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 September 30, 1999 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 October 15, 1999, outstanding common shares totaled 14,019,202. 2 JERRY'S FAMOUS DELI, INC. INDEX Page Number PART I - FINANCIAL INFORMATION Item 1. Consolidated Financial Statements Consolidated Balance Sheets as of September 30, 1999 and December 31, 1998.................. 2 Consolidated Statements of Operations for the Three Months and Nine Months Ended September 30, 1999 and September 30, 1998................................................... 3 Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 1999 and September 30, 1998................................................... 4 Notes to Consolidated Financial Statements.................................................. 5 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations General..................................................................................... 7 Results of Operations....................................................................... 8 Liquidity and Capital Resources............................................................. 9 Item 3. Quantitative and Qualitative Disclosure About Market Risk................................... 10 PART II - OTHER INFORMATION Items 1. through 6................................................................................... 10 Signatures.................................................................................. 11 1 3 JERRY'S FAMOUS DELI, INC. CONSOLIDATED BALANCE SHEETS SEPTEMBER 30, DECEMBER 31, 1999 1998 ---- ---- (unaudited) ASSETS Current assets Cash and cash equivalents $ 1,035,871 $ 985,382 Accounts receivable, net 283,020 424,400 Inventory 1,401,527 1,394,899 Prepaid expenses 562,882 449,737 Deferred income taxes 269,327 269,327 Prepaid income taxes 83,601 267,321 ----------- ----------- Total current assets 3,636,228 3,791,066 Property and equipment, net 29,649,230 33,534,787 Deferred income taxes 629,801 629,801 Goodwill and covenants not to compete 9,315,101 9,701,723 Other assets 1,256,373 1,335,331 ----------- ----------- Total assets $44,486,733 $48,992,708 =========== =========== LIABILITIES AND EQUITY Current liabilities Accounts payable $ 2,042,088 $ 3,099,839 Accrued expenses 1,557,320 1,411,457 Sales tax payable 322,019 421,897 Deferred income 22,542 -- Current portion of long-term debt 1,700,955 1,279,371 ----------- ----------- Total current liabilities 5,644,924 6,212,564 Long-term debt 12,197,173 15,908,582 Deferred rent 456,963 457,525 ----------- ----------- Total liabilities 18,299,060 22,578,671 Minority interest 612,389 554,899 Equity Preferred stock Series A, no par, 5,000,000 shares authorized, no shares issued or outstanding at September 30, 1999 or at December 31, 1998 -- -- Common stock, no par value, 60,000,000 shares authorized, 14,019,202 and 14,508,902 issued and outstanding at September 30, 1999 and December 31, 1998, respectively 24,575,522 25,271,737 Equity 999,762 587,401 ----------- ----------- Total equity 25,575,284 25,859,138 ----------- ----------- Total liabilities and equity $44,486,733 $48,992,708 =========== =========== The accompanying notes are an integral part of these consolidated financial statements. 2 4 JERRY'S FAMOUS DELI, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) THREE MONTHS ENDED NINE MONTHS ENDED SEPTEMBER 30, SEPTEMBER 30, 1999 1998 1999 1998 ---- ---- ---- ---- Revenues $ 15,578,675 $ 17,200,722 $ 51,926,970 $ 47,560,238 Cost of sales 5,366,261 5,820,944 18,017,146 15,544,925 ------------ ------------ ------------ ------------ Gross profit 10,212,414 11,379,778 33,909,824 32,015,313 Operating expenses Labor 5,597,900 6,177,878 18,756,866 16,945,603 Occupancy and other 2,111,905 2,272,206 6,767,057 6,427,029 Occupancy - related party 279,014 253,000 816,129 670,053 General and administrative expenses 1,091,055 1,307,821 3,482,093 3,537,253 Depreciation 654,714 600,435 2,027,991 2,374,040 Amortization 169,179 392,732 511,581 704,629 ------------ ------------ ------------ ------------ Total expenses 9,903,767 11,004,072 32,361,717 30,658,607 ------------ ------------ ------------ ------------ Income from operations 308,647 375,706 1,548,107 1,356,706 Other income (expense) Interest income 3,455 649 15,999 36,435 Interest expense (274,797) (361,904) (940,840) (924,632) Other income (expense), net 8,500 -- 5,952 -- ------------ ------------ ------------ ------------ Income before provision (benefit) for income taxes and minority interest 45,805 14,451 629,218 468,509 Provision (benefit) for income taxes (25,180) (37,373) 85,720 71,101 Minority interest 38,430 41,994 131,137 94,296 ------------ ------------ ------------ ------------ Income before cumulative effect of change in accounting principle 32,555 9,830 412,361 303,112 Cumulative effect of change in accounting principle, net of tax benefit of $65,162 -- -- -- (132,299) ------------ ------------ ------------ ------------ Net income $ 32,555 $ 9,830 $ 412,361 $ 170,813 ============ ============ ============ ============ Net income per share before cumulative effect of change in accounting principle applicable to common stock - Basic and Diluted $ 0.00 $ 0.00 $ 0.03 $ 0.02 Cumulative effect of change in accounting principle - Basic and Diluted -- -- -- (0.01) ------------ ------------ ------------ ------------ Net income per share applicable to common stock - Basic and Diluted $ 0.00 $ 0.00 $ 0.03 $ 0.01 ============ ============ ============ ============ Weighted average shares outstanding - Basic 14,048,702 15,127,064 14,204,030 14,827,294 ============ ============ ============ ============ Weighted average shares outstanding - Diluted 14,056,684 15,148,326 14,212,012 14,901,989 ============ ============ ============ ============ The accompanying notes are an integral part of these consolidated financial statements. 3 5 JERRY'S FAMOUS DELI, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) NINE MONTHS ENDED SEPTEMBER 30, 1999 1998 ---- ---- Cash flows from operating activities: Net income $ 412,361 $ 170,813 ----------- ------------ Adjustments to reconcile net income to net cash provided by operating activities, net of acquisitions: Cumulative effect of change in accounting principle -- 132,299 Depreciation 2,027,991 2,374,040 Amortization 511,581 704,629 Gain on sale of assets (8,500) -- Minority interest 131,137 94,296 Deferred income taxes -- -- Deferred income 21,980 -- Changes in assets and liabilities: Accounts receivable 141,380 (134,132) Inventory (6,628) (390,259) Prepaid expenses (113,145) 1,016,456 Prepaid income taxes 183,720 (146,416) Preopening costs -- (624,800) Other assets (67,616) (769,879) Accounts payable (1,057,751) 1,399,157 Accrued expenses 145,863 177,637 Sales tax payable (99,878) (43,415) ----------- ------------ Total adjustments 1,810,134 3,789,613 ----------- ------------ Net cash provided by operating activities 2,222,495 3,960,426 ----------- ------------ Cash flows from investing activities: Purchase of Epicure Market -- (8,518,674) Acquisition of restaurant -- (1,760,000) Net proceeds from sale of facility 3,913,244 -- Additions to equipment (940,734) (1,421,313) Additions to improvements - land, building and leasehold (1,250,472) (1,244,751) Deductions to construction-in-progress 153,532 149,518 Proceeds from sale of fixed assets 8,500 -- ----------- ------------ Net cash provided by (used in) investing activities 1,884,070 (12,795,220) ----------- ------------ Cash flows from financing activities: Borrowings on credit facilities 2,178,988 15,965,000 Payments on long-term debt (5,468,813) (8,155,738) Dividends paid to minority shareholders (70,036) (69,555) Purchase of Company's common stock (696,215) (22,478) ----------- ------------ Net cash (used in) provided by financing activities (4,056,076) 7,717,229 ----------- ------------ Net increase (decrease) in cash and cash equivalents 50,489 (1,117,565) Cash and cash equivalents, beginning of period 985,382 2,264,308 ----------- ------------ Cash and cash equivalents, end of period $ 1,035,871 $ 1,146,743 =========== ============ The accompanying notes are an integral part of these consolidated financial statements. 4 6 JERRY'S FAMOUS DELI, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 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 nine months ended September 30, 1999 and September 30, 1998 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, 1998 consolidated balance sheet is derived from the audited consolidated financial statements included in the Company's December 31, 1998 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 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, JFD--Encino ("JFD--Encino"), a California limited partnership and National Deli Corporation, ("NDC"), a Florida corporation and wholly-owned subsidiary of JFD--Inc. JFD--Inc. and JFD--Encino operate family oriented, full-service restaurants. NDC operates The Epicure Market ("Epicure"), a specialty gourmet food store located in Miami Beach, Florida. 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, Woodland Hills, and Costa Mesa. JFD--Inc. also includes the two Rascal House restaurants located in Miami Beach and Boca Raton, Florida. Reclassification Certain amounts in the previously presented financial statements have been reclassified to conform to the current period presentation. 2. SUPPLEMENTAL CASH FLOW INFORMATION Nine Months Ended September 30, 1999 1999 1998 ---- ---- Supplemental cash flow information: Cash paid for: Interest ......................................................... $809,000 $ 900,000 Income taxes ..................................................... $ 2,000 $ 311,000 Supplemental information on noncash investing and financing activities: Common Stock issued in purchase of Epicure ....................... $ -- $2,395,147 5 7 JERRY'S FAMOUS DELI, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 3. NET INCOME PER SHARE In accordance with Statement of Financial Accounting Standards ("SFAS") No. 128, "Earnings Per Share," basic net income per share is computed by dividing the net income attributable to common shareholders by the weighted average number of common shares outstanding during the period. Diluted net income per common share is computed by dividing the net income attributable to common shareholders by the weighted average number of common and common share equivalents outstanding during the period. Common share equivalents included in the diluted computation represent shares issuable upon assumed exercise of stock options using the treasury stock method. 4. IMPACT OF RECENT ACCOUNTING PRONOUNCEMENTS In April 1998, the American Institute of Certified Public Accountants ("AICPA") issued Statement of Position ("SOP") 98-5 entitled "Reporting on the Costs of Start-Up Activities." SOP 98-5 requires entities to expense as incurred all start-up and preopening costs that are not otherwise capitalizable as long-lived assets. Restatement of the previously issued financial statements is not permitted by SOP 98-5, and entities are not required to report the pro forma effects of the retroactive application of the new accounting standard. The Company's early adoption of this new accounting principle in 1998 resulted in the recognition of the cumulative effect of the change in accounting principle as a one-time charge against earnings of $132,299, net of related income tax benefit of $65,162, recorded as of January 1, 1998. Thus, the Consolidated Statement of Operations and the Consolidated Statement of Cash Flows for the nine months ended September 30, 1998 have been restated to reflect the change. 5. SALE OF PASADENA PROPERTY The Company closed escrow on the sale of its Pasadena facility at the close of business on May 2, 1999. The gross proceeds from the sale were $4,120,000 which resulted in no significant gain or loss. Of these proceeds, approximately $3,750,000 was used to reduce the Company's debt and the remaining proceeds were applied to other related costs of the sale. 6 8 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS GENERAL The following table presents for the three and nine months ending September 30, 1999 and 1998, the Consolidated Statements of Operations of the Company expressed as percentages of total revenue. The results of operations for the first nine months of 1999 are not necessarily indicative of the results to be expected for the full year ending December 31, 1999. PERCENTAGE OF TOTAL REVENUE --------------------------- THREE MONTHS ENDED, NINE MONTHS ENDED SEPTEMBER 30, SEPTEMBER 30, ------------------- ----------------- 1999 1998 1999 1998 ----- ----- ----- ----- Revenues 100.0% 100.0% 100.0% 100.0% Cost of sales 34.4 33.8 34.7 32.7 ----- ----- ----- ----- Gross profit 65.6 66.2 65.3 67.3 Operating expenses Labor 35.9 35.9 36.1 35.6 Occupancy and other 15.4 14.7 14.6 14.9 ----- ----- ----- ----- Total operating expenses 51.3 50.6 50.7 50.5 General and administrative expenses 7.0 7.6 6.7 7.4 Depreciation and amortization expense 5.3 5.8 4.9 6.5 ----- ----- ----- ----- Total expenses 63.6 64.0 62.3 64.4 ----- ----- ----- ----- Income from operations 2.0 2.2 3.0 2.9 Interest income 0.0 0.0 0.0 0.1 Interest expense (1.8) (2.1) (1.8) (2.0) Other income, net 0.1 0.0 0.0 0.0 ----- ----- ----- ----- Income before provision for income taxes and minority interest 0.3 0.1 1.2 1.0 Provision (benefit) for income taxes (0.2) (0.2) 0.2 0.2 Minority interest 0.3 0.2 0.2 0.2 ----- ----- ----- ----- Income before cumulative effect of change in accounting principle 0.2 0.1 0.8 0.6 Cumulative effect of change in accounting principle -- -- -- (0.3) ----- ----- ----- ----- Net income 0.2% 0.1% 0.8% 0.3% ===== ===== ===== ===== 7 9 RESULTS OF OPERATIONS Three Months Ended September 30, 1999 Compared to Three Months Ended September 30, 1998 Revenues for the three months ended September 30, 1999 decreased approximately $1,622,000, or 9.4%, to approximately $15,579,000 for the 1999 quarter from approximately $17,201,000 for the 1998 quarter. This decrease was primarily due to: a decrease in sales of approximately $990,000 for the two Rascal House restaurants in Florida; a decrease in sales of approximately $689,000 related to the sale of the Pasadena restaurant, which was sold on May 2, 1999; and, a decrease in revenues of approximately $74,000 for The Epicure Market. Management attributes the decrease in sales in the Florida area primarily due to the temporary closure of the Miami restaurant in the month of September 1999 for remodeling, which contributed approximately $473,000 to the decrease, coupled with increased competition in both the Miami and Boca Raton areas. In addition, the combined decrease was partially offset by an overall increase in same store sales for the eight Southern California stores in operation since July 1, 1998 of approximately $120,000, or 1.2% for the 1999 period. To address the above decreases, the Company believes that the Rascal House remodeling and continued marketing of its restaurants and specific products, consistent with other casual dining and fast food restaurants, will have a positive effect on store sales. Cost of sales, which consists primarily of food costs, increased 0.6 percentage points, as a percentage of revenues, to 34.4% for the 1999 quarter from 33.8% for the 1998 quarter. 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 0.7 percentage points to 51.3% for the 1999 quarter from 50.6% for the 1998 quarter. This increase is primarily attributable to occupancy and other, which increased 0.7 percentage points, as a percentage of revenues, to 15.4% for the 1999 quarter from 14.7% for the 1998 quarter. Labor, as a percentage of revenues, remained unchanged at 35.9% for the 1999 quarter as compared to the same period for 1998. Management is taking several steps to control such costs, including the implementation of an incentive program for restaurant managers which is based on a reduction of food and labor costs. General and administrative expenses decreased approximately $217,000 or 0.6 percentage points as a percentage of revenues to 7.0% for the 1999 quarter from 7.6% in the 1998 quarter. This decrease is partly the result of a reduction in personnel employed at the Company's corporate headquarters and partly a reduction of corporate overhead expenses. Depreciation and amortization expense, as a percentage of revenue, decreased 0.5 percentage points to 5.3% for 1999 from 5.8% for the 1998 quarter. Depreciation expense increased approximately $54,000 for the 1999 quarter as compared to the 1998 quarter. Amortization expense decreased approximately $224,000 for the 1999 quarter as compared to the 1998 quarter primarily due to the change in accounting principle related to preopening costs. The decrease in interest expense of approximately $87,000 to approximately $275,000 for the 1999 third quarter from approximately $362,000 for the same 1998 period, resulted from the overall decrease in debt associated with the sale of the Pasadena store. Nine Months Ended September 30, 1999 Compared to Nine Months Ended September 30, 1998 Revenues increased approximately $4,367,000, or 9.2%, to approximately $51,927,000 for the 1999 nine-month period from approximately $47,560,000 for the 1998 nine-month period. Epicure, acquired on April 1, 1998, contributed increased revenues of approximately $3,667,000 in 1999. The Boca restaurant, which opened in July 1, 1998, contributed revenues of approximately $2,235,000 to the 1999 period. Revenues for the same eight Southern California restaurants operated during both nine-month periods increased approximately $497,000, or 1.6%. The overall increase was partially offset by the sale of the Pasadena facility, which contributed to a decrease in revenue of approximately $1,185,000. In addition, The Rascal House restaurant in Miami Beach, Florida had decreased revenues of approximately $885,000 for the 1999 period, which is mostly due to the opening of the Boca store and increased competition, coupled with the restaurant being temporarily closed for remodeling for most of September 1999. 8 10 Cost of sales, as a percentage of revenues, increased 2.0 percentage points, to 34.7% for the 1999 period from 32.7% for the 1998 period. This increase is primarily related to The Rascal House restaurants operating with a higher food cost percentage than the stores in California. Labor expense, as a percentage of revenues, increased 0.5 percentage point, to 36.1% in 1999 from 35.6% for 1998. Occupancy and other, as a percentage of revenues, decreased 0.3 percentage point, to 14.6% in 1999 from 14.9% for the 1998 period. General and administrative expenses, as a percentage of revenues, decreased 0.7 percentage point to 6.7% for 1999 from 7.4% for 1998 due to the reasons discussed above in the quarter-to-quarter analysis. Depreciation and amortization expense, as a percentage of revenues, decreased 1.6 percentage points to 4.9% in 1999 from 6.5% in the 1998 period. Depreciation expense decreased approximately $346,000 for the 1999 period as compared to the 1998 period primarily due to the change in life of certain furniture and fixtures from a five-year useful life to an eight-year useful life, effective July 1, 1998. Amortization expense decreased approximately $193,000 for the 1999 period as compared to the 1998 period primarily due to the change in accounting principle related to preopening costs. Interest expense increased approximately $16,000, mostly due to the increase in expense on the credit facility as a result of the purchase of Epicure. This increase was partially offset by the decrease in debt from the proceeds of the sale of the Pasadena restaurant. 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. The cost of renovation will depend upon the style of restaurant being converted. Renovation of Jerry's Famous Deli restaurants have cost between $2 million and $3 million per location, or $267 to $400 per square foot. In addition, the Company spent approximately $696,000 pursuant to the Company's stock repurchase program. In September 1998, the Company entered into a $15,000,000 credit facility with BankBoston, N.A. in the form of a $9,000,000 term loan and $6,000,000 revolving line of credit. In conjunction with the agreement, the Company repaid certain existing debt with the proceeds from the term loan. The term loan and the revolver mature five years from inception and bear interest at the Eurodollar rate plus a variable percentage margin totaling approximately 7.5% at September 30, 1999. The debt is collateralized by assets of the Company and includes certain financial covenants. In September 1999, the Company and BankBoston, N.A. amended the credit agreement for certain financial covenants and scheduled repayments of the term loans. The Company utilized approximately $560,000 of the credit line in conjunction with the repurchase of approximately $696,000 of its Common Stock during the nine month period ended September 30, 1999. In addition, approximately $3,750,000 from the proceeds of the sale of the Pasadena facility was used to reduce the Company's debt. Management believes that cash on hand, including cash drawn on the line of credit, proceeds from the sale of the Pasadena facility and cash flows from operations will be sufficient for operation of the Company's existing restaurants and market. Future anticipated capital needs, primarily for development or acquisition of new restaurants, cannot be projected with certainty. Additional capital expenditures will be required as new locations are added. The Company generally intends to seek leased locations. 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 availability, amount, type and cost of financing for the Company and general economic conditions and other factors. Further information on these and other factors is contained in the Company's Annual Report on Form 10-K for the year ended December 31, 1998 and its other reports filed with the Securities and Exchange Commission. 9 11 Item 3. Quantitative and Qualitative Disclosure About Market Risk. Not applicable. PART II - OTHER INFORMATION Items 1. through 4. Not applicable. Item 5. Other Information. In September 1999, the Company entered into a Quick Food License Agreement ("Agreement") with Universal Studios CityWalk Hollywood ("Universal") to provide consulting and technical services to Universal in connection with the planning, development, construction, furnishing and equipping of a "Jerry's Famous Deli" type restaurant, located in Universal City. The Agreement has a term of approximately 10 years from the restaurant's opening date, which is currently scheduled for the second quarter of 2000, with certain provisions for options to extend. The Company will earn from Universal a license fee at a specified amount for the first two years of restaurant operations, with an additional fee payable to the Company if certain excess requirements are met. In addition, during all subsequent years the Company will earn an amount equal to a specified percentage of defined "gross sales" of the restaurant. In conjunction with the Agreement, the Company will provide consulting services for a one-time "consulting fee" to be earned and paid by Universal over a period including six full months of continuous operation of the restaurant. Items 6. Exhibits and Reports on Form 8-K Exhibit Number ------ 10.45 Quick Food License Agreement, dated as of September 3, 1999, by and between Universal Studios CityWalk Hollywood, a division of Universal Studios, Inc. and Jerry's Famous Deli, Inc. 10.46 Fourth Amendment to Credit Agreement, dated as of September 30, 1999, by and among Jerry's Famous Deli, Inc. and BankBoston, N.A. 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: November 12, 1999 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