1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 10-Q
(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________ to ____________
Commission File No. 33-94724
JERRY'S FAMOUS DELI, INC.
(Exact name of registrant as specified in its charter)
California 95-3302338
---------- ----------
(State or Other Jurisdiction of (I.R.S.Employer Identification No.)
Incorporation or Organization)
12711 Ventura Boulevard, Suite 400, Studio City, California 91604
-----------------------------------------------------------------
(Address of Principal Executive Offices)
(818) 766-8311
--------------
(Registrant's Telephone Number, Including Area Code)
-----------------------------------------------------------
(Former name, former address and former fiscal year,
if changed since last report)
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.
YES X NO
------- -------
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date. As of July 18, 1997,
outstanding common shares totaled 14,210,155.
2
JERRY'S FAMOUS DELI, INC.
INDEX
Page
Number
PART I - FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
Consolidated Balance Sheets as of June 30, 1997 and December 31, 1996 ......... 2
Consolidated Statements of Operations for the Three Months and Six Months Ended
June 30, 1997 and June 30, 1996 ............................................... 3
Consolidated Statements of Cash Flows for the Six Months Ended
June 30, 1997 and June 30, 1996 ............................................... 4
Notes to Consolidated Financial Statements .................................... 5
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Results of Operations ......................................................... 7
Liquidity and Capital Resources ............................................... 9
PART II - OTHER INFORMATION
Items 1. through 6 ...................................................................... 10
Signatures .................................................................... 11
1
3
JERRY'S FAMOUS DELI, INC.
CONSOLIDATED BALANCE SHEETS
JUNE 30, DECEMBER 31,
1997 1996
----------- -----------
ASSETS
Current assets
Cash and cash equivalents $ 567,257 $ 4,145,265
Accounts receivable, net 405,878 347,148
Inventory 377,000 420,819
Prepaid expenses 1,773,031 471,202
Preopening costs 247,404 549,607
Income taxes receivable 157,449 210,153
----------- -----------
Total current assets 3,528,019 6,144,194
Property and equipment, net 27,492,924 25,694,476
Organization costs 91,042 104,483
Deferred income taxes 322,056 322,056
Goodwill and covenants not to compete 3,739,524 3,868,909
Other assets 476,684 428,867
----------- -----------
Total assets $35,650,249 $36,562,985
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable $ 1,645,448 $ 3,350,099
Accrued expenses 1,667,458 1,641,784
Sales tax payable 192,474 434,379
Deferred income and income taxes 49,517 15,699
Current portion of long-term debt 578,739 578,739
Current portion of obligations under capital leases 7,110 20,722
----------- -----------
Total current liabilities 4,140,746 6,041,422
Long-term debt 5,670,589 5,959,959
Deferred credits 464,626 496,578
----------- -----------
Total liabilities 10,275,961 12,497,959
Minority interest 486,068 440,998
Shareholders' equity
Preferred stock Series A, no par, 5,000,000 shares authorized,
no shares issued or outstanding at June 30, 1997 and
10,000 issued or outstanding at December 31, 1996 -- 9,153,078
Common stock, no par value, 60,000,000 shares authorized,
14,210,155 and 10,838,062 issued and outstanding at
June 30, 1997 and December 31, 1996, respectively 24,032,032 14,175,109
Retained earnings 856,188 295,841
----------- -----------
Total shareholders' equity 24,888,220 23,624,028
----------- -----------
Total liabilities and shareholders' equity $35,650,249 $36,562,985
=========== ===========
The accompanying notes are an integral part of these consolidated
financial statements
2
4
JERRY'S FAMOUS DELI, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE MONTHS ENDED JUNE 30, SIX MONTHS ENDED JUNE 30,
1997 1996 1997 1996
------------ ------------ ------------ ------------
Revenues $ 13,026,122 $ 8,001,601 $ 27,837,878 $ 15,736,129
Cost of sales 4,035,500 2,536,996 8,414,417 4,883,169
------------ ------------ ------------ ------------
Gross profit 8,990,622 5,464,605 19,423,461 10,852,960
Operating expenses
Labor 4,735,456 2,711,068 10,254,322 5,380,268
Occupancy and other 1,679,070 1,005,290 3,479,206 2,029,029
Occupancy - related party 160,434 45,000 338,658 90,000
General and administrative expenses 1,091,232 1,082,782 2,293,921 1,852,409
Depreciation and amortization expenses 905,383 370,777 1,863,007 652,067
------------ ------------ ------------ ------------
Total expenses 8,571,575 5,214,917 18,229,114 10,003,773
------------ ------------ ------------ ------------
Income from operations 419,047 249,688 1,194,347 849,187
Other income (expense)
Interest income 9,040 30,739 40,900 108,513
Interest expense (151,877) (116,491) (305,618) (155,576)
Other income, net (1,776) 7,534 (1,361) 14,068
------------ ------------ ------------ ------------
Income before provision for income
taxes and minority interest 274,434 171,470 928,268 816,192
Provision for income taxes 75,800 60,000 276,000 274,000
Minority interest 44,771 20,676 91,921 131,216
------------ ------------ ------------ ------------
Net income $ 153,863 $ 90,794 $ 560,347 $ 410,976
============ ============ ============ ============
Net income per common share:
Primary $ 0.01 $ 0.01 $ 0.04 $ 0.04
============ ============ ============ ============
Fully diluted $ 0.01 $ 0.01 $ 0.04 $ 0.04
============ ============ ============ ============
Weighted average common shares
outstanding - primary 14,043,432 10,481,244 12,554,693 10,476,241
============ ============ ============ ============
Weighted average common shares
outstanding - fully diluted 14,043,432 10,481,244 14,046,433 10,486,918
============ ============ ============ ============
The accompanying notes are an integral part of these consolidated
financial statements
3
5
JERRY'S FAMOUS DELI, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30,
1997 1996
----------- -----------
Cash flows from operating activities:
Net income $ 560,347 $ 410,976
----------- -----------
Adjustments to reconcile net income to net cash provided by
operating activities
Depreciation and amortization 1,863,007 652,067
Gain on sale of assets (2,756) --
Minority interest 91,921 131,216
Deferred income taxes (7,850) 22,266
Deferred income 41,668 --
Changes in assets and liabilities
Accounts receivable (58,730) (77,990)
Inventory 43,819 (58,997)
Prepaid expenses (551,829) (160,091)
Preopening costs (15,191) (332,677)
Other assets (47,818) 1,627
Organization costs -- (3,826)
Accounts payable (1,704,651) (129,260)
Accrued expenses 25,674 33,306
Sales tax payable (241,905) (88,971)
Deferred income and income taxes payable 20,752 (190,923)
----------- -----------
Total adjustments (543,889) (202,253)
----------- -----------
Net cash provided by operating activities 16,458 208,723
----------- -----------
Cash flows from investing activities:
Additions to equipment (767,946) (1,210,774)
Additions to improvements - land, building and leasehold (482,871) (832,384)
Additions to construction-in-progress (1,954,661) (2,119,678)
Funds in excrow for purchase of Solley's, Inc. assets -- (2,543,500)
Purchase of land -- (2,477)
Purchase of building and related purchase option payments -- (764,068)
Proceeds from sale of fixed assets 7,000 --
----------- -----------
Net cash used in investing activities (3,198,478) (7,472,881)
----------- -----------
Cash flows from financing activities:
Borrowings from credit facility -- 303,165
Payments on credit facility -- (70,000)
Borrowings on long-term debt -- 2,500,000
Payments on long-term debt (289,370) (3,044)
Advances to related parties -- (1,128,450)
Capital lease payments (13,612) (24,229)
Distribution paid to shareholder -- (13,068)
Dividends paid to minority shareholders (46,851) (52,266)
Proceeds from exercise of 65,000 warrants, net of related costs 57,048 --
Purchase of Company's common stock (103,203) --
----------- -----------
Net cash (used in) provided by financing activities (395,988) 1,512,108
----------- -----------
Net decrease in cash and cash equivalents (3,578,008) (5,752,050)
Cash and cash equivalents, beginning of period 4,145,265 7,214,412
--------- ---------
Cash and cash equivalents, end of period $ 567,257 $ 1,462,362
=========== ===========
The accompanying notes are an integral part of these consolidated
financial statements
4
6
JERRY'S FAMOUS DELI, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION AND ORGANIZATION:
Basis of Presentation
The accompanying consolidated financial statements of Jerry's Famous Deli,
Incorporated and its subsidiaries ("the Company") for the three and six months
ended June 30, 1997 and June 30, 1996 have been prepared in accordance with
generally accepted accounting principles and with the instructions to Form 10-Q
and Article 10 of Regulation S-X. These financial statements have not been
audited by independent accountants, but include all adjustments (consisting of
normal recurring adjustments) which are, in Management's opinion, necessary for
a fair presentation of the financial condition, results of operations and cash
flows for such periods. However, these results are not necessarily indicative of
results for any other interim period or for the full year. The December 31, 1996
balance sheet is derived from the audited financial statements included in the
Company's December 31, 1996 Form 10-K.
Certain information and footnote disclosures normally included in
financial statements in accordance with generally accepted accounting principles
have been omitted pursuant to requirements of the Securities and Exchange
Commission. Management believes that the disclosures included in the
accompanying interim financial statements and footnotes are adequate to make the
information not misleading, but should be read in conjunction with the
consolidated financial statements and notes thereto included in the the
Company's Form 10-K for the preceding fiscal year.
Organization
The accompanying consolidated financial statements consist of Jerry's
Famous Deli, Incorporated ("JFD--Inc."), a California corporation and JFD-Encino
("JFD--Encino"), a California limited partnership. JFD--Inc. and JFD--Encino
operate family oriented, full-service restaurants. These entities are
collectively referred to as "Jerry's
Famous Deli, Inc." or the "Company."
JFD--Inc. and JFD--Encino include the operations of the Southern
California restaurants located in Studio City, Encino, Marina del Rey, West
Hollywood, Pasadena, Westwood, Sherman Oaks and Woodland Hills and Rascal House,
which is located in Florida. A tenth restaurant in Costa Mesa, California, is
under renovation and is scheduled to open in the third quarter of 1997.
On March 28, 1997, the Company announced that Kenneth Abdalla had assumed
the office of President on an interim basis with the specific objective of
assisting in the execution of the Company's acquisition and expansion strategy.
In connection therewith, the Company entered into a consulting agreement with
Kenneth Abdalla and a company affiliated with him for services to be provided to
the Company through December 1998 in consideration of 200,000 shares of common
stock to Kenneth Abdalla and $600,000 to his affiliated company.
In April 1997, the Company purchased at costs of $3.06 and $3.50 per share
and retired 32,500 shares of its common stock.
2. INCOME TAXES
The Company accounts for income taxes in accordance with Statement of
Financial Accounting Standard ("SFAS") No. 109 "Accounting for Income Taxes."
SFAS No. 109 prescribes the use of the liability method to compute the
differences between the tax bases of assets and liabilities and related
financial reporting amounts using currently enacted future tax laws and rates.
Under SFAS No. 109 the effect on deferred taxes of a change in tax rates is
recognized in income in the period that includes the enactment date. The
estimated deferred tax credit, principally resulting from temporary differences
in the recognition of depreciation expense for financial statement and tax
reporting purposes, as of June 30, 1997, was approximately $8,000.
3. SUPPLEMENTAL CASH FLOW INFORMATION
Six Months Ended June 30,
1997 1996
-------- --------
Supplemental cash flow information:
Cash paid for:
Interest ........................... $307,000 $188,000
Income taxes ....................... $233,000 $435,000
5
7
Supplemental information on noncash investing and financing activities:
Preferred stock converted into common stock ..................... $ 9,153,000 --
Decrease in deferred costs capitalized to
construction-in-progress .................................... -- $ (22,000)
Purchase of restaurant .......................................... $ -- $ 3,250,000
Write off of fully depreciated capital leases, equipment and
leasehold improvements .................................... $ 169,000 --
Issuance of 200,000 unregistered common shares in connection
with a consulting agreement ............................... $ 750,000 --
4. NET INCOME PER SHARE
Net income per common share for the 1997 and 1996 three-month and
six-month periods are based on the weighted average number of common shares
outstanding. Fully diluted shares outstanding include outstanding stock options
utilizing the treasury stock method.
5. IMPACT OF RECENT ACCOUNTING PRONOUNCEMENTS
In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards ("SFAS") No. 128, "Earnings Per
Share." SFAS No. 128 supercedes and simplifies the existing computational
guidelines under Accounting Principles Board Opinion No. 15, "Earnings Per
Share." It is effective for financial statements issued for periods ending after
December 15, 1997. Among other changes, SFAS No. 128 eliminates the presentation
of primary EPS and replaces it with basic EPS for which common stock equivalents
are not considered in the computation. It also revises the computation of
diluted EPS. It is not expected that the adoption of SFAS No. 128 will have a
material impact on the earnings per share results reported by the Company under
the Company's current capital structure.
6. SUBSEQUENT EVENTS
On July 24, 1997, the Company obtained a $2,500,000 term loan
collateralized by certain real and personal property of Rascal House restaurant.
The loan bears interest at the LIBOR rate for one-, two- or three-month periods
plus 2.5%, up to a maximum rate of 11.0% and will mature on August 1, 2004. The
proceeds of approximately $2,455,000 will primarily be used for the development
or acquisition of new restaurants.
6
8
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
GENERAL
The following table presents for the three and six months ending June 30,
1997 and 1996, the Consolidated Statements of Operations of the Company
expressed as percentages of total revenue. The results of operations for the
first six months of 1997 are not necessarily indicative of the results to be
expected for the full year ending December 31, 1997.
PERCENTAGE OF TOTAL REVENUE
---------------------------
THREE MONTHS ENDED JUNE 30, SIX MONTHS ENDED JUNE 30,
--------------------------- -------------------------
1997 1996 1997 1996
------ ------ ------ ------
Revenues 100.0% 100.0% 100.0% 100.0%
Cost of sales
Food 27.8 28.7 27.4 28.2
Other 3.2 3.0 2.8 2.8
------ ------ ------ ------
Total cost of sales 31.0 31.7 30.2 31.0
------ ------ ------ ------
Gross profit 69.0 68.3 69.8 69.0
Operating expenses
Labor 36.4 33.9 36.8 34.2
Occupancy and other 14.1 13.2 13.7 13.5
Total operating expenses 50.5 47.1 50.5 47.7
General and administrative expenses 8.4 13.5 8.3 11.7
Depreciation and amortization expenses 6.9 4.6 6.7 4.2
------ ------ ------ ------
Total expenses 65.8 65.2 65.5 63.6
------ ------ ------ ------
Income from operations 3.2 3.1 4.3 5.4
Interest income 0.1 0.4 0.1 0.7
Interest expense (1.2) (1.5) (1.1) (1.0)
Other income, net 0.0 0.1 0.0 0.1
------ ------ ------ ------
Income before provision for income
taxes and minority interest 2.1 2.1 3.3 5.2
Provision for income taxes 0.6 0.7 1.0 1.8
Minority interest 0.3 0.3 0.3 0.8
------ ------ ------ ------
Net income 1.2% 1.1% 2.0% 2.6%
====== ====== ====== ======
RESULTS OF OPERATIONS
Three Months Ended June 30, 1997 Compared to Three Months Ended June 30,
1996
Revenues for the three months ended June 30, 1997 increased $5,025,000, or
62.8%, to $13,026,000 for the 1997 quarter from $8,002,000 for the 1996 quarter.
Included in this increase are revenues of over $5,736,000 from the four
restaurants and the bakery opened or acquired since June 30, 1996 ("new store
restaurants").
Revenue for the same five restaurants ("same store restaurants") operated
during both periods decreased approximately $511,000 or 6.6%. Most of this
decrease in revenue occurred at the Pasadena and Encino restaurants and was
primarily due to increased competition in both areas. In addition, the December
1996 opening of the Woodland Hills restaurant has temporarily drawn customers
away from Encino restaurant. In response, management has taken a
7
9
number of corrective actions. At Encino a banquet room was created and the "Take
Out" area was expanded while marketing efforts have been increased for the
Pasadena restaurant. The recent repaving by the City of Pasadena of the pathway
leading from the main boulevard should improve the foot traffic to the Pasadena
restaurant and lead to the reopening of the outside patio, which has been closed
since March 1997. In addition, both the Encino and Pasadena restaurants have
improved their retail merchandising by installing display cases of bakery goods
supplied by the Company's Sherman Oaks bakery.
Cost of sales, as a percentage of revenues, decreased 0.7 percentage point
to 31.0% for the 1997 quarter from 31.7% for the 1996 quarter. The cost of food,
which comprises over 90% of cost of sales, decreased 0.9 percentage point to
27.8% for 1997 from 28.7% for 1996. A major factor for the decrease is the lower
cost of bakery goods, a substantial amount of which is supplied to Jerry's
Southern California restaurants by the Company's Sherman Oaks bakery. Also, the
Company's continuing program of more effective buying, improved cost controls
and growing volume purchasing, due to additional restaurants, contributed toward
lower prices on dry goods, which savings was partially offset by price increases
in coffee, beef and paper products. The 0.2% percentage point increase in other
cost of sales is primarily due to cost of sales for catering services. As a
result of lower cost of sales, gross profit increased as a percentage of
revenues to 69.0% for 1997 from 68.3% for 1996.
Operating expenses, which include all restaurant level operating costs,
including, but not limited to, labor, rent, laundry, maintenance, utilities and
repairs, as a percentage of revenues, increased 3.4 percentage points to 50.5%
for the 1997 quarter from 47.1% for the 1996 quarter. Labor increased 2.5
percentage points to 36.4% for 1997 from 33.9% for 1996. On March 1, 1997, the
minimum wage was increased in California to $5.00 from $4.75 an hour, which
affected approximately 50% of the employees in each California restaurant.
Newly-opened restaurants commonly incur relatively higher labor costs during the
first several months after opening until predictable customer patterns are
developed. Over the next several months, the labor costs of the new store
restaurants are expected to decrease. In addition, at Rascal House restaurant,
located in southern Florida, a 1997 second quarter seasonal decline in revenue
did not bring about a comparable decrease in labor costs. In June 1997,
management took corrective action by, during the off season, reducing overtime
and staffing and closing the restaurant between 1:00 am and 6:00am from Sunday
through Thursday. The same reduction in operating hours was introduced in two
Southern California restaurants. Occupancy expenses increased 0.9 percentage
point to 14.1% for 1997 from 13.2% for 1996, which resulted principally from
slight increases in supplies, utilities and rent expense.
Overall, general and administrative expenses increased only $8,000, or
0.8%, in the 1997 quarter over the 1996 quarter. Therefore, as a percentage of
revenues, general and administrative expenses decreased 5.1 percentage points to
8.4% in 1997 from 13.5% in 1996. Management labor expense was reduced in the
1997 quarter due to the waiver of the 1997 quarterly performance incentive bonus
for three executive officers.
Depreciation and amortization expense, as a percentage of revenue,
increased 2.3 percentage points or approximately $535,000, to 6.9% for the 1997
quarter from 4.6% for the 1996 quarter. The increase is primarily the result of
the July 1996 and the September 1996 acquisitions, and related agreements, of
the Solley's restaurants and Rascal House restaurant, respectively.
Six Months Ended June 30, 1997 Compared to Six Months Ended June 30, 1996
Revenues increased $12,102,000, or 76.9%, to $27,838,000 for the 1997
six-month period from $15,736,000 for the 1996 six-month period. The four
restaurants and the bakery, opened or acquired since June 30, 1996, contributed
revenues of approximately $12,797,000 in 1997. Revenues for the same five
restaurants operated during both six-month periods, decreased approximately
$573,000, or 3.7%. Most of this decrease is attributible to the Encino
restaurant for the reasons discussed in the quarter-to-quarter comparison. In
addition, the Company has noticed an increase in seasonality in certain of its
restaurants, particularly with Rascal House in Florida.
Cost of sales, as a percentage of revenues, decreased 0.8 percentage
point, to 30.2% for the 1997 period from 31.0% for the 1996 period. As discussed
above, the lower costs of bakery goods and the Company's continuing program of
more effective buying, improved cost controls and growing volume purchasing
continue to lower food prices, more than offsetting both seasonal and other
price increases. Lower cost of sales improved gross profit 0.8 percentage point,
to 69.8% from 69.0%.
Income from operations, as a percentage of revenues, decreased 1.1
percentage points to 4.3% for 1997 from 5.4% for 1996. The increases in
depreciation and amortization expense and labor more than offset decreases in
cost of sales and general and administrative expenses.
8
10
Labor expense, as a percentage of revenues, increased 2.6 percentage
points, primarily due to the same factors as those discussed above with respect
to the second quarter. In addition, the federal minimum wage was increased on
October 1, 1996 to $4.75 from $4.25 an hour, which affected approximately 50% of
the employees in each restaurant.
General and administrative expenses, as a percentage of revenues,
decreased 3.4 percentage points to 8.3% for 1997 from 11.7% for 1996 due to
increases in many general and administrative expenses at rates less than the
growth of revenues. As new restaurants are opened and/or acquired, certain
general and administrative expenses, relating directly to restaurant operations
including insurance, employee benefits and others, are expected to increase.
Interest income, as a percentage of revenues, decreased approximately 0.6
percentage point to 0.1% for 1997 from 0.7% for 1996, which was primarily due to
the usage of funds received from the October 1995 Public Offering.
LIQUIDITY AND CAPITAL RESOURCES
The Company's capital requirements are primarily for the development,
construction and equipping of new restaurants. Generally, the Company leases the
property and extensively remodels the existing building for each new restaurant.
Based on historic experience, each new restaurant requires between $2,000,000
and $3,000,000 for remodeling and purchasing of equipment.
The Company is continuing its current plans for expansion and plans to
open its tenth restaurant in Costa Mesa, California, in August 1997. Funds to
complete the renovation of the Costa Mesa building will come primarily from the
remaining proceeds from the August and November 1996 issuance of 12,000 shares
of preferred stock. Such shares were subsequently converted on March 27, 1997
into common stock.
The Company has a revolving line of credit in the aggregate amount of
$965,000 from United Mizrahi Bank, which terminates in April 1998. As of June
30, 1997, the Company had no amounts outstanding under this revolving line of
credit.
Management believes that cash on hand, cash flows from operations and its
available credit line will be sufficient to finance the completion of the Costa
Mesa restaurant and operation of the Company's existing restaurants. Management
is currently seeking new locations for development or acquisition of restaurants
in California, Las Vegas, Chicago and Florida. In planning for future expansion
and the resulting capital needs of the Company, management is evaluating other
sources of financing, including equity and/or debt financing. Future growth
could be dependent upon the Company obtaining additional capital.
Statements made herein that are not historical facts are forward looking
statements and are subject to a number of risk factors, including the public's
acceptance of the Jerry's Famous Deli format in each new location, consumer
trends in the restaurant industry, competition from other restaurants, the costs
and delays experienced in the course of remodeling or building new restaurants,
the amount and rate of growth of administrative expenses associated with
building the infrastructure needed for future growth, the availablility, amount,
type and cost of financing for the Company and general economic conditions and
other factors.
9
11
PART II - OTHER INFORMATION
Items 1. through 3. Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
On May 27, 1997, the Company held its Annual Meeting of Shareholders.
Shareholders voted upon the election of directors and upon the ratification of
Coopers & Lybrand, L.L.P., as the Company's independent public accountants for
the fiscal year ending December 31, 1997. Isaac Starkman, Guy Starkman, Jason
Starkman, Paul Gray, Stanley Schneider and Kenneth Abdalla, all of whom were
directors prior to the Annual Meeting and were nominated by management for
re-election, were re-elected at the meeting. The following votes were cast for
each nominees:
Name For Authority
---- --- Withheld
---------
Isaac Starkman 9,954,663 50,410
Guy Starkman 9,947,750 57,323
Jason Starkman 9,938,400 66,673
Paul Gray 9,968,503 36,570
Stanley Schneider 9,968,503 36,570
Kenneth Abdalla 9,962,353 42,720
The following votes were cast for the ratification of Coopers &
Lybrand, L.L.P., as the Company's independent public accountants for the
fiscal year ending December 31, 1997: For: 9,982,818; Against: 16,000;
Abstain: 6,255.
Items 5 and 6. Not applicable.
10
12
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.
JERRY'S FAMOUS DELI, INC.
Date: August 1, 1997 By: /s/ Isaac Starkman
---------------------------------
Isaac Starkman
Chief Executive Officer and
Chairman of the Board of Directors
By: /s/ Christina Sterling
---------------------------------
Christina Sterling
Chief Financial Officer
11