Quality Dining, Inc

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International Guild of Hospitality & Restaurant Managers

4220 Edison Lakes Parkway
Mishawaka , IN 46545

Phone: (574) 271-4600
Fax: (574) 271-4612

Quality Dining, Inc., founded in 1981, operates four distinct restaurant concepts. It owns the Grady's American Grill and two Italian Dining concepts, and operates Burger King restaurants and Chili's Grill & Bar (Chili's) as a franchisee of Burger King Corporation and Brinker International, Inc. (Brinker), respectively. The Company operates its Italian Dining restaurants under the tradenames of Spageddies Italian Kitchen (Spageddies) and Papa Vino's Italian Kitchen (Papa Vino's). As of October 28, 2001 , the Company operated 191 restaurants, including 116 Burger King restaurants, 33 Chili's, 34 Grady's American Grill restaurants, three Spageddies and five Papa Vino's.

In October 2001, the Company acquired 42 Burger King restaurants in the Grand Rapids metropolitan area. The Company will operate 32 of the 42 restaurants under lease agreements it previously made with the landlords for those restaurants. It will operate the remaining 10 restaurants under interim arrangements while attempting to establish long-term agreements. The Company also built three new Burger King restaurants and two new Chili's restaurants, and sold one Grady's American Grill restaurant in 2001. The Company has also entered into an agreement to sell nine Grady's American Grill restaurants, and has closed two additional Grady's American Grill restaurants.

Burger King Restaurants

Burger King restaurants offer a diverse menu containing a variety of traditional and non-traditional food items, featuring the Whopper sandwich and other flame-broiled hamburgers and sandwiches, which are prepared to order with the customer's choice of condiments. The menu also typically includes breakfast entrees, french fries, onion rings, desserts and soft drinks.

The Company's Burger King restaurants compete with McDonald's and Wendy's restaurants.

Chili's Grill & Bar

Chili's restaurants are full-service, casual dining restaurants featuring table service designed to minimize customer waiting and facilitate table turnover. Service personnel are dressed casually to reinforce the casual, informal environment. Chili's restaurants feature a diverse menu of food items, including a variety of hamburgers, fajitas, steak, chicken and seafood entrees and sandwiches, barbecued ribs, salads, appetizers and desserts, all of which are prepared fresh daily according to recipes specified by Chili's. Emphasis is placed on serving substantial portions of food at modest prices. Each Chili's restaurant has a full bar serving beer, wine and cocktails.

The Chili's franchise agreements provide that Brinker, owner of the Chili's concept, may establish advertising cooperatives (Cooperatives) for geographic areas where one or more restaurants are located. Any restaurants located in areas subject to a Cooperative are required to contribute 3% of sales to the Cooperative in lieu of contributing 0.5% of sales to Brinker. Each such restaurant is also required to directly spend 0.5% of sales on local advertising.

Chili's competes with other casual dining concepts such as Applebee's, T.G.I. Friday's, Bennigan's, Olive Garden and Red Lobster restaurants.

Grady's American Grill

Grady's American Grill restaurants feature quality food in a classic American style, served in a setting that is designed to be warm and inviting setting. Prior to the Company's acquisition of the concept from Brinker on December 21, 1995 , Brinker owned and operated 33 of the 34 Grady's American Grill restaurants owned and operated by the Company at the end of the fiscal year ended October 28, 2001 . The Grady's American Grill menu features signature prime rib, high quality steaks, daily servings of seafood, salads, sandwiches, soups and desserts. Entrees emphasize on-premise scratch preparation in a classic American style.

The primary competitors to Grady's American Grill are Houston's, J. Alexander's, Outback Steakhouse, Houlihan's and O'Charley's Restaurant & Lounge, as well as a large number of locally owned independent restaurants.

Italian Dining Restaurants

The Company's Italian Dining concepts consist of Papa Vino's Italian Kitchen and Spageddies Italian Kitchen. The first Papa Vino's restaurant was opened in 1996, and the first Spageddies restaurant was opened in 1994. The Company had been a franchisee of Spageddies since 1994, and became the owner of the concept in October 1995. Papa Vino's and Spageddies each offers a casual dining atmosphere with quality food, generous portions and moderate prices, all enjoyed in a setting featuring the ambiance of a traditional Italian trattoria with stone archways, large wine casks and wine racks lining the walls and exhibition cooking. The Company's Italian Dining concepts are proprietary, and provide the Company with flexibility for expansion and development.

A fundamental component of the Italian Dining concepts is to provide the customer with a wide variety of quality, value-priced Italian food. The restaurant menu includes an array of entrees, including traditional Italian pasta, grilled meats and freshly prepared selections of pizzas, soups, salads and sandwiches. The menu also includes specialty appetizers, fresh baked bread and desserts, together with a full-service bar serving beer, wine and cocktails.

The competitors to the Company's Italian Dining restaurants are other casual dining concepts such as Applebee's, T.G.I. Friday's, Bennigan's, Olive Garden and Red Lobster restaurants.

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Disclaimer:
The data included within the Financial section is solely for information and does not construe a recommendation and/or endorsement by IGHRM or its members to invest funds with any of the companies listed. You are strongly urged to obtain professional advice with qualified individuals or corporations for any investments of funds.