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# SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

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# FORM 10-Q

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# Quarterly Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934

# For the Quarterly Period Ended September 29, 2002

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# Commission file number 0-19924

# RARE Hospitality International, Inc.(Exact name of registrant as specified in its charter)

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# Internal Revenue Service - Employer Identification No. 58-1498312

# 8215 Roswell Rd; Bldg. 600; Atlanta, GA 30350
(770) 399-9595

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Indicate by check mark
whether the registrant (1) has filed all reports required to be filed by Section
13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days.

# XX   Yes      No

As of November 8, 2002,
there were 21,991,580 shares of common stock of the Registrant outstanding.

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# RARE Hospitality International, Inc. and Subsidiaries

# Index

`Part I - Financial Information                                                              Page
                                                                                            ----
      Item 1. Consolidated Financial Statements:

                    Consolidated Balance Sheets as of
                    September 29, 2002 and December 30, 2001                                  1

                    Consolidated Statements of Earnings -
                    for the quarters and nine months ended
                    September 29, 2002 and September 30, 2001                                 2

                    Consolidated Statement of Shareholders' Equity
                    and Comprehensive Income for the nine months
                    ended September 29, 2002                                                  3

                    Condensed Consolidated Statements of Cash Flows -
                    for the nine months ended September 29, 2002
                    and September 30, 2001                                                    4

                    Notes to the Consolidated Financial Statements                           5-8

      Item 2. Management's Discussion and Analysis of
                    Financial Condition and Results of Operations                            8-12

      Item 3. Quantitative and Qualitative Disclosures About
                    Market Risk                                                               12

      Item 4. Controls and Procedures                                                         13


Part II - Other Information

      Item 1. Legal Proceedings                                                               13

      Item 2. Changes in Securities and Use of Proceeds                                       13

      Item 3. Defaults Upon Senior Securities                                                 13

      Item 4. Submission of Matters to a Vote of Securities
                    Holders                                                                   13

      Item 5. Other Information                                                               13

      Item 6. Exhibits and Reports on Form 8-K                                                13

      Signatures                                                                              14

      Certifications                                                                         14-16`

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# Part I. Financial Information

# Item 1. Financial Statements

# RARE Hospitality International, Inc. and Subsidiaries
                                          Consolidated Balance Sheets
                                     (In thousands, except share amounts)
                                                  (Unaudited)

`September 29,           December 30,
Assets                                                      2002                   2001
                                                            ----                   ----
Current assets:
     Cash and cash equivalents                           $ 22,355               $  25,979
     Short-term investments at market value                15,000                       -
     Accounts receivable                                    8,333                   6,710
     Inventories                                           14,008                  13,437
     Prepaid expenses                                       3,820                   3,069
     Refundable income taxes                                6,238                   3,902
     Deferred income taxes                                  7,101                   6,643
                                                         --------                --------
         Total current assets                              76,855                  59,740

Property & equipment, less accumulated
   depreciation                                           287,097                 269,323
Goodwill, net                                              19,187                  19,187
Deferred income taxes                                           -                   2,276
Other                                                       2,961                   2,871
                                                         --------                --------
         Total assets                                    $386,100                $353,397
                                                         ========                ========
Liabilities and Shareholders' Equity
Current liabilities:
     Accounts payable                                    $ 17,059                $ 27,189
     Accrued expenses                                      37,145                  37,424
     Current installments of obligations under
         capital leases                                        53                      58
                                                         --------                --------
         Total current liabilities                         54,257                  64,671

Debt, net of current installments                          15,000                  10,000
Deferred tax liability                                      2,128                      --
Obligations under capital leases                           20,814                  20,867
                                                         --------                --------
         Total liabilities                                 92,199                  95,538

Minority interest                                           1,370                   1,329

Shareholders' equity:
     Preferred stock                                            -                       -
     Common stock                                         190,224                 178,787
     Unearned compensation-restricted stock                  (895)                   (522)
     Retained earnings                                    104,299                  79,007
     Accumulated other comprehensive loss                    (938)                  (583)
     Treasury stock at cost; 10,000 shares in
       2002 and 2001                                         (159)                  (159)
                                                         --------                --------
         Total shareholders' equity                       292,531                 256,530
         Total liabilities and shareholders'             --------                --------
           equity                                        $386,100                $353,397
                                                         ========                ========`

See accompanying notes to consolidated financial statements

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# RARE Hospitality International, Inc. and Subsidiaries
                                      Consolidated Statements of Earnings
                               (In thousands, except per share data) (Unaudited)

`Quarter Ended                  Nine Months Ended
                                                           -------------                  -----------------
Revenues:                                           Sept. 29,         Sept. 30,       Sept. 29,        Sept. 30,
                                                      2002              2001            2002             2001
                                                      ----              ----            ----             ----
   Restaurant sales:
     LongHorn Steakhouse                            $100,343           $88,769        $309,287         $273,194
     The Capital Grille                               19,798            17,949          63,373           56,982
     Bugaboo Creek Steak House                        17,762            16,749          52,088           49,704
     Specialty concepts                                1,955             1,897           5,621            5,437
                                                     -------           -------        --------         --------
         Total restaurant sales                      139,858           125,364         430,369          385,317
                                                     =======           =======         =======          =======
   Franchise revenues                                     84                79             257              247
                                                     -------           -------         -------          -------
         Total revenues                              139,942           125,443         430,626          385,564
Costs and expenses:                                  =======           =======         =======          =======
   Cost of restaurant sales                           50,355            46,204         155,948          140,677
   Operating expenses - restaurants                   63,765            57,569         189,695          168,710
   Depreciation and amortization
     - restaurants                                     5,934             5,438          17,535           15,586
   Pre-opening expense                                   996               707           2,735            3,327
   General and administrative expenses                 8,771             7,918          25,456           23,411
                                                     -------           -------         -------          -------
         Total costs and expenses                    129,821           117,836         391,369          351,711
                                                     =======           =======         =======          =======
     Operating income                                 10,121             7,607          39,257           33,853
Interest expense, net                                    528               491           1,398            1,547
Early termination of interest
 rate swap agreement                                       -                 -               -            1,100
Minority interest                                         87               131             387              531
                                                     -------           -------         -------          -------
   Earnings before income taxes                        9,506             6,985          37,472           30,675
Income tax expense                                     3,090             2,304          12,180           10,071
                                                     -------           -------         -------          -------
         Net earnings                                 $6,416            $4,681         $25,292          $20,604
                                                     =======           =======         =======          =======
Basic earnings per common share                        $0.29             $0.22           $1.17            $0.99
                                                     =======           =======         =======          =======
Diluted earnings per common share                      $0.28             $0.21           $1.11            $0.93
                                                     =======           =======         =======          =======
Weighted average common shares outstanding:
   Basic                                              21,820            21,337          21,681           20,876
                                                     =======           =======         =======          =======
   Diluted                                            22,924            22,385          22,841           22,125
                                                     =======           =======         =======          =======`

See accompanying notes to consolidated financial statements

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# RARE Hospitality International, Inc. and Subsidiaries
                                Consolidated Statement of Shareholders' Equity
                                           and Comprehensive Income
                                          (In thousands, unaudited)

`Common Stock                                                    Other           Total
                                    ----------------      Restricted      Retained    Treasury    Comprehensive    Shareholders'
                                  Shares        Amount         Stock      Earnings      Stock     Income (Loss)      Equity
                                  ------        ------         -----      --------      -----       --------        --------
Balance, December 30, 2001         21,522      $178,787       $(522)       $79,007     $  (159)      $ (583)       $256,530

Comprehensive income:

Net earnings                           --            --          --         25,292          --           --          25,292
Change in unrealized loss
  from interest rate swaps             --            --          --             --          --         (355)           (355)
                                                                                                                    -------
Total comprehensive income                                                                                           24,937                                                                                                         9,815
                                                                                                                    -------
Amortization of restricted
  stock                                --            --         317             --          --           --             317
Issuance of shares to
  retirement plans                     11           219          --             --          --           --             219
Issuance of shares pursuant
   to restricted stock award           30           690        (690)            --          --           --              --
Issuance of shares pursuant
   to exercise of stock
   options                            407         4,460          --             --          --           --           4,460
Tax benefit of stock options
   exercised                           --         6,068          --             --          --           --           6,068
                                   ------      --------       -----       --------     -------       ------        --------
Balance, September 29, 2002        21,970      $190,224       $(895)      $104,299     $  (159)      $ (938)       $292,531
                                   ======      ========       =====       ========     =======       ======        ========`

See accompanying notes to consolidated financial statements

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# RARE Hospitality International, Inc. and Subsidiaries
                                Condensed Consolidated Statements of Cash Flows
                                           (In thousands, unaudited)

`Nine Months Ended
                                                                                    -----------------
                                                                             Sept. 29,             Sept. 30,
                                                                               2002                  2001
                                                                               ----                  ----
Cash Flows from operating activities:
   Net earnings                                                             $  25,292               $ 20,604
   Adjustments to reconcile net earnings to
     net cash provided by operating activities:
       Depreciation and amortization                                           18,825                 17,682
       Changes in working capital accounts                                     (6,421)               (11,864)
       Minority interest                                                          387                    531
       Deferred tax(benefit) expense                                              954                    (54)
       Issuance of common stock to employee
         retirement plans                                                         219                    441
                                                                            ---------               --------
   Net cash provided by operating activities                                   39,256                 27,340
                                                                            ---------               --------
Cash flows from investing activities:
   Purchase of property and equipment                                         (36,201)               (33,880)
   Purchase of short-term investments                                         (15,000)                     -
                                                                            ---------               --------
   Net cash used by investing activities                                      (51,201)               (33,880)
                                                                            ---------               --------
Cash flows from financing activities:
   Proceeds from (repayments of) credit facilities                              5,000                (41,000)
   Proceeds from issuance of common stock                                           -                 57,623
   Distributions to minority partners                                            (346)                  (646)
   Increase (Decrease) in bank overdraft included in accounts
     payable                                                                     (735)                   378
   Principal payments on capital leases                                           (58)                   (31)
   Purchase of common stock for treasury                                            -                   (159)
   Proceeds from exercise of stock options                                      4,460                  3,800
                                                                            ---------               --------
   Net cash provided by financing activities                                    8,321                 19,965
                                                                            ---------               --------
Net (decrease) increase in cash and cash equivalents                           (3,624)                13,425
Cash and cash equivalents, beginning of period                                 25,979                  3,771
                                                                            ---------               --------
Cash and cash equivalents, end of period                                    $  22,355               $ 17,196
                                                                            =========               ========
Supplemental disclosure of cash flow information
   Cash paid for income taxes                                               $   4,442               $ 11,666
                                                                            =========               ========
   Cash paid for interest                                                   $     923               $  1,297
                                                                            =========               ========`

See accompanying notes to consolidated financial statements

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# RARE Hospitality International, Inc.
                                  Notes to Consolidated Financial Statements
                                                  (Unaudited)

1.    Basis of Presentation

The consolidated financial
statements of RARE Hospitality International, Inc. and subsidiaries (the
Company) as of September 29, 2002 and December 30, 2001 and for the
quarters and nine months ended September 29, 2002 and September 30, 2001 have
been prepared by the Company, pursuant to the rules and regulations of the
Securities and Exchange Commission. The information furnished herein reflects
all adjustments (consisting of normal recurring accruals and adjustments), which
are, in the opinion of management, necessary to fairly present the operating
results for the respective periods. Certain information and footnote disclosures
normally presented in annual financial statements prepared in accordance with
generally accepted accounting principles have been omitted pursuant to such
rules and regulations. These financial statements should be read in conjunction
with the consolidated financial statements and notes thereto contained in the
Companys Annual Report on Form 10-K for the year ended December 30, 2001.

The Company operates on a
52- or 53-week fiscal year ending on the last Sunday in each calendar year. Each
of the four fiscal quarters is typically made up of 13 weeks. The fiscal
quarters and year-to-date periods ended September 29, 2002 and September 30,
2001 each contained 13 weeks and 39 weeks, respectively.

2.       New Accounting Pronouncements

In November 2001, the
Emerging Issues Task Force (EITF) of the Financial Accounting
Standards Board (FASB) reached a consensus on EITF Issue 01-9,
Accounting for Consideration Given by a Vendor to a Customer. EITF
01-9 addresses the recognition, measurement and income statement classification
for sales incentives offered to customers. Sales incentives include discounts,
coupons, free products or services and generally any other offers that entitle a
customer to receive a reduction in the price of a product. Under EITF 01-9, the
reduction in the selling price of the product resulting from any sales
incentives should be classified as a reduction of revenue. Historically, the
Company recognized certain sales incentives as restaurant operating and general
and administrative expenses. Although this pronouncement does not have any
impact on the Companys consolidated results of operations or financial
position, the presentation prescribed has the effect of reducing sales,
restaurant operating expense, and general and administrative expenses. Due to
the adoption of EITF 01-9 as of the beginning of fiscal 2002, sales, restaurant
operating expense, and general and administrative expenses have been restated
for the third quarter and first nine months of 2001 to conform to the new
presentation requirement. Same store sales comparisons for each of the
Companys restaurant concepts for the third quarter of 2002, consist of
sales at restaurants opened prior to January 1, 2001 and, consistent with prior
years, are calculated using sales prior to being reduced for discounts, coupons,
free products or services.

The Company adopted
Statement of Financial Accounting Standards (SFAS) No. 142,
Goodwill and Other Intangible Assets, effective as of the beginning
of fiscal year 2002. SFAS No. 142 requires that an intangible asset that is
acquired shall be initially recognized and measured based on its fair value.
This Statement also provides that goodwill should not be amortized, but shall be
tested for impairment annually, or more frequently if circumstances indicate
potential impairment, through a comparison of fair value to its carrying amount.
In the first quarter of fiscal 2002, the Company ceased amortization of goodwill
and performed the required goodwill impairment testing. The impairment test
requires the Company to compare the fair value of each reporting unit to its
carrying value to determine whether there is an indication that an impairment
may exist. If an impairment of goodwill is determined to exist, it is measured
as the excess of its carrying value over its fair value. Upon performing the
initial test of the carrying value of the Companys goodwill, it was
concluded that there was no current indication of impairment to goodwill.
Accordingly, no impairment losses were recorded upon the initial adoption of
SFAS No. 142.

As of the date of adoption,
the Company had unamortized goodwill in the amount of approximately $19.2
million. Amortization expense related to goodwill was $272,000 and approximately
$1.1 million for the third quarter of 2001 and fiscal year 2001, respectively.
In accordance with SFAS No. 142, no goodwill amortization expense was recorded
in the Companys financial statements for the third quarter of 2002. For
the foreseeable future, management believes the only impact on the
Companys consolidated financial statements from the adoption of SFAS 142
will be the elimination of goodwill amortization expense.

The pro forma effects of
the adoption of SFAS No. 142 on net earnings and basic and diluted earnings per
share is as follows (in thousands, except per share amounts):

`Quarter Ended                        Nine Months Ended
                                                     -------------                        -----------------
                                              Sept. 29,           Sept. 30,           Sept. 29,        Sept. 30,
                                                2002                2001                2002             2001
                                              --------            --------            --------          -------
Net earnings, as reported                     $  6,416            $  4,681           $  25,292        $  20,604
Goodwill amortization, net of
      tax benefit                                    -                 169                   -              506
                                             ---------           ---------            --------         --------
Net earnings, pro forma                       $  6,416            $  4,850           $  25,292        $  21,110
                                             =========           =========            ========         ========
Basic earnings per common share:
Net earnings, as reported                     $   0.29            $   0.22           $    1.17        $    0.99
Goodwill amortization, net of
      tax benefit                                    -                0.01                   -             0.02
                                             ---------           ---------            --------         --------
Net Earnings, pro forma                       $   0.29            $   0.23           $    1.17        $    1.01
                                             =========           =========            ========         ========
Diluted earnings per common share:
Net earnings, as reported                     $   0.28            $   0.21           $    1.11        $    0.93
Goodwill amortization, net of
      tax benefit                                    -                0.01                   -             0.02
                                             ---------           ---------            --------         --------
Net Earnings, pro forma                       $   0.28            $   0.22           $    1.11        $    0.95
                                             =========           =========            ========         ========`

In October 2001, the Financial  Accounting  Standards Board issued SFAS No. 144,  "Accounting for the Impairment of Long-Lived Assets",
which supercedes SFAS No. 121,  "Accounting for the Impairment of Long-Lived  Assets and for Long-Lived  Assets to be Disposed of", and
the  accounting and reporting  provisions of APB No. 30,  "Reporting the Results of Operations - Reporting the Effects of Disposal of a
Segment of a Business, and Extraordinary,  Unusual and Infrequently  Occurring Events and Transactions",  for the disposal of a segment
of a business.  SFAS No. 144 retains many of the provisions of SFAS No. 121, but addresses  certain  implementation  issues  associated
with that  statement.  The Company  adopted  SFAS No. 144  effective as of the  beginning of fiscal 2002.  The adoption of SFAS No. 144
did not have a material impact on the Company's consolidated financial statements.

3.    Long-Term Debt

At September 29, 2002,
$15.0 million was outstanding under the Companys $100 million revolving
credit agreement at a weighted average interest rate of 7.77% after considering
the effect of the Companys interest rate swap agreement.

4.   Income Taxes

Income tax expense for the
third quarter and first nine months of 2002 was 32.5% of earnings before income
taxes, which reflects the effective tax rate expected to be applicable for the
full 2002 fiscal year. The effective income tax rate differs from applying the
statutory federal income tax rate of 35% to pre-tax earnings primarily due to
employee FICA tip tax credits (a reduction in income tax expense) and work
opportunity tax credits partially offset by state income taxes.

5.    Earnings Per Share

Basic earnings per common
share equals net earnings divided by the weighted average number of common
shares outstanding and does not include the dilutive effect of stock options or
restricted stock. Diluted earnings per common share equals net earnings divided
by the weighted average number of common shares outstanding, after giving effect
to dilutive stock options and restricted stock. A reconciliation between basic
and diluted weighted average shares outstanding and the related earnings per
share calculation is presented below (in thousands, except per share amounts):

`Quarter Ended                   Nine Months Ended
                                                         -------------                   -----------------
                                                   Sept. 29,        Sept. 30,         Sept. 29,       Sept. 30,
                                                     2002             2001              2002            2001
                                                     ----             ----              ----           ----
Basic weighted average shares outstanding            21,820           21,337            21,681         20,876
Dilutive effect of stock options                      1,014              979             1,068          1,177
Dilutive effect of restricted stock                      90               69                92             72
                                                   --------         --------          --------       --------
Diluted weighted average shares outstanding          22,924           22,385            22,841         22,125
                                                   ========         ========          ========       ========
Net earnings                                       $  6,416         $  4,681          $ 25,292       $ 20,604
                                                   ========         ========          ========       ========
Basic earnings per common share                    $   0.29         $   0.22          $   1.17       $   0.99
                                                   ========         ========          ========       ========
Diluted earnings per common share                  $   0.28         $   0.21          $   1.11       $   0.93
                                                   ========         ========          ========       ========`

6. Derivative Instruments and Comprehensive Income

The Company uses an
interest rate swap agreement to effectively fix the interest rate on variable
rate borrowings under the Companys $100 million revolving credit facility.
This interest rate swap agreement is classified as a hedge of a cash flow
exposure and accordingly, the initial fair value and subsequent changes therein
was reported as a component of other comprehensive loss and subsequently
reclassified into earnings when the forecasted cash flows affect earnings. The
estimated fair value of the Companys interest rate swap agreement at
September 29, 2002 was a payable of $1,503,000 ($938,000 net of tax benefit).
Approximately $536,000 of the net payable was classified as current on September
29, 2002. A reconciliation of net earnings and total comprehensive income is as
follows (in thousands):

`Quarter Ended                          Nine Months Ended
                                                    ----------------                         ----------------
                                                Sept. 29,           Sept. 30,           Sept. 29,             Sept. 30,
                                                  2002                2001                2002                  2001
                                                 ------              ------              ------                ------

Net earnings                                      $6,416             $4,681             $ 25,292             $ 20,604
Cumulative effect of change in
  accounting principle                                --                 --                   --                 (624)
Change in unrealized loss from interest
  rate swap agreement                               (210)              (224)                (355)                 (49)
                                                --------           --------             --------             --------
Total comprehensive income                        $6,206             $4,457             $ 24,937             $ 19,931
                                                ========           ========             ========             ========`

7. Equity

On July 24, 2002, the
Company announced that its Board of Directors has extended until April 30, 2003,
its prior authorization for the Company to repurchase up to $15.0 million in
value of its common stock in the open market.

# Item 2.         Management's Discussion and Analysis of Financial Condition and Results of Operations

# Results of Operations

# Revenues

The Company currently
derives all of its revenues from restaurant sales and franchise revenues. Total
revenues increased 11.6% and 11.7% for the quarter and nine months ended
September 29, 2002, respectively, as compared to the same periods of the prior
fiscal year.

Same store sales
comparisons for each of the Companys restaurant concepts for the quarter
ended September 29, 2002, consist of sales at restaurants opened prior to
January 1, 2001 and are calculated using sales prior to being reduced for
discounts, coupons, free products or services.

LongHorn Steakhouse:

Sales in the LongHorn
Steakhouse restaurants for the quarter and nine months ended September 29, 2002
increased 13.0% and 13.2%, respectively, as compared to the same periods of the
prior year. The increases reflect a 9.0% and 10.2% increase in restaurant
operating weeks in the quarter and nine months ended September 29, 2002,
respectively, as compared to the same periods of the prior fiscal year,
resulting from an increase in the restaurant base from 152 LongHorn Steakhouse
restaurants at the end of the third quarter of 2001 to 166 at the end of the
third quarter of 2002 and an increase in average weekly sales. Average weekly
sales for all LongHorn Steakhouse restaurants in the third quarter of 2002 were
$47,287, a 3.7% increase over the comparable period in 2001. Same store sales
for the comparable LongHorn Steakhouse restaurants increased 1.8% in the third
quarter of 2002 as compared to the same period in 2001, primarily due to an
increase in customer counts and, to a lesser extent, an increase in average
check.

The Capital Grille:

Sales in The Capital Grille
restaurants for the quarter and nine months ended September 29, 2002, increased
10.3% and 11.2%, respectively, as compared to the same periods of the prior
fiscal year. The increase reflects no increase in restaurant operating weeks for
the quarter and a 7.1% increase in restaurant operating weeks for the nine
months ended September 29, 2002, as compared to the same periods of the prior
fiscal year, resulting from the opening of one The Capital Grille restaurant
near the end of the second quarter of 2001. Average weekly sales for all The
Capital Grille restaurants in the third quarter of 2002 were $101,528, a 10.3%
increase from the comparable period in 2001. Same store sales for the comparable
The Capital Grille restaurants increased 8.4% in the third quarter of 2002,
primarily due to an increase in customer counts.

Bugaboo Creek:

Sales in the Bugaboo Creek
Steak House restaurants increased for the quarter and nine months ended
September 29, 2002, by 6.0% and 4.8%, respectively, as compared to the same
periods of the prior fiscal year. The increase reflects a 5.3% and 2.7% increase
in restaurant weeks in the quarter and nine months ended September 29, 2002,
respectively, as compared to the same periods of the prior fiscal year,
resulting from an increase in the restaurant base from 19 Bugaboo Creek Steak
House restaurants at the end of the third quarter of 2001 to 20 restaurants at
the end of the third quarter of 2002. Average weekly sales for all Bugaboo Creek
Steak House restaurants in the third quarter of 2002 were $68,315, a 0.7%
increase from the comparable period for 2001. Same store sales for the
comparable Bugaboo Creek Steak House restaurants in the third quarter of 2002
decreased 0.7% as compared to the same period in 2001, due to a decrease in
customer counts.

Franchise Revenue:

Franchise revenues
increased to $84,000 for the third quarter of 2002, from $79,000 for the same
period in 2001.

Costs and Expenses

Cost of restaurant sales as
a percentage of restaurant sales decreased to 36.0% for the third quarter of
2002 from 36.9% for the third quarter of 2001 and decreased to 36.2% for the
nine months ended September 29, 2002 as compared to 36.5% during the same period
of 2001. For the third quarter, this decrease resulted from favorable red meat
pricing and menu mix shifts. For the nine month period ended September 29, 2002
favorable pricing on red meat was partially offset by higher produce costs. The
Company is currently under fixed price contracts with respect to all of its beef
products and these contracts are in effect for the remainder of 2002.

Restaurant operating
expense as a percentage of restaurant sales decreased to 45.6% for the third
quarter of 2002 from 45.9% for the third quarter of 2001 and increased to 44.1%
for the first nine months of 2002, as compared to 43.8% for the same period of
2001. The decrease in restaurant operating expenses as a percentage of
restaurant sales for the third quarter of 2002 as compared to the same period of
the prior year was primarily due to decreases in advertising and promotional
expenses and, to a lesser extent, decreases in utility and operating supply
expense. The increase in restaurant operating expense, as a percentage of
restaurant sales for the comparable nine month period, was primarily due to an
increase in restaurant labor costs.

Restaurant depreciation as
a percentage of restaurant sales remained essentially flat at 4.2% for the third
quarter and 4.1% for the first nine months of 2002 as compared to 4.3% and 4.0%,
respectively, for the same periods of the prior fiscal year.

Pre-opening expense for the
first nine months of 2002 was $2.7 million, a decrease from $3.3 million in the
same period of the prior year. This decrease was due to the 13 restaurants
opened during the first nine months of 2002 as compared to 15 restaurants opened
in the same period of the prior year.

General and administrative
expenses, as a percentage of total revenues, remained flat at 6.3% for the third
quarter of 2002 and 2001, and decreased to 5.9% for the nine months ended
September 29, 2002 from 6.1% for the same period of 2001. The decrease was
principally due to greater leverage of fixed and semi-fixed general and
administrative expenses resulting from the higher average weekly sales volumes.

As a result of the
relationships between revenues and expenses discussed above, the Companys
operating income increased to $10.1 million for the third quarter of 2002 and
increased to $39.3 million for the first nine months of 2002 as compared to $7.6
million and $33.9 million, respectively, for the same periods of the prior year.

Interest expense, net
increased slightly to $528,000 in the third quarter of 2002 from $491,000 in the
same period of the prior year.

Minority interest expense
decreased to $87,000 for the third quarter of 2002 from $131,000 for the same
period of the prior year primarily due to the Companys acquisition of two
joint venture restaurants from two joint venture partners in 2002.

Income tax expense for the
third quarter and first nine months ended September 29, 2002 was 32.5% of
earnings before income taxes, which reflects the effective tax rate expected to
be applicable for the full 2002 fiscal year. These rates in 2002 compare to
rates of 33.0% and 32.8% for the quarter and nine months ended September 30,
2001, respectively. The Companys effective income tax rate differs from
applying the statutory federal income tax rate of 35% to pre-tax income,
primarily due to employee FICA tip tax credits and work opportunity tax credits
partially offset by state income taxes.

Net earnings increased to
$6.4 million for the third quarter of 2002 from net earnings of $4.7 million for
the third quarter of 2001 and increased to $25.3 million for the nine months
ended September 29, 2002 from $20.6 million for the nine months ended September
30, 2001, reflecting the net effect of the items discussed above.

Liquidity and Capital Resources:

The Company requires
capital primarily for the development of new restaurants, selected acquisitions
and the remodeling of existing restaurants. During the first nine months of 2002
the Companys principal sources of working capital were cash provided by
operating activities ($39.2 million), proceeds from borrowings under the
Companys revolving credit facility ($5.0 million) and proceeds from the
exercise of employee stock options ($4.5 million). For the first nine months of
2002, the principal uses of working capital were capital expenditures ($36.2
million) for new and improved facilities and the purchase of short-term
investments ($15.0 million). As of September 29, 2002, the Company had $15.0
million outstanding under the Companys $100 million revolving credit
facility.

The Company intends to open
an aggregate 17 Company-owned LongHorn Steakhouse restaurants, and three Bugaboo
Creek Steak House restaurants in fiscal year 2002. The Company estimates that
its capital expenditures for fiscal year 2002 will be approximately $50-55
million. During the first nine months of 2002, the Company opened 13 LongHorn
Steakhouse restaurants and one Bugaboo Creek Steak House restaurant. Four
additional LongHorn Steakhouse restaurants and two Bugaboo Creek Steak House
restaurants are expected to be opened by the end of 2002. Management believes
that available cash, cash provided by operations, and available borrowings under
the Companys $100 million revolving credit facility will provide
sufficient funds to finance the Companys expansion plans through the year
2005.

Since substantially all
sales in the Companys restaurants are for cash, and accounts payable are
generally due in seven to 30 days, the Company may operate with little or
negative working capital.

Forward-Looking Statements

Statements contained in
this Report concerning future results, performance or expectations are
forward-looking statements within the meaning of Section 21E of the Securities
Exchange Act of 1934, as amended. All forward-looking statements in this Report
are made based upon managements current expectations or beliefs, as well
as assumptions made by, and information currently available to, the Company on
the date of this Report. All forward-looking statements involve risks and
uncertainties that could cause actual results, performance or developments to
differ materially from those expressed or implied by those forward-looking
statements, such as: the Companys ability to open the anticipated number
of new restaurants on time and within budget; the Companys ability to
continue to increase same-store sales at anticipated rates; a recession or other
negative effect on business dining patterns, or some other negative effect on
the economy in general; the effect upon dining patterns and the economy in
general, of war, insurrection and/or terrorist attacks on United Sates soil;
unexpected increases in cost of sales or other expenses; and the impact of any
negative publicity or public attitudes related to the consumption of beef. Other
risks and uncertainties include fluctuations in quarterly operating results,
seasonality, guest trends, competition and risks associated with the development
and management of new restaurant sites. More information about factors that
potentially may affect the Companys results, performance or development is
included in the Companys other filings with the Securities and Exchange
Commission, including its annual report on Form 10-K for the year ended December
30, 2001, and the Companys press releases and other communications.

# Item 3. Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Risk

As of November 1, 2002,
$15.0 million was outstanding under the Companys $100 million revolving
credit facility. Amounts outstanding under such credit facility bear interest at
LIBOR plus a margin of 1.25% to 2.0% (depending on the Companys leverage
ratio), or the administrative agents prime rate of interest plus a margin
of 0% to 0.75% (depending on the Companys leverage ratio) at the
Companys option. Accordingly, the Company is exposed to the impact of
interest rate fluctuations. To achieve the Companys objective of managing
its exposure to interest rate changes, the Company from time to time uses
interest rate swaps.

The Company has used an
interest rate swap as a hedging agreement to effectively fix the interest rate
at 6.52%, plus the margin on a notional principal amount of $15.0 million from
July 2002 through March 2003, and $17.5 million from April 2003 through August
2004.

While changes in LIBOR and
the administrative agents prime rate of interest could affect the cost of
borrowings under the credit facility in excess of amounts covered by the hedging
agreement in the future, the Company does not consider its current exposure to
changes in such rates to be material, and the Company believes that the effect,
if any, of reasonably possible near-term changes in interest rates on the
Companys financial condition, results of operations or cash flows would
not be material.

Investment Portfolio

The Company invests
portions of its excess cash, if any, in highly liquid investments. At September
29, 2002, the Company had $20.6 million invested in high-grade overnight
repurchase agreements, and $15.0 million in short-term investments in the form
of Federal, state and municipal bonds. As of September 29, 2002, the Company has
classified all short-term investments as trading securities.

# Item 4. Controls and Procedures

In October 2002, an
evaluation was performed, under the supervision and with the participation of
the Companys management, including the Chief Executive Officer and Chief
Financial Officer, of the effectiveness of the design and operation of the
Companys disclosure controls and procedures. Our evaluation tested
controls and other procedures designed to ensure that information required to be
disclosed by us in the reports that we file or submit under the Securities
Exchange Act of 1934, as amended (the Act), is recorded, processed,
summarized and reported, within the time periods specified in the Securities and
Exchange Commissions rules and forms. Based upon that evaluation, the
Chief Executive Officer and the Chief Financial Officer concluded that
information required to be disclosed in our reports that we file or submit under
the Act is accumulated and communicated to management, including our Chief
Executive Officer and Chief Financial Officer, as appropriate in a manner that
allows timely decisions regarding required disclosure.

In addition, there have
been no significant changes in the Companys internal controls or in other
factors that could significantly affect these controls subsequent to the date of
their evaluation.

# Part II - Other Information

# Item 1. Legal Proceedings

None

# Item 2.  Changes in Securities and Use of Proceeds

None

# Item 3. Defaults Upon Senior Securities

None

# Item 4. Submission of Matters to a Vote of Securities Holders

None

# Item 5. Other Information

None

# Item 6. Exhibits and Reports on Form 8-K

| | (a) | Exhibits Filed.

99.1    Written Statement of the Chief Executive Officer
99.2    Written Statement of the Chief Financial Officer
| | --- | ----------------------------------------------------------------------------------------------------------------------------------

| | (b) | Reports filed on Form 8-K.

                None
| | --- | ------------------------------------------------

---

# Signatures

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.

`/s/ Philip J. Hickey, Jr.
                           -------------------------
                           Philip J. Hickey, Jr.
                           Chairman of the Board and
                           Chief Executive Officer
                           (Principal Executive Officer)

                           /s/ W. Douglas Benn
                           -------------------------
                           W. Douglas Benn
                           Executive Vice President, Finance
                           and Chief Financial Officer
                           (Principal Financial and
                           Accounting Officer)


         Date:             November 13, 2002
                           -----------------`

---

# Certifications

I, Philip J. Hickey, Jr., certify that:

|1. | I have reviewed this quarterly report on Form 10-Q of RARE Hospitality International, Inc.;
|-- | -------------------------------------------------------------------------------------------

|2. | Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under
which such statements were made, not misleading with respect to the period
covered by this quarterly report;
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|3. | Based on my knowledge, the financial statements, and other financial information
included in this quarterly report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as
of, and for, the periods presented in this quarterly report;
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4. | The registrants other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | a) | designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this quarterly report is being prepared;
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | b) | evaluated the effectiveness of the registrants disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the Evaluation Date); and
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | c) | presented in this quarterly report our conclusions about the effectiveness of
the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------

|5. | The registrants other certifying officer and I have disclosed, based on
our most recent evaluation, to the registrants auditors and the audit
committee of registrants board of directors (or persons performing the
equivalent function):
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | a) | all significant deficiencies in the design or operation of internal controls which
could adversely affect the registrants ability to record, process,
summarize and report financial data and have identified for the
registrants auditors any material weaknesses in internal controls; and
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | b) | any
fraud, whether or not material, that involves management or other employees who
have a significant role in the registrants internal controls; and
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------

|6. | The registrants other certifying officer and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

`November 13, 2002                           /s/ PHILIP J. HICKEY, JR.
                                            -------------------------
                                            Philip J. Hickey, Jr.
                                            Chairman of the Board and
                                            Chief Executive Officer`

---

I, W. Douglas Benn, certify that:

|1. | I have reviewed this quarterly report on Form 10-Q of RARE Hospitality International, Inc.;
|-- | -------------------------------------------------------------------------------------------

|2. | Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under
which such statements were made, not misleading with respect to the period
covered by this quarterly report;
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|3. | Based on my knowledge, the financial statements, and other financial information
included in this quarterly report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as
of, and for, the periods presented in this quarterly report;
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|4. | The registrants other certifying officer and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | a) | designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this quarterly report is being prepared;
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | b) | evaluated the effectiveness of the registrants disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the Evaluation Date); and
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | c) | presented in this quarterly report our conclusions about the effectiveness of
the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------

|5. | The registrants other certifying officer and I have disclosed, based on
our most recent evaluation, to the registrants auditors and the audit
committee of registrants board of directors (or persons performing the
equivalent function):
|-- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | a) | all significant deficiencies in the design or operation of internal controls which
could adversely affect the registrants ability to record, process,
summarize and report financial data and have identified for the
registrants auditors any material weaknesses in internal controls; and
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | b) | any
fraud, whether or not material, that involves management or other employees who
have a significant role in the registrants internal controls; and
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------

|6. | The registrants other certifying officer and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
|-- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

`November 13, 2002                                    /s/ W. DOUGLAS BENN
                                                     -------------------
                                                     W. Douglas Benn
                                                     Executive Vice President, Finance and
                                                     Chief Financial Officer`