SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                   FORM 10-QSB


(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 29,1997

                                       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. 0-23226


                              GRILL CONCEPTS, INC.
        -----------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)


           Delaware                                        13-3319172
-------------------------------                ---------------------------------
(State or other jurisdiction of                (IRS Employer Identification No.)
incorporation or organization)
                       


        11661 San Vicente Blvd., Suite 404, Los Angeles, California 90049
        -----------------------------------------------------------------
                    (Address of principal executive offices)


                                 (310) 820-5559
                           ---------------------------
                           (Issuer's telephone number)

   --------------------------------------------------------------------------
   (Former name, former address and former fiscal year, if changed since last
   report)


     Check  whether  the issuer (1) filed all  reports  required  to be filed by
Section 13 or 15(d) of the  Exchange  Act during the past 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
                                                                      ---   ---

     As of August 1, 1997,  15,672,481 shares of Common Stock of the issuer were
outstanding.

<PAGE>
                              GRILL CONCEPTS, INC.

                                      INDEX


                                                                          Page
                                                                         Number
                                                                         ------
PART I - FINANCIAL INFORMATION

     Item 1. Financial Statements

          Consolidated Condensed Balance Sheets - June 29, 1997
          and December 29, 1996............................................  1

          Consolidated Condensed Statements of Operations - 
          For the three months and six months ended June 29, 1997
          and June 30, 1996................................................  3

          Consolidated Condensed Statements of Cash Flows - For the
          six months ended June 29, 1997 and June 30, 1996.................  4

          Notes to Consolidated Condensed Financial Statements.............  5

     Item 2.  Management's  Discussion  and Analysis of Financial
              Condition and Results of Operations..........................  7

PART II - OTHER INFORMATION

     Item 2.  Changes in Securities........................................  9

     Item 4.  Submission of Matters to a Vote of Security Holders.......... 10

     Item 6.  Exhibits and Reports on Form 8-K............................. 10

SIGNATURES................................................................. 11


<PAGE>
                         PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS


                      GRILL CONCEPTS, INC. AND SUBSIDIARIES

                      CONSOLIDATED CONDENSED BALANCE SHEETS


                                     ASSETS


                                             June 29,        December 29,
                                               1997              1996
                                           ----------        ------------
Current assets:
  Cash and cash equivalents                $  645,151        $  372,317
  Inventory                                   299,261           239,237
  Prepaid expenses                            957,228         1,038,036
                                           ----------        ----------
     Total current assets                   1,901,640         1,649,590
                                           ----------        ----------

Property and equipment, at cost            10,243,162         8,589,597
  Less:  accumulated depreciation          (3,786,847)       (3,364,486)
                                           ----------        ----------
     Property and equipment, net            6,456,315         5,225,111
                                           ----------        ----------
Other assets:
  Goodwill                                    241,733           245,829
  Other                                     1,032,400           961,484
                                           ----------        ----------
     Total other assets                     1,274,133         1,207,313
                                           ----------        ----------
     Total assets                          $9,632,088        $8,082,014
                                           ==========        ==========

  The accompanying notes are an integral part of these consolidated financial
  statements.


                                       1
<PAGE>
                      GRILL CONCEPTS, INC. AND SUBSIDIARIES

                      CONSOLIDATED CONDENSED BALANCE SHEETS
                                   (Continued)

                      LIABILITIES AND STOCKHOLDERS' EQUITY

                                                June 29,           December 29,
                                                  1997                 1996
                                               ----------          ------------
Current liabilities:
  Accounts payable                            $ 1,266,253          $ 1,143,484
  Accrued expenses                              1,406,902            1,283,805
  Current portion of long term debt               401,189              421,317
                                              -----------          -----------
     Total current liabilities                  3,074,344            2,848,606

Long-term debt, net of current                    877,681            1,030,927
                                              -----------          -----------
     Total liabilities                          3,952,025            3,879,533
                                              -----------          -----------

Stockholders' equity:
  Series A, Convertible Preferred Stock, 
   $.001 par value, authorized 1,000,000
   shares; Shares issued and outstanding:
   0 in 1997, 700 in 1996                                                    1
  Series B, Convertible Preferred Stock, 
   $.001 par value, authorized 1,000,000
   shares; shares issued and outstanding:
   32 in 1997, 65 in 1996.                              1                    1
  Series I, Convertible Preferred Stock,
   $.001 par value, authorized 1,000,000 
   shares, shares issued and outstanding:
   1000 shares in 1997, 0 in 1996                       1
  Series  II, Convertible Preferred Stock,
   $0.001  par  value, authorized 1,000,000
   shares, shares issued and outstanding:
   500 shares in 1997, 0 in 1996                        1
  Common stock, $.00001 par value:
   30,000,000 shares authorized, shares
   issued and outstanding: 15,672,481 in
   1997 and 13,799,230 in 1996                        157                  138

  Additional paid-in capital                   11,010,801            9,552,458

  Accumulated deficit                          (5,330,898)           (5,350,117)
                                              -----------           -----------
  Stockholders' equity                          5,680,063             4,202,481
                                              -----------           -----------
     Total liabilities and stockholders'
      equity                                  $ 9,632,088           $ 8,082,014
                                              ===========           ===========


  The accompanying notes are an integral part of these consolidated financial
  statements


                                       2
<PAGE>
                      GRILL CONCEPTS, INC. AND SUBSIDIARIES

                 CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS



<TABLE>
<CAPTION>
                                          Three Months Ended             Six Months Ended
                                       -------------------------    --------------------------
                                        June 29,       June 30,        June 29,     June 30,
                                         1997            1996           1997          1996
                                       ----------    -----------    -----------    -----------
<S>                                    <C>           <C>            <C>            <C>
Sales                                 $ 7,306,781    $ 5,691,606    $14,447,501    $10,937,385

Cost of sales                           1,987,026      1,546,185      3,943,243      2,892,312
                                      -----------    -----------    -----------    -----------
Gross Profit                            5,319,755      4,145,421     10,504,258      8,045,073
                                      -----------    -----------    -----------    -----------
Costs and expenses:
  Restaurant operating expenses         4,535,844      3,580,099      8,876,711      6,766,900
  General and administrative              539,641        440,217      1,063,124        911,151
  Depreciation and amortization           224,978        186,552        424,656        377,987
  Amortization of preopening expenses      85,300             --        135,600             --
                                      -----------    -----------    -----------    -----------
     Total operating expenses           5,385,763      4,206,868     10,500,091      8,056,038

Income (loss) from operations             (66,008)       (61,447)         4,167        (10,965)

Non-recurring credit                       43,714             --         93,000             --
Interest expense, net                     (29,567)       (32,561)       (73,614)       (70,458)
                                      -----------    -----------    -----------    -----------
Income (loss) before taxes on income      (51,861)       (94,008)        23,553        (81,423)

Provision for taxes on income                  --             --            800            800
                                      -----------    -----------    -----------    -----------
Net income (loss)                     $   (51,861)   $   (94,008)   $    22,753    $   (82,223)
                                      -----------    ===========    -----------    ===========

Preferred stock:
  Dividends accrued                          (417)                         (417)
  Accounting deemed dividends            (126,389)                     (126,389)
                                      -----------                   -----------

                                         (126,806)                     (126,806)
                                      -----------                   -----------

  Net loss applicable to common
   stock                              $  (178,667)                  $  (104,053)
                                      ===========                   ===========

Net income (loss) per share
  Net income (loss)                   $     (0.00)                  $      0.00
                                      -----------                   -----------

  Preferred Stock
    Dividends                         $     (0.00)                  $     (0.00)
    Accounting deemed dividends       $     (0.01)                  $     (0.01)
                                      -----------                   ------------

                                      $     (0.01)                  $     (0.01)
                                      -----------                   -----------

Net loss applicable to common
 stocks                               $     (0.01)   $     (0.01)   $     (0.01)   $     (0.01)
                                      ===========    ===========    ===========    ===========

Average weighted shares
 outstanding                           14,708,761     13,653,076     14,518,749     13,326,153
                                      ===========    ===========    ===========    ===========

</TABLE>

  The accompanying notes are an integral part of these consolidated financial
  statements.


                                       3
<PAGE>
                      GRILL CONCEPTS, INC. AND SUBSIDIARES
                 CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS


                                                          Six Months Ended
                                                   -----------------------------
                                                    June 29,          June 30,
                                                       1997              1996
                                                   -----------       -----------

Cash  flows  from  operating activities:
  Net income (loss)                                $    22,753       $  (82,223)
  Adjustments to reconcile net income (loss)
   to net cash provided by operating activities:
    Depreciation and amortization                      560,256          371,507
    Changes in operating assets and liabilities
      Inventories                                      (60,024)          (9,041)
      Prepaid expenses                                  80,808           32,050
      Other assets                                    (206,510)         (31,027)
      Accounts payable                                 122,769         (153,793)
      Accrued liabilities                              123,097         (115,449)
                                                   -----------       ----------
      Net cash provided by (used in) operating
       activities                                      643,149           12,023
                                                   -----------       ----------
Cash flows from investing activities;
  Additions to furniture, equipment and
   improvements                                     (1,653,565)        (397,084)
  Net cash acquired through purchase of business            --          253,231
                                                   -----------       ----------
  Net cash (used in) investing activities           (1,653,565)        (143,853)
                                                   -----------       ----------
Cash flows from financing activities:
  Proceeds from issue of Common and Preferred
   Stock                                             1,456,630        1,455,000
  Payments on long-term debt                          (173,374)        (195,758)
                                                   -----------       ----------
  Net cash provided by financial activities          1,283,250        1,259,242
                                                   -----------       ----------
Net increase in cash and cash equivalents              272,834        1,127,412

Cash and cash equivalents, beginning of period         372,317          631,116
                                                   -----------       ----------
Cash and cash equivalents, end of period           $   645,151       $1,788,528
                                                   -----------       ----------
*Net cash acquired through purchase of business
  Working capital, other than cash                                       26,716
  Furniture, equipment and improvements                                (321,880)
  Excess of cost over net assets acquired                              (245,829)
  Other assets                                                          (55,776)
  Fair value of stock exchanged                                         850,000
                                                                     ----------
    Net cash acquired                                                $  253,231
                                                                     ----------
Supplemental cash flow information:
  Cash paid during the period for:
    Interest                                       $    53,598       $  104,935
    Income taxes                                            --       $      800


  The accompanying notes are an integral part of these consolidated financial
  statements.


                                       4
<PAGE>
                      GRILL CONCEPTS, INC. AND SUBSIDIARIES

              NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS

1.   INTERIM FINANCIAL PRESENTATION

     The interim consolidated  financial statements are prepared pursuant to the
     requirements for reporting on Form 10-QSB.  These financial statements have
     not been audited by independent accountants.  The December 29, 1996 balance
     sheet data was  derived  from  audited  financial  statements  but does not
     include  all  disclosures   required  by  generally   accepted   accounting
     principles.  The interim  financial  statements and notes thereto should be
     read in conjunction with the financial statements and notes included in the
     Company's   Form  10-KSB  dated  December  29,  1996.  In  the  opinion  of
     management, these interim financial statements reflect all adjustments of a
     normal  recurring  nature necessary for a fair statement of the results for
     the interim periods presented. The current period results of operations are
     not necessarily indicative of results which ultimately will be reported for
     the full year ending December 28, 1997.

2.   BUSINESS AND ORGANIZATION

     In April of 1996, the Company  acquired 100% of the common stock of EMNDEE,
     Inc.  ("EMNDEE") and The Grill on the Alley, Inc. ("Grill,  Inc.").  EMNDEE
     and Grill, Inc. own, collectively, 100% of The Grill Limited Partnership, a
     California  limited  partnership  which owns and  operates The Grill on the
     Alley (the "Grill"),  an upscale Beverly Hills  restaurant  which opened in
     1984 and served as the model for the Company's Daily Grill restaurants.  As
     a result of the foregoing, these interim statements include the accounts of
     the Grill during 1997. As  acquisition  of the Grill occurred April 1,1996,
     the  accounts  of the Grill,  for the 13 week  period from April 1, 1996 to
     June 30, 1996, are reflected in the financial  statements as of and for the
     quarter ended June 30, 1996.

     The unaudited proforma  financial  information set forth below is presented
     as if the acquisition of the Grill had been  consummated as of December 31,
     1995. The proforma financial  information is not necessarily  indicative of
     what actual  results of  operations  of the Company  would have been if the
     acquisitions  were consummated as of December 31, 1995, nor does it purport
     to represent the results of operations for future periods.

                                    1997              1996
                                -----------       -----------

          Sales                 $14,447,501       $11,792,680

          Net income (loss)     $    22,753       $   (25,931)


3.   STOCKHOLDERS' EQUITY

     During the quarter ended June 29, 1997,  the remaining 610 shares of Series
     A Convertible  Preferred Stock were converted  resulting in the issuance of
     an aggregate of 702,080 shares of common stock at an average price of $0.87
     per  share.  Additionally,  during  the  quarter,  33  shares  of  Series B
     Convertible  Preferred Stock were converted resulting in the issuance of an
     aggregate of 388,067  shares of common  stock at an average  price of $0.85
     per share.

     On June 24,  1997,  the Company  completed a private  placement  of 200,000
     shares of common  stock,  1,000  shares of Series I  Convertible  Preferred
     Stock, 500 shares of Series II Convertible  Preferred  Stock,  750,000 five
     year $2.00  Warrants and 750,000 five year $3.00  Warrants.  The  aggregate
     sales price of those securities was $1,500,000.

     The Series I Convertible  Preferred Stock is convertible  into common stock
     at $1.25 per share.


                                       5
<PAGE>
     The Series II Convertible  Preferred Stock is convertible into common stock
     commencing  one year from the date of  issuance at the greater of (i) $1.00
     per  share,  or (ii) 75 % of the  average  closing  price of the  Company's
     common  stock for the five trading  days  immediately  prior to the date of
     conversion;  provided, however, that the conversion price shall in no event
     exceed  $2.50 per  share.  The  Series II  Convertible  Preferred  Stock is
     entitled to receive an annual  dividend  equal to $100 per share payable on
     conversion or redemption  in cash or, at the  Company's  option,  in common
     stock at the then applicable  conversion  price.  The Series II Convertible
     Preferred  Stock is  subject  to  redemption,  in whole or in part,  at the
     option of the  Company on or after the second  anniversary  of  issuance at
     $1,000 per share.

     The $2.00 Warrants are  exercisable to purchase  common stock at a price of
     $2.00 per share commencing three years from the date of issuance and ending
     five years from the date of  issuance.  The $2.00  Warrants  are subject to
     cancellation  in the event the  holders  of Series I  Preferred  Stock,  or
     common stock issued upon conversion of such preferred stock,  sell,  assign
     or transfer such  preferred  stock or underlying  common stock,  other than
     transfers to permitted  persons,  within three years of the initial sale of
     the warrants.

     The $3.00 Warrants are  exercisable to purchase  common stock at a price of
     $3.00 per share commencing three years from the date of issuance and ending
     five years from the date of  issuance.  The $3.00  Warrants  are subject to
     cancellation  in the event the  holders  of Series I  Preferred  Stock , or
     common stock issued upon conversion of such preferred stock,  sell,  assign
     or transfer such  preferred  stock or underlying  common stock,  other than
     transfers to permitted  persons,  within three years of the initial sale of
     the warrants.

4.   BANK LINE OF CREDIT

     During the quarter,  the Company paid down its $1,000,000 available line of
     credit to $0. 

5.   DEEMED DIVIDEND

     In  accordance  with the recent  position of the  Securities  and  Exchange
     Commission regarding accounting for Preferred Stock which is convertible at
     a discount from market price for common stock, the Company has reflected an
     accounting  "deemed  dividend".  This  accounting  deemed  dividend,  which
     relates  to  the  issuance  of  the   Preferred   Stock,   is  a  non-cash,
     non-recurring  accounting entry for determining income (loss) applicable to
     common stock and income (loss) per share.

6.   IMPACT OF RECENT ACCOUNTING PRONOUNCEMENTS

     In February 1997, the Financial  Accounting Standards Board issued SFAS No.
     128,  "Earnings Per Share",  which establishes  standards for computing and
     presenting  earnings per share.  SFAS No. 128 requires the  replacement  of
     primary  earnings per share with basic  earnings per share.  Basic earnings
     per share excludes  dilution,  and is computed by dividing income available
     to common  stockholders  by the  weighted-average  number of common  shares
     outstanding  during the period.  The Company  will be required to adopt the
     provisions  of SFAS No. 128 for 1997.  It is not expected that the adoption
     of the SFAS No.  128 will  have a  material  impact on  earnings  per share
     results  reported  by the  Company  under  the  Company's  current  capital
     structure.

     Other recently issued  standards of the FASB are not expected to affect the
     Company as conditions to which those standards apply are absent.


                                       6
<PAGE>
Item 2. Management's  Discussion and Analysis of Financial Condition and Results
        of Operations.

The following  discussion and analysis  should be read in  conjunction  with the
Company's financial statements and notes thereto included elsewhere in this Form
10-QSB.  Except for the historical  information contained herein, the discussion
in this Form 10-QSB contains  certain  forward  looking  statements that involve
risks and uncertainties,  such as statements of the Company's plans, objectives,
expectations and intentions.  The cautionary statements made in this Form 10-QSB
should be read as being  applicable to all related forward  statements  wherever
they appear in this Form  10-QSB.  The  Company's  actual  results  could differ
materially from those discussed here.

MATERIAL CHANGES IN RESULTS OF OPERATIONS FOR THE SIX MONTHS ENDED JUNE 29, 1997
AS COMPARED TO THE SIX MONTHS ENDED JUNE 29, 1996.

The results of operations for the 26 week period ended June 29, 1997 include the
operations  of seven  Daily Grill  restaurants  for the full six months plus the
Washington D.C. Daily Grill for sixteen weeks,  three Pizzeria Uno units and The
Grill restaurant.  The first half of 1996 includes six Daily Grill  restaurants,
three Pizzeria Uno stores and The Grill for thirteen weeks.

The Company's  revenues for the six month period  increased 32.1% to $14,447,000
from  $10,937,000  for the same period in 1996.  The increase of $3.5 million is
primarily a result of added sales by the inclusion of The Grill  restaurant  for
the full period this year, the addition of the Irvine,  California,  Daily Grill
opened in September, 1996 and sales from the Washington D.C. Daily Grill, opened
in March, 1997. Additionally, same store sales increased 2.9%.

While  revenues  increased by 32.1% in the 1997 six month  period when  compared
with the similar period in 1996,  cost of sales increased 36.3% and increased as
a percentage  of sales from 26.4% to 27.3%.  This increase in cost of sales as a
percentage of sales during the 1997 period is  attributable  principally  to the
inclusion of The Grill which has  historically  experienced an  approximate  31%
cost of sales as compared to  approximately  a 27% cost of sales for Daily Grill
restaurants.  This  higher  cost of sales at The Grill is offset by lower  labor
costs.

As a result,  gross profit  increased 30.6% from $8,045,000  (73.6% of sales) in
1996 to $10,504,000 (72.7% of sales) in 1997.

Restaurant  operating  expenses increased to $8,877,000 (61.4% of sales) in 1997
from  $6,767,000(61.9%  of sales) in 1996.  The dollar  increase  in  restaurant
operating  expenses was attributable to the operation of the two new restaurants
during the 1997 period, plus the operation of The Grill for two full quarters in
1997.

General and  administrative  expenses  increased only 16.7% to represent 7.4% of
sales  in the  1997  six  months  while  amounting  to 8.3% of sales in the 1996
period.  This percentage  decrease occurred as a result of the added volume from
two  additional  Daily Grills and the addition of The Grill with only a $152,000
increase in corporate overhead.

Depreciation and amortization  expense increased by $182,000 during the 1997 six
month  period as a result of the  opening of two new  restaurants.  Included  in
amortization  expense is $136,000  relating to the  amortization  of  preopening
expenses  for  these  two  new  Daily  Grill  restaurants.  The  Company  had no
amortization of preopening expenses during the similar period in 1996.

The Company also reported a non-recurring credit of $93,000 during 1997 relating
to overaccruals of non-recurring acquisition costs reported in 1996.

MATERIAL CHANGES IN FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES.

At June 29, 1997 the Company had negative  working  capital of $1,173,000  and a
cash balance of $645,000  compared to negative working capital of $1,119,000 and
a cash balance of $372,000 at December 29, 1996.  The change in working  capital
and cash was primarily attributable to the sale of the Preferred I and II stocks
in June, 1997 offset by funds expended on the Washington, D.C. Daily Grill.


                                       7
<PAGE>
Historically,  the  Company  has funded its  day-to-day  operations  through its
operating  cash  flow,  while  funding  growth  through  a  combination  of bank
borrowing, loans from stockholders/officers, the sale of Debentures, the sale of
Preferred Stock, the issuance of warrants,  and loans and tenant allowances from
certain of its  landlords.  At June 29,1997,  the Company had existing term loan
bank   borrowing   of   $907,000,   an  SBA  loan  of   $151,000,   loans   from
stockholders/officers of $84,000 and loans/advances from a landlord of $137,000.

In addition to the  Washington,  D.C.  Daily Grill  opened in March,  1997,  the
Company  presently  anticipates  opening one additional Daily Grill store in the
greater Washington, D.C. area and has signed an agreement to form an LLC for the
operation of a "The Grill" restaurant in San Jose, California.  The Company will
contribute $200,000 toward the expected cost of this restaurant of approximately
$1,500,000. The cost of opening new Daily Grill restaurants is anticipated to be
between  $800,000  and  $1,400,000  per site  depending  upon the  location  and
available tenant allowances.

On June 24, 1997, the Company completed a private placement of 200,000 shares of
common stock,  1,000 shares of Series I Convertible  Preferred Stock, 500 shares
of Series II Convertible  Preferred Stock,  750,000 five year $2.00 Warrants and
750,000 five year $3.00 Warrants.  The aggregate sales price of those securities
was $1,500,000.

The Series I Convertible  Preferred  Stock is  convertible  into common stock at
$1.25 per share.

The Series II  Convertible  Preferred  Stock is  convertible  into common  stock
commencing  one year from the date of  issuance  at the greater of (i) $1.00 per
share, or (ii) 75 % of the average  closing price of the Company's  common stock
for the five trading days immediately prior to the date of conversion; provided,
however, that the conversion price shall in no event exceed $2.50 per share. The
Series II Convertible  Preferred Stock is entitled to receive an annual dividend
equal to $100 per share  payable on  conversion or redemption in cash or, at the
Company's option,  in common stock at the then applicable  conversion price. The
Series II Convertible  Preferred Stock is subject to redemption,  in whole or in
part,  at the  option of the  Company  on or after  the  second  anniversary  of
issuance at $1,000 per share.

The $2.00 Warrants are  exercisable to purchase common stock at a price of $2.00
per share commencing three years from the date of issuance and ending five years
from the date of issuance. The $2.00 Warrants are subject to cancellation in the
event the  holders of Series I  Preferred  Stock,  or common  stock  issued upon
conversion of such  preferred  stock,  sell,  assign or transfer such  preferred
stock or underlying  common stock,  other than  transfers to permitted  persons,
within three years of the initial sale of the warrants.

The $3.00 Warrants are  exercisable to purchase common stock at a price of $3.00
per share commencing three years from the date of issuance and ending five years
from the date of issuance. The $3.00 Warrants are subject to cancellation in the
event the  holders of Series I  Preferred  Stock,  or common  stock  issued upon
conversion of such  preferred  stock,  sell,  assign or transfer such  preferred
stock or underlying  common stock,  other than  transfers to permitted  persons,
within three years of the initial sale of the warrants.

In accordance with the recent position of the Securities and Exchange Commission
regarding accounting for Preferred Stock which is convertible at a discount from
market price for common stock,  the Company has reflected an accounting  "deemed
dividend". This accounting deemed dividend, which relates to the issuance of the
Preferred Stock, is a non-cash,  non-recurring  accounting entry for determining
income (loss) applicable to common stock and income (loss) per share.

Other than the opening of new restaurants,  management believes that the Company
has adequate  resources on hand and through cash flow to sustain  operations for
at least the following 12 months.

                           PART II - OTHER INFORMATION

Item 2. Changes in Securities

(a)  On June 24, 1997, the Company sold (i) 200,000 shares of common stock, (ii)
     1,000 shares of Series I Convertible  Preferred Stock,  (iii) 500 shares of
     Series II  Convertible  Preferred  Stock,  (iv)  750,000  five  year  $2.00
     warrants and (v) 750,000 five year $3.00 warrants.

(b)  The securities were issued to a single accredited investor.


                                       8
<PAGE>
(c)  The aggregate sales price of such securities was $1,500,000. No commissions
     or discounts were paid in connection with the placement.

(d)  The  securities  were  offered  pursuant  to  Regulation  D. The  offer was
     directed  exclusively  to a  single  accredited  investor  without  general
     solicitation or advertising and based on representations  from the investor
     that such  investor was  acquiring  for  investment.  The  securities  bear
     legends restricting the resale thereof.

(e)  The Series I Convertible  Preferred Stock is convertible  into common stock
     at $1.25 per share.

     The Series II Convertible Stock is convertible into common stock commencing
one year from the date of  issuance  at the  greater of (i) $1.00 per share,  or
(ii) 75% of the average closing price of the Company's common stock for the five
trading days  immediately  prior to the date of conversion;  provided,  however,
that the conversion  price shall in no event exceed $2.50 per share.  The Series
II Convertible  Preferred  Stock is entitled to receive an annual dividend equal
to $100 per  share  payable  on  conversion  or  redemption  in cash or,  at the
Company's option,  in common stock at the then applicable  conversion price. The
Series II Convertible  Preferred Stock is subject to redemption,  in whole or in
part,  at the  option of the  Company  on or after  the  second  anniversary  of
issuance at $1,000 per share.

     The $2.00 Warrants are  exercisable to purchase  common stock at a price of
$2.00 per share commencing three years from the date of issuance and ending five
years from the date of issuance.  The $2.00 Warrants are subject to cancellation
in the event the holders of Series I Preferred  Stock,  or common  stock  issued
upon conversion of such preferred stock, sell, assign or transfer such preferred
stock or underlying  common stock,  other than  transfers to permitted  persons,
within three years of the initial sale of the warrants.

     The $3.00 Warrants are  exercisable to purchase  common stock at a price of
$3.00 per share commencing three years from the date of issuance and ending five
years from the date of issuance.  The $3.00 Warrants are subject to cancellation
in the event the holders of Series I Preferred  Stock,  or common  stock  issued
upon conversion of such preferred stock, sell, assign or transfer such preferred
stock or underlying  common stock,  other than  transfers to permitted  persons,
within three years of the initial sale of the  warrants.  

Item 4. Submission of Matters to a Vote of Security Holders

(a)  On June 6, 1997, an annual meeting of shareholders of Grill Concepts,  Inc.
     was held.

(b)  The  following  directors  were  elected  (by the vote  indicated)  at such
     meeting:


     Robert Wechsler      9,621,920  For  15,642  Against  18,590  Abstain
     Robert Spivak        9,636,635  For     927  Against  18,590  Abstain
     Michael Weinstock    9,636,635  For     927  Against  18,590  Abstain
     Richard Shapiro      9,636,920  For     642  Against  18,590  Abstain
     Charles Frank        9,636,920  For     642  Against  18,590  Abstain
     Glenn Golenberg      9,621,635  For  13,905  Against  18,590  Abstain
     Pater Balas          9,621,635  For  15,927  Against  18,590  Abstain

(c)  In addition to the  election of directors  as noted  above,  the  following
     matters were voted upon at such meeting:

     (i)  Approval of amendment to Certificate of  Incorporation to increase the
          number of authorized  shares of common stock from 20,000,000 shares to
          30,000,000 shares (8,203,638 For, 166,068 Against, 22,233 Abstain)

     (ii) Ratification  of appointment of Coopers & Lybrand LLP as the Company's
          independent  certifying  accountants  (9,524,903  For, 79,066 Against,
          51,183 Abstain)


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<PAGE>
Item 6. Exhibits and Reports on Form 8-K

     (a)  Exhibits

          Exhibit No.                   Description

              3.1       Certificate of Amendment to Restated Certificate of
                        Incorporation

              4.1       Certificate  of  Designation  of Series I  Convertible  
                        Preferred Stock

              4.2       Certificate of  Designation  of Series II  Convertible
                        Preferred Stock

              10.1      Form of $2.00 Warrant

              10.2      Form of $3.00 Warrant


     (b)  Reports on Form 8-K

          None


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<PAGE>
                                   SIGNATURES


In accordance with the  requirements of the Exchange Act, the registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.



                                              GRILL CONCEPTS, INC.



Dated:  August 8, 1997                        By: /s/ Robert Spivak
                                                 -------------------------------
                                                  Robert Spivak
                                                  President and C.E.O


Dated:  August 8, 1997                        By: /s/ Ben Sumner
                                                 -------------------------------
                                                  Ben Sumner
                                                  Chief Financial Officer and
                                                  Accounting Officer



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