)

$
(9.89
)

$
(1.34
)


NMWeighted average shares outstanding  Basic and Diluted


9,281



7,234



7,234



7,234



NMBalance Sheet Data (at the end of the period)Cash and cash equivalents


2,460



249



682



740



829Working capital (deficit)


(35,334
)


(36,156
)


(34,320
)


(33,110
)


(18,334
)Total assets


163,453



160,842



157,764



195,048



180,132Total debt


41,000



118,031



125,950



114,136



112,056Total stockholders equity (deficiency in assets)


6,403



(72,690
)


(76,091
)


(14,692
)


(13,906
)     (1)
    
    We utilize a 52- or 53-week accounting period which ends on the
    last Sunday of the calendar year. The fiscal years ended
    December 26, 2010, December 27, 2009,
    December 28, 2008 and December 30, 2007, each have
    52 weeks, while the fiscal year ended December 31,
    2006 had 53 weeks.(2)
    
    The undeclared preferred dividend total for fiscal 2010 of
    $10.8 million was offset by an add-back of
    $7.0 million in the fourth quarter of 2010 related to the
    exchange of the Companys Series A preferred 37




---



##### Table of Contents



stock. The exchange of the Series A preferred stock was
    completed prior to our initial public offering, using an
    estimated initial public offering price of $15.00 per share
    which, based on the total liquidation preference for the
    Series A preferred stock (including accrued and undeclared
    dividends thereon) of $105.2 million as of the date of the
    exchange, resulted in the issuance of 7,015,630 common shares.
    Because the final initial public offering price was $14.00 per
    share, the 7,015,630 common shares issued to the preferred
    shareholders represented only $98.2 million of value,
    $7.0 million less than the carrying value of the
    Series A preferred stock as of the date of the exchange.
    Because the fair value of consideration transferred was less
    than the carrying amount of the Series A preferred stock,
    the discount was added back to undeclared preferred dividends in
    arriving at net earnings available to common shareholders and is
    recorded as such on the Consolidated Statements of Operations
    for fiscal 2010.(3)
    
    The Company was structured as a Subchapter S corporation for the
    year ended December 25, 2005 and was changed to a C
    corporation effective June 29, 2006 as part of our
    recapitalization in 2006. As a result, corporate income taxes
    and per share data for 2006 is not meaningful and therefore not
    shown in the table above. If the Company had been a C
    corporation during the pre-recapitalization period of 2006, the
    income tax expense would have been $0.5 million higher than
    the amount presented in the table above.  Non-GAAP Measures
        Fiscal Year2010


2009Net loss attributed to common shareholders

$
(4,999
)

$
(8,198
)Impact from:Management Fees(1)


2,402



1,722Incremental Public Company Costs(2)


(1,164
)


(1,224
)Stock Compensation Expense(3)


(1,507
)


(1,800
)Interest Expense(4)


4,169



4,453Income Tax Expense(5)


(6,399
)


(3,351
)Undeclared Preferred Dividends(6)


3,769



11,599Write-off of loan origination fees(7)


1,300



Stock Compensation Expense(8)


17,892



Gain on Sale of Restaurant(9)






(1,502
)Asset Impairment(10)






6,436Modified Pro Forma net income

$
15,463


$
8,135   38




---



##### Table of Contents



Basic


Diluted2010


2009


2010


2009Net loss per share- using adjusted share counts

$
(0.26
)

$
(0.43
)

$
(0.24
)

$
(0.40
)Impact from:Management Fees(1)

$
0.12



0.09



0.12



0.08Incremental Public Company Costs(2)

$
(0.06
)


(0.06
)


(0.06
)


(0.06
)Stock Compensation Expense(3)

$
(0.08
)


(0.09
)


(0.07
)


(0.09
)Interest Expense(4)

$
0.22



0.23



0.20



0.22Income Tax Expense(5)

$
(0.33
)


(0.17
)


(0.31
)


(0.16
)Undeclared Preferred Dividends(6)

$
0.19



0.60



0.18



0.56Write-off of loan origination fees(7)

$
0.07







0.06



Stock Compensation Expense(8)

$
0.93







0.87



Gain on Sale of Restaurant(9)

$




(0.08
)






(0.07
)Asset Impairment(10)

$




0.33







0.31Modified Pro Forma net income per share

$
0.80


$
0.42


$
0.75


$
0.39     1)
    
    Represents management fees and expenses paid to our private
    equity sponsors which will not be incurred subsequent to our
    initial public offering.2)
    
    Represents an estimate of additional recurring incremental
    legal, accounting, insurance and other compliance costs we
    expect to incur as a public company.3)
    
    Represents the estimate of recurring stock compensation expense
    related to restricted shares issued pursuant to the Bravo Brio
    Restaurant Group, Inc. Stock Incentive Plan which was approved
    by our board of directors and shareholders in October, 2010,
    offset by the actual compensation cost booked in the fourth
    quarter of 2010 related to outstanding restricted shares.4)
    
    Represents an adjustment to interest expense assuming the
    receipt of proceeds from our initial public offering and the use
    of such proceeds to pay down debt at the beginning of fiscal
    2009.5)
    
    Currently, our net deferred tax assets are offset by a full
    valuation allowance. This adjustment reflects a tax rate of
    30.0% which reflects our estimate of our long-term effective tax
    rate.6)
    
    Our Series A preferred shares plus cumulative undeclared
    dividends thereon were converted to common shares pursuant to
    the exchange agreement (executed in connection with our initial
    public offering). This adjustment reflects the add-back of
    undeclared preferred dividends net of gain on conversion of
    preferred stock.7)
    
    Reflects the write-off of the unamortized portion of our old
    loan origination costs related to our previous credit facility.8)
    
    Represents the one-time non-cash stock compensation charge
    recorded for existing options to purchase our common shares
    under the 2006 Stock Option Plan that became fully vested and
    exercisable upon consummation of our initial public offering.9)
    
    Reflects an adjustment for a gain on the sale of a restaurant
    during the third quarter of 2009, primarily due to the
    recognition of deferred lease incentives. We do not expect gains
    of this nature in the future.10)
    
    Reflects the charges recorded in fiscal 2009 related to the
    impairment of three restaurants.  Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations.   39




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##### Table of Contents



Overview
      Performance
    Indicators
    
    Comparable Restaurants and Comparable Restaurant
    Sales.  We consider a restaurant to be comparable
    in the first full quarter following the eighteenth month of
    operations. Changes in comparable restaurant sales reflect
    changes in sales for the comparable group of restaurants over a
    specified period of time. Changes in comparable sales reflect
    changes in guest count trends as well as changes in average
    check.
    Average Check.  Average check is calculated by
    dividing revenues by guest counts for a given time period.
    Average check reflects menu price influences as well as changes
    in menu mix. Management uses this indicator to analyze trends in
    guests preferences, effectiveness of menu changes and price
    increases and per guest expenditures.
    Average Unit Volume.  Average unit volume
    consists of the average sales of our restaurants over a certain
    period of time. This measure is calculated by dividing total
    restaurant sales within a period by the relevant period. This
    indicator assists management in measuring changes in guest
    traffic, pricing and development of our brands.
    Operating Margin.  Operating margin represents
    income from operations before interest and taxes as a percentage
    of our revenues. By monitoring and controlling our operating
    margins, we can gauge the overall profitability of our company.  Key
    Financial Definitions
  Revenues.
  Cost of Sales.
 40




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##### Table of Contents



Labor Costs.
  Operating Costs.
  Occupancy Costs.
  General and Administrative.
  Restaurant Pre-opening Costs.
  Impairment.
  Net interest expense. mark-to-market
  Results
    of Operations
    Fiscal Year EndedDecember 26


% of


December 27


% of


December 28


% of2010


Revenue


2009


Revenue


2008


Revenue(Dollar in thousands, unless percentage)Revenues

$
343,025



100
%

$
311,709



100
%

$
300,783



100
%Costs and ExpensesCost of sales


89,456



26.1
%


82,609



26.5
%


84,618



28.1
%Labor


114,468



33.4
%


106,330



34.1
%


102,323



34.0
%Operating


53,331



15.5
%


48,917



15.7
%


47,690



15.9
%Occupancy


22,729



6.6
%


19,636



6.3
%


18,736



6.2
%General and administrative expenses


37,539



10.9
%


17,280



5.5
%


15,271



5.1
%Restaurant preopening costs


2,375



0.7
%


3,758



1.2
%


5,434



1.8
%Asset impairment charges






0.0
%


6,436



2.1
%


8,506



2.8
%Depreciation and amortization


16,708



4.9
%


16,088



5.2
%


14,651



4.9
%Total costs and expenses


336,606



98.1
%


301,054



96.6
%


297,229



98.8
%Income from operations


6,419



1.9
%


10,655



3.4
%


3,554



1.2
%Loss on extinguishment of debt


1,300



0.4
%






0.0
%






0.0
%Interest expense, net


6,121



1.8
%


7,119



2.3
%


9,892



3.3
%(Loss) income before income taxes


(1,002
)


(0.3
)%


3,536



1.1
%


(6,338
)


(2.1
)%Income tax expense


228



0.1
%


135



0.0
%


55,061



18.3
%Net (loss) income

$
(1,230
)


(0.4
)%

$
3,401



1.1
%

$
(61,399
)


(20.4
)%  41




---



##### Table of Contents



Year
    Ended December 26, 2010 Compared to Year Ended
    December 27, 2009
  Revenues.
      Cost of Sales.
  Labor Costs.
  Operating Costs.
  Occupancy Costs.
  General and Administrative.
 42




---



##### Table of Contents



Restaurant Pre-opening Costs.
  Depreciation and Amortization.
  Impairment.
  Loss on extinguishment of debt.
  Net Interest Expense.
  Income Taxes.
  Year
    Ended December 27, 2009 Compared to Year Ended
    December 28, 2008
  Revenues.
   43




---



##### Table of Contents



Cost of Sales.
  Labor Costs.
  Operating Costs.
  Occupancy Costs.
  General and Administrative.
  Restaurant Pre-opening Costs.
  Depreciation and Amortization.
  Impairment.
 44




---



##### Table of Contents



Net Interest Expense.
  Income Taxes.
  Liquidity
          Year Ended,December 26,


December 27,2010


2009(In thousands)Net cash provided by operating activities

$
37,682


$
33,782Net cash used in investing activities


(18,691
)


(24,957
)Net cash used in financing activities


(16,780
)


(9,258
)Net increase (decrease) in cash and equivalents


2,211



(433
)Cash and cash equivalents at beginning of year


249



682Cash and cash equivalents at end of period

$
2,460


$
249   Operating Activities.
 45




---



##### Table of Contents



Investing Activities.
  Financing Activities.
    Capital
    Resources
  Future Capital Requirements.
      Current Resources.
   46




---



##### Table of Contents



paid-in-kind
    and/or
     47




---



##### Table of Contents



Off-Balance
    Sheet Arrangements
    Significant
    Accounting Policies
  Pre-opening Costs.
  Property and Equipment.
  Leases.
    Impairment of Long-Lived Assets. 12-month
 48




---



##### Table of Contents



Self-Insurance Reserves.
  Income Taxes.
    Stock-Based Compensation. and/or
 49




---



##### Table of Contents



Commitments
    and Contingencies
    Payments Due by YearContractual Obligations

Total


2011


2012-2013


2014-2015


After 2015(In thousands)Term Loan Facility(1)

$
41,000


$
2,050


$
6,150


$
32,800



Interest


5,554



1,527



2,996



1,031



Operating Leases


260,897



19,291



39,459



40,788



161,359Construction purchase obligations


1,742



1,742











Total contractual cash obligations

$
309,193


$
24,610


$
48,605


$
74,619


$
161,359     (1)
    
    Our senior credit facilities, consisting of a $45.0 million
    term loan facility and a $40.0 million revolving credit
    facility, will be paid off over a five year period with the
    outstanding balance due in 2015.  Inflation
       50




---



##### Table of Contents



Segment
    Reporting
    Recently
    Adopted Accounting Pronouncements
          Item 7A.
    Quantitative
    and Qualitative Disclosures about Market Risk.  Interest
    Rate Risk
   51




---



##### Table of Contents



Commodity
    Price Risk
    Item 8.
    Financial
    Statements and Supplementary Data.    Item 9.
    Changes
    in and Disagreements with Accountants on Accounting and
    Financial Disclosure.    Item 9A.
    Controls
    and Procedures.  Disclosure
    Controls and Procedures
  Rule 13a-15(e)
  Limitations
    on the Effectiveness of Controls
   52




---



##### Table of Contents



Managements
    Report on Internal Control Over Financial Reporting
    Changes
    in Internal Control over Financial Reporting
    Item 9B.
    Other
    Information.   Part III  Item 10.
    Directors,
    Executive Officers and Corporate Governance.    (614) 326-7944. Form 8-K
  Item 11.
    Executive
    Compensation.   53




---



##### Table of Contents



Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters.    Equity
    Compensation Plan Information
    Number ofSecuritiesNumber of





Remaining AvailableSecurities to be





for Future IssuanceIssued upon


Weighted-Average


Under EquityExercise of


Exercise Price of


Compensation PlansOutstanding


Outstanding


(ExcludingOptions, Warrants


Options, Warrants


Securitiesand Rights


and Rights


Reflected in Column(a).Plan Category

(a)


(b)


(c)Equity compensation plans approved by security holders:Bravo Development, Inc. Option Plan


1,414,203



1.44



Bravo Brio Restaurant Group, Inc. Stock Incentive Plan










1,450,200Equity Compensation plans not approved by security holders:None   Item 13.
    Certain
    Relationships and Related Transactions, and Director
    Independence.    Item 14.
    Principal
    Accounting Fees and Services.   Part IV  Item 15.
    Exhibits
    and Financial Statement Schedules.    1.
    Financial Statements: See Index to Consolidated Financial
    Statements appearing on page 55 of this report.     54




---



##### 



Index to
    Consolidated Financial Statements
   
 Page No.Report of Independent Registered Public
    Accounting Firm


56Consolidated Balance Sheets


57Consolidated Statements of Operations


58Consolidated Statements of Stockholders
    Equity (Deficiency in Assets)


59Consolidated Statements of Cash Flows


60Notes to Consolidated Financial Statements


61   55




---



##### Table of Contents



Report of
    Independent Registered Public Accounting Firm           DELOITTE &
    TOUCHE LLP
    56




---



##### Table of Contents



BRAVO
    BRIO RESTAURANT GROUP, INC., AND SUBSIDIARIES
    CONSOLIDATED BALANCE SHEETS
    AS OF DECEMBER 26, 2010 AND DECEMBER 27, 2009  2010


2009(Dollars in thousands, except par values)ASSETSCurrent assetsCash and cash equivalents

$
2,460


$
249Accounts receivable


4,754



5,534Tenant improvement allowance receivable


632



2,435Inventories


2,415



2,203Prepaid expenses and other current assets


2,229



2,049Total current assets


12,490



12,470Property and equipment, net


147,621



144,880Other assets, net


3,342



3,492Total assets

$
163,453


$
160,842LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIENCY IN
    ASSETS)Current liabilitiesTrade and construction payables

$
9,920


$
12,675Accrued expenses


21,150



21,658Current portion of long-term debt


2,050



1,039Deferred lease incentives


4,979



4,284Deferred gift card revenue


9,725



8,970Total current liabilities


47,824



48,626Deferred lease incentives


54,594



53,451Long-term debt


38,950



116,992Other long-term liabilities


15,682



14,463Commitments and contingencies (Note 13)Stockholders equity (deficiency in assets)Common shares, no par value, per share  authorized,
    100,000,000 shares: issued and outstanding,
    19,250,500 shares at December 26, 2010;
    7,234,370 shares, $0.001 par value, issued and
    outstanding at December 27, 2009


191,297



1Preferred shares, no par value, per share 
    authorized, 5,000,000 shares; issued and outstanding,
    0 shares at December 26, 2010; 59,500 shares
    $0.001 par value issued and outstanding at
    December 27, 2009






1Additional paid-in capital






110,972Retained deficit


(184,894
)


(183,664
)Total stockholders equity (deficiency in assets)


6,403



(72,690
)Total liabilities and stockholders equity

$
163,453


$
160,842    57




---



##### Table of Contents



BRAVO
    BRIO RESTAURANT GROUP, INC., AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF OPERATIONS
    FOR THE FISCAL YEARS ENDED DECEMBER 26, 2010, DECEMBER 27, 2009,
    AND
    DECEMBER 28, 2008  Fiscal Year EndedDecember 26,


December 27,


December 28,2010


2009


2008(Dollars and shares in thousands,except per share data)Revenues

$
343,025


$
311,709


$
300,783Costs and expensesCost of sales


89,456



82,609



84,618Labor


114,468



106,330



102,323Operating


53,331



48,917



47,690Occupancy


22,729



19,636



18,736General and administrative expenses


37,539



17,280



15,271Restaurant preopening costs


2,375



3,758



5,434Asset impairment charges






6,436



8,506Depreciation and amortization


16,708



16,088



14,651Total costs and expenses


336,606



301,054



297,229Income from operations


6,419



10,655



3,554Loss on extinguishment of debt


1,300Interest expense, net


6,121



7,119



9,892(Loss) income before income taxes


(1,002
)


3,536



(6,338
)Income tax expense


228



135



55,061Net (loss) income

$
(1,230
)

$
3,401


$
(61,399
)Undeclared preferred dividends, net of adjustment 
    (Note 1)


(3,769
)


(11,599
)


(10,175
)Net loss attributed to common shareholders

$
(4,999
)

$
(8,198
)

$
(71,574
)Net loss per share  basic and diluted

$
(0.54
)

$
(1.13
)

$
(9.89
)Weighted average shares outstanding  basic and diluted


9,281



7,234



7,234    58




---



##### Table of Contents



BRAVO
    BRIO RESTAURANT GROUP, INC., AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY (DEFICIENCY
    IN ASSETS)
    FOR THE FISCAL YEARS ENDED DECEMBER 26, 2010, DECEMBER 27, 2009,
    AND
    DECEMBER 28, 2008  StockholdersAdditional











EquityCommon Stock


Preferred Stock


Paid-In


Retained


Treasury Stock


(Deficiency inShares


Amount


Shares


Amount


Capital


Deficit


Shares


Amount


Assets)(Dollars in thousands)Balance  December 30, 2007


7,234,370



1



59,500



1



110,972



(125,666
)










(14,692
)Net loss






















(61,399
)










(61,399
)Purchase of treasury shares


























(1,585
)


(100
)


(100
)Sale of treasury shares


























1,585



100



100Balance  December 28, 2008


7,234,370


$
1



59,500


$
1


$
110,972


$
(187,065
)

$
0


$
0


$
(76,091
)Net income






















3,401











3,401Purchase of treasury shares


























(1,217
)


(184
)


(184
)Sale of treasury shares


























1,217



184



184Balance  December 27, 2009


7,234,370


$
1



59,500


$
1


$
110,972


$
(183,664
)

$



$



$
(72,690
)Net loss






















(1,230
)










(1,230
)Share-based compensation costs






18,177



























18,177Exchange of common and preferred stock, to common shares, no par
    value per share


7,015,630



110,973



(59,500
)


(1
)


(110,972
)Issuance of common stock for initial public offering, net of
    fees and issuance costs


5,000,000



62,138



























62,138Issuance of restricted shares


500



8



























8Balance  December 26, 2010


19,250,500


$
191,297






$



$



$
(184,894
)





$



$
6,403    59




---



##### Table of Contents



BRAVO
    BRIO RESTAURANT GROUP, INC., AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF CASH FLOWS
    FOR THE FISCAL YEARS ENDED DECEMBER 26, 2010, DECEMBER 27, 2009,
    AND
    DECEMBER 28, 2008  Fiscal Year EndedDecember 26,


December 27,


December 28,2010


2009


2008(Dollars in thousands)Cash flow from operating activities:Net (loss) income

$
(1,230
)

$
3,401


$
(61,399
)Adjustments to reconcile net (loss) income to net cash provided
    by operating activities:Depreciation and amortization (excluding deferred lease
    incentives)


16,768



16,088



14,651Loss (gain) on disposals of property and equipment


235



(236
)


114Write-off of unamortized loan origination fees


1,300Impairment of assets






6,436



8,506Amortization of deferred lease incentives


(4,734
)


(5,016
)


(3,139
)Stock compensation costs


18,185Interest incurred but not yet paid


114



1,340



1,285Deferred income taxes










54,895Changes in certain assets and liabilities:Accounts and tenant improvement receivables


2,583



(452
)


446Inventories


(212
)


(213
)


24Prepaid expenses and other current assets


(180
)


9



(882
)Trade and construction payables


(3,095
)


(1,805
)


1,596Deferred lease incentives


6,572



10,771



15,205Deferred gift card revenue


755



431



(587
)Other accrued liabilities


(508
)


(545
)


(1,153
)Other  net


1,129



3,573



2,939Net cash provided by operating activities


37,682



33,782



32,501Cash flow from investing activities:Purchase of property and equipment


(18,695
)


(25,708
)


(42,496
)Proceeds from sale of property and equipment


4



500Restricted cash






251



(251
)Intangibles acquired










(341
)Net cash used in investing activities


(18,691
)


(24,957
)


(43,088
)Cash flow from financing activities:Proceeds from long-term debt


80,550



103,450



104,450Payments on long-term debt


(152,811
)


(112,708
)


(93,921
)Payment of
    paid-in-kind
    interest


(4,884
)Proceeds from common share issuance, net of underwriter fees


65,100Cost incurred in connection with the common share issuance


(2,962
)Proceeds from sale of stock






184



100Repurchase of stock






(184
)


(100
)Loan origination fees related to new credit facility


(1,773
)Net cash (used in) provided by financing activities


(16,780
)


(9,258
)


10,529Net increase (decrease) in cash equivalents:


2,211



(433
)


(58
)Cash and equivalents  beginning of year


249



682



740Cash and equivalents  end of year

$
2,460


$
249


$
682Supplemental disclosures of cash flow information:Interest paid  net of $70, $454 and $950 capitalized
    in 2010, 2009, and 2008, respectively

$
6,362


$
7,030


$
8,840Income taxes paid (refunded)

$
165


$
300


$
(83
)Property additions financed by trade and construction payables

$
1,742


$
994


$
963    60




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##### Table of Contents



BRAVO
    BRIO RESTAURANT GROUP, INC., AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  1.
    SUMMARY
    OF SIGNIFICANT ACCOUNTING POLICIES  Description of Business ® ® ® ® ® ®
  Fiscal Year End
  Initial Public Offering
         61




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##### Table of Contents



Accounting Estimates
  Cash and Cash Equivalents
  Receivables
  Inventories first-in,
  Pre-opening Costs
  Property and Equipment
  Leases
 62




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##### Table of Contents



Other Assets
  Impairment of Long-Lived Assets 12-month
        Estimated Fair Value of Financial Instruments
  Revenue Recognition
 63




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##### Table of Contents



Advertising
  Self-Insurance Reserves
  Derivative Instruments
  Income Taxes
    Stock-Based Compensation
  Segment Reporting
  Recently Adopted Accounting Pronouncements
 64




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##### Table of Contents



2.
    EARNINGS
    PER SHARE      Fiscal Years2010


2009


2008(Dollars in thousands,except per share data)Net loss attributed to common shareholders

$
(4,999
)

$
(8,198
)

$
(71,574
)Basic weighted average common shares outstanding


9,281



7,234



7,234Dilutive effect of equity awards










Diluted weighted average common and potentially issuable common
    shares outstanding


9,281



7,234



7,234Basic and diluted loss per common share

$
(0.54
)

$
(1.13
)

$
(9.89
)    65




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##### Table of Contents



3.
    PROPERTY
    AND EQUIPMENT    2010


2009Land and buildings

$
5,575


$
5,402Leasehold improvements


134,665



124,331Equipment and fixtures


82,704



76,714Construction in progress


5,179



4,255Deposits on equipment orders


945



501Total


229,068



211,203Less accumulated depreciation and amortization


(81,447
)


(66,323
)Property and equipment, net

$
147,621


$
144,880   4.
    OTHER
    ASSETS    2010


2009Loan origination fees

$
1,773


$
4,512Liquor licenses


1,442



1,393Trademarks


142



117Deposits


166



150Other assets  at cost


3,523



6,172Less accumulated amortization


(181
)


(2,680
)Other assets  net

$
3,342


$
3,492   5.
    LONG-TERM
    DEBT    2010


2009Term loan

$
41,000


$
79,818Note agreement






32,270Revolving credit facility






5,550Mortgage notes






393Total


41,000



118,031Less current maturities


(2,050
)


(1,039
)Long-term debt

$
38,950


$
116,992      66




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90-day
    and/or
   67




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##### Table of Contents



2011

$
2,0502012


2,0502013


4,1002014


4,1002015


28,700Total

$
41,000     6.
    ACCRUED
    EXPENSES    2010


2009Compensation and related benefits

$
8,871


$
10,268Accrued self-insurance claims liability


4,577



4,853Other taxes payable


4,203



3,546Other accrued liabilities


3,499



2,991Total accrued expenses

$
21,150


$
21,658   7.
    OTHER
    LONG-TERM LIABILITIES    2010


2009Deferred rent

$
15,579


$
13,975Deferred compensation (Note 9)






166Partner surety (Note 9)






200Other long-term liabilities


103



122Total other long-term liabilities

$
15,682


$
14,463   8.
    LEASES   68




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##### Table of Contents



2011

$
19,2912012


19,6322013


19,8272014


20,4102015


20,378Thereafter


161,359Total

$
260,897       2010


2009


2008Minimum rent

$
13,727


$
11,391


$
10,618Contingent rent


900



705



933Total

$
14,627


$
12,096


$
11,551   9.
    BONUS
    PLANS      10.
    EMPLOYEE
    BENEFIT PLAN   69




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##### Table of Contents



11.
    STOCK
    BASED COMPENSATION  2006
    Plan
    and/or
      2010


2009


2008Outstanding  beginning of year


1,776,727



1,694,041



1,768,645Weighted-average exercise price

$
1.45


$
1.45


$
1.45Granted






127,463



Weighted-average exercise price

$



$
1.29


$
Forfeited


(362,524
)


(44,777
)


(74,604
)Weighted-average exercise price

$
1.45


$
1.45


$
1.45Outstanding  end of year


1,414,203



1,776,727



1,694,041Weighted-average exercise price

$
1.44


$
1.44


$
1.45Exercisable  end of year


1,414,203







      70




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##### Table of Contents



Weighted-AverageNumber of


MeasurementOptions


Date Fair ValueUnvested  beginning of year


705,674


$
12.64Granted






Vested


(343,150
)


12.64Forfeited


(362,524
)


12.64Unvested  end of year






     Stock
    Incentive Plan
    Weighted-Number of


Average GrantShares


Date Fair ValueOutstanding  beginning of year





$
Granted


451,800



16.90Vested


(500
)


16.90Forfeited


(2,000
)


16.90Outstanding  end of year


449,300


$
16.90    71




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##### Table of Contents



12.
    INCOME
    TAXES    2010


2009


2008Current income tax expense:Federal

$



$



$
State and local


228



135



166Total current income tax expense


228



135



166Deferred income tax expense:Federal










50,107State and local










4,788Total deferred income tax expense










54,895Total income tax expense

$
228


$
135


$
55,061     2010


2009Deferred tax assets:Goodwill for tax reporting purposes

$
34,891


$
38,127Stock compensation


7,026Self-insurance reserves


2,682



2,819Depreciation and amortization


5,982



4,918Federal and state net operating losses


225



4,425FICA tip credit carryforward


13,349



9,893Other


879



809Total gross deferred tax assets


65,034



60,991Deferred tax liabilities:Prepaid assets


(419
)


(305
)Deferred rent


(1,847
)


(638
)Total gross deferred tax liabilities


(2,266
)


(943
)Valuation allowance


(62,768
)


(60,048
)Net deferred tax asset

$



$
      72




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##### Table of Contents



2010


2009


2008Provision at statutory rate

$
(351
)

$
1,238


$
(2,218
)FICA tip credit


(3,487
)


(3,073
)


(2,890
)State income taxes  net of federal benefit


104



292



(389
)Other  net


1,242



1,120



1,068Deferred tax asset valuation allowance


2,720



558



59,490Total income tax expense

$
228


$
135


$
55,061       13.
    COMMITMENTS
    AND CONTINGENCIES      14.
    RELATED-PARTY
    TRANSACTIONS   73




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##### Table of Contents



15.
    INTERIM
    FINANCIAL RESULTS (UNAUDITED)    Fiscal 2010First


Second


Third


Fourth


TotalQuarter


Quarter


Quarter


Quarter


YearRevenue

$
81,844


$
89,152


$
83,704


$
88,325


$
343,025Income (loss) from operations


4,386



7,244



5,079



(10,290
)


6,419Net (loss) income attributed to common shareholders(1)


(573
)


2,377



(266
)


(6,537
)


(4,999
)Basic and diluted net (loss) income per share(2)

$
(0.08
)

$
0.33


$
(0.04
)

$
(0.42
)

$
(0.54
)Basic and diluted weighted average shares outstanding


7,234



7,234



7,234



15,421



9,281   Fiscal 2009First


Second


Third


Fourth


TotalQuarter


Quarter


Quarter


Quarter


YearRevenue

$
73,593


$
79,921


$
76,843


$
81,352


$
311,709Income from operations


600



3,716



5,330



1,009



10,655Net (loss) income attributed to common shareholders


(4,003
)


(914
)


487



(3,768
)


(8,198
)Basic and diluted net (loss) income per share

$
(0.55
)

$
(0.13
)

$
0.07


$
(0.52
)

$
(1.13
)Basic and diluted weighted average shares outstanding


7,234



7,234



7,234



7,234



7,234     (1)
    
    The fourth quarter of 2010 contains an IPO-related
    $20.5 million expense, consisting of $18.2 million for
    non cash stock compensation charges, $1.3 million for the
    write off of loan origination fees and $1.0 million related
    to the termination of the Management Agreements.(2)
    
    Sum of the quarterly amounts do not equal the total year amount
    due to the adjustment in share count that occurred in connection
    with the IPO.  quarter-to-quarter
 74




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##### Table of Contents



Exhibit Index  Description3
.1

Second Amended and Restated Articles of Incorporation of Bravo
    Brio Restaurant Group, Inc. (incorporated by reference from
    Exhibit 3.1 to the Current Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    October 27, 2010).3
.2

Second Amended and Restated Regulations of Bravo Brio Restaurant
    Group, Inc. (incorporated by reference from Exhibit 3.2 to
    the Current Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    October 27, 2010).4
.1

Form of Common Stock Certificate (incorporated by reference from
    Exhibit 4.1 to Amendment No. 3 to the Registration
    Statement on
    Form S-1
    (Registration
    No. 333-167951)
    filed with the Securities and Exchange Commission on
    October 7, 2010).4
.2

Credit Agreement, dated as of October 26, 2010, by and
    among Bravo Brio Restaurant Group, Inc., as borrower, the
    domestic subsidiaries of the borrower, as guarantors, the
    lenders party thereto, Wells Fargo Bank, National Association,
    as administrative agent, Bank of America, N.A., as syndication
    agent, KeyBank National Association and Regions Financial
    Corporation, as co-documentation agents, and Wells Fargo
    Securities, LLC and Banc of America Securities LLC, as co-lead
    arrangers and joint book managers (incorporated by reference
    from Exhibit 4.1 to the Current Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    October 27, 2010).10
.1

Registration Rights Agreement, dated as of June 29, 2006,
    by and among Bravo Development, Inc., Bravo Development Holdings
    LLC and the other investors named therein (incorporated by
    reference from Exhibit 10.7 to the Registration Statement
    on
    Form S-1
    (Registration
    No. 333-167951)
    filed with the Securities and Exchange Commission on
    July 2, 2010).10
.2

Employment Agreement, effective January 12, 2007, by and
    between Bravo Development, Inc. and Saed Mohseni (incorporated
    by reference from Exhibit 10.10 to the Registration
    Statement on
    Form S-1
    (Registration
    No. 333-167951)
    filed with the Securities and Exchange Commission on
    July 2, 2010).10
.3

Employment Agreement, dated as of October 26, 2010, by and
    between Bravo Brio Restaurant Group, Inc. and James J.
    OConnor (incorporated by reference from Exhibit 10.1
    to the Current Report on
    Form 8-K
    filed with the Securities and Exchange Commission on
    October 27, 2010).10
.4

Exchange Agreement, dated as of October 18, 2010, by and
    among Bravo Brio Restaurant Group, Inc., Bravo Development
    Holdings LLC and all other shareholders of Bravo Brio Restaurant
    Group, Inc. listed on the signature pages thereto (incorporated
    by reference from Exhibit 10.16 to Amendment No. 5 to
    the Registration Statement on
    Form S-1
    (Registration
    No. 333-167951)
    filed with the Securities and Exchange Commission on
    October 19, 2010).10
.5

Plan of Reorganization, dated as of October 18, 2010, by
    and between Bravo Brio Restaurant Group, Inc. and Bravo
    Development Holdings LLC (incorporated by reference from
    Exhibit 10.17 to Amendment No. 3 to the Registration
    Statement on
    Form S-1
    (Registration
    No. 333-167951)
    filed with the Securities and Exchange Commission on
    October 7, 2010).10
.6

Bravo Development, Inc. 2006 Stock Option Plan (incorporated by
    reference from Exhibit 10.11 to the Registration Statement
    on
    Form S-1
    (Registration
    No. 333-167951)
    filed with the Securities and Exchange Commission on
    July 2, 2010).10
.7

Amendment No. 1 to the Bravo Development, Inc. 2006 Stock
    Option Plan (incorporated by reference from Exhibit 10.11
    to Amendment No. 3 to the Registration Statement on
    Form S-1
    (Registration
    No. 333-167951)
    filed with the Securities and Exchange Commission on
    October 7, 2010).10
.8

Form of Option Award Letter under the Bravo Development, Inc.
    2006 Stock Option Plan (incorporated by reference from
    Exhibit 10.12 to the Registration Statement on
    Form S-1
    (Registration
    No. 333-167951)
    filed with the Securities and Exchange Commission on
    July 2, 2010).10
.9

Bravo Brio Restaurant Group, Inc. Stock Incentive Plan.10
.10

Form of Non-Qualified Option Award Letter under the Bravo Brio
    Restaurant Group, Inc. Stock Incentive Plan (incorporated by
    reference from Exhibit 10.14 to Amendment No. 4 to the
    Registration Statement on
    Form S-1
    (Registration
    No. 333-167951)
    filed with the Securities and Exchange Commission on
    October 8, 2010). 75




---



##### Table of Contents



Description10
.11

Form of Restricted Stock Award Letter under the Bravo Brio
    Restaurant Group, Inc. Stock Incentive Plan (incorporated by
    reference from Exhibit 10.15 to Amendment No. 4 to the
    Registration Statement on
    Form S-1
    (Registration
    No. 333-167951)
    filed with the Securities and Exchange Commission on
    October 8, 2010).10
.12*

Bravo Brio Restaurant Group, Inc. Foodservice Distribution
    Agreement, dated as of February 10, 2011, by and between
    Bravo Brio Restaurant Group, Inc. and Distribution Market
    Advantage, Inc.12
.1

Computation of Ratio of Earnings to Fixed Charges.21
.1

Subsidiaries of Bravo Brio Restaurant Group, Inc.23
.1

Consent of Deloitte & Touche LLP.24
.1

Powers of Attorney (included on the signature page).31
.1

Certifications of Chief Executive Officer Pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.31
.2

Certifications of Chief Financial Officer Pursuant to
    Section 302 of the Sarbanes-Oxley Act of 2002.32
.1

Certifications of Chief Executive Officer and Chief Financial
    Officer pursuant to Section 906 of the Sarbanes-Oxley Act
    of 2002.     *
    
    Certain information in this exhibit has been omitted and filed
    separately with the SEC. Confidential treatment has been
    requested from the SEC with respect to the omitted portions. 76




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##### Table of Contents



SIGNATURES        By:
    /s/  Saed
    Mohseni      POWER OF
    ATTORNEY
      Signature

Title

DateBy:

/s/  Saed
    MohseniSaed
    Mohseni

President, Chief Executive Officer and Director (principal
    executive officer)

February 17, 2011By:

/s/  James
    J. OConnorJames
    J. OConnor

Chief Financial Officer, Treasurer and Secretary (principal
    financial officer and principal accounting officer)

February 17, 2011By:

/s/  Allen
    J. BernsteinAllen
    J. Bernstein

Director

February 17, 2011By:

/s/  Alton
    F. Doody IIIAlton
    F. Doody III

Director

February 17, 2011By:

/s/  James
    S. GulmiJames
    S. Gulmi

Director

February 17, 2011By:

/s/  David
    B. PittawayDavid
    B. Pittaway

Director

February 17, 2011By:

/s/  Harold
    O. Rosser, IIHarold
    O. Rosser, II

Director

February 17, 2011By:

/s/  Fortunato
    N. ValentiFortunato
    N. Valenti

Director

February 17, 2011  77