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|  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) |

| Large accelerated filer  ___                                  | Accelerated filer X  |
|-------------------------------------------------------------------------|--------------------------------|
| Non-accelerated filer ___ (Do not check if a smaller reporting company) | Smaller reporting company ___  |

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THE STEAK N SHAKE COMPANY 

| PART I. FINANCIAL INFORMATION |                                                                                                |                                                                                                                                          |   |   |   | Page   |
|------------------------------------|-----------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|
|                               |                                                                                                |                                                                                                                                          |   |   |   |   |   |
|                               | ITEM 1. FINANCIAL STATEMENTS                                                                        |                                                                                                                                          |   |   |   |   |   |
|                               |                                                                                                | Condensed Consolidated Statements of Financial Position as of July 1, 2009 (Unaudited) and September 24, 2008                  | 3      |
|                               |                                                                                                |                                                                                                                                          |   |   |   |   |   |   |   |   |
|                               |                                                                                                | Condensed Consolidated Statements of Operations for the Twelve and Forty Weeks Ended July 1, 2009 and July 2, 2008 (Unaudited) | 4      |
|                               |                                                                                                |                                                                                                                                          |   |   |   |   |   |   |   |   |
|                               |                                                                                                | Condensed Consolidated Statements of Cash Flows for the Forty Weeks Ended July 1, 2009 and July 2, 2008 (Unaudited)                 | 5      |
|                               |                                                                                                |                                                                                                                                          |   |   |   |   |   |   |   |   |
|                               |                                                                                                | Notes to Condensed Consolidated Financial Statements (Unaudited)                                                                              |   |   | 6      |
|                               |                                                                                                |                                                                                                                                          |   |   |   |   |   |   |   |   |
|                               | ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS | 15                                                                                                                                            |
|                               |                                                                                                |                                                                                                                                          |   |   |   |   |   |   |   |   |
|                               | ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                                  | 22                                                                                                                                            |
|                               |                                                                                                |                                                                                                                                          |   |   |   |   |   |   |   |   |
|                               | ITEM 4. CONTROLS AND PROCEDURES                                                                     |                                                                                                                                          |   |   |   | 22     |
|                               |                                                                                                |                                                                                                                                          |   |   |   |   |   |   |   |   |
|                               |                                                                                                |                                                                                                                                          |   |   |   |   |   |   |   |   |
| PART II. OTHER INFORMATION         |                                                                                                |                                                                                                                                          |   |   |   |   |
|                               |                                                                                                |                                                                                                                                          |   |
|                               | ITEM 1. LEGAL PROCEEDINGS                                                                           |                                                                                                                                          |   |   | 23     |
|                               |                                                                                                |                                                                                                                                          |   |   |   |   |   |   |
|                               | ITEM 1A. RISK FACTORS                                                                               |                                                                                                                                          |   |   | 23     |
|                               |                                                                                                |                                                                                                                                          |   |   |   |   |   |   |
|                               | ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                                         | 23                                                                                                                                            |
|                               |                                                                                                |                                                                                                                                          |   |   |   |   |   |   |
|                               | 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)                                                                         |   |   |   |   |   |   |
|                                                                                                                       |   | July 1, |   |   | September 24, |   |
|                                                                                                                       |   | 2009 |   |   | 2008 |   |
|                                                                                                                       |   | (Unaudited) |   |   |   |   |
| Assets:                                                                                                                    |   |   |   |   |   |   |
| Current assets                                                                                                             |   |   |   |   |   |   |
| Cash and cash equivalents                                                                                                  |   | $ | 37,843 |   |   | $ | 6,855 |   |
| Receivables, net of allowances of $539 (2009) and $341 (2008)                                                              |   |   | 8,011 |   |   |   | 15,622 |   |
| Inventories                                                                                                                |   |   | 7,131 |   |   |   | 6,795 |   |
| Deferred income taxes                                                                                                      |   |   | 5,674 |   |   |   | 3,260 |   |
| Assets held for sale                                                                                                       |   |   | 18,479 |   |   |   | 25,395 |   |
| Other current assets                                                                                                       |   |   | 5,488 |   |   |   | 3,009 |   |
| Total current assets                                                                                                       |   |   | 82,626 |   |   |   | 60,936 |   |
| Net property and equipment                                                                                                 |   |   | 406,197 |   |   |   | 432,690 |   |
| Goodwill                                                                                                                   |   |   | 14,503 |   |   |   | 14,503 |   |
| Other intangible assets, net                                                                                               |   |   | 1,616 |   |   |   | 1,765 |   |
| Other assets                                                                                                               |   |   | 8,180 |   |   |   | 10,242 |   |
| Total assets                                                                                                               |   | $ | 513,122 |   |   | $ | 520,136 |   |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| Liabilities and shareholders' equity:                                                                                      |   |   |   |   |   |   |   |   |
| Current liabilities                                                                                                        |   |   |   |   |   |   |   |   |
| Accounts payable                                                                                                           |   | $ | 25,495 |   |   | $ | 25,302 |   |
| Accrued expenses                                                                                                           |   |   | 32,018 |   |   |   | 31,685 |   |
| Current portion of long-term debt                                                                                          |   |   | 20 |   |   |   | 733 |   |
| Revolving credit                                                                                                           |   |   | 13,680 |   |   |   | 14,180 |   |
| Current portion of obligations under leases                                                                                |   |   | 4,424 |   |   |   | 4,417 |   |
| Total current liabilities                                                                                                  |   |   | 75,637 |   |   |   | 76,317 |   |
| Deferred income taxes                                                                                                      |   |   | 9,858 |   |   |   | 2,209 |   |
| Other long-term liabilities                                                                                                |   |   | 6,792 |   |   |   | 7,439 |   |
| Obligations under leases                                                                                                   |   |   | 132,035 |   |   |   | 134,809 |   |
| Long-term debt                                                                                                             |   |   | 53 |   |   |   | 15,783 |   |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| 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                                                                                                 |   |   | 129,268 |   |   |   | 128,526 |   |
| Retained earnings                                                                                                          |   |   | 164,349 |   |   |   | 161,733 |   |
| Treasury stock - at cost: 1,519,905 shares as of July 1, 2009; 1,760,531    shares as of September 24, 2008 |   |   | (20,036 | ) |   |   | (21,846 | ) |
| Total shareholders' equity                                                                                                 |   |   | 288,747 |   |   |   | 283,579 |   |
| Total liabilities and shareholders' equity                                                                                 |   | $ | 513,122 |   |   | $ | 520,136 |   |
|                                                                                                                       |   |   |   |   |   |   |   |   |
| See accompanying notes.                                                                                                    |   |   |   |   |   |   |   |   |

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| Condensed Consolidated Statements of Operations (Unaudited)                      |   |
|----------------------------------------------------------------------------------|--------|
| The Steak n Shake Company                                                        |   |   |   |   |   |   |   |   |   |   |   |   |
| (Amounts in $000s except share and per share data)                               |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                             |   | Twelve Weeks Ended |   |   | Forty Weeks Ended |   |
|                                                                             |   | July 1, |   |   | July 2, |   |   | July 1, |   |   | July 2, |   |
|                                                                             |   | 2009 |   |   | 2008 |   |   | 2009 |   |   | 2008 |   |
| Revenues:                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |
| Net sales                                                                        |   | $ | 145,648 |   |   | $ | 143,303 |   |   | $ | 464,342 |   |   | $ | 468,071 |   |
| Franchise fees                                                                   |   |   | 701 |   |   |   | 990 |   |   |   | 2,713 |   |   |   | 3,105 |   |
| Total revenues                                                                   |   |   | 146,349 |   |   |   | 144,293 |   |   |   | 467,055 |   |   |   | 471,176 |   |
|                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Costs and expenses:                                                              |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cost of sales                                                                    |   |   | 34,814 |   |   |   | 35,527 |   |   |   | 112,456 |   |   |   | 115,658 |   |
| Restaurant operating costs                                                       |   |   | 76,880 |   |   |   | 79,241 |   |   |   | 253,088 |   |   |   | 259,090 |   |
| General and administrative                                                       |   |   | 7,886 |   |   |   | 11,056 |   |   |   | 27,330 |   |   |   | 35,546 |   |
| Depreciation and amortization                                                    |   |   | 6,913 |   |   |   | 7,812 |   |   |   | 23,842 |   |   |   | 25,925 |   |
| Marketing                                                                        |   |   | 8,230 |   |   |   | 6,666 |   |   |   | 25,646 |   |   |   | 23,043 |   |
| Interest                                                                         |   |   | 3,347 |   |   |   | 3,263 |   |   |   | 10,998 |   |   |   | 10,816 |   |
| Rent                                                                             |   |   | 3,577 |   |   |   | 3,379 |   |   |   | 11,801 |   |   |   | 11,107 |   |
| Pre-opening costs                                                                |   |   | 7 |   |   |   | 112 |   |   |   | 7 |   |   |   | 1,243 |   |
| Asset impairments and provision for restaurant closing                           |   |   | 63 |   |   |   | 14,089 |   |   |   | 980 |   |   |   | 14,089 |   |
| Gain on disposal of property                                                     |   |   | (85 | ) |   |   | (385 | ) |   |   | (97 | ) |   |   | (372 | ) |
| Other income, net                                                                |   |   | (630 | ) |   |   | (288 | ) |   |   | (968 | ) |   |   | (1,263 | ) |
| Total costs and expenses                                                         |   |   | 141,002 |   |   |   | 160,472 |   |   |   | 465,083 |   |   |   | 494,882 |   |
|                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Earnings (loss) before income taxes                                              |   |   | 5,347 |   |   |   | (16,179 | ) |   |   | 1,972 |   |   |   | (23,706 | ) |
|                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income taxes                                                                     |   |   | 1,544 |   |   |   | (6,382 | ) |   |   | (644 | ) |   |   | (9,912 | ) |
|                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net earnings (loss)                                                              |   | $ | 3,803 |   |   | $ | (9,797 | ) |   | $ | (2,616 | ) |   | $ | (13,794 | ) |
|                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic earnings (loss) per common and common    equivalent share   |   | $ | 0.13 |   |   | $ | (0.35 | ) |   | $ | (0.09 | ) |   | $ | (0.49 | ) |
|                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Diluted earnings (loss) per common and common    equivalent share |   | $ | 0.13 |   |   | $ | (0.35 | ) |   | $ | (0.09 | ) |   | $ | (0.49 | ) |
|                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted average shares and equivalents:                                         |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                                            |   |   | 28,551,669 |   |   |   | 28,288,330 |   |   |   | 28,447,380 |   |   |   | 28,274,193 |   |
| Diluted                                                                          |   |   | 28,663,007 |   |   |   | 28,288,330 |   |   |   | 28,538,960 |   |   |   | 28,274,193 |   |
|                                                                             |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| See accompanying notes.                                                |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |

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| Condensed Consolidated Statements of Cash Flows (Unaudited)                           |   |
|--------------------------------------------------------------------------------------------|--------|
| The Steak n Shake Company                                                                  |   |   |   |   |   |   |
| (Amounts in $000s)                                                                         |   |   |   |   |   |   |
|                                                                                       |   | Forty Weeks Ended |   |
|                                                                                       |   | July 1, |   |   | July 2, |   |
|                                                                                       |   | 2009 |   |   | 2008 |   |
| Operating activities:                                                                      |   |   |   |   |   |   |
| Net earnings (loss)                                                                        |   | $ | 2,616 |   |   | $ | (13,794 | ) |
| Adjustments to reconcile net earnings (loss) to net cash provided by operating activities: |   |   |   |   |   |   |   |   |
| Depreciation and amortization                                                              |   |   | 23,842 |   |   |   | 25,925 |   |
| Provision for deferred income taxes                                                        |   |   | 5,235 |   |   |   | (4,714 | ) |
| Asset impairments and provision for restaurant closing                                     |   |   | 980 |   |   |   | 14,089 |   |
| Non-cash expense for stock-based compensation and deferred rent                            |   |   | 2,422 |   |   |   | 2,676 |   |
| Gain on disposal of property                                                          |   |   | (97 | ) |   |   | (372 | ) |
| Changes in receivables and inventories                                                     |   |   | 7,581 |   |   |   | 1,720 |   |
| Changes in other assets                                                                    |   |   | (3,016 | ) |   |   | (3,299 | ) |
| Changes in accounts payable and accrued expenses                                           |   |   | 1,552 |   |   |   | 1,340 |   |
| Net cash provided by operating activities                                                  |   |   | 41,115 |   |   |   | 23,571 |   |
|                                                                                       |   |   |   |   |   |   |   |   |
| Investing activities:                                                                      |   |   |   |   |   |   |   |   |
| Additions of property and equipment                                                        |   |   | (3,145 | ) |   |   | (28,512 | ) |
| Proceeds from property and equipment disposals                                             |   |   | 9,277 |   |   |   | 11,531 |   |
| Net cash provided by (used in) investing activities                                        |   |   | 6,132 |   |   |   | (16,981 | ) |
|                                                                                       |   |   |   |   |   |   |   |   |
| Financing activities:                                                                      |   |   |   |   |   |   |   |   |
| Net proceeds from revolving credit facility                                                |   |   | (500 | ) |   |   | (18,005 | ) |
| Principal payments on long-term debt                                                       |   |   | (16,443 | ) |   |   | (1,080 | ) |
| Proceeds from equipment and property sale-leasebacks                                       |   |   | 3,597 |   |   |   | 14,817 |   |
| Principal payments on direct financing lease obligations                                   |   |   | (3,606 | ) |   |   | (3,336 | ) |
| Proceeds from exercise of stock options                                                    |   |   | — |   |   |   | 132 |   |
| Excess tax benefits from stock-based awards                                                |   |   | 40 |   |   |   | 10 |   |
| Repurchase of employee shares for tax withholding                                          |   |   | (202 | ) |   |   | (8 | ) |
| Proceeds from employee stock purchase plan                                                 |   |   | 855 |   |   |   | 1,004 |   |
| Net cash used in financing activities                                                      |   |   | (16,259 | ) |   |   | (6,466 | ) |
|                                                                                       |   |   |   |   |   |   |   |   |
| Increase in cash and cash equivalents                                                      |   |   | 30,988 |   |   |   | 124 |   |
| Cash and cash equivalents at beginning of period                                           |   |   | 6,855 |   |   |   | 1,497 |   |
| Cash and cash equivalents at end of period                                                 |   | $ | 37,843 |   |   | $ | 1,621 |   |
|                                                                                       |   |   |   |   |   |   |   |   |
| See accompanying notes.                                                          |   |   |   |   |   |   |   |   |

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Notes to Condensed Consolidated Financial Statements

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|                                                                                                                                                                                                                                                                                                                                                                                                                            | Twelve Weeks Ended                                            |   | Forty Weeks Ended                                                                                             |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                                                            | July 1,                                                       |   | July 2,                                                                                                       |   | July 1, |   | July 2, |
|                                                                                                                                                                                                                                                                                                                                                                                                                            | 2009                                                          |   | 2008                                                                                                          |   | 2009 |   | 2008 |
| Basic earnings (loss) per share:                                                                                                                                                                                                                                                                                                                                                                                                |                                                          |   |                                                                                                          |   |   |   |   |
| Weighted average common shares                                                                                                                                                                                                                                                                                                                                                                                                  | 28,551,669                                                    |   | 28,288,330                                                                                                    |   | 28,447,380 |   | 28,274,193 |
|                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                          |   |                                                                                                          |   |   |   |   |
| Diluted earnings (loss) per share:                                                                                                                                                                                                                                                                                                                                                                                              |                                                          |   |                                                                                                          |   |   |   |   |
| Weighted average common shares                                                                                                                                                                                                                                                                                                                                                                                                  | 28,551,669                                                    |   | 28,288,330                                                                                                    |   | 28,447,380 |   | 28,274,193 |
| Dilutive effect of stock awards                                                                                                                                                                                                                                                                                                                                                                                                 |          111,338 |   |                  — |   |                   91,580 |   |                   — |
| Weighted average common and incremental shares                                                                                                                                                                                                                                                                                                                                                                                  | 28,663,007                                                    |   | 28,288,330                                                                                                    |   | 28,538,960 |   | 28,274,193 |
|                                                                                                                                                                                                                                                                                                                                                                                                                            |                                                          |   |                                                                                                          |   |   |   |   |
| Number of share-based awards excluded from the calculation of    diluted earnings (loss) per share because the awards' exercise    prices were greater than the average market price ofthe    Company's common stock, or because they were antidilutive   due to the Company's net losses for the twelve and forty    weeks ended July 2, 2008. | 577,537                                                       |   | 1,947,310                                                                                                     |   | 830,307 |   | 1,576,327 |

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|                                           |   | July 1, |     |   | September 24, |   |
|------------------------------------------------|--------|---------|----------|--------|---------------|--------|
|                                           |   | 2009    |     |   | 2008          |   |
| Land                                           |   | $       | 151,677  |   |          | $      | 151,006 |   |
| Buildings                                      |   |    | 149,823  |   |          |   | 156,695 |   |
| Land and leasehold improvements                |   |    | 154,859  |   |          |   | 157,738 |   |
| Equipment                                      |   |    | 200,384  |   |          |   | 204,116 |   |
| Construction in progress                       |   |    | 1,428    |   |          |   | 2,423 |   |
|                                           |   |    | 658,171  |   |          |   | 671,978 |   |
| Less accumulated depreciation and amortization |   |    | (251,974 | )      |          |   | (239,288 | ) |
| Net property and equipment                     |   | $       | 406,197  |   |          | $      | 432,690 |   |

|                            |   | July 1, |   |   | September 24, |   |
|---------------------------------|--------|---------|--------|--------|---------------|--------|
|                            |   | 2009    |   |   | 2008          |   |
| Land and buildings              |   | $       | 15,819 |   |          | $      | 21,726 |   |
| Land and leasehold improvements |   |    | 2,652  |   |          |   | 3,388 |   |
| Equipment                       |   |    | 8      |   |          |   | 281 |   |
| Total assets held for sale      |   | $       | 18,479 |   |          | $      | 25,395 |   |

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|                                                     |   | July 1, |   |   | September 24, |   |
|----------------------------------------------------------|--------|---------|--------|--------|---------------|--------|
|                                                     |   | 2009    |   |   | 2008          |   |
| Gross value of intangible assets subject to amortization |   | $       | 2,291  |   |          | $      | 2,291 |   |
| Accumulated amortization                                 |   |    | (1,175 | )      |          |   | (1,026 | ) |
| Intangible assets subject to amortization, net           |   |    | 1,116  |   |          |   | 1,265 |   |
| Intangible assets with indefinite lives                  |   |    | 500    |   |          |   | 500 |   |
| Total intangible assets                                  |   | $       | 1,616  |   |          | $      | 1,765 |   |

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| September 24, 2008 accrual balance     |   | $      | 372  |   |
|----------------------------------------|--------|--------|------|--------|
| Year-to-date fiscal year 2009 accruals |   |   | 121  |   |
| Year-to-date fiscal year 2009 payments |   |   | (479 | )      |
| July 1, 2009 accrual balance           |   | $      | 14   |   |

| ·   | Level 1:  Unadjusted quoted prices in active markets for identical assets and liabilities.                                                                                                                                            |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| ·   | Level 2:  Observable inputs other than those included in Level 1.  For example, quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets. |

| ·   | Level 3:  Unobservable inputs reflecting management’s own assumptions about the inputs used in pricing the asset or liability. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                 |   | Level 1 |    |   | Level 2 |   |    | Level 3 |   |   | Total   |   |
|------------------------------------------------------|--------|---------|---------|--------|---------|--------|---------|---------|--------|--------|---------|--------|
| Cash equivalents                                     |   | $       | — |   |    | $      | 33,457  |    |   | $      | — |   |   | $ | 33,457 |   |
| Non-qualified deferred compensation plan investments |   |    | 335     |   |    |   | — |    |   |   | — |   |   |   | 335 |   |
| Total assets at fair value                           |   | $       | 335     |   |    | $      | 33,457  |    |   | $      | — |   |   | $ | 33,792 |   |

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 

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|                                                                                         |   | Twelve Weeks Ended |   |   | Forty Weeks Ended |   |
|----------------------------------------------------------------------------------------------|--------|--------------------|--------|--------|------------------------|--------|
|                                                                                         |   | July 1,            |   |   | July 2,                |   |   | July 1, |   |   | July 2, |   |
|                                                                                         |   | 2009               |   |   | 2008                   |   |   | 2009 |   |   | 2008 |   |
| Revenues:                                                                                    |   |               |   |   |                   |   |   |   |   |   |   |   |
| Net sales                                                                                    |   |               | 99.5   | %      |                   |   | 99.3 | % |   |   | 99.4 | % |   |   | 99.3 | % |
| Franchise fees                                                                               |   |               | 0.5    | %      |                   |   | 0.7 | % |   |   | 0.6 | % |   |   | 0.7 | % |
| Total revenues                                                                               |   |               | 100.0  | %      |                   |   | 100.0 | % |   |   | 100.0 | % |   |   | 100.0 | % |
|                                                                                         |   |               |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Costs and expenses:                                                                          |   |               |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Cost of sales (1)                                                                            |   |               | 23.9   | %      |                   |   | 24.8 | % |   |   | 24.2 | % |   |   | 24.7 | % |
| Restaurant operating costs (1)                                                               |   |               | 52.8   | %      |                   |   | 55.3 | % |   |   | 54.5 | % |   |   | 55.4 | % |
| General and administrative                                                                   |   |               | 5.4    | %      |                   |   | 7.7 | % |   |   | 5.9 | % |   |   | 7.5 | % |
| Depreciation and amortization                                                                |   |               | 4.7    | %      |                   |   | 5.4 | % |   |   | 5.1 | % |   |   | 5.5 | % |
| Marketing                                                                                    |   |               | 5.6    | %      |                   |   | 4.6 | % |   |   | 5.5 | % |   |   | 4.9 | % |
| Interest                                                                                     |   |               | 2.3    | %      |                   |   | 2.3 | % |   |   | 2.4 | % |   |   | 2.3 | % |
| Rent                                                                                         |   |               | 2.4    | %      |                   |   | 2.3 | % |   |   | 2.5 | % |   |   | 2.4 | % |
| Pre-opening costs                                                                            |   |               | 0.0    | %      |                   |   | 0.1 | % |   |   | 0.0 | % |   |   | 0.3 | % |
| Asset impairments and provision for restaurant closing                                       |   |               | 0.0    | %      |                   |   | 9.8 | % |   |   | 0.2 | % |   |   | 3.0 | % |
| Gain on disposal of property                                                                 |   |               | (0.1   | )%     |                   |   | (0.3 | )% |   |   | (0.0 | )% |   |   | (0.1 | )% |
| Other income, net                                                                            |   |               | (0.4   | )%     |                   |   | (0.2 | )% |   |   | (0.2 | )% |   |   | (0.3 | )% |
|                                                                                         |   |               |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Earnings (loss) before income taxes                                                          |   |               | 3.7    | %      |                   |   | (11.2 | )% |   |   | 0.4 | % |   |   | (5.0 | )% |
|                                                                                         |   |               |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Income taxes                                                                                 |   |               | 1.1    | %      |                   |   | (4.4 | )% |   |   | (0.1 | )% |   |   | (2.1 | )% |
|                                                                                         |   |               |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Net earnings (loss)                                                                          |   |               | 2.6    | %      |                   |   | (6.8 | )% |   |   | 0.6 | % |   |   | (2.9 | )% |
|                                                                                         |   |               |   |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| (1) Cost of sales and restaurant operating costs are expressed as a percentage of net sales. |   |

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| ·   | the success of our plan to increase store traffic on a profitable basis;               |
|--------------------|----------------------------------------------------------------------------------------|
| ·   | competition in the restaurant industry for guests, staff, locations, and new products; |

| ·   | disruptions in the overall economy and the financial markets;                     |
|--------------------|-----------------------------------------------------------------------------------|
| ·   | our ability to comply with the restrictions and covenants to our debt agreements; |

| ·   | declines in the market price of our common stock;                                  |
|--------------------|------------------------------------------------------------------------------------|
| ·   | the potential to recognize additional impairment charges on our long-lived assets; |

| ·   | fluctuations in food commodity and energy prices and the availability of food commodities; |
|--------------------|--------------------------------------------------------------------------------------------|
| ·   | the ability of our franchisees to operate profitable restaurants;                          |

| ·   | the poor performance or closing of even a small number of restaurants; |
|--------------------|------------------------------------------------------------------------|
| ·   | changes in guest preferences, tastes, and dietary habits;              |

| ·   | changes in minimum wage rates and the availability and cost of qualified personnel; |
|--------------------|-------------------------------------------------------------------------------------|
| ·   | harsh weather conditions or losses due to casualties;                               |

| ·   | unfavorable publicity relating to food safety or food-borne illness;                                |
|--------------------|-----------------------------------------------------------------------------------------------------|
| ·   | exposure to liabilities related to the ownership and leasing of significant amounts of real estate; |

| ·   | 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. CONTROLS AND PROCEDURES 

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PART II. OTHER INFORMATION 

ITEM 1. LEGAL PROCEEDINGS 

ITEM 1A. RISK FACTORS 

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

| Name                  |   | Votes For  |   | Votes Withheld |
|-----------------------|--------|------------|--------|----------------|
| Sardar Biglari        |   | 24,266,009 |   | 605,969        |
| Philip Cooley         |   | 24,340,198 |   | 531,780        |
| Ruth J. Person        |   | 24,237,539 |   | 634,439        |
| William J. Regan, Jr. |   | 24,365,262 |   | 506,716        |
| John W. Ryan          |   | 24,351,945 |   | 520,033        |

| Votes For  |   | Votes Against/Withheld |   | Abstentions/Brokers Non-Votes |
|------------|--------|------------------------|--------|-------------------------------|
| 24,644,170 |   | 159,849                |   | 67,959                        |

| Votes For  |   | Votes Against/Withheld |   | Abstentions/Brokers Non-Votes |
|------------|--------|------------------------|--------|-------------------------------|
| 15,546,672 |   | 177,634                |   | 9,147,672                     |

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ITEM 6. EXHIBITS 

| Exhibit Number                                                                                            |   | Description                                                                                                                                                                                                                                                       |
|-----------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 3.01                                                                                                      |   | By-laws of the Company, amended effective July 1, 2009                                                                                                                                                                                                            |
|                                                                                                      |   |                                                                                                                                                                                                                                                              |
| 4.01                                                                                                      |   | Eleventh Amendment to Credit Agreement by and between The Steak n Shake Company and Fifth Third Bank, Indiana (Central) dated November 21, 2008.  (Incorporated by reference to Exhibit 10.1 to Registrant's Current Report on Form 8-k dated July 8, 2009). |
|                                                                                                      |   |                                                                                                                                                                                                                                                              |
| 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                                                                                                                                                                                                                                       |
|                                                                                                      |   |                                                                                                                                                                                                                                                              |
| * Indicates management contract or compensatory plans or arrangements required to be filed as an Exhibit. |

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Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. 

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