<PAGE>
                     U.S. SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                    FORM 10-Q


[X]   Quarterly report under Section 13 or 15(d) of the Securities  Exchange Act
      of 1934

                For the quarterly period ended September 29, 2002

[ ]   Transition  report under Section 13 or 15 (d) of the  Securities  Exchange
      Act of 1934

    For the transition period from ____________________ to _________________

                         Commission file number 0-21625


                         FAMOUS DAVE'S OF AMERICA, INC.
             (Exact Name of Registrant as Specified in Its Charter)

          Minnesota                                              41-1782300
(State or other Jurisdiction of                               (I.R.S. Employer
Incorporation or Organization)                               Identification No.)

                    8091 Wallace Road, Eden Prairie, MN 55344
                    (Address of Principal Executive Offices)
                                 (952) 294-1300
              (Registrant's Telephone Number, Including Area Code)

                   7357 Anagram Drive, Eden Prairie, MN 55344
              (Former Name, Former Address and Former Fiscal Year,
                         If Changed Since Last Report)

      Indicate by check whether the registrant: (1) filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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 [ ]

      At November 12, 2002 there were 11,385,375 shares of common stock, $.01
par value, outstanding.

           Transitional Small Business Disclosure Format (check one):

                                 Yes [ ] No [X]
<PAGE>
                         FAMOUS DAVE'S OF AMERICA, INC.
                               September 29, 2002

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                        PAGE NO.
                                                                        --------
<S>       <C>                                                           <C>
PART I    FINANCIAL INFORMATION

Item 1    Condensed Consolidated Financial Statements

             Condensed Consolidated Balance Sheets -                         3
             September 29, 2002 and December 30, 2001

             Condensed Consolidated Statements of Operations -
             For the thirty-nine weeks and thirteen weeks ended
             September 29, 2002 and
             September 30, 2001                                              4

             Condensed Consolidated Statements of Cash Flows -
             For the thirty-nine weeks ended September 29, 2002
             and September 30, 2001                                          5

            Notes to Condensed Consolidated Financial Statements             6

Item 2    Management's Discussion and Analysis of Financial Condition
            and Results of Operations                                       10

Item 3    Quantitative and Qualitative Disclosures About Market Risk        19

Item 4    Controls and Procedures                                           19

PART II   OTHER INFORMATION

Item 1    Legal Proceedings                                                 20

Item 6    Exhibits and Reports on Form 8-K                                  20

          SIGNATURES                                                        21

          CERTIFICATIONS                                                    22
</TABLE>


                                       2
<PAGE>
                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                    SEPTEMBER 29, 2002 AND DECEMBER 30, 2001
                      (IN THOUSANDS, EXCEPT PER SHARE DATA)

<TABLE>
<CAPTION>
                                                                 (UNAUDITED)     (AUDITED)
                                                                SEPTEMBER 29,   DECEMBER 30,
                                                                    2002            2001
                                                                -------------   ------------
<S>                                                             <C>             <C>
                                     ASSETS
CURRENT ASSETS:
  Cash and cash equivalents                                       $  7,411        $  7,398
  Accounts receivable, net                                           1,536           1,374
  Inventories                                                        1,607           1,441
  Prepaids and other current assets                                  3,388           1,273
                                                                  --------        --------
     Total current assets                                           13,942          11,486

PROPERTY, EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET                 50,059          46,940

Other assets:
  Notes receivable, net of current portion                           1,430           1,146
  Deposits                                                             358             410
  Debt issuance costs, net                                             643             618
  Investment in and advances to unconsolidated subsidiary                0           4,830
  Deferred tax assets                                                5,457           5,010
                                                                  --------        --------

TOTAL ASSETS                                                      $ 71,889        $ 70,440
                                                                  ========        ========

                      LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
  Line of credit                                                  $      0        $    100
  Current portion of long-term debt                                    322             695
  Current portion of capital lease obligations                         732             865
  Accounts payable                                                   2,693           2,419
  Accrued payroll and related taxes                                    861           1,134
  Other current liabilities                                          1,960           2,096
                                                                  --------        --------
     Total current liabilities                                       6,568           7,309

LONG-TERM DEBT, NET OF CURRENT PORTION                              10,833           8,886
FINANCING LEASE OBLIGATION                                           4,500           4,500
CAPITAL LEASE OBLIGATIONS, NET OF CURRENT PORTION                      892           1,193
DEFERRED RENT                                                        2,001           1,553
DEFERRED GAIN, NET OF CURRENT PORTION                                  283             310
                                                                  --------        --------
     Total liabilities                                              25,077          23,751
                                                                  --------        --------

SHAREHOLDERS' EQUITY:
  Common stock, $.01 par value, 100,000 shares authorized,
   11,388 and 11,180 shares issued and outstanding                     114             112
  Additional paid-in capital                                        53,514          52,693
  Accumulated deficit                                               (6,816)         (6,116)
                                                                  --------        --------
     Total shareholders' equity                                     46,812          46,689
                                                                  --------        --------

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY                        $ 71,889        $ 70,440
                                                                  ========        ========
</TABLE>


     See accompanying notes to condensed consolidated financial statements.


                                       3
<PAGE>
                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
          (IN THOUSANDS, EXCEPT PER SHARE DATA AND SHARES OUTSTANDING)
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                     THIRTEEN WEEKS ENDED           THIRTY NINE WEEKS ENDED
                                                                 -----------------------------   -----------------------------
                                                                 SEPTEMBER 29,   SEPTEMBER 30,   SEPTEMBER 29,   SEPTEMBER 30,
                                                                     2002            2001            2002            2001
                                                                 -------------   -------------   -------------   -------------
<S>                                                              <C>             <C>             <C>             <C>
REVENUES                                                         $     23,868    $     23,105    $     69,281    $     66,421
                                                                 ------------    ------------    ------------    ------------

COSTS AND EXPENSES:
  Food and beverage costs                                               7,142           7,075          21,017          20,548
  Labor and benefits                                                    6,698           6,109          18,856          17,906
  Operating expenses                                                    5,160           4,866          14,898          14,738
  Depreciation and amortization                                         1,157           1,120           3,433           3,293
  Pre-opening expenses                                                    382             192             712             518
  General and administrative                                            2,127           1,717           5,917           4,791
                                                                 ------------    ------------    ------------    ------------
     Total costs and expenses                                          22,666          21,079          64,833          61,794
                                                                 ------------    ------------    ------------    ------------

INCOME FROM OPERATIONS                                                  1,202           2,026           4,448           4,627
                                                                 ------------    ------------    ------------    ------------

OTHER INCOME (EXPENSE):
  Interest income                                                         120              40             327              94
  Interest expense                                                       (333)           (396)         (1,084)         (1,169)
  Gain (loss) on sale of assets                                          (212)              8             560             112
  Other income (expense), net                                             (67)             28              56              51
  Equity in losses and impairment of                                   (4,906)           (403)         (5,454)           (596)
   investment in unconsolidated subsidiary
                                                                 ------------    ------------    ------------    ------------
     Total other income (expense)                                      (5,398)           (723)         (5,595)         (1,508)
                                                                 ------------    ------------    ------------    ------------

INCOME (LOSS) BEFORE INCOME TAXES                                      (4,196)          1,303          (1,147)          3,119

INCOME TAX BENEFIT                                                      1,636           3,192             447           3,192
                                                                 ------------    ------------    ------------    ------------

Net Income (Loss)                                                $     (2,560)   $      4,495    $       (700)   $      6,311
                                                                 ============    ============    ============    ============

BASIC NET INCOME (LOSS) PER COMMON SHARE                         $      (0.22)   $       0.45    $      (0.06)   $       0.65
                                                                 ============    ============    ============    ============

DILUTED NET INCOME (LOSS) PER COMMON SHARE                       $      (0.22)   $       0.41    $      (0.06)   $       0.59
                                                                 ============    ============    ============    ============

       WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - BASIC          11,386,000      10,021,000      11,318,000       9,724,000
                                                                 ============    ============    ============    ============

       WEIGHTED AVERAGE COMMON SHARES OUTSTANDING - DILUTED        11,386,000      10,922,000      11,318,000      10,697,000
                                                                 ============    ============    ============    ============
</TABLE>


     See accompanying notes to condensed consolidated financial statements.


                                       4
<PAGE>
                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                   (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                             THIRTY NINE WEEKS ENDED

                                                                                           SEPTEMBER 29,   SEPTEMBER 30,
                                                                                               2002            2001
                                                                                           -------------   -------------
<S>                                                                                        <C>              <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
  Net income (loss)                                                                          $   (700)       $  6,311
  Adjustments to reconcile net income (loss) to cash flows from operating activities
    Depreciation and amortization                                                               3,433           3,293
    Gain on sale of assets                                                                       (646)           (112)
    Deferred Tax Benefit                                                                         (448)         (3,195)
    Deferred Rent                                                                                 514               0
    Equity in loss of unconsolidated subsidiary                                                 5,454             596
    Changes in operating assets and liabilities:
     Accounts receivable, net                                                                     200            (250)
     Inventories                                                                                 (338)            (15)
     Prepaids and other current assets                                                           (183)           (296)
     Deposits                                                                                      52             181
     Accounts payable                                                                             244            (441)
     Accrued payroll and related taxes                                                           (273)            (83)
     Other current liabilities                                                                   (137)           (143)
                                                                                             --------        --------
      Cash flows from operating activities                                                      7,172           5,846
                                                                                             --------        --------

CASH FLOWS FROM INVESTING ACTIVITIES:
  Proceeds from sale of property, equipment, and leasehold improvements                         3,083               0
  Purchases of property, equipment and leasehold improvements                                 (10,811)         (5,168)
  Investment in (advances to) unconsolidated subsidiary                                        (1,267)         (1,352)
  Repayments of advances from investment in unconsolidated subsidiary                             558               0
  Payments received on notes receivable                                                           943             122
  Advances on notes receivable                                                                   (887)              0
                                                                                             --------        --------
      Cash flows from investing activities                                                     (8,381)         (6,398)
                                                                                             --------        --------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Payments for debt issuance costs                                                                (19)            (27)
  Proceeds from capital lease obligations                                                          35             976
  Net payments on line of credit                                                                 (100)           (344)
  Payments on long-term debt                                                                   (1,108)           (458)
  Payments on capital lease obligations                                                          (744)           (718)
  Proceeds from debt obligations                                                                2,582               0
  Proceeds from exercise of stock options and warrants                                            576           2,104
                                                                                             --------        --------
      Cash flows from financing activities                                                      1,222           1,533
                                                                                             --------        --------

INCREASE IN CASH AND CASH EQUIVALENTS                                                              13             981

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                                  7,398           1,895
                                                                                             --------        --------

CASH AND CASH EQUIVALENTS, END OF PERIOD                                                     $  7,411        $  2,876
                                                                                             ========        ========

NON-CASH INVESTING AND FINANCING ACTIVITIES:
  Note receivable issued in connection with sale of assets                                   $  2,187        $    145
                                                                                             ========        ========
   Stock options issued for debt issuance costs                                              $     41        $      0
                                                                                             ========        ========
   Equipment purchased under capital lease obligations                                       $     45        $  2,294
                                                                                             ========        ========
   Property and equipment exchanged for investment in unconsolidated subsidiary              $      0        $  2,665
                                                                                             ========        ========
   Common stock issued in connection with property acquired                                  $    206        $      0
                                                                                             ========        ========
</TABLE>


     See accompanying notes to condensed consolidated financial statements.


                                       5
<PAGE>
                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 29, 2002
                                   (UNAUDITED)

(1)   GENERAL

      Famous Dave's of America, Inc. ("Famous Dave's" or the "Company")
currently operates or franchises sixty-nine restaurants under the name "Famous
Dave's" throughout various regions of the United States. Our restaurants, the
majority of which offer full table service, feature hickory smoked,
off-the-grill favorites served in one of our two casual formats: a "northwoods"
style lodge, or a nostalgic roadhouse "shack". We also operate one Blues Club
featuring nightly musical entertainment. We seek to differentiate ourselves by
providing high quality food in these distinctive and comfortable environments.
At September 29, 2002, there were two additional company-owned and four
franchised restaurants in development. As of September 30, 2001 we operated or
franchised fifty restaurants, with one additional company-owned and six
franchised units in development.

(2)   BASIS OF FINANCIAL STATEMENT PRESENTATION

      The accompanying unaudited condensed consolidated financial statements
have been prepared by us following the rules and regulations of the Securities
and Exchange Commission. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with accounting
principles generally accepted in the United States of America have been
condensed or omitted pursuant to such rules and regulations. Although we believe
that the disclosures are adequate to make the information presented not
misleading, it is suggested that these interim condensed consolidated financial
statements be read in conjunction with our most recent audited consolidated
financial statements and notes thereto included in our Annual Report on Form
10-K for the fiscal year ended December 30, 2001. In our opinion, all
adjustments (which include only normal recurring adjustments) necessary for a
fair presentation of the financial position, results of operations and cash
flows for the interim periods presented have been made.

(3)   IMPAIRMENT OF LONG-LIVED ASSETS

      Restaurant sites are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable. Recoverability of restaurant sites to be held and used is measured
by a comparison of the carrying amount of the restaurant site to future net cash
flows expected to be generated on a restaurant-by-restaurant basis. If such
restaurant site is considered to be impaired, the impairment to be recognized is
measured by the amount by which the carrying amount of the restaurant site
exceeds the fair value. Restaurant sites to be disposed of are reported at the
lower of their carrying amount or fair value on a restaurant-by-restaurant
basis, less estimated costs to sell.

(4)   RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

      In April 2002, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 145, "Rescission of FASB
Statements No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical
Corrections." The Company believes the adoption of SFAS No. 145 will not have a
material effect on the Company's consolidated financial position or results of
operations.

      In June 2002, FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities." SFAS No. 146 requires the recognition of a
liability for a cost associated with an exit or disposal activity when the
liability is incurred versus the date the Company commits to an exit plan. In
addition, SFAS No. 146 states the liability should be initially measured at fair
value. The requirements of SFAS No. 146 are effective for exit or disposal
activities that are initiated after December 31, 2002. The Company believes the
adoption of SFAS No. 146 will not have a material effect on the Company's
consolidated financial position or results of operations.


                                       6
<PAGE>

                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                               SEPTEMBER 29, 2002
                                   (UNAUDITED)

(5)   NET INCOME (LOSS) PER SHARE OF COMMON STOCK

      Basic net income (loss) per share is computed by dividing the net income
(loss) by the weighted average number of common shares outstanding during the
reporting period. The Company's diluted net income (loss) per share is computed
by dividing net income (loss) by the sum of the weighted average number of
shares of common stock outstanding and common share equivalents, when dilutive,
for the reporting period. Following is a table (in thousands, except per share
data) of a reconciliation of basic and diluted net income (loss) per common
share:

<TABLE>
<CAPTION>
                                                      Thirteen Weeks Ended            Thirty Nine Weeks Ended

                                                 September 29,    September 30,   September 29,    September 30,
                                                     2002             2001            2002             2001
<S>                                              <C>              <C>             <C>              <C>
NET INCOME (LOSS) PER SHARE - BASIC:
  Net income (loss)                                $ (2,560)        $  4,495        $   (700)        $  6,311
  Weighted average shares - outstanding              11,386           10,021          11,318            9,724
  Net income (loss) per share - basic              $   (.22)        $    .45        $   (.06)        $    .65

NET INCOME (LOSS) PER SHARE -DILUTED:
  Net income (loss)                                $ (2,560)        $  4,495        $   (700)        $  6,311
  Weighted average shares outstanding                11,386           10,021          11,318            9,724
  Dilutive impact of common stock
    equivalents outstanding                                              901                              973
                                                   --------         --------        --------         --------
  Weighted average shares and                        11,386           10,922          11,318           10,697
    potential dilutive shares outstanding
  Net income (loss) per share - dilutive           $   (.22)        $    .41        $   (.06)        $    .59
</TABLE>

      The Company uses the treasury stock method for calculating the dilutive
effect of the stock options and warrants (using the average market price).

      If we had achieved positive net income, common share equivalents of
615,000 and 630,000 would have been included in the calculation of diluted
income per share. Options to purchase 378,000 shares of common stock with a
weighted average exercise price of $6.92 were outstanding at September 29, 2002,
but would have been excluded from the computation of common share equivalents
for the thirteen week diluted share calculation because their exercise prices
were greater than the average market price of the common shares for that period.
All options and warrants would have been dilutive for the thirteen week period
ended September 29, 2002.

      Options to purchase 108,000 shares of common stock with a weighted average
exercise price of $7.71 were outstanding at September 29, 2002 but would have
been excluded from the computation of common share equivalents for the
thirty-nine week diluted share calculation because their exercise prices were
greater than the average market price of the common shares for that period.

(6)   INCOME FROM FRANCHISEES

      As of September 29, 2002 we had thirty-one franchise units in operation,
six in Minnesota, six in Wisconsin, four in Illinois, three in Nebraska, two in
Utah and one each in Alabama, Indiana, Iowa, South Dakota, Tennessee, Ohio, New
Jersey, North Dakota, Kentucky and Georgia. All of our franchise agreements
require that each restaurant operate in accordance with our operating
procedures, adhere to the menu established by us and meet all quality, service
and cleanliness standards.


                                       7
<PAGE>
                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                               SEPTEMBER 29, 2002
                                   (UNAUDITED)

(7)   RELATED PARTY TRANSACTIONS

      S&D LAND HOLDINGS, INC. - S&D Land Holdings, Inc. ("S&D"), is a company
wholly owned by the Company's founding shareholder and Chairman. We lease the
real estate for three of our units from S&D. These leases have been in place
since 1996 and we consider the terms to be at market rates.

(8)   INCOME TAXES

      At September 29, 2002, the Company had generated net operating losses of
approximately $6.8 million, which, if not used, will begin to expire in 2011,
and tax credit carry forwards of approximately $719,000 which, if not used, will
also begin to expire in 2011. Future changes in ownership of the Company may
place limitations on the use of these net operating loss carry forwards. The
Company utilizes the liability method of accounting for income taxes. Deferred
tax assets and liabilities are recognized for the expected future tax
consequences attributable to temporary differences between the financial
statement and income tax reporting bases of assets and liabilities.

(9)   NOTES PAYABLE

      In May 2002, a note payable was signed with GE Capital Franchise Finance
Corporation for $1,485,321 to facilitate mortgage financing. The rate on the
note is 8.83%, with an expiration date of June, 2022. This note provided
financing for our first Richmond, Virginia location, and is secured by the
building, land, and fixtures at this property. This note replaced a preliminary
note payable signed in October 2001 for up to $1.6 million.

      In August 2002, a note payable was signed with GE Capital Franchise
Finance Corporation for $1,493,490 to facilitate mortgage financing. The rate on
the note is 8.75%, with an expiration date of August 2022. This note provided
financing for our second Richmond, Virginia location, and is secured by the
building, land, and fixtures at this property. This note replaced a preliminary
note payable signed in March, 2002 for up to $1.6 million.

      In September 2002, a note payable was entered into with GE Capital
Franchise Finance Corporation for $1,182,039 to provide financing for our
restaurant in Mesquite, Texas. The variable interest rate on this note is the
sum of 3.80% plus the one month London Interbank Offered Rate (LIBOR). This note
is secured by the building, land, and fixtures at this property.

(10)  FINANCING LEASE OBLIGATIONS

      In March 1999, we completed a sale-leaseback transaction involving three
of our existing units that provided proceeds of approximately $4.5 million.
Under this financing we are obligated to make monthly payments of approximately
$42,917 (which increases 4.04% every two years) for a minimum of twenty years.

(11)  DEFERRED GAIN AND NOTE RECEIVABLE

      During the second quarter ended July 2, 2000, the Company sold property
and equipment at two of its company-operated restaurants. These restaurants were
converted to franchises. The Company financed part of the sale price on each
transaction with notes that bear interest at 9.6% and 12% and require monthly
payments of principal and interest. The balance on these notes receivable was
approximately $787,000 as of September 29, 2002. They are secured by equipment
and mature through July 2010. The note receivable for the sale of one restaurant
was approximately 90% of the selling price. The Company recorded a deferred gain
on this sale and will recognize the gain over the term of the note receivable.

      Included in the notes receivable balance are several notes receivable with
franchisees relating to the sale of assets. This information is detailed in the
Company's Form 10-K for the fiscal year ended December 30, 2001. Total notes
receivable as of September 29, 2002 were $3,273,792.


                                       8
<PAGE>
                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                               SEPTEMBER 29, 2002
                                   (UNAUDITED)

      Advances on notes receivable during the thirty-nine week period ended
September 29, 2002 represent advances to franchisees. They are offset by
payments on notes receivable for a net effect of $56,000 of payments received
during the thirty-nine period ended September 29, 2002.

(12)  COMMITMENTS AND CONTINGENCIES

      The LLC that owns the Chicago club (FUMUME, LLC) is responsible for the
payment of the rent for the Chicago club; however, the Company remains liable
under the lease with the landowner. The lease expires in 2008 and the future
minimum rental payments are approximately $2,338,000 over the balance of the
lease life.

(13)  INVESTMENT IN AND ADVANCES TO UNCONSOLIDATED SUBSIDIARY

      The Company owns approximately 40% of the membership interest of FUMUME,
LLC, a company that develops themed restaurants based on the entertainment
artist Isaac Hayes.

      For the thirty-nine weeks ended September 29, 2002, the Company recorded
equity in losses of an unconsolidated subsidiary based on the greater of 40% of
the net loss (which is accounted for on the equity method of accounting) or 100%
of the cash loss the Company is obligated to fund pursuant to the FUMUME
operating agreement. For the thirty-nine weeks ended September 29, 2002, the
Company recorded 100% of the cash loss of $827,000.

      We completed an evaluation of the profitability outlook for the LLC. Based
on ongoing cash operating losses, we concluded that we would not be able to
recover the carrying value of the investment. We, therefore, have recorded
impairment losses totaling $4.8 million for the thirteen weeks ended September
29, 2002. $4.6 million of this impairment charge is included in losses and
impairment in unconsolidated subsidiary with the remaining $163,000 included in
other expenses.

      The Company has agreed to reimburse FUMUME for operating losses incurred
at the Memphis and Chicago clubs. The Company can terminate the reimbursement
obligation with respect to the Chicago club if after any two-year period ending
May 31 there has been a cumulative operating loss. With respect to the Memphis
club, the Company may terminate the reimbursement obligation if the cumulative
deficit of the club (excluding management fees) exceeds $2 million or, if after
any five-year period ending May 31, there has been a cumulative operating loss.

      The membership interest in FUMUME, LLC is voting and is not publicly
traded.

      See the "Management's Discussion and Analysis of Financial Condition and
Operations" section for further discussion of this topic.

(14)  SUBSEQUENT EVENT

      Two company-owned restaurants were sold to a new franchise group on July
1, 2002 for approximately $2.3 million. As part of this transaction, we provided
approximately $452,000 in financing in the form of 60-month notes bearing
interest at 9.5%. We also provided short term financing to the purchaser in the
amount of $1.73 million. The $1.73 million note was paid in full by the
franchisee on October 15, 2002.


                                       9
<PAGE>
                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

ITEM 2.

OVERVIEW

      The business of Famous Dave's of America, Inc. ("Famous Dave's" or the
"Company") is to develop, own, operate and franchise casual dining restaurants
under the name "Famous Dave's." As of September 29, 2002 we owned & operated or
franchised 69 restaurants, with locations shown in the table below. We expect to
open two additional company-owned restaurants before the end of the fiscal year.
In addition, we have signed development agreements representing commitments to
develop an additional 115 franchised restaurants. We expect four of these
franchised restaurants to open before the end of the fiscal year.

<TABLE>
<CAPTION>
                           SEPTEMBER 29, 2002                           SEPTEMBER 30, 2001
                 ---------------------------------------      ---------------------------------------

                   COMPANY                                     COMPANY
                    OWNED      FRANCHISED       TOTAL           OWNED       FRANCHISED       TOTAL
  STATE          RESTAURANTS   RESTAURANTS   RESTAURANTS      RESTAURANTS   RESTAURANTS   RESTAURANTS
  -----          -----------   -----------   -----------      -----------   -----------   -----------
<S>              <C>           <C>           <C>              <C>            <C>          <C>
Alabama                0            1             1                0             0            0
Georgia                0            1             1                0             1            1
Illinois               9            4            13                8             3           11
Indiana                0            1             1                0             0            0
Iowa                   3            1             4                3             0            3
Kentucky               0            1             1                0             0            0
Maryland               5            0             5                4             0            4
Minnesota             12            6            18               13             4           17
Nebraska               1            3             4                1             1            2
New Jersey             0            1             1                0             0            0
North Dakota           0            1             1                0             0            0
Ohio                   0            1             1                0             0            0
Oklahoma               1            0             1                0             0            0
South Dakota           0            1             1                0             1            1
Tennessee              0            1             1                0             0            0
Texas                  2            0             2                0             0            0
Utah                   0            2             2                2             0            2
Virginia               5            0             5                3             0            3
Wisconsin              0            6             6                3             3            6
                 -----------   -----------   -----------      -----------   -----------   -----------
                      38           31            69               37            13           50
</TABLE>

      Famous Dave's is also a 40% participant in a joint venture (FUMUME, LLC)
to operate theme restaurant concepts based on the entertainment artist Isaac
Hayes. Pursuant to the agreement governing the joint venture, the participants
in the joint venture formed a Delaware limited liability company named FUMUME,
LLC. FUMUME opened its first location in Chicago in June 2001 and opened the
second location in Memphis, Tennessee in October 2001. Each location is
structured as a separate Delaware limited liability company, each of which is
wholly owned by FUMUME.


                                       10
<PAGE>
                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

      Our future additional revenues and profits will depend upon various
factors, including additional market acceptance of the Famous Dave's concept,
the quality of our restaurant operations, the ability to successfully expand
into new markets, our ability to raise additional financing as required and
general economic conditions. There can be no assurance that we will successfully
implement our expansion plans, in which case we will continue to be dependent on
revenues from existing operations. We also face all of the risks, expenses and
difficulties frequently encountered in the development of an expanding business.
Furthermore, to the extent that our expansion strategy is successful, we must
manage the transition to multiple-site and higher-volume operations, the control
of overhead expenses and the addition and retention of necessary personnel.

      Components of operating expenses include operating payroll and employee
benefits, occupancy costs, repairs and maintenance, and advertising and
promotion. Certain of these costs are variable and will increase with sales
volume. The primary fixed costs are corporate and restaurant management and
occupancy costs. Our experience is that when a new restaurant opens, it incurs
higher than normal levels of labor and food costs until operations stabilize,
usually during the first three months of operation. As restaurant management and
staff gain experience after the opening of a new restaurant, improvements are
seen in expense controls such as labor scheduling, food cost management and
operating expenses, and expense levels are brought down to levels similar to
those at our more established restaurants.

      General and administrative expenses include all corporate and
administrative functions that serve to support existing operations and provide
an infrastructure to support future growth. Management, supervisory and staff
salaries, employee benefits, travel, rent, depreciation, general insurance and
marketing expenses are major items in this category.

      The following discussion and analysis of financial condition and results
of operations should be read in conjunction with the accompanying unaudited
condensed consolidated financial statements and notes and the audited
consolidated financial statements and notes included in the Company's Form 10-K
for the fiscal year ended December 30, 2001.


                                       11
<PAGE>
                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

RESULTS OF OPERATIONS

      Our restaurant level operating profit expressed as a percentage of
restaurant revenues is as follows: (this does not include any of our Franchise
Royalty Income, Licensing Royalty Income, or Franchise Fee Income):

<TABLE>
<CAPTION>
                                             THIRTEEN WEEKS ENDED          THIRTY-NINE WEEKS ENDED
                                          SEPTEMBER 29,   SEPTEMBER 30,  SEPTEMBER 29,  SEPTEMBER 30,
                                              2002           2001           2002            2001
                                          (UNAUDITED)     (UNAUDITED)    (UNAUDITED)     (UNAUDITED)

<S>                                       <C>             <C>             <C>            <C>
RESTAURANT REVENUES                          100.0%         100.0%           100%           100%

UNIT-LEVEL COSTS AND EXPENSES
    Food and beverage costs                   31.7%          31.6%          31.9%          31.7%
    Labor and benefits                        29.7%          27.3%          28.6%          27.6%
    Operating expenses                        22.9%          21.7%          22.6%          22.7%
    Depreciation and amortization              4.8%           4.7%           5.2%           5.1%
    Pre-opening expenses                       1.7%           1.0%           1.1%           1.0%
                                             -----          -----          -----          -----
      Total costs and expenses                90.8%          86.3%          89.4%          88.1%
                                             -----          -----          -----          -----

RESTAURANT-LEVEL OPERATING PROFIT              9.2%          13.7%          10.6%          11.9%
                                             =====          =====          =====          =====
</TABLE>

REVENUES:

      RESTAURANT REVENUES

      Restaurant revenue for the thirteen weeks ended September 29, 2002 was
$22,554,000 compared to $22,393,000 for the same period in 2001, a 0.7%
increase. This increase is due to a higher number of operating weeks and a
slight increase in restaurant average weekly volume. For the thirty-nine weeks
ended September 29, 2002, restaurant revenue was $65,912,000 compared to
$64,889,000 for the same period in 2001, a 1.6% increase. This increase is due
to an increase in the number of operating weeks in 2002 and a slight increase in
restaurant average weekly volume.

      During the year between September 30, 2001 and September 29, 2002, seven
new company stores were opened, while six company-owned restaurants were sold to
franchisees. There were 466.3 operating weeks in 2002 compared to 465 in 2001
for company operated restaurants. Year-to-date, there were 1,375 operating weeks
in 2002 compared to 1,358 in 2001.

      As of September 29, 2002, the Company had twenty-seven restaurants that
had been open for more than eighteen months and these restaurants reported
decreases in same store sales of approximately 1.3% in the thirteen weeks ended
September 29, 2002. For the thirty-nine weeks ended September 29, 2002, same
store sales are flat.


                                       12
<PAGE>
                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

OTHER REVENUE

      Other revenue for the Company consists of royalty revenues and franchise
fees. Franchise revenues for the thirteen weeks ended September 29, 2002 were
$1,268,000 compared to $681,000 for the thirteen weeks ended September 30, 2001,
a 86.2% increase. For the thirty-nine week period ended September 29, 2002,
franchise revenues totaled $3,194,000 compared to $1,373,000 for the same period
in 2001, a 132.6% increase. Franchise revenue includes both franchise royalty
income and franchise fees. Royalties are based on a percent of sales, while fee
amounts reflect initial non-refundable fixed fees and are recorded as revenue
when an agreement is signed and no additional material services are required by
the Company. The increase in royalty revenues and franchise fees is primarily
due to an increase in the number of franchisees and the restaurants they have
opened. The Company had thirty-one franchise restaurants open at September 29,
2002, compared to thirteen at September 30, 2001. Average weekly volume for
franchise restaurants was $50,013 for the 13 weeks ended September 29, 2002, a
5.7% increase over the third quarter of 2001. Year-to-date, average weekly
volume at franchise restaurants was $49,036, a 4.7% increase over the same
period in 2001.

      The Company also receives licensing revenue based on sales of branded
products including sauces, seasoning and prepared meats. For the thirteen weeks
ended September 29, 2002, the licensing royalty income was $45,000, compared to
$31,000 for the same period in 2001. For the thirty-nine week period ended
September 29, 2002, the licensing royalty income was $175,000, compared to
$160,000 for the same period in 2001.

      The chart below shows a summary of revenues by type:

<TABLE>
<CAPTION>
                                      THIRTEEN WEEKS ENDED:         THIRTY-NINE WEEKS ENDED:
                                  SEPTEMBER 29,   SEPTEMBER 30,   SEPTEMBER 29,   SEPTEMBER 30,
                                      2002            2001            2002            2001
                                   (UNAUDITED)     (UNAUDITED)     (UNAUDITED)     (UNAUDITED)
<S>                               <C>             <C>             <C>             <C>
REVENUE:

    Restaurant Revenues              $22,554         $22,393         $65,912         $64,889

    Franchise Royalty Income             929             346           2,254             897

    Franchise Fees                       340             335             940             475

    Licensing Royalty Income              45              31             175             160
                                     -------         -------         -------         -------
      TOTAL REVENUES                 $23,868         $23,105         $69,281         $66,421
                                     =======         =======         =======         =======
</TABLE>

FOOD AND BEVERAGE COSTS

      Food and beverage costs for the thirteen weeks ended September 29, 2002
were $7,142,000 or 31.7% of restaurant revenue, compared to $7,075,000 or 31.6%
of restaurant revenue for the same period in 2001. For the thirty-nine week
period ended September 29, 2002, food and beverage costs were $21,017,000, or
31.9% of restaurant revenue, compared to $20,548,000 or 31.7% of restaurant
revenue for the same period in 2001. The increase in food and beverage costs as
a percent of restaurant revenue was due primarily to an increase in rib prices
offset by decreases in beef and chicken products. We renewed our pork contract
during October 2002 at prices below the previous contract and, therefore, expect
a slight improvement in food costs during the last month of this year and into
2003.


                                       13
<PAGE>
                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

LABOR AND BENEFITS

      Labor and benefits for the thirteen weeks ended September 29, 2002 were
$6,698,000 or 29.7% of restaurant revenue, compared to $6,109,000 or 27.3% of
restaurant revenue for the same period in 2001. For the thirty-nine week period
ended September 29, 2002, labor and benefits were $18,856,000 or 28.6% of
restaurant revenue, compared to $17,906,000 or 27.6% of restaurant revenue for
the same period in 2001. This increase in labor and benefits as a percentage of
restaurant revenue is primarily due to increased staffing and inefficiencies at
new restaurants and the related increase in benefits costs. We expect to
maintain this level of costs for the fourth quarter of 2002.

OPERATING EXPENSES

      For the thirteen weeks ended September 29, 2002, operating costs were
$5,160,000 or 22.9% of restaurant revenue, compared to $4,866,000 or 21.7% of
restaurant revenue for the same period in 2001. For the thirty-nine week period
ended September 29, 2002, operating costs were $14,898,000 or 22.6% of
restaurant revenue, compared to $14,738,000 or 22.7% of restaurant revenue for
the same period in 2001. The increase in operating expense as a percent of
restaurant revenue were as a result of inefficiencies, especially at the newer
restaurants.

DEPRECIATION AND AMORTIZATION

      Unit-level depreciation and amortization for the thirteen weeks ended
September 29, 2002 was $1,082,000 or 4.8% of restaurant revenue compared to
$1,060,000 or 4.7% of restaurant revenue during the same period in 2001. For the
thirty-nine week period ended September 29, 2002, unit-level depreciation and
amortization was $3,226,000 or 4.9% of restaurant revenue, compared with
$3,119,000 or 4.9% of restaurant revenue for the same period in 2001.

      Total company depreciation and amortization for the thirteen weeks ended
September 29, 2002 was $1,157,000 or 4.8% of revenue compared to $1,120,000 or
4.7% of revenue during the same period in 2001. For the thirty-nine week period
ended September 29, 2002, total company depreciation and amortization was
$3,433,000 or 5.2% of restaurant revenue, compared with $3,293,000 or 5.1% of
restaurant revenue for the same period in 2001. The increased dollar amount of
depreciation expense is the result of new restaurants opened, offset by older
restaurants sold during the four quarters subsequent to July 1, 2001.

PRE-OPENING EXPENSES

      Pre-opening expenses were $382,000 or 1.7% of restaurant revenue for the
thirteen weeks ended September 29, 2002, compared to $192,000 or 1.0% of
restaurant revenue during the same period in 2001. For the thirty-nine week
period ended September 29, 2002, pre-opening expenses were $712,000 or 1.1% of
restaurant revenue, compared to $518,000 or 1.0% of restaurant revenue for the
same period in 2001. Pre-opening expenses are charged to expense in the month
that they are incurred. There were three new restaurant openings during the
third quarter of 2002, and six opened year-to-date, compared to two new units
opened in the third quarter of 2001, and five opened in the first three quarters
of 2001. Pre-opening costs will vary from location to location depending on a
number of factors, including (but not limited to) the size and physical layout
of each location; the cost of travel and lodging in different metropolitan
areas; and the relative difficulty of the restaurant staffing and training
process. The increase in pre-opening costs in 2002 over 2001, both in the
quarter in year-to-date periods, is primarily due to a greater number of
restaurants opened, as well excess pre-openings expenses related to the delayed
opening of our restaurant in Lewisville, Texas.


                                       14
<PAGE>
                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

RESTAURANT-LEVEL OPERATING PROFIT

      Restaurant-level operating profit represents income from restaurant
operations before general and administrative expenses, and excludes licensing,
royalty and fee income. Restaurant-level operating profit totaled $2,015,000 or
9.2% of restaurant revenue for the thirteen weeks ended September 29, 2002,
compared to $3,090,000 or 13.7% of restaurant revenue in the corresponding
period of 2001. For the thirty-nine week period ended September 29, 2002,
restaurant-level operating profit totaled $7,915,000 or 10.6% of restaurant
revenue, compared to $8,060,000 or 11.9% of restaurant revenue. Although
restaurant-level operating profit should not be considered an alternative to
income from operations as a measure of our operating performance, such
unit-level measurement is commonly used as an additional measure of operating
performance in the restaurant industry and certain related industries. The
decrease in restaurant-level operating profit for the quarter and year-to-date
periods, both in amount and as a percent of restaurant revenue from 2001 to
2002, is attributable to the increase in operating expenses as a percent of
revenues, as outlined in the previous sections.

GENERAL AND ADMINISTRATIVE EXPENSES

      General and administrative ("G&A") expenses for the thirteen weeks ended
September 29, 2002 were $2,127,000 or 8.9% of operating revenue, compared to
$1,717,000 or 7.4% of operating revenue for the same period in 2001. For the
thirty-nine week period ended September 29, 2002 G & A expenses were $5,917,000
or 8.5% of operating revenue, compared to $4,791,000 or 7.2% of operating
revenue for the same period in 2001. The increase in general and administrative
expenses reflects increased personnel at the corporate level and increased
recruiting and training costs to support restaurant and franchise growth. G&A
during the current quarter also included approximately $250,000 in legal
expenses related to a lawsuit in Dallas.

INCOME FROM OPERATIONS

      Income from operations totaled $1,202,000 or 5.0% of operating revenue for
the thirteen weeks ended September 29, 2002, compared to $2,026,000 or 8.8% of
operating revenue in the corresponding period in 2001. For the thirty-nine week
period ended September 29, 2002, income from operations totaled $4,448,000 or
6.4% of operating revenue, compared to $4,627,000 or 7.0% of operating revenue
in the same period in 2001. The decrease in income is primarily attributable to
an increase in operating expenses as outlined above.

INTEREST INCOME

      Interest income was $120,000 or 0.5% of operating revenue for the thirteen
weeks ended September 29, 2002. For the same period in 2001, interest income was
$40,000 or 0.2% of operating revenue. For the thirty-nine week period ended
September 29, 2002, interest income was $327,000 or 0.5% of operating revenue,
compared to $94,000 for the same period in 2001. The increase in interest income
from 2001 to 2002 is primarily due to increased interest earned from cash on
hand, as well as interest earned on notes receivable to the Company.

INTEREST EXPENSE

      Interest expense was $333,000, or 1.4% of operating revenue for the
thirteen weeks ended September 29, 2002. For the same period in 2001, interest
expense was $396,000, or 1.7% of operating revenue. For the thirty-nine week
period ended September 29, 2002, interest expense was $1,084,000, or 1.6% of
operating revenue, compared to $1,169,000, or 1.8% of operating revenue for the
same period in 2001. The decrease in dollars of expense is primarily due to
reduction of certain debt.

GAIN (LOSS) ON SALE OF ASSETS AND OTHER INCOME (EXPENSE)

      During the thirteen week period ended September 29, 2002, the Company
recorded a loss on the sale of assets and other expenses, net, of $(279,000), or
1.2% of revenue. This compares to $36,000, or 0.2% of


                                       15
<PAGE>
                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

revenue, for the same period in 2001. For the thirty-nine week period ended
September 29, 2002, the Company recorded a gain on sale of assets and other
income, net, of $616,000, or 0.9% of revenue, compared to $163,000 or 0.2% of
operating revenue for the same period in 2001. The entire loss on sale of
assets is attributable to the sale of two of our restaurants to a franchisee
in Utah. Other expenses of $67,000 is made up of our management fees and
equipment rental fees to FUMUME, LLC, offset by $163,000 in impairment charges
related to the investment in unconsolidated subsidiary.

EQUITY IN LOSSES AND IMPAIRMENT OF INVESTMENT IN UNCONSOLIDATED SUBSIDIARY

      Effective June 1, 2001, Famous Dave's Ribs-U, Inc., our wholly-owned
subsidiary, entered into a joint venture with Memphis-based Lifestyle Ventures,
LLC, H&H Holding Company, LLC and another investor to develop a themed
restaurant concept based on the entertainment artist Isaac Hayes. Pursuant to
the agreement governing the joint venture, the participants in the joint venture
formed a Delaware limited liability company named FUMUME, LLC. FUMUME opened its
first location in Chicago in June 2001 and its second location in Memphis,
Tennessee in October 2001. Each location is structured as a separate Delaware
limited liability company, each of which is wholly owned by FUMUME.

      In exchange for a 40% interest in the LLC, the Company agreed to
contribute: (i) $825,507 in working capital, (ii) the assets comprising Famous
Dave's Ribs and Blues Club in Chicago and (iii) certain rights to use Famous
Dave's various licensed marks. Although the joint venture that owns the Chicago
club is now responsible for the payment of the rent for the Chicago club, the
Company remains liable under the lease with the landowner.

      The Company has agreed to reimburse the LLC for operating losses incurred
at the Memphis and Chicago clubs. The Company can terminate our reimbursement
obligation with respect to the Chicago club if after any two-year period ending
May 31 there has been a cumulative operating loss. With respect to the Memphis
club, the Company may terminate the reimbursement obligation if the cumulative
deficit of the club (excluding management fees) exceeds $2 million or, if after
any five-year period ending May 31, there has been a cumulative operating loss.

      The Company has agreed to provide various management services for the
clubs. In exchange for these services, the Company will receive a fee equal to
3% of gross sales per year. The management agreement with respect to a
particular club terminates upon, among other things, the termination of our
loss-reimbursement obligations as described above.

      In the quarter ended September 29, 2002, the Company recorded 100% of the
cash losses of ($279,000), or (1.2%) of revenue, compared to ($403,000) or
(1.7%) during the same period of 2001. We also recorded an impairment reserve of
$4.8 million, of which $4,627,000 is included in this line. For the thirty-nine
week period, the total loss of $5,454,000 includes $827,000 of operating losses
compared to $596,000 during the same time period last year.

      The impairment charge reflects our conclusion that we will not be able to
recover the carrying value of the investment in the unconsolidated subsidiary.
We also remain contingently liable for the lease at the Chicago location and
anticipate an additional charge of approximately $1.6 million related to this
contingent liability by the end of the year. We are pursuing an exit from this
partnership. As we evaluate an exit strategy from this investment, we remain
liable for our obligations under the operating agreement.


                                       16
<PAGE>
                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

INCOME TAX PROVISION

      For the quarter ended September 29, 2002, the Company recorded an income
tax benefit of $1,636,000, or approximately 39% of the loss before taxes. For
the thirty-nine week period ended September 29, 2002, the income tax benefit
totals $447,000, or approximately 39% of loss before taxes. During the thirteen
weeks ended September 30, 2001, we reflected the full value of the deferred tax
asset of $3.2 million. Previous to the thirteen weeks ended September 30, 2001,
we had fully reserved the deferred tax assets due to the uncertainty of their
use in future periods.

NET INCOME (LOSS) PER COMMON SHARE

      The net income (loss) for the thirteen weeks ended September 29, 2002 was
$(2,560,000) or $(.22) per share on approximately 11,386,000 weighted average
shares outstanding, compared to $4,495,000 or $.41 per share on approximately
10,922,000 weighted average diluted shares outstanding during the comparable
period in 2001. The net loss for the thirty-nine weeks ended September 29, 2002
was $(700,000) or $(.06) per share on approximately 11,318,000 weighted average
shares outstanding, compared to $6,311,000 or $.59 per share on approximately
10,697,000 weighted average dilutive shares outstanding during the comparable
period in 2001. The decrease in net income (loss) per share is primarily a
result of the impairment charge in the current year and the adjustment to the
deferred tax asset in the prior year. It is also attributable to the increase in
operating expenses as described in earlier paragraphs.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

      During the thirty-nine weeks ending September 29, 2002, our balance of
cash and cash equivalents increased by $13,000 to approximately $7,411,000 from
the December 30, 2001 balance. The primary sources of cash were cash from
operations, proceeds from the sale of three restaurants to a franchisee, and
proceeds from financing, while the primary uses of cash were the purchases of
property, equipment and leasehold improvements (approximately $11.0 million),
and payments on long-term debt and capital leases (approximately $1.9 million).

      The Company finalized two note payables with GE Capital Franchise Finance
Corporation during the third quarter of 2002 for approximately $2.676 million.
These notes financed the land and building for our Mesquite, Texas and our
second Richmond, Virginia locations. The required payments are $9,420 and
$13,321 per month for a period of fifteen and twenty years respectively.

      To continue our expansion, we anticipate that additional financing will
likely be required during the next twelve months. Any proceeds from financing
will be used to purchase real estate and develop company-owned restaurants. For
the next twelve months, we believe that future development and expansion will be
funded or financed primarily through cash and short-term investments currently
held, and proceeds from forms of financing such as mortgages or other credit
facilities. However, there can be no assurance that additional financing
required for expansion will be available on terms acceptable or favorable to us.


                                       17
<PAGE>
                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

CRITICAL ACCOUNTING POLICIES

      Our significant accounting policies are described in Note One and Note Six
to the consolidated financial statements included in our annual report for the
year ended December 30, 2001. The accounting policies used in preparing our
interim 2002 consolidated condensed financial statements are the same as those
described in our annual report.

      Our critical accounting policies are those both having the most impact to
the reporting of our financial condition and results, and requiring significant
judgments and estimates. Our critical accounting policies include those related
to (a) property, equipment and leasehold improvements impairments; (b) initial
franchise revenues; (c) investment in unconsolidated subsidiary. The evaluation
of long-lived assets for impairment involves management judgment in estimating
future cash flows related to and fair values of such assets. Initial franchise
revenues are recognized when the Company has performed substantially all of its
obligations as franchisor. Management records the investment in unconsolidated
subsidiary on the equity method based on the Company's net loss obligation (100%
of the cash loss).

SEASONALITY

      Our units typically generate higher revenues during the second and third
quarters (spring and summer months) than in the first and fourth quarters (fall
and winter months) as a result of seasonal traffic increases experienced during
the summer months, and possible adverse weather that can disrupt customer and
employee transportation to our restaurants during the winter months.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

      The Private Securities Litigation Reform Act of 1995 provides a "safe
harbor" for forward-looking statements. Certain information included in this
Form 10-Q and other materials filed or to be filed with the Securities and
Exchange Commission (as well as information included in oral statements or other
written statements made or to be made by us) contain statements that are
forward-looking. A number of important factors could, individually or in the
aggregate, cause actual results to differ materially from those expressed or
implied in any forward-looking statements. Such factors include, but are not
limited to, the following: our ability to expand into new markets; our ability
to execute our expansion strategy; changes in business strategy or development
plans; availability and terms of capital; changes in costs of food, labor, and
employee benefits; changes in government regulations; competition; availability
of locations and terms of sites for restaurant development; development and
operating costs; advertising and promotional efforts; brand awareness. For
further information regarding these and other factors, see our Annual Report on
Form 10-K for the fiscal year ended December 30, 2001.


                                       18
<PAGE>
                 FAMOUS DAVE'S OF AMERICA, INC. AND SUBSIDIARIES
           QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

ITEM 3.

MARKET RISK SENSITIVITY

      The Company's financial instruments include cash and cash equivalents and
long-term debt. The Company includes as cash and cash equivalents certificates
of deposits and all other investments with original maturities of three months
or less when purchased and which are readily convertible into known amounts of
cash. The Company's cash and cash equivalents are not subject to significant
interest rate risk due to the short maturities of these instruments. The
Company's long-term debt is not subject to interest rate risk because all of the
Company's long-term debt has fixed rates of interest. The Company does not enter
into contracts for speculative purposes, nor is it a party to any leveraged
instruments.

ITEM 4.

CONTROLS AND PROCEDURES

Under the supervision and with the participation of our management, including
our chief executive officer and chief financial officer, we conducted an
evaluation of our disclosure controls and procedures, as such term is defined
under Rule 13a-14(C) promulgated under the Securities Exchange Act of 1934, as
amended, within 90 days of the filing date of this report. Based on their
evaluation, our chief executive officer and chief financial officer concluded
that our disclosure controls and procedures are effective.

There have been no significant changes (including corrective actions with regard
to significant deficiencies or material weaknesses) in our internal controls or
in other factors that could significantly affect these controls subsequent to
the date of the evaluation referenced above.


                                       19
<PAGE>
PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

      On August 19, 2002, the 44th district court of Texas issued a temporary
restraining order against the Company in favor of Colter's Restaurants, a
Dallas, Texas-based restaurant company. The restraining order enjoined Famous
Dave's from operating, locating, and advertising restaurants in the Dallas
market, excluding the restaurant that had opened in Mesquite, Texas. The order
did delay the opening of the Famous Dave's restaurant in Lewisville, Texas.

      Famous Dave's had been in negotiations with Colter's Restaurants regarding
the potential purchase, by Famous Dave's, of certain Colter's properties. The
two sides were not able to reach an agreement on any transaction. In its
lawsuit, Colter's claims that Famous Dave's used confidential information it
had obtained during the negotiations in selecting its sites to compete against
Colter's.

      On September 6, 2002, an agreed to Temporary Restraining Order was issued
in favor of Colter's Restaurants against Famous Dave's. This order specifically
allowed for the operations of the Famous Dave's restaurant in Mesquite, Texas
and allowed the opening of the Famous Dave's restaurant in Lewisville, Texas,
while enjoining the Company from operating, locating or advertising any
additional restaurants in the Dallas market pending a September 20 hearing.

      On September 25, 2002, the 44th District Court of Texas denied Colter's
Restaurants request for a temporary injunction, citing lack of sufficient
evidence to support such a request. The effect is that Famous Dave's is, once
again, allowed to operate, locate and advertise restaurants in the Dallas
market. Other claims, however, are still pending against the Company. We do not
believe that the remaining claims have any merit, although there can be no
certainty that we will be successful in defending such claims.

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a)   Exhibits

      10.1  1995 Stock Option and Compensation Plan (as amended through May 22,
            2002).

      10.2  1997 Employee Stock Option Plan (as amended through May 22, 2002).

      10.3  1998 Director Stock Option Plan (as amended through May 22, 2002).

      99.1  Certification from Chief Financial Officer and Chief Executive
            Officer

(b)   Reports on Form 8-K

On September 27, 2002, the Company filed a Current Report on Form 8-K dated
September 26, 2002 to announce that it had dismissed Virchow Krause and Company,
LLP as its independent accountants and that it had engaged Grant Thornton LLP to
be its new independent accountants.


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<PAGE>
                                   SIGNATURES

In accordance with 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.

                                           FAMOUS DAVE'S OF AMERICA, INC.


November 13, 2002                          /s/ Martin J. O'Dowd
                                           --------------------
                                           Martin J. O'Dowd
                                           President and Chief Executive Officer

November 13, 2002                          /s/ Kenneth J Stanecki
                                           ----------------------
                                           Kenneth J. Stanecki
                                           Chief Financial Officer


                                       21
<PAGE>
                                 CERTIFICATIONS

I, Martin J. O'Dowd, certify that:

      1.    I have reviewed this quarterly report on Form 10-Q of Famous Dave's
            of America, Inc.;

      2.    Based on my knowledge, this quarterly report does not contain any
            untrue statements of a material fact or omit to state a material
            fact necessary to make the statement made, in light of the
            circumstances under which such statements were made, not misleading
            with respects to the period covered by this quarterly report.;

      3.    Based on my knowledge, the financial statements, and other financial
            information included in this quarterly report, fairly present in all
            material respects, the financial condition, results of operations
            and cash flows of the registrant as of, and for, the periods
            presented in this quarterly report.;

      4.    The registrant's other officers and I are responsible for
            establishing and maintaining disclosure controls and procedures (as
            defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant
            and we have:

            a.    designed such disclosure controls and procedures to ensure
                  that material information relating to the registrant,
                  including its consolidated subsidiaries, is made known to us
                  by others within those entities, particularly during the
                  period in which this quarterly report is being prepared;

            b.    evaluated the effectiveness of the registrant's disclosure
                  controls and procedures as of a date within 90 days prior to
                  the filing of this quarterly report and

            c.    presented in this quarterly report our conclusions about the
                  effectiveness of the disclosure controls and procedures based
                  on our evaluation as of the filing of this quarterly report;

      5.    The registrant's other certifying officers and I have disclosed,
            based on our most recent evaluation, to the registrant's auditors
            and the audit committee of registrant's board of directors:

            a.    All significant deficiencies in the design or operation of
                  internal controls which could adversely affect the
                  registrant's ability to record, process, summarize and report
                  financial data and have identified for the registrant's
                  auditors any material weaknesses in internal controls; and

            b.    Any fraud, whether or not material, that involves management
                  or other employees who have a significant role in the
                  registrant's internal controls; and

      6.    The registrant's other certifying officers and I have identified in
            this quarterly report whether or not there were any significant
            changes in internal controls or in other factors that could
            significantly affect internal controls subsequent to the date of our
            most recent evaluation, including any corrective actions with regard
            to significant deficiencies and material weaknesses.

Dated: November 13, 2002                   /s/ Martin J. O'Dowd
                                           --------------------
                                           Martin J. O'Dowd
                                           President and Chief Executive Officer


                                       22
<PAGE>
                                 CERTIFICATIONS

I, Kenneth J. Stanecki, certify that:

      1.    I have reviewed this quarterly report on Form 10-Q of Famous Dave's
            of America, Inc.;

      2.    Based on my knowledge, this quarterly report does not contain any
            untrue statements of a material fact or omit to state a material
            fact necessary to make the statement made, in light of the
            circumstances under which such statements were made, not misleading
            with respects to the period covered by this quarterly report.;

      3.    Based on my knowledge, the financial statements, and other financial
            information included in this quarterly report, fairly present in all
            material respects, the financial condition, results of operations
            and cash flows of the registrant as of, and for, the periods
            presented in this quarterly report.;

      4.    The registrant's other officers and I are responsible for
            establishing and maintaining disclosure controls and procedures (as
            defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant
            and we have:

            a.    designed such disclosure controls and procedures to ensure
                  that material information relating to the registrant,
                  including its consolidated subsidiaries, is made known to us
                  by others within those entities, particularly during the
                  period in which this quarterly report is being prepared;

            b.    evaluated the effectiveness of the registrant's disclosure
                  controls and procedures as of a date within 90 days prior to
                  the filing of this quarterly report and

            c.    presented in this quarterly report our conclusions about the
                  effectiveness of the disclosure controls and procedures based
                  on our evaluation as of the filing of this quarterly report;

      5.    The registrant's other certifying officers and I have disclosed,
            based on our most recent evaluation, to the registrant's auditors
            and the audit committee of registrant's board of directors:

            a.    All significant deficiencies in the design or operation of
                  internal controls which could adversely affect the
                  registrant's ability to record, process, summarize and report
                  financial data and have identified for the registrant's
                  auditors any material weaknesses in internal controls; and

            b.    Any fraud, whether or not material, that involves management
                  or other employees who have a significant role in the
                  registrant's internal controls; and

      6.    The registrant's other certifying officers and I have identified in
            this quarterly report whether or not there were any significant
            changes in internal controls or in other factors that could
            significantly affect internal controls subsequent to the date of our
            most recent evaluation, including any corrective actions with regard
            to significant deficiencies and material weaknesses.

Dated: November 13, 2002                                 /s/ Kenneth J. Stanecki
                                                         -----------------------
                                                         Martin J. O'Dowd
                                                         Chief Financial Officer


                                       23