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                                                                    EXHIBIT 99.1

                                  BRIAZZ, INC.

                                  RISK FACTORS

                          RISKS RELATED TO OUR BUSINESS

WE HAVE A HISTORY OF LOSSES AND ANTICIPATE CONTINUED LOSSES IN THE FUTURE, WHICH
MAY HAVE A MATERIAL ADVERSE EFFECT ON OUR BUSINESS, OUR ABILITY TO IMPLEMENT OUR
BUSINESS STRATEGY AND OUR STOCK PRICE.

We incurred losses of $12.5 million during the fiscal year ended December 27,
1998, $15.4 million during the fiscal year ended December 26, 1999, $6.3 million
during the fiscal year ended December 31, 2000, $6.8 million during the fiscal
year ended December 30, 2001, $15.1 million during the fiscal year ended
December 29, 2002 and $8.1 million for the 39-weeks ended September 28, 2003.
Since inception, we had accumulated net losses of approximately $70 million
through September 28, 2003 and have experienced negative cash flows from
operations. These matters raise substantial doubt about our ability to continue
as a going concern. Our ability to continue as a going concern is dependent upon
numerous factors, including our ability to obtain additional financing, our
ability to increase our level of future revenues and our ability to reduce
operating expenses. Failure to achieve profitability, or maintain profitability
if achieved, may have a material adverse effect on our business, our ability to
implement our business strategy and our stock price. It is anticipated that
additional cash will be needed by the end of 2003 in order to continue
operating.

There can be no assurance that we will be able to obtain additional financing,
increase revenues, reduce expenses or successfully complete other steps to
continue as a going concern. Due to the substantial number of shares issuable
upon conversion of our Series F Convertible Preferred Stock, we may be unable to
negotiate subsequent equity financings on terms favorable to us, or at all. In
addition, our existing debt represents a substantial percentage of our asset
value. As a result of this high level of leverage, we may find it difficult to
incur additional debt, either in the form of an operating line of credit or
discretionary debt financing. If we are unable to obtain sufficient funds to
satisfy our cash requirements, we may be forced to substantially reduce and/or
curtail operations. Such events would materially and adversely affect our
financial position and results of operations.

OUR BUSINESS STRATEGY IS TO FOCUS OUR EFFORTS ON IMPROVING OUR FINANCIAL
PERFORMANCE THROUGH A COMBINATION OF COST CUTTING MEASURES AND NEW CORPORATE
DEVELOPMENT INITIATIVES. OUR INABILITY TO IMPLEMENT OUR BUSINESS STRATEGY WOULD
HAVE A MATERIAL ADVERSE EFFECT ON OUR OPERATING RESULTS AND PROSPECTS.

Our business strategy is to focus our efforts on achieving profitability through
a combination of cost cutting measures and new corporate development
initiatives, which may include licensing or franchising our products to third
parties and securing additional wholesale accounts. The success of our business
strategy will depend in part upon our ability to conclude agreements with
retailers, wholesalers or others who may license, resell or purchase a franchise
for our products. We are working with Flying Food Group ("FFG") to test the sale
of our food products through Starbuck's; however, we have not entered into any
agreement with FFG or Starbuck's and the test may be discontinued at any time.
We may be unable to conclude agreements with third parties on terms favorable to
us, or at all. In addition, in order to enter into agreements with these
parties, we may need to recruit additional management and raise additional
capital.

If we enter into agreements with third party distributors of our products, our
existing cafe management systems, financial and management controls and
information systems may not be adequate to support our planned expansion. Our
ability to manage our growth effectively will require us to continue to expend
funds to improve these systems, procedures and controls, which we expect will
increase our operating expenses and capital requirements. In addition, we must
effectively expand, train and manage our work force. We cannot assure you that
we will be able to respond on a timely basis to all of the changing demands that
our planned expansion will impose on management and on our existing systems,
procedures and controls. In addition, we cannot assure you that we will be able
to continue to improve our information systems and financial controls or to
manage other factors necessary for us to achieve our growth strategy. For any of
these reasons, we could lose opportunities or overextend our resources, which
could adversely affect our operating results.

In addition, agreements with third party distributors may prove to be
unsuccessful. In the past, we distributed our products through Quality Food
Centers, Albertson's, Safeway, Ralph's and Dominick's grocery stores and through
Target stores. We also developed a line of dinner foods for home meal
replacement that was tested through one of our Seattle cafes. These attempts
were unsuccessful and have been discontinued. Following the discontinuation of
these relationships, we evaluated the grocery segment of our wholesale business
and decided to withdraw from this distribution channel.



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As part of our strategy to improve our financial performance, we are continuing
to review our cost structure and to make cost reductions where possible. In the
last year, we have taken significant steps designed to reduce our costs,
including personnel reductions, reductions in general and administrative
expenses, reorganization of certain business operations, elimination of certain
wholesale accounts, discontinuation of branded sales in the Los Angels market,
and closure of certain cafes, in addition to the closure of our Seattle, Chicago
and Los Angeles central kitchens and the outsourcing of our food production in
those markets to third party suppliers. We will continue to seek to reduce our
general and administration and other expenses in order to improve our margins
and help us achieve profitability. We cannot assure you that we will be able to
achieve the desired level of cost reductions or that such reductions, if
achieved, will not have an adverse impact on our revenues. If we are not able to
sufficiently reduce our costs or implement new distribution relationships on
terms favorable to us, we will continue to experience losses which will have a
material adverse affect on our business.

WE HAVE ENTERED INTO A TEST AGREEMENT WITH BORDERS, INC. TO OPERATE AND MANAGE
CAFES IN EIGHT BORDERS LOCATIONS. EVEN IF THE TEST IS SUCCESSFUL, THE TEST MAY
NOT BE EXTENDED.

We have signed an agreement with Borders, Inc. to manage and operate the cafe
portion of 8 stores on a test basis for a period of six months after the last
test store is opened. We will retain all the receipts generated from these cafes
and be responsible for substantially all of the costs resulting from the
operations of these cafes. In exchange, the Company will pay Borders an amount
equal to $60,000 for each cafe opened, or a total amount of $480,000, for
improvements made to the cafes. In addition, we will pay a base rent. There can
be no assurance that upon the end of the test period, even if the test proves to
be successful, that the agreement will be extended.

WE HAVE NOT MADE RENT PAYMENTS ON CERTAIN OF OUR LEASES AND PAYMENTS TO CERTAIN
OF OUR SUPPLIERS. IF WE ARE UNABLE TO MEET OUR OBLIGATIONS TO THIRD PARTIES, WE
MAY BE REQUIRED TO DISCONTINUE OUR OPERATIONS.

We have deferred payments to certain of our landlords and suppliers, including
FFG. If our landlords or our suppliers require payments in excess of our
available cash, we may be required to close cafes, discontinue use of suppliers,
limit our product offerings or cease operations altogether. Any such action by
our landlords or suppliers may also cause an event of default under the terms of
our debt financings or our other contractual relationships, or adversely affect
our relationships with other third parties, all of which would adversely affect
our operations.

WE HAVE BECOME INCREASINGLY DEPENDENT UPON THIRD PARTIES FOR THE SUPPLY,
QUALITY, SAFETY AND COST OF OUR FOOD PRODUCTS.

As we complete our transition to outsourcing of food production, we are, and
will increasingly be, dependent on third parties for the production and assembly
of our food products. Any failure or delay by them to manufacture and assemble
our food products, even for a short period of time, would impair our ability to
supply our cafes and would harm our business. We cannot assure you that we will
be able to maintain satisfactory relationships with these third parties on
acceptable commercial terms. Nor can we assure you that they will continue to
provide food products that meet our quality standards. Our agreement with FFG,
which produces substantially all our food products in Seattle and Chicago and
subcontracts such production to HEMA Foods, Inc. ("HEMA") in Los Angeles, may
permit FFG to terminate our relationship on short notice. HEMA may terminate its
relationship with FFG, and FFG may have difficulty assuming or subcontracting
its obligations in Los Angeles, on short notice. In addition, we do not have any
direct contractual relationship with HEMA. If any of our food production
relationships were to terminate unexpectedly, we may have difficulty obtaining,
manufacturing and assembling our food products, or obtaining adequate quantities
of products, at the same quality at competitive prices in a timely fashion,
which could limit our ability to adequately supply our cafes and could adversely
affect our operating results. If we were unable to find another third party to
produce our food products on acceptable terms, we might be required to
reestablish central kitchens or to discontinue our operations.

WE HAVE TRANSFERRED MOST OF OUR CENTRAL KITCHEN EQUIPMENT TO FFG, WHICH LIMITS
OUR ABILITY TO ESTABLISH NEW CENTRAL KITCHENS SHOULD IT BECOME NECESSARY TO DO
SO.

As part of the food production agreement with FFG, we agreed to transfer to FFG
without charge any of our central kitchen equipment that may be requested by
FFG. Pursuant to this agreement, we have transferred certain of our central
kitchen equipment to FFG in the Chicago and Seattle and certain other equipment
to HEMA in Los Angeles. If the production agreement is terminated within one
year following commencement of production, FFG will return the equipment to us.
Otherwise, FFG will retain all transferred equipment. As a result of the
equipment transfers, we will find it necessary to acquire new equipment should
we enter into markets where FFG does not have an existing central kitchen or
declines to provide services, or should we cease to use FFG in an existing
market. Due to the high cost of equipment, any future need to acquire such
equipment could have a material adverse effect on our results. In addition, we
may not have adequate capital to procure the



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required equipment. Further, we may not be able to acquire necessary equipment
in a timely manner and, as a result, may not be able to meet food production
requirements. Any failure to acquire necessary equipment could have a material
adverse effect on our business and results.

WE MAY FACE COMPETITION FROM FFG OR ITS CUSTOMERS PROVIDING SIMILAR PRODUCTS TO
THOSE WE MARKET.

While the food production agreement with FFG generally prohibits FFG from using
our trademarks for its own purposes, it does not forbid FFG from using the same
food formulations, recipes or ingredients for products that it sells to the food
service industry. FFG may thus compete with us directly by selling the same or
similar products to wholesalers that we target for wholesale accounts. In such
event, we will not be able to offer products at a competitive price compared to
FFG. FFG may also sell such products to wholesalers or retailers with whom we
compete. In the event of such sales, we may not be able to offer products at a
competitive price compared to wholesalers or retailers who purchased the similar
products from FFG because these retailers and wholesalers were not required to
invest the large amounts we spend in product development, and may not be
required to provide FFG with the same profit factor as we are under the food
production agreement. In any such case, we may lose customers to FFG or to these
wholesalers and retailers, and our business and results may suffer materially.

IF WE ARE UNABLE TO COMPLETE OUR ANNOUNCED SAN FRANCISCO CENTRAL KITCHEN CLOSURE
AND TRANSITION TO OUTSOURCING OUR CENTRAL KITCHEN FUNCTIONS ON TERMS FAVORABLE
TO US, OUR BUSINESS MAY BE HARMED.

We intend to close our remaining central kitchen in the San Francisco market and
outsource our food production in that market. FFG does not currently have
sufficient capacity to assume our food production in this market, and it has not
entered into any subcontract arrangement in this market for the production of
our food. We intend, therefore, to outsource our food production to another
third party. The timing and benefits of this transition will depend on a number
of factors, many of which are outside our control, including maintaining product
quality, ensuring adequate product quantities, the closing of our remaining
central kitchen in San Francisco, including the transfer or sale of equipment,
termination or transfer of staff and termination or sublease of the space, and
transfer of the central kitchen functions to a supplier other than FFG,
including hiring, training, production and assembly and coordination of
functions.

ANY DEFAULT IN THE REPAYMENT OF THE CONVERTIBLE NOTE HELD BY LAURUS MASTER FUND,
LTD. (LAURUS) COULD HAVE A MATERIAL ADVERSE AFFECT ON OUR BUSINESS, PROSPECTS,
RESULTS OF OPERATIONS OR FINANCIAL CONDITION.

Upon completion of the DB financing, we made a $300,000 principal payment on our
$1.25 million convertible note, reducing the principal amount to $626,400. In
October 2003, we made an additional principal payment of $52,000 reducing the
balance to $574,400. This unpaid principal amount, together with a $75,000 fee
relating to the $300,000 prepayment, is payable in 12 equal installments on the
first business day of each calendar month, beginning September 1, 2003. Accrued
and unpaid interest must also be paid monthly; however, Laurus has waived its
right to receive any interest payments until October 1, 2003. The amounts due
under the note are secured by a blanket security interest in all our assets. On
October 1, 2003, the Company was in arrears on its interest and principal
payments to Laurus. Subsequently, in October 2003 the Company received a waiver
from Laurus in which Laurus agreed to waive any defaults resulting from the late
payment of the monthly amount due October 1, 2003 and agreed to make all
payments due and payable under the note from October 1, 2003 to November 15,
2003 due and payable on November 16, 2003 and waived any defaults and penalties
resulting from the postponement of payments. The current principal balance of
this note is approximately $574,400, the amount currently due in fees is
approximately $68,750 and the past due interest as of November 1, 2003 is
approximately $60,000.

In some circumstances, the note is convertible into shares of our common stock.
The conversion price under the note is $0.10 per share for the first $350,700
converted into shares of our common stock after July 31, 2003 and $0.30 per
share for any additional amounts converted into shares of our common stock.
Although the convertible note provides us with the option of making monthly
payments by issuing shares, the number of shares that we can issue with respect
to any payment is limited to 25% of the number of shares of our common stock
traded on our principal trading market during the 30 calendar day period
preceding the date on which we provide notice of repayment in shares, unless
waived by Laurus. Any additional amounts must be paid in cash. Due to the
limited trading volume of our shares in recent periods, we expect that our
ability to issue shares in satisfaction of the monthly payments will be very
limited. In addition, we are not permitted to make such payments in shares and
are required to make such payments in cash if any of the following events
occurs: (i) the average daily volume weighted average price of our shares on our
principal trading market for the 11 trading days preceding a payment date is
less than 115% of the applicable conversion price, (ii) there fails to exist an
effective resale registration statement with respect to the shares; or (iii)
there occurs any event of default. The events of default under the convertible
note are similar to those customary for convertible debt securities, including
breaches of material terms, failure to pay amounts owed, delisting of our common
stock from the OTC Bulletin Board or a national securities exchange, or failure
to comply with the reporting, filing or other obligations of listing on such
market. In the event that a payment default occurs and is continuing, Laurus may
convert all or



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part of any monthly payment into shares of our common stock at the lower of the
applicable fixed conversion price or 70% of the average of the three lowest
closing prices for our common stock on our principal trading market for the 30
trading days prior to the conversion date.

If we default on our obligations under the convertible note, or if we fail to
have a resale registration statement declared and maintained as effective with
respect to the shares, we may be required to immediately repay the outstanding
principal amount of the convertible note and any accrued and unpaid interest. We
do not currently have cash or cash equivalents or available debt or equity
financing sufficient to repay such amounts if such repayment is required.
Accordingly, we anticipate that additional financing would be required to repay
such amounts. We cannot guarantee that such financing would be available on
terms favorable to us, or at all. If we could not arrange for such financing on
favorable terms, our business and financial results would be materially
adversely affected. In the event of any sale or liquidation of our assets to
repay such debt, the note holder, as a secured party, would have priority over
other creditors and over our shareholders with respect to such assets and the
proceeds of such assets.

ANY DEFAULT IN THE REPAYMENT OF OUR $6.0 MILLION IN SENIOR SECURED NOTES COULD
HAVE A MATERIAL ADVERSE AFFECT ON OUR BUSINESS, PROSPECTS, RESULTS OF OPERATIONS
AND FINANCIAL CONDITION.

The principal and accrued and unpaid interest on the $6.0 million principal
amount of senior secured notes we issued to DB, Briazz Venture, L.L.C. (BV),
Spinnaker Investment Partners, L.P. (Spinnaker), and Delafield are due on August
1, 2005; provided, however, that the notes will accelerate and become due if we
(i) fail to pay any amount when due, (ii) fail to cure defaults under the notes
within ten days of notice or (iii) are forced to seek bankruptcy protection or
otherwise become insolvent. The amounts due under the notes are secured by a
blanket security interest in all our assets. If we are unable to pay any amount
when due, DB, BV, and Spinnaker may foreclose on our assets, which could
substantially adversely impact our ability to continue as a going concern. We do
not currently have cash or cash equivalents or available debt or equity
financing sufficient to repay the principal amounts if such repayment is
required. Accordingly, we anticipate that additional financing would be required
to repay such amounts. We cannot guarantee that such financing would be
available on terms favorable to us, or at all. If we cannot arrange for such
financing on favorable terms, our business and financial results would be
materially adversely affected. In the event of any sale or liquidation of our
assets to repay such debt, the note holders, as secured parties, would have
priority over other creditors and over our shareholders with respect to such
assets and the proceeds of such assets.

WE CONTINUE TO EXPERIENCE A DECLINE IN OUR SAME STORE SALES WHEN COMPARED TO
PRIOR PERIODS. IF THIS TREND CONTINUES WE MAY HAVE TO CLOSE ADDITIONAL STORES.

In the past, we have closed cafes because they did not generate sufficient
revenues and we cannot assure you that additional cafes will not be closed. For
the year ended December 29, 2002 and the 39-week period ended September 28,
2003, our same-store sales decreased compared to the prior fiscal periods. If
our same-store sales continue to decline or fail to sufficiently improve, we may
be required to close additional cafes. The closing of a significant number of
cafes or the failure to increase same-store sales could have an adverse impact
on our reputation, operations and financial results. During the 39-week period
ending September 28, 2003 we closed a total of 5 cafes. We expect to close one
additional cafe by the end of the year.

IF WE ARE UNABLE TO CONTINUE LEASING OUR RETAIL LOCATIONS OR OBTAIN ACCEPTABLE
LEASES FOR NEW CAFES, OUR BUSINESS MAY SUFFER.

All of our cafe locations are on leased premises. If we are unable to renew our
leases on acceptable terms, or if we are subject to substantial rent increases,
our business could suffer. Because we compete with other retailers for cafe
sites and because some landlords may grant exclusive rights to locations to our
competitors, we may not be able to obtain new leases or renew existing leases on
acceptable terms. Any inability to renew or obtain leases could increase our
costs and adversely affect our operating results and brand-building strategy.

OUR THIRD PARTY DISTRIBUTION STRATEGY COULD RESULT IN INCREASED COMPETITION IN
OUR EXISTING MARKETS. THIS STRATEGY COULD CAUSE SALES IN SOME OF OUR EXISTING
CAFES TO DECLINE.

In accordance with our expansion strategy, we may enter into agreements with
third parties to distribute our products through new distribution channels in
our existing markets. The presence of additional distribution channels in
existing markets may result in diminished sales performance and customer counts
for cafes near the area in which third parties distribute our products, due to
sales cannibalization.



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TENANT TURNOVER AND VACANCIES IN OFFICE BUILDINGS WHERE OUR CAFES ARE LOCATED
COULD CAUSE OUR CAFE SALES TO DECLINE.

Our business has and could continue to suffer as a result of tenant turnover and
vacancies. Many of our cafes are located in office buildings, and office workers
are our target customers. Vacancies, tenant turnover or tenants with few office
workers, especially in San Francisco and Seattle, have negatively impacted the
operations of our cafes located in office buildings during the last two years
due to the reduction in the number of potential customers in the building, and
could continue to have a negative impact on our operations. The risk related to
vacancies and tenant turnover is greater in office buildings with larger
tenants, where the loss of a single tenant may have a greater impact on that
cafe's sales.

IF PRODUCTION AT FFG AND HEMA CENTRAL KITCHENS OR OUR SAN FRANCISCO CENTRAL
KITCHEN IS INTERRUPTED, WE MAY BE UNABLE TO SUPPLY OUR CAFES IN THAT GEOGRAPHIC
MARKET AND OUR BUSINESS WILL SUFFER.

FFG's and HEMA's central kitchens and our San Francisco central kitchen produce
or distribute substantially all of our food products for the cafes and wholesale
accounts in their geographic regions, as well as all of the box lunches and
catered platters in each region. If any of these central kitchens were to close
for any reason, such as fire, natural disaster or failure to comply with
government regulations, we would be unable to provide our food products in the
areas served by the affected central kitchen. These central kitchens are
geographically dispersed and none could cost effectively supply another market
if a central kitchen were to close. As a result, the closure of any central
kitchen even for a short period of time would have a material adverse effect on
our operating results. We may have no control over any such closures.

WE ARE SUBSTANTIALLY DEPENDENT ON THIRD-PARTY SUPPLIERS AND DISTRIBUTORS AND THE
LOSS OF ANY ONE OF THEM COULD HARM OUR OPERATING RESULTS.

We are substantially dependent on a small number of suppliers and distributors
for our products, including FFG, HEMA, suppliers of meat, breads and soups, and
Sysco Distribution Services, which during the 39-weeks ended September 28, 2003
procured from our suppliers and delivered to us the majority of our ingredients
and packaging products. Most of our packaged products come from Bunzl, a
national distributor. Such packaged products represent roughly 15% of our
purchases. During the year ended December 29, 2002, Stockpot, Inc. provided
approximately 20% of our cost of food and packaging. Any failure or delay by any
of these suppliers or distributors to deliver products to our central kitchens,
even for a short period of time, would impair our ability to supply our cafes
and could harm our business. We have limited control over these third parties,
and we cannot assure you that we will be able to maintain satisfactory
relationships with any of them on acceptable commercial terms. Nor can we assure
you that they will continue to provide food products that meet our quality
standards. Our relationships with our suppliers are generally governed by
short-term contracts. If any of these relationships were to terminate
unexpectedly, we may have difficulty obtaining adequate quantities of products
of the same quality at competitive prices in a timely fashion, which could limit
our product offerings or our ability to adequately supply our cafes and could
adversely affect our operating results.

IF WE FAIL TO FURTHER DEVELOP AND MAINTAIN OUR BRAND, OUR BUSINESS COULD SUFFER.

We believe that maintaining and developing our brand is critical to our success
and that the importance of brand recognition may increase as a result of
competitors offering products similar to ours. Subject to available funding, we
intend to increase our marketing expenditures to create and maintain brand
loyalty and increase awareness of our brand. If our brand-building strategy is
unsuccessful, these expenses may never be recovered, and we may be unable to
increase or maintain our revenues.

Our success in promoting and enhancing the BRIAZZ brand will also depend on our
ability to provide customers with high-quality products, which is, in part,
dependent on the performance of FFG, HEMA and our San Francisco central kitchen,
and customer service. We cannot assure you that consumers will perceive our
products as being of high quality. If they do not, the value of our brand may be
diminished and, consequently, our ability to implement our business strategy may
be adversely affected.

IF OUR CUSTOMERS DO NOT PERCEIVE PRE-PACKAGED SANDWICHES AND SALADS AS FRESH AND
DESIRABLE, OR IF THEY WOULD PREFER MADE-TO-ORDER FOOD ITEMS, OUR OPERATING
RESULTS WILL SUFFER.

Our business strategy focuses on pre-packaged food items. All of our salads and
most of our sandwiches are prepared and assembled in central kitchens and sold
as pre-packaged items. Unlike delicatessens, our cafes generally do not add or
omit specific ingredients to or from food items at the customer's request. If
customers prefer custom prepared items over



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pre-packaged items, or if they do not perceive pre-packaged sandwiches and
salads as fresh and desirable, we may be unsuccessful in attracting and
retaining customers, causing our operating results to suffer.

OUR BUSINESS COULD BE HARMED BY LITIGATION OR PUBLICITY CONCERNING FOOD QUALITY,
HEALTH AND OTHER ISSUES, WHICH MAY CAUSE CUSTOMERS TO AVOID OUR PRODUCTS AND
RESULT IN LIABILITIES.

Our business could be harmed by litigation or complaints from customers or
government authorities relating to food quality, illness, injury or other health
concerns or operating issues. Because most of our food products for each
geographic market are prepared in a central kitchen, health concerns surrounding
our food products, if raised, may adversely affect sales in all of our cafes in
that market. Adverse publicity about such allegations may negatively affect our
business, regardless of whether the allegations are true, by discouraging
individuals from buying our products. Because we emphasize the freshness and
quality of our products, adverse publicity relating to food quality or similar
concerns may affect us more than it would food service businesses that compete
primarily on other factors. Such adverse publicity could damage our reputation
and divert the attention of our management from other business concerns. We
could also incur significant liabilities if a lawsuit or claim resulted in an
adverse decision or in a settlement payment, and incur substantial litigation
costs regardless of the outcome of such litigation. As we outsource our food
production in most markets to third parties, we are similarly affected by any
litigation, complaints or publicity relating to those suppliers.

OUR QUARTERLY OPERATING RESULTS MAY FLUCTUATE AND COULD FALL BELOW EXPECTATIONS
OF SECURITIES ANALYSTS AND INVESTORS, RESULTING IN A DECLINE IN OUR STOCK PRICE.

Our quarterly and yearly operating results have varied in the past, and we
believe that our operating results will continue to vary in the future. For this
reason, you should not rely on our operating results as indications of future
performance. In future periods, our operating results may fall below the
expectations of securities analysts and investors, causing the trading price of
our common stock to fall. In addition, most of our expenses, such as employee
compensation and lease payments for facilities and equipment, are relatively
fixed. Our expense levels are based, in part, on our expectations regarding
future sales. As a result, any shortfall in sales relative to our expectations
may cause significant decreases in our operating results from quarter to
quarter, cause us to fail to meet the expectations of securities analysts and
investors and result in a decline in our stock price.

OUR CAFES ARE CURRENTLY LOCATED IN FOUR GEOGRAPHIC MARKETS. AS A RESULT, WE ARE
HIGHLY VULNERABLE TO NEGATIVE OCCURRENCES IN THOSE MARKETS.

We currently operate our cafes in Seattle, San Francisco, Chicago and Los
Angeles. As a result, we are susceptible to adverse trends and economic
conditions in these markets. Additionally, given our geographic concentration,
negative publicity regarding any of our cafes, or other regional occurrences
such as local strikes, earthquakes or other natural disasters, in these markets,
may have a material adverse affect on our business and operations.

OUR FOOD PREPARATION AND PRESENTATION METHODS ARE NOT PROPRIETARY, AND THEREFORE
COMPETITORS MAY BE ABLE TO COPY THEM, WHICH MAY HARM OUR BUSINESS.

We consider our food preparation and presentation methods, including our food
product packaging, box lunch packaging and design of the interior of our cafes,
essential to the appeal of our products and brand. Although we consider our
packaging and store design to be essential to our brand identity, we have not
applied to register all trademarks or trade dress in connection with these
features, and therefore cannot rely on the legal protections provided by
trademark registration. Because we do not hold any patents for our preparation
methods, it may be difficult for us to prevent competitors from copying our
methods. In addition, under our food production agreement with FFG, FFG is
permitted to use our recipes, food formulations and ingredients for products it
sells in the food industry, including products that may compete directly with
our products. If our competitors copy our preparation and presentation methods,
the value of our brand may be diminished and our market share may decrease. In
addition, competitors may be able to develop food preparation and presentation
methods that are more appealing to consumers than our methods, which may also
harm our business.

WE DEPEND ON THE EXPERTISE OF KEY PERSONNEL. IF THIS INDIVIDUAL WERE TO LEAVE,
OUR BUSINESS MAY SUFFER.

We are dependent to a large degree on the services of Victor D. Alhadeff. Our
operations may suffer if we were to lose the services of this individual, who
could leave BRIAZZ at any time. In addition, competition for qualified
management in our industry is intense. Many of the companies with which we
compete for experienced management personnel have greater financial and other
resources than we do.



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RISKS RELATED TO OUR INDUSTRY

OUR OPERATIONS ARE SUSCEPTIBLE TO CHANGES IN FOOD AND SUPPLY COSTS, WHICH COULD
ADVERSELY AFFECT OUR MARGINS.

Our profitability depends, in part, on our ability to anticipate and react to
changes in food and supply costs. Our purchasing staff negotiates prices for all
of our ingredients and supplies based upon current market prices with the
exception of the food production contract with FFG where we pay a fee based on
FFG's actual costs plus a profit factor. Various factors beyond our control,
including, for example, governmental regulations, rising energy costs and
adverse weather conditions, may cause our food and supply costs to increase. We
cannot assure you that we will be able to anticipate and react to changing food
and supply costs by adjusting our purchasing practices. Any failure to do so may
adversely affect our operating results.

IF WE FACE INCREASED LABOR COSTS OR LABOR SHORTAGES, OUR GROWTH AND OPERATING
RESULTS MAY BE ADVERSELY AFFECTED.

Labor is a primary component in the cost of operating our business. As of
November 1, 2003, we employed 45 salaried and 252 hourly employees. We expend
significant resources in recruiting and training our managers and employees. If
we face increased labor costs because of increases in competition for employees,
the minimum wage or employee benefits costs (including costs associated with
health insurance coverage), or unionization of our employees, our operating
expenses will likely increase and our growth may be adversely affected.
Additionally, any increases in employee turnover rates are likely to lead to
additional recruiting and training costs.

Our success depends upon our ability to attract, motivate and retain a
sufficient number of qualified employees, including cafe managers, to keep pace
with our growth strategy. Any inability to recruit and retain sufficient numbers
of employees may delay or prevent the anticipated openings of new cafes.

COMPETITION IN OUR MARKETS MAY RESULT IN PRICE REDUCTIONS, REDUCED MARGINS OR
THE INABILITY TO ACHIEVE MARKET ACCEPTANCE FOR OUR PRODUCTS.

The market for lunch and breakfast foods in the geographic markets where we
operate is intensely competitive and constantly changing. We may be unable to
compete successfully against our current and future competitors, which may
result in pricing reductions that will result in reduced margins and the
inability to achieve market acceptance for our products.

Many businesses provide services similar to ours. Our competitors include
sandwich shops, company cafeterias, delicatessens, pushcart vendors, fast food
chains and catering companies. Many of our competitors have significantly more
capital, research and development, manufacturing, distribution, marketing, human
and other resources than we do. As a result, they may be able to adapt more
quickly to market trends, devote greater resources to the promotion or sale of
their products, receive greater support and better pricing terms from
independent distributors, initiate or withstand substantial price competition,
or take advantage of acquisition or other opportunities more readily than we
can.

WE MAY BE SUBJECT TO PRODUCT LIABILITY CLAIMS, WHICH MAY ADVERSELY AFFECT OUR
OPERATIONS.

We may be held liable or incur costs to settle liability claims if any of the
food products we, FFG or HEMA prepare or we sell cause injury or are found
unsuitable during preparation, sale or use. While FFG must indemnify us for
damages arising from its failure to provide us with food meeting state and
federal standards, we may not receive payment pursuant to this right in a timely
manner. As a result, we may be required to make substantial payments with
respect to any claims well in advance of any collection we may realize from FFG.
Although we currently maintain product liability insurance, where appropriate,
we cannot assure you that this insurance is adequate, and, at any time, it is
possible that such insurance coverage may cease to be available on commercially
reasonable terms, or at all. A product liability claim could result in liability
to us greater than our total assets or insurance coverage. Moreover, product
liability claims could have an adverse impact on our business even if we have
insurance coverage.

CHANGES IN CONSUMER PREFERENCES OR DISCRETIONARY CONSUMER SPENDING COULD
NEGATIVELY IMPACT OUR RESULTS.

Our success depends, in part, upon the popularity of our food products and our
ability to develop new menu items that appeal to consumers. Shifts in consumer
preferences away from our cafes or away from our cuisine, our inability to
develop new menu items that appeal to consumers, or changes in our menu that
eliminate items popular with some consumers could harm our business. Also, our
success depends to a significant extent on numerous factors affecting
discretionary consumer spending, including economic conditions, disposable
consumer income and consumer confidence. Adverse changes in these factors could
reduce customer traffic or impose practical limits on pricing, either of which
could harm our business.



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INABILITY TO OBTAIN REGULATORY APPROVALS, OR TO COMPLY WITH ONGOING AND CHANGING
REGULATORY REQUIREMENTS, FOR OUR REMAINING CENTRAL KITCHEN, FFG'S OR HEMA'S
CENTRAL KITCHENS OR OUR CAFES COULD RESTRICT OUR BUSINESS AND OPERATIONS.

Our remaining central kitchen, FFG's and HEMA's central kitchens and our cafes
are subject to various local, state and federal governmental regulations,
standards and other requirements for food storage, preparation facilities, food
handling procedures, other good manufacturing practices requirements and product
labeling. In addition, license and permit requirements relating to health and
safety, building and land use and environmental protection apply to our
operations. If we or FFG encounter difficulties in obtaining any necessary
licenses or permits or complying with these ongoing and changing regulatory
requirements:

         o        the opening of new cafes could be delayed;

         o        existing cafes or central kitchens, whether operated by FFG or
                  ourselves, could be closed temporarily or permanently; or

         o        our product offerings could be limited.

The occurrence of any of these problems could harm our operating results.

RISKS RELATING TO OUR SECURITIES

OUR DIRECTORS, EXECUTIVE OFFICERS AND SIGNIFICANT SHAREHOLDERS HOLD A
SUBSTANTIAL PORTION OF OUR STOCK, AND DB, BV, SPINNAKER, AND LAURUS HOLD
SUBSTANTIAL RIGHTS, WHICH MAY LEAD TO CONFLICTS WITH OTHER SHAREHOLDERS OVER
CORPORATE GOVERNANCE.

Our directors, executive officers and current holders of 5% or more of our
outstanding common stock hold a substantial portion of our stock. Laurus holds
rights to purchase a substantial portion of our stock and debt with covenants
relating to corporate governance. In addition, DB, BV, Spinnaker and Delafield
hold shares of our Series F Convertible Preferred Stock that are convertible
into 76,438,410 shares of our common stock at an initial conversion price of
$0.10 per share, and hold debt with covenants relating to corporate governance.
We have also agreed to issue new and existing management shares of Series F
Convertible Preferred Stock that are initially convertible into approximately
5.3 million shares of our common stock at a conversion price of $0.10 per share,
and stock options that are exercisable for approximately 5.4 million shares of
our common stock at an exercise price equal to fair market value on the date of
grant. Such persons, acting together, and each acting alone, will be able to
significantly influence all matters requiring shareholder approval, including
the election of directors and significant corporate transactions, such as
mergers or other business combinations.

As part of the transaction in which DB, BV, and Spinnaker purchased the Series F
Convertible Preferred Stock, they were granted the right to select new executive
officers to be appointed by the Company and DB, BV, and Spinnaker were granted
the right, which has since been utilized, to designate up to five of our
directors, with two directors to be designated by DB, two directors to be
designated by BV and one director to be designated by Spinnaker. As a result,
DB, BV and Spinnaker exercise substantial control over our business. We believe
that these entities will continue to exert a large degree of control on the
affairs of our corporation. The control exercised by DB, BV, Spinnaker and other
major shareholders and debtholders may delay, deter or prevent a third party
from acquiring or merging with us, which in turn could reduce the market price
of our common stock.

CONVERSION OF OUR OUTSTANDING CONVERTIBLE SECURITIES COULD SUBSTANTIALLY DILUTE
COMMON STOCK PRICES BECAUSE THE CONVERSION PRICES OF THOSE SECURITIES AND/OR THE
NUMBER OF SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THOSE SECURITIES
ARE BELOW OUR CURRENT MARKET PRICE OR SUBJECT TO ADJUSTMENT.

We have issued and plan to issue in the future various securities that are
convertible or exercisable at prices that are lower than the current market
price of our common stock or are subject to adjustment due to a variety of
factors, including fluctuations in the market price of our common stock and the
issuance of securities at an exercise or conversion price less than the
then-current exercise or conversion price of those securities. For example, DB,
BV, Spinnaker and Delafield collectively hold shares of our Series F Convertible
Preferred Stock that are initially convertible into 76,438,410 shares of our
common stock at an initial conversion price of $0.10 per share. Pursuant to the
terms of our agreement with DB, BV, Spinnaker and Delafield, we have also agreed
to issue new and existing management shares of Series F Convertible Preferred
Stock that will be initially convertible into approximately 5.3 million shares
of our common stock at an initial conversion price of $0.10 per share, and



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stock options that will be initially exercisable for approximately 5.4 million
shares of our common stock at an exercise price equal to the fair market value
at the time of grant. As of October 31, 2003, the closing price of a share of
our common stock on the OTC Bulletin Board was $0.16. If we issue any additional
shares of common stock or shares convertible into shares of common stock
(subject to customary exclusions) at an effective price per share that is less
than the Series F Convertible Preferred Stock conversion price then in effect,
the conversion price will be reduced on a "weighted average" basis to eliminate
the dilutive effect of such issuance on the Series F Convertible Preferred
Stock. Any adjustments to the conversion price of the Series F Convertible
Preferred Stock are cumulative. The terms of the Series F Convertible Preferred
Stock also permit the holders thereof to convert their shares of Series F
Convertible Preferred Stock into shares of our common stock on a "cashless
exercise" basis in the event that the fair market value of the common stock
exceeds the conversion price on the date of conversion. In addition to the
foregoing, we have issued a note to Laurus that is convertible into shares of
our common stock at conversion prices of $0.10 or $0.30 per share, or in an
event of default, at a discount to market. Depending upon the market price in
effect at the time of any conversion of the note, such conversions could cause
significant dilution to existing shareholders. See the risk factor, "Any Default
in the Repayment of the Convertible Note Held By Laurus Master Fund, Ltd.
(Laurus) Could Have a Material Adverse Affect on Our Business, Prospects,
Results of Operations or Financial Condition".

The value of our common stock could, therefore, experience substantial dilution
as a result of the conversion or exercise of our outstanding derivative
securities or as a result of any issuance of additional securities at prices
lower than the conversion prices of such securities. Also, as a result of
conversions of the principal or interest portion of our convertible note or
conversion of the Series F Convertible Preferred Stock and any related sales of
our common stock by the holders, the market price of our common stock could be
depressed.

IF OUR SECURITY HOLDERS ENGAGE IN SHORT SALES OF OUR COMMON STOCK, INCLUDING
SALES OF SHARES TO BE ISSUED UPON CONVERSION OF DEBT SECURITIES, THE PRICE OF
OUR COMMON STOCK MAY DECLINE.

Selling short is a technique used by a shareholder to take advantage of an
anticipated decline in the price of a security. A significant number of short
sales or a large volume of other sales within a relatively short period of time
can create downward pressure on the market price of a security. In an event of
default under the Laurus note, the decrease in market price would allow Laurus
to convert its debt securities into or for an increased number of shares of our
common stock. Further sales of common stock issued upon conversion of the Laurus
note or the Series F Convertible Preferred Stock could cause even greater
declines in the price of our common stock due to the number of additional shares
available in the market, which could encourage short sales that could further
undermine the value of our common stock. The common stock could, therefore,
experience a decline in value as a result of short sales of our common stock.

WE WERE RECENTLY TRANSFERRED TO THE OVER-THE-COUNTER BULLETIN BOARD AND AS A
RESULT, OUR SHAREHOLDERS MAY EXPERIENCE LIMITED LIQUIDITY.

Our common stock was transferred to the OTC Bulletin Board on June 2, 2003
because we failed to meet the requirements for listing on the Nasdaq SmallCap
Market. Trading on the OTC Bulletin Board is generally less robust than on the
Nasdaq National or SmallCap Markets. As a result, an investor may find it more
difficult to sell our common stock or to obtain accurate quotations as to the
market value of our common stock.

OUR STOCK PRICE MAY BE VOLATILE BECAUSE OF FACTORS BEYOND OUR CONTROL.

The market price of our common stock may fluctuate significantly in response to
a number of factors, most of which are beyond our control, including:

         o        changes in securities analysts' recommendations or estimates
                  of our financial performance;

         o        changes in market valuations of similar companies; and

         o        announcements by us or our competitors of significant
                  contracts, new products, acquisitions, commercial
                  relationships, joint ventures or capital commitments.

In the past, companies that have experienced volatility in the market price of
their stock have been subject to securities class action litigation. A
securities class action lawsuit against us, regardless of its merit, could
result in substantial costs and divert the attention of our management from
other business concerns, which in turn could have a materially adverse impact on
our financial results.



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OUR ARTICLES OF INCORPORATION, BYLAWS, CERTAIN OF OUR AGREEMENTS AND THE
WASHINGTON BUSINESS CORPORATION ACT CONTAIN ANTI-TAKEOVER PROVISIONS WHICH COULD
DISCOURAGE OR PREVENT A TAKEOVER, EVEN IF AN ACQUISITION WOULD BE BENEFICIAL TO
OUR SHAREHOLDERS.

Provisions of our articles of incorporation and bylaws could make it more
difficult for a third party to acquire us, even if doing so would be beneficial
to our shareholders. These provisions include:

         o        authorizing the issuance of "blank check" preferred stock that
                  could be issued by our board of directors, without shareholder
                  approval, to increase the number of outstanding shares or
                  change the balance of voting control and thwart a takeover
                  attempt;

         o        prohibiting cumulative voting in the election of directors,
                  which would otherwise allow less than a majority of
                  shareholders to elect directors;

         o        limiting the ability of shareholders to call special meetings
                  of shareholders; and

         o        prohibiting shareholder action by non-unanimous written
                  consent and requiring all shareholder actions to be taken at a
                  meeting of our shareholders.

In addition, Chapter 23B.19 of the Washington Business Corporation Act and the
terms of our preferred stock and debt financings and our stock option plan may
discourage, delay or prevent a change in control which you may favor.



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