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UNITED      STATES

|  THE                STEAK N SHAKE COMPANY(Exact                name of registrant as specified in its                charter) |
|------------------------------------------------------------------------------------------------------------------------------------|

| INDIANA                                          | 37-0684070                         |
|--------------------------------------------------|------------------------------------|
| (State                or other jurisdiction      | (I.R.S.                Employer    |
| of                incorporation or organization) | Identification                No.) |

| 36                S. Pennsylvania Street, Suite 500     |                      |
|---------------------------------------------------------|---------------------------|
| Indianapolis,                Indiana                    | 46204                     |
| (Address                of principal executive offices) | (Zip                code) |

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THE      STEAK N      SHAKE COMPANY

| PART I.                  FINANCIAL                  INFORMATION |                                                                                                                                                   |                                                                                                                                                                                                   |   |   |   | Page   |
|----------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|
|                                                                 |                                                                                                                                                   |                                                                                                                                                                                                   |   |   |   |   |   |
|                                                                 | ITEM                  1. FINANCIAL                  STATEMENTS                                                                                         |                                                                                                                                                                                                   |   |   |   |   |   |
|                                                                 |                                                                                                                                                   | Condensed                  Consolidated Statements of Financial Position (Unaudited) as of April                  9, 2008 and September 26, 2007                                                  | 3      |
|                                                                 |                                                                                                                                                   |                                                                                                                                                                                                   |   |   |   |   |   |   |   |   |
|                                                                 |                                                                                                                                                   | Condensed                  Consolidated Statements of Operations (Unaudited) for the Sixteen and                  Twenty-Eight Weeks Ended April 9, 2008 and April 11,                  2007 | 4      |
|                                                                 |                                                                                                                                                   |                                                                                                                                                                                                   |   |   |   |   |   |   |   |   |
|                                                                 |                                                                                                                                                   | Condensed                  Consolidated Statements of Cash Flows (Unaudited) for the Twenty-Eight                  Weeks Ended April 9, 2008 and April 11,                  2007             | 5      |
|                                                                 |                                                                                                                                                   |                                                                                                                                                                                                   |   |   |   |   |   |   |   |   |
|                                                                 |                                                                                                                                                   | Notes                  to                  Condensed Consolidated Financial Statements                  (Unaudited)                                                                                    |   |   | 6      |
|                                                                 |                                                                                                                                                   |                                                                                                                                                                                                   |   |   |   |   |   |   |   |   |
|                                                                 | ITEM                  2.                  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF                  OPERATIONS | 13                                                                                                                                                                                                     |
|                                                                 |                                                                                                                                                   |                                                                                                                                                                                                   |   |   |   |   |   |   |   |   |
|                                                                 | ITEM                  3.                  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET                  RISK                                  | 22                                                                                                                                                                                                     |
|                                                                 |                                                                                                                                                   |                                                                                                                                                                                                   |   |   |   |   |   |   |   |   |
|                                                                 | ITEM                  4. CONTROLS                  AND PROCEDURES                                                                                      |                                                                                                                                                                                                   |   |   |   | 22     |
|                                                                 |                                                                                                                                                   |                                                                                                                                                                                                   |   |   |   |   |   |   |   |   |
|                                                                 |                                                                                                                                                   |                                                                                                                                                                                                   |   |   |   |   |   |   |   |   |
| PART                  II. OTHER                  INFORMATION         |                                                                                                                                                   |                                                                                                                                                                                                   |   |   |   |   |
|                                                                 |                                                                                                                                                   |                                                                                                                                                                                                   |   |
|                                                                 | ITEM                  4.                  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                                                |                                                                                                                                                                                                   | 23     |
|                                                                 |                                                                                                                                                   |                                                                                                                                                                                                   |   |   |   |   |   |   |   |   |
|                                                                 | ITEM                  5. OTHER                  INFORMATION                                                                                            |                                                                                                                                                                                                   |   |   |   |   | 24 |
|                                                                 |                                                                                                                                                   |                                                                                                                                                                                                   |   |   |   |   |   |   |   |   |
|                                                                 | ITEM                  6.                  EXHIBITS                                                                                                     |                                                                                                                                                                                                   |   |   |   |   |   | 24 |
|                                                                 |                                                                                                                                                   |                                                                                                                                                                                                   |   |   |   |   |   |   |   |   |
|                                                                 |                                                                                                                                                   |                                                                                                                                                                                                   |   |   |   |   |   |   |   |   |
| SIGNATURES                                                           |                                                                                                                                                   |                                                                                                                                                                                                   |   |   |   |   |   | 25 |

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Table          of Contents

PART  I.FINANCIAL      INFORMATION

ITEM      1. FINANCIAL      STATEMENTS

| Condensed                  Consolidated Statements of Financial Position                                                                                                           |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| The                  Steak n Shake                  Company                                                                                                                        |   |   |   |   |   |   |
| (Amounts                  in $000s except share and per share data)                                                                                                                |   |   |   |   |   |   |
|                                                                                                                                                                               |   | April                  9, |   |   | September                  26, |   |
|                                                                                                                                                                               |   | 2008 |   |   | 2007 |   |
|                                                                                                                                                                               |   | (Unaudited) |   |   | (Unaudited) |   |
| Assets:                                                                                                                                                                            |   |   |   |   |   |   |
| Current                  Assets                                                                                                                                                    |   |   |   |   |   |   |
| Cash                  and cash                  equivalents                                                                                                                        |   | $ | 1,580 |   |   | $ | 1,497 |   |
| Receivables,                  net                                                                                                                                                  |   |   | 4,455 |   |   |   | 6,289 |   |
| Inventories                                                                                                                                                                        |   |   | 7,510 |   |   |   | 7,226 |   |
| Deferred                  income                  taxes                                                                                                                            |   |   | 3,461 |   |   |   | 3,616 |   |
| Assets                  held for                  sale                                                                                                                             |   |   | 20,841 |   |   |   | 18,571 |   |
| Other                  current                  assets                                                                                                                             |   |   | 13,304 |   |   |   | 10,998 |   |
| Total                  current                  assets                                                                                                                             |   |   | 51,151 |   |   |   | 48,197 |   |
| Net                  property and                  equipment                                                                                                                       |   |   | 485,527 |   |   |   | 492,610 |   |
| Goodwill                                                                                                                                                                           |   |   | 14,503 |   |   |   | 14,503 |   |
| Other                  intangible assets,                  net                                                                                                                     |   |   | 1,854 |   |   |   | 1,959 |   |
| Other                  assets                                                                                                                                                      |   |   | 7,434 |   |   |   | 7,945 |   |
| Total                  assets                                                                                                                                                      |   | $ | 560,469 |   |   | $ | 565,214 |   |
|                                                                                                                                                                               |   |   |   |   |   |   |   |   |
| Liabilities                  and Shareholders'                  Equity:                                                                                                            |   |   |   |   |   |   |   |   |
| Current                  Liabilities                                                                                                                                               |   |   |   |   |   |   |   |   |
| Accounts                  payable                                                                                                                                                  |   | $ | 26,920 |   |   | $ | 28,195 |   |
| Accrued                  expenses                                                                                                                                                  |   |   | 30,948 |   |   |   | 32,624 |   |
| Current                  portion of long-term                  debt                                                                                                                |   |   | 1,351 |   |   |   | 2,390 |   |
| Line                  of                  credit                                                                                                                                   |   |   | 29,540 |   |   |   | 27,185 |   |
| Current                  portion of obligations                  under leases                                                                                                      |   |   | 3,921 |   |   |   | 4,180 |   |
| Total                  current                  liabilities                                                                                                                        |   |   | 92,680 |   |   |   | 94,574 |   |
| Deferred                  income                  taxes                                                                                                                            |   |   | 4,860 |   |   |   | 5,060 |   |
| Other                  long-term                  liabilities                                                                                                                      |   |   | 7,085 |   |   |   | 5,701 |   |
| Obligations                  under                  leases                                                                                                                         |   |   | 137,480 |   |   |   | 139,493 |   |
| Long-term                  debt                                                                                                                                                    |   |   | 16,506 |   |   |   | 16,522 |   |
|                                                                                                                                                                               |   |   |   |   |   |   |   |   |
| Commitments                  and                  Contingencies                                                                                                                    |   |   |   |   |   |   |   |   |
| Shareholders'                  Equity:                                                                                                                                             |   |   |   |   |   |   |   |   |
| Common                  stock - $0.50 stated value,                  50,000,000 shares authorized - shares                  issued:                  30,332,839               |   |   | 15,166 |   |   |   | 15,166 |   |
| Additional                  paid-in                  capital                                                                                                                       |   |   | 127,920 |   |   |   | 126,415 |   |
| Retained                  earnings                                                                                                                                                 |   |   | 180,715 |   |   |   | 185,024 |   |
| Treasury                  stock - at cost:                  1,857,740 shares as of April 9, 2008; 1,959,931                  shares as of                  September 26, 2007 |   |   | (21,943 | ) |   |   | (22,741 | ) |
| Total                  shareholders'                  equity                                                                                                                       |   |   | 301,858 |   |   |   | 303,864 |   |
| Total                  liabilities and                  shareholders' equity                                                                                                       |   | $ | 560,469 |   |   | $ | 565,214 |   |
|                                                                                                                                                                               |   |   |   |   |   |   |   |   |
| See                  accompanying                  notes.                                                                                                                          |   |   |   |   |   |   |   |   |

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Table            of Contents

| Condensed                  Consolidated Statements of Operations                                                                              |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------|--------|
| The                  Steak n Shake                  Company                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |
| (Amounts                  in $000s except share and per share data)                                                                           |   |   |   |   |   |   |   |
|                                                                                                                                          |   |   |   |   |   |   |   |
|                                                                                                                                          |   | Sixteen                  Weeks                  Ended |   |   | Twenty-Eight                  Weeks                  Ended |   |
|                                                                                                                                          |   | April                  9, |   |   | April                  11, |   |   | April                  9, |   |   | April                  11, |   |
|                                                                                                                                          |   | 2008 |   |   | 2007 |   |   | 2008 |   |   | 2007 |   |
|                                                                                                                                          |   | (Unaudited) |   |   | (Unaudited) |   |   | (Unaudited) |   |   | (Unaudited) |   |
| Revenues:                                                                                                                                     |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  sales                                                                                                                    |   | $ | 189,272 |   |   | $ | 201,055 |   |   | $ | 324,768 |   |   | $ | 347,513 |   |
| Franchise                  fees                                                                                                               |   |   | 1,215 |   |   |   | 1,096 |   |   |   | 2,115 |   |   |   | 1,904 |   |
| Total                  revenues                                                                                                               |   |   | 190,487 |   |   |   | 202,151 |   |   |   | 326,883 |   |   |   | 349,417 |   |
|                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Costs                  and                  Expenses:                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cost                  of                  sales                                                                                               |   |   | 47,447 |   |   |   | 46,188 |   |   |   | 80,131 |   |   |   | 79,258 |   |
| Restaurant                  operating                  costs                                                                                  |   |   | 104,039 |   |   |   | 101,783 |   |   |   | 179,849 |   |   |   | 177,251 |   |
| General                  and                  administrative                                                                                  |   |   | 14,369 |   |   |   | 17,551 |   |   |   | 24,503 |   |   |   | 31,106 |   |
| Depreciation                  and                  amortization                                                                               |   |   | 10,455 |   |   |   | 9,825 |   |   |   | 18,113 |   |   |   | 17,051 |   |
| Marketing                                                                                                                                     |   |   | 10,376 |   |   |   | 9,148 |   |   |   | 16,377 |   |   |   | 15,574 |   |
| Interest                                                                                                                                      |   |   | 4,240 |   |   |   | 4,242 |   |   |   | 7,553 |   |   |   | 7,375 |   |
| Rent                                                                                                                                          |   |   | 4,520 |   |   |   | 4,255 |   |   |   | 7,728 |   |   |   | 7,303 |   |
| Pre-opening                  costs                                                                                                            |   |   | 677 |   |   |   | 812 |   |   |   | 1,131 |   |   |   | 1,746 |   |
| Asset                  impairments and provision                  for  restaurant                  closings                         |   |   | — |   |   |   | (127 | ) |   |   | — |   |   |   | (193 | ) |
| Other                  income,                  net                                                                                           |   |   | (524 | ) |   |   | (539 | ) |   |   | (975 | ) |   |   | (944 | ) |
| Total                  costs and                  expenses                                                                                    |   |   | 195,599 |   |   |   | 193,138 |   |   |   | 334,410 |   |   |   | 335,527 |   |
|                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (Loss)                  Earnings Before Income                  Taxes                                                                         |   |   | (5,112 | ) |   |   | 9,013 |   |   |   | (7,527 | ) |   |   | 13,890 |   |
|                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income                  Taxes                                                                                                                 |   |   | (2,302 | ) |   |   | 3,021 |   |   |   | (3,530 | ) |   |   | 3,733 |   |
|                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net                  (Loss)                  Earnings                                                                                         |   | $ | (2,810 | ) |   | $ | 5,992 |   |   | $ | (3,997 | ) |   | $ | 10,157 |   |
|                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                  (Loss) Earnings Per Common                  and  Common                  Equivalent                  Share   |   | $ | (0.10 | ) |   | $ | 0.21 |   |   | $ | (0.14 | ) |   | $ | 0.36 |   |
|                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Diluted                  (Loss) Earnings Per Common                  and  Common                  Equivalent                  Share |   | $ | (0.10 | ) |   | $ | 0.21 |   |   | $ | (0.14 | ) |   | $ | 0.36 |   |
|                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted                  Average Shares and                  Equivalents:                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                                                                                                         |   |   | 28,269,538 |   |   |   | 28,025,019 |   |   |   | 28,221,692 |   |   |   | 27,974,493 |   |
| Diluted                                                                                                                                       |   |   | 28,269,538 |   |   |   | 28,230,461 |   |   |   | 28,221,692 |   |   |   | 28,191,845 |   |
|                                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| See                  accompanying                  notes.                                                                                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

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Table            of Contents

| CondensedConsolidated                  Statements of Cash Flows                                                                                                     |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| The                  Steak n Shake                  Company                                                                                                         |   |   |   |   |   |   |
| (Amounts                  in $000s)                                                                                                                                 |   |   |   |   |   |   |
|                                                                                                                                                                |   | Twenty-Eight                  Weeks                  Ended |   |
|                                                                                                                                                                |   | April                  9, |   |   | April                  11, |   |
|                                                                                                                                                                |   | 2008 |   |   | 2007 |   |
|                                                                                                                                                                |   | (Unaudited) |   |   | (Unaudited) |   |
| Operating                  Activities:                                                                                                                              |   |   |   |   |   |   |
| Net                  (loss)                  earnings                                                                                                               |   | $ | (3,997 | ) |   | $ | 10,157 |   |
| Adjustments                  to reconcile net                  (loss) earnings to net                  cash provided by                  operating activities: |   |   |   |   |   |   |   |   |
| Depreciation                  and                  amortization                                                                                                     |   |   | 18,113 |   |   |   | 17,051 |   |
| Provision                  for deferred income                  taxes                                                                                               |   |   | 257 |   |   |   | (5 | ) |
| Provision                  for restaurant                  closings                                                                                                 |   |   | — |   |   |   | (193 | ) |
| Non-cash                  expense for stock-based                  compensation and                  deferred                  rent                                 |   |   | 1,584 |   |   |   | 2,206 |   |
| Loss                  on disposal of                  property                                                                                                      |   |   | 13 |   |   |   | 291 |   |
| Changes                  in receivables and                  inventories                                                                                            |   |   | 1,515 |   |   |   | 168 |   |
| Changes                  in other                  assets                                                                                                           |   |   | (2,354 | ) |   |   | (4,769 | ) |
| Changes                  in accounts payable and                  accrued expenses                                                                                  |   |   | (1,244 | ) |   |   | (5,196 | ) |
| Net                  cash provided by operating                  activities                                                                                         |   |   | 13,887 |   |   |   | 19,710 |   |
|                                                                                                                                                                |   |   |   |   |   |   |   |   |
| Investing                  Activities:                                                                                                                              |   |   |   |   |   |   |   |   |
| Additions                  of property and                  equipment                                                                                               |   |   | (23,858 | ) |   |   | (41,412 | ) |
| Proceeds                  from property and                  equipment disposals                                                                                    |   |   | 9,872 |   |   |   | 5,638 |   |
| Net                  cash used in investing                  activities                                                                                             |   |   | (13,986 | ) |   |   | (35,774 | ) |
|                                                                                                                                                                |   |   |   |   |   |   |   |   |
| Financing                  Activities:                                                                                                                              |   |   |   |   |   |   |   |   |
| Net                  proceeds (payments) on line of                  credit facility                                                                                |   |   | 2,355 |   |   |   | (1,470 | ) |
| Proceeds                  from issuance of                  long-term debt                                                                                          |   |   | — |   |   |   | 15,000 |   |
| Principal                  payments on long-term                  debt                                                                                              |   |   | (1,055 | ) |   |   | (1,041 | ) |
| Proceeds                  from equipment and                  property sale-leasebacks                                                                              |   |   | — |   |   |   | 800 |   |
| Principal                  payments on lease                  obligations                                                                                           |   |   | (2,272 | ) |   |   | (1,690 | ) |
| Proceeds                  from exercise of stock                  options                                                                                           |   |   | 140 |   |   |   | 660 |   |
| Excess                  tax benefits from                  stock-based awards                                                                                       |   |   | 10 |   |   |   | 62 |   |
| Proceeds                  from employee stock                  purchase plan                                                                                        |   |   | 1,004 |   |   |   | 1,234 |   |
| Net                  cash provided by financing                  activities                                                                                         |   |   | 182 |   |   |   | 13,555 |   |
|                                                                                                                                                                |   |   |   |   |   |   |   |   |
| Increase                  (decrease) in Cash and                  Cash Equivalents                                                                                  |   |   | 83 |   |   |   | (2,509 | ) |
| Cash                  and Cash Equivalents at                  Beginning of Period                                                                                  |   |   | 1,497 |   |   |   | 4,820 |   |
|                                                                                                                                                                |   |   |   |   |   |   |   |   |
| Cash                  and Cash Equivalents at End                  of Period                                                                                        |   | $ | 1,580 |   |   | $ | 2,311 |   |
|                                                                                                                                                                |   |   |   |   |   |   |   |   |
| See                  accompanying                  notes.                                                                                                           |   |   |   |   |   |   |   |   |

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Notes

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|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | Sixteen                  Weeks                  Ended                                                                     |   | Twenty-Eight                  Weeks                  Ended |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | April                  9,                                                                                                 |   | April                  11,                                 |   | April                  9, |   | April                  11, |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | 2008                                                                                                                      |   | 2007                                                       |   | 2008 |   | 2007 |
| Basic                  (loss) earnings per                  share:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                                                                                                                      |   |                                                       |   |   |   |   |
| Weighted                  average common                  shares                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 28,269,538                                                                                                                |   | 28,025,019                                                 |   | 28,221,692 |   | 27,974,493 |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                      |   |                                                       |   |   |   |   |
| Diluted                  (loss) earnings per                  share:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                      |   |                                                       |   |   |   |   |
| Weighted                  average common                  shares                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 28,269,538                                                                                                                |   | 28,025,019                                                 |   | 28,221,692 |   | 27,974,493 |
| Dilutive                  effect of stock                  options                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |                    — |   | 205,442                                                    |   |                     — |   | 217,352 |
| Weighted                  average common and                  incremental shares                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 28,269,538                                                                                                                |   | 28,230,461                                                 |   | 28,221,692 |   | 28,191,845 |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |                                                                                                                      |   |                                                       |   |   |   |   |
| Number                  of share-based awards                  excluded from the                    calculation of                  diluted (loss) earnings per                  share  because                  the awards'                  exercise                  prices were greater                   than                  the average market                  price of the                  Company's  common                  stock, or because                  they were antidilutive due                  to the Company's net                  loss for the sixteen and  twenty-eight                  weeks                  ended April 9, 2008 | 1,443,593                                                                                                                 |   | 1,116,845                                                  |   | 1,445,749 |   | 821,295 |

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|                                                                             |   | April                  9, |     |   | September                  26, |   |
|----------------------------------------------------------------------------------|--------|---------------------------|----------|--------|--------------------------------|--------|
|                                                                             |   | 2008                      |     |   | 2007                           |   |
| Land                                                                             |   | $                         | 166,604  |   |                           | $      | 171,631 |   |
| Buildings                                                                        |   |                      | 167,076  |   |                           |   | 166,982 |   |
| Land                  and leasehold                  improvements                |   |                      | 164,615  |   |                           |   | 156,687 |   |
| Equipment                                                                        |   |                      | 206,205  |   |                           |   | 200,775 |   |
| Construction                  in                  progress                       |   |                      | 13,691   |   |                           |   | 16,555 |   |
|                                                                             |   |                      | 718,191  |   |                           |   | 712,630 |   |
| Less                  accumulated depreciation and                  amortization |   |                      | (232,664 | )      |                           |   | (220,020 | ) |
| Net                  property and                  equipment                     |   | $                         | 485,527  |   |                           | $      | 492,610 |   |

|                                                              |   | April                  9, |   |   | September                  26, |   |
|-------------------------------------------------------------------|--------|---------------------------|--------|--------|--------------------------------|--------|
|                                                              |   | 2008                      |   |   | 2007                           |   |
| Land                  and                  buildings              |   | $                         | 19,798 |   |                           | $      | 17,494 |   |
| Land                  and leasehold                  improvements |   |                      | 592    |   |                           |   | 592 |   |
| Equipment                                                         |   |                      | 451    |   |                           |   | 485 |   |
| Total                  assets held for                  sale      |   | $                         | 20,841 |   |                           | $      | 18,571 |   |

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|                                                                                       |   | April                  9, |   |   | September                  26, |   |
|--------------------------------------------------------------------------------------------|--------|---------------------------|--------|--------|--------------------------------|--------|
|                                                                                       |   | 2008                      |   |   | 2007                           |   |
| Gross                  value of intangible assets                  subject to amortization |   | $                         | 2,291  |   |                           | $      | 2,291 |   |
| Accumulated                  amortization                                                  |   |                      | (937   | )      |                           |   | (832 | ) |
| Intangible                  assets subject to                  amortization, net           |   |                      | 1,354  |   |                           |   | 1,459 |   |
| Intangible                  assets with indefinite                  lives                  |   |                      | 500    |   |                           |   | 500 |   |
| Total                  intangible                  assets                                  |   | $                         | 1,854  |   |                           | $      | 1,959 |   |

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| Initial                  accrual                  balance            |   | $      | 2,221  |   |
|----------------------------------------------------------------------|--------|--------|--------|--------|
| 4th                  quarter 2007                  payments          |   |   | (46    | )      |
| September                  26, 2007 accrual                  balance |   | $      | 2,175  |   |
| Year-to-date                  fiscal 2008                  payments  |   |   | (1,570 | )      |
| April                  9, 2008 accrual                  balance      |   | $      | 605    |   |

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ITEM      2.

| ●    | Total                revenues decreased 5.8% to                $190,487. |
|---------------------------|--------------------------------------------------------------------------|

| ●    | Diluted                loss per share of                ($0.10),                including $0.02 per share of incremental non-operating                expenses. |
|---------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ●    | Delivering                improved                customer value proposition through price/value promotion and                innovation. |
|---------------------------|-------------------------------------------------------------------------------------------------------------------------------------------|

| ●    | Generating                incremental                cash flow and delivering                cost                savings. |
|---------------------------|---------------------------------------------------------------------------------------------------------------------------|

| ●    | Continuing                to                significantly improve the customer service                experience. |
|---------------------------|-------------------------------------------------------------------------------------------------------------------|

| ●    | Critically                reviewing                underperforming                units/markets. |
|---------------------------|--------------------------------------------------------------------------------------------------|

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|                                                                                                                                            |   | Sixteen                  Weeks                  Ended |    |    | Twenty-Eight                  Weeks                  Ended |   |
|-------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------|---------|---------|------------------------------------------------------------|--------|
|                                                                                                                                            |   | April                  9,                             |    |    | April                  11,                                 |   |   | April                  9, |   |   | April                  11, |   |
|                                                                                                                                            |   | 2008                                                  |    |    | 2007                                                       |   |   | 2008 |   |   | 2007 |   |
| Revenues:                                                                                                                                       |   |                                                  |    |    |                                                       |   |   |   |   |   |   |   |
| Net                  sales                                                                                                                      |   |                                                  | 99.4    | %       |                                                       |   | 99.5 | % |   |   | 99.4 | % |   |   | 99.5 | % |
| Franchise                  fees                                                                                                                 |   |                                                  | 0.6     |    |                                                       |   | 0.5 |   |   |   | 0.6 |   |   |   | 0.5 |   |
| Total                  revenues                                                                                                                 |   |                                                  | 100.0   |    |                                                       |   | 100.0 |   |   |   | 100.0 |   |   |   | 100.0 |   |
|                                                                                                                                            |   |                                                  |    |    |                                                       |   |   |   |   |   |   |   |   |   |   |   |
| Costs                  and                  Expenses:                                                                                           |   |                                                  |    |    |                                                       |   |   |   |   |   |   |   |   |   |   |   |
| Cost                  of                  sales  (1)                                                                                  |   |                                                  | 25.1    |    |                                                       |   | 23.0 |   |   |   | 24.7 |   |   |   | 22.8 |   |
| Restaurant                  operating costs                  (1)                                                                                |   |                                                  | 55.0    |    |                                                       |   | 50.6 |   |   |   | 55.4 |   |   |   | 51.0 |   |
| General                  and                  administrative                                                                                    |   |                                                  | 7.5     |    |                                                       |   | 8.7 |   |   |   | 7.5 |   |   |   | 8.9 |   |
| Depreciation                  and                  amortization                                                                                 |   |                                                  | 5.5     |    |                                                       |   | 4.9 |   |   |   | 5.5 |   |   |   | 4.9 |   |
| Marketing                                                                                                                                       |   |                                                  | 5.4     |    |                                                       |   | 4.5 |   |   |   | 5.0 |   |   |   | 4.5 |   |
| Interest                                                                                                                                        |   |                                                  | 2.2     |    |                                                       |   | 2.1 |   |   |   | 2.3 |   |   |   | 2.1 |   |
| Rent                                                                                                                                            |   |                                                  | 2.4     |    |                                                       |   | 2.1 |   |   |   | 2.4 |   |   |   | 2.1 |   |
| Pre-opening                  costs                                                                                                              |   |                                                  | 0.4     |    |                                                       |   | 0.4 |   |   |   | 0.3 |   |   |   | 0.5 |   |
| Asset                  impairments and provision                  for restaurant                  closings                                      |   |                                                  | — |    |                                                       |   | (0.1 | ) |   |   | — |   |   |   | (0.1 | )  |
| Other                  income,                  net                                                                                             |   |                                                  | (0.3    | )  |                                                       |   | (0.3 | )  |   |   | (0.3 | ) |   |   | (0.3 | )  |
|                                                                                                                                            |   |                                                  |    |    |                                                       |   |   |   |   |   |   |   |   |   |   |   |
| (Loss)                  Earnings Before Income                  Taxes                                                                           |   |                                                  | (2.7    | )  |                                                       |   | 4.5 |   |   |   | (2.3 | )  |   |   | 4.0 |   |
|                                                                                                                                            |   |                                                  |    |    |                                                       |   |   |   |   |   |   |   |   |   |   |   |
| Income                  Taxes                                                                                                                   |   |                                                  | (1.2    | )  |                                                       |   | 1.5 |   |   |   | (1.1 | )  |   |   | 1.1 |   |
|                                                                                                                                            |   |                                                  |    |    |                                                       |   |   |   |   |   |   |   |   |   |   |   |
| Net                  (Loss)                  Earnings                                                                                           |   |                                                  | (1.5    | )%      |                                                       |   | 3.0 | % |   |   | (1.2 | )% |   |   | 2.9 | % |
|                                                                                                                                            |   |                                                  |    |    |                                                       |   |   |   |   |   |   |   |   |   |   |   |
| (1)                  Cost of sales and restaurant                  operating costs are expressed as a percentage of net                  sales. |

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| ●    | the                poor performance or closing of even a small number of                restaurants; |
|---------------------------|------------------------------------------------------------------------------------------------------|

| ●    | our                ability to attract and retain                guests; |
|---------------------------|-------------------------------------------------------------------------|

| ●    | the                ability of our franchisees to operate profitable                restaurants; |
|---------------------------|-------------------------------------------------------------------------------------------------|

| ●    | changes                in guest preferences, tastes and dietary                habits; |
|---------------------------|----------------------------------------------------------------------------------------|

| ●    | changes                in minimum                wage rates; |
|---------------------------|--------------------------------------------------------------|

| ●    | the                availability and cost of qualified                personnel; |
|---------------------------|---------------------------------------------------------------------------------|

| ●    | fluctuations                in food commodity prices and the availability of food                commodities; |
|---------------------------|---------------------------------------------------------------------------------------------------------------|

| ●    | harsh                weather conditions; |
|---------------------------|------------------------------------------|

| ●    | unfavorable                publicity relating to food safety or food borne                illness; |
|---------------------------|----------------------------------------------------------------------------------------------------|

| ●    | our                ability to comply with the restrictions and covenants to                our debt agreements; |
|---------------------------|----------------------------------------------------------------------------------------------------------------------|

| ●    | our                ability to renegotiate our debt agreements and refinance our current                debt                at similar rates; |
|---------------------------|----------------------------------------------------------------------------------------------------------------------------------------------|

| ●    | our                ability to effectively negotiate sale-leaseback                transactions; |
|---------------------------|-------------------------------------------------------------------------------------------------|

| ●    | our                ability to comply with existing and future governmental                regulations; |
|---------------------------|--------------------------------------------------------------------------------------------------------|

| ●    | our                ability to adequately protect our trademarks, service marks and other                components of our brand;                and |
|---------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------|

| ●    | other                risks identified in the periodic reports we file with the Securities                and                Exchange Commission. |
|---------------------------|--------------------------------------------------------------------------------------------------------------------------------------------------|

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ITEM      3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET      RISK

ITEM      4. 

Based      on an evaluation of our disclosure controls and procedures (as defined in      Exchange Act Rules 13a-15(e) and 15d-15(c)), our Chief Executive Officer and      Chief Financial Officer have concluded that our disclosure controls and      procedures were effective as of April      9,      2008.

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ITEM      4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY      HOLDERS

| 1.   | Nine                directors from among eleven nominees were elected to serve until                the next                annual meeting and until their successors are duly elected and qualified.                The nine nominees with the most votes cast “for” were elected. The results                of the vote are as follows: |
|----------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Name                                                    | Votes                  For | Votes                  Withheld |
|---------------------------------------------------------|----------------------------|---------------------------------|
| J.                  Fred                  Risk          | 17,943,588                 | 4,737,912                       |
| Steven                  M.                  Schmidt     | 17,718,071                 | 4,963,429                       |
| Edward                  W.                  Wilhelm     | 17,716,429                 | 4,965,071                       |
| Geoff                  Ballotti                         | 17,712,099                 | 4,969,401                       |
| Wayne                  L.                  Kelley       | 17,641,427                 | 5,040,073                       |
| Ruth                  J.                  Person        | 17,606,229                 | 5,075,271                       |
| John                  W.                  Ryan          | 17,601,111                 | 5,080,389                       |
| Sardar                  Biglari                         | 15,645,868                 | 42,360                          |
| Philip                  L.                  Cooley      | 15,645,574                 | 42,654                          |
| James                  Williamson,                  Jr. | 5,452,242                  | 1,541,030                       |
| Alan                  B.                  Gilman        | 5,447,374                  | 1,545,898                       |

| 2.   | The                2008 Equity Incentive Plan was approved as                follows: |
|----------------|---------------------------------------------------------------------------------------|

| Votes                  For | Votes                  Against/Withheld | Abstentions/Brokers                  Non-Votes |
|----------------------------|-----------------------------------------|------------------------------------------------|
| 13,766,344                 | 8,813,976                               | 101,179                                        |

| 3.   | Deloitte                & Touche, LLP, was ratified as the Company’s independent registered                public accounting firm for the current fiscal year as                follows: |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Votes                  For | Votes                  Against/Withheld | Abstentions/Brokers                  Non-Votes |
|----------------------------|-----------------------------------------|------------------------------------------------|
| 22,289,291                 | 102,552                                 | 289,656                                        |

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ITEM      5

ITEM      6

| Exhibit                  Number |   | Description                                                                                                                                                                                                                                                                                                                                           |
|---------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 4.01                            |   | Amendment                  No. 7 to the Amended and                  Restated Note Purchase and Private Shelf Agreement dated May 16,                  2008                                                                                                                                                                                           |
|                            |   |                                                                                                                                                                                                                                                                                                                                                  |
| 4.02                            |   | Eighth                  Amendment to Credit                  Agreement by and between The Steak n Shake Company and Fifth Third                  Bank,                  Indiana (Central) dated May 16, 2008                                                                                                                                          |
|                            |   |                                                                                                                                                                                                                                                                                                                                                  |
| 10.01                           |   | Form                  of Employee Incentive Stock                  Option Agreement                                                                                                                                                                                                                                                                   |
|                            |   |                                                                                                                                                                                                                                                                                                                                                  |
| 10.02                           |   | Form                  of Employee Incentive                  Restricted Stock Agreement                                                                                                                                                                                                                                                               |
|                            |   |                                                                                                                                                                                                                                                                                                                                                  |
| 10.03                           |   | Form                  of Change in Control Benefits                  Agreement dated November 7, 2007 with Duane Geiger (Identical to                  and                  incorporated herein by reference to Exhibit 10.31 to the Registrant's                  Annual Report on Form 10-K for the year ended September 26,                  2007) |
|                            |   |                                                                                                                                                                                                                                                                                                                                                  |
| 10.04                           |   | First                  Amendment dated April 22,                  2008 to Form of Change in Control Benefits Agreement dated November                  7,                  2007 with Duane Geiger                                                                                                                                                     |
|                            |   |                                                                                                                                                                                                                                                                                                                                                  |
| 31.01                           |   | Rule                  13(a)-14(a)/15d-14(a)                  Certification of Chief Executive Officer                                                                                                                                                                                                                                                 |
|                            |   |                                                                                                                                                                                                                                                                                                                                                  |
| 31.02                           |   | Rule                  13(a)-14(a)/15d-14(a)                  Certification of Chief Financial Officer                                                                                                                                                                                                                                                 |
|                            |   |                                                                                                                                                                                                                                                                                                                                                  |
| 32.01                           |   | Section                  1350                  Certifications                                                                                                                                                                                                                                                                                         |

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