________________________________________________________________________
             _______________________________________________________
                        SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C.  20549

                                    FORM 10-K
      ___
     / X / Annual Report pursuant to Section 13 or 15(d) of the Securities
          Exchange Act of 1934
     For the fiscal year ended December 29, 1996
       __
     /    / Transition Report pursuant to Section 13 or 15(d) of the
          Securities Exchange Act of 1934
     For the transition period from ________ to ________

     Commission file number 1-8881

                                   SBARRO, INC.
              (Exact name of Registrant as specified in its charter)

                    NEW YORK                                11-2501939
     (State or other jurisdiction of           (I.R.S. Employer
      incorporation or organization)          Identification No.)


        763 Larkfield Road, Commack, New York                         11725
            (Address of principal executive offices)               (Zip Code)

     Registrant's telephone number, including area code:      (5l6) 864-0200


           Securities registered pursuant to Section 12(b) of the Act:

                                                  Name of each Exchange on
              Title of each class                        which Registered
     Common Stock, par value $.01 per share       New York Stock Exchange

        Securities registered pursuant to Section 12(g) of the Act:  None

          Indicate by check mark whether the registrant (1) has filed all
     reports required to be filed by Section 13 or 15(d) of the Securities
     Exchange Act of 1934 during the preceding 12 months (or for such shorter
     period that the registrant was required to file such reports), and (2)
     has been subject to such filing requirement for the past 90 days.
       Yes      X          No

          Indicate by check mark if disclosure of delinquent filers pursuant
     to Item 405 of Regulation S-K is not contained herein, and will not be
     contained, to the best of registrant's knowledge, in definitive proxy or
     information statements incorporated by reference in Part III of this
     Form 10-K or any amendment to this Form 10-K  [   ].

          The aggregate market value  of Common Stock held  by non-affiliates
     of the registrant as of March 14, 1997 was approximately $357,000,000.

          The number of shares of Common Stock  of the registrant outstanding
     as of March 14, 1997 was 20,407,825.


                       DOCUMENTS INCORPORATED BY REFERENCE

          Portions of the Proxy Statement  to be used in  connection with the
     registrant's 1997  Annual Meeting  of Shareholders  are incorporated  by
     reference into Part III of this report.





                                    SBARRO, INC.

                                       PART I

          ITEM 1.  BUSINESS


                    Sbarro, Inc., a New York corporation, was organized in
          1977 and is the successor to a number of family food and
          restaurant businesses developed and operated by the Sbarro
          family.  The Company has become a leading operator and franchisor
          of family-style Italian restaurants, with 816 Sbarro restaurants
          worldwide.  In addition, since 1995, the Company has created,
          through joint ventures, other concepts for the purpose of
          developing growth opportunities in addition to its Sbarro
          restaurants.  (See ``New Ventures'', below.)  As used in this
          report, the term "Company" refers to Sbarro, Inc. and its
          consolidated subsidiaries, unless the context indicates
          otherwise.


                    General

                    The Company develops and operates or franchises an
          international chain of family-style Italian restaurants under the
          "Sbarro" and "Sbarro The Italian Eatery"  names (``Sbarro
          restaurants'').  Sbarro restaurants are family-oriented
          cafeteria-style restaurants featuring a menu of popular Italian
          food, including pizza with a variety of toppings, a selection of
          pasta dishes and other hot and cold Italian entrees, salads,
          sandwiches, cheesecake and other desserts.

                    As of December 29, 1996, there were 816 Sbarro
          restaurants, located in 48 states throughout the United States,
          the District of Columbia and in Aruba, Australia, the Bahamas,
          Belgium, Canada, Chile, France, Israel, Japan, Korea, Kuwait,
          Lebanon, the Philippines, Puerto Rico, Qatar, Saudi Arabia, and
          the United Kingdom.  At that date, the Company owned and operated
          597 restaurants and franchised 219 Sbarro restaurants.  In
          addition, since 1995, the Company has created and operated,
          through joint ventures, other concepts for the purpose of
          developing growth opportunities in addition to its Sbarro
          restaurants.


                    Restaurant Expansion

                    The Company has expanded significantly in recent years,
          growing from 123 restaurants at the time of the Company's initial
          public offering of Common Stock in 1985 to 530 restaurants at the
          beginning of 1992 to 816 at the end of 1996.  During 1996, 65 new
          Sbarro restaurants were opened, of which 29 were Company-owned
          and 36 were franchised.
                                         -2-
                    During 1997, the Company plans to open approximately 80
          restaurants, of which approximately 40 are expected to be





          Company-owned and the balance are expected to be franchised.  The
          actual number of openings will depend on the availability of
          appropriate sites, as well as other factors.

                    While most Sbarro restaurants are located in shopping
          malls, in recent years the Company has been expanding the basic
          Sbarro concept outside the shopping mall environment by adding
          Company and franchise restaurants in downtown areas in major
          United States cities, such as Boston, Chicago, New York and
          Philadelphia, as well as on toll roads, in strip shopping
          centers, hospitals, convention centers, universities, casinos,
          hotels and airports.  In addition, kiosks have been introduced in
          certain selected markets.

                    The following table indicates the number of Company-
          owned and Sbarro franchised restaurants during each of the years
          from 1992 through 1996.

                                                  Fiscal Year

                                             1996  1995 1994 1993 1992
          Company-owned Sbarro restaurants:
           Opened during period  (*)         29    44   53   59   58
           Acquired from [sold to]
             franchisees during period - net  1     -    2    7   [1]
           Closed during period  (**)        [4]  [40]  [3]  [7] [13]
           Open at end of period            597   571  567  515  456

          Franchised Sbarro restaurants:
           Opened during period              36    40   38   24   26
           Purchased from [sold to]
             Company during period - net     [1]    -   [2]  [7]   1
           Closed or terminated during
             period                         [16]   [2]  [8] [14] [14]
           Open at end of period            219   200  162  134  131

          All Sbarro restaurants:
           Opened during period              65    84   91   83   84
           Closed or terminated during
             period                         [20]  [42] [11] [21] [27]
           Open at end of period            816   771  729  649  587

          Kiosks  (all franchised)            7     8    7    7    5

          (*)  Includes, in 1996, three mall locations of a joint venture
          which operate as Umberto of New Hyde Park units.

          (**)  In December 1995, the Company announced the planned closing
          of 40 Company-owned Sbarro restaurants.  The costs associated
          with the closing of these restaurants was provided for in the

                                         -3-
          1995 financial statements.  See Note A to "Selected Financial
          Data" in Item 6 of this Report and ``Management's Discussion and
          Analysis of Financial Condition and Results of Operations''in
          Item 7 of this Report.






                    Concept and Menu

                    Sbarro restaurants are family oriented, offering quick,
          efficient, friendly cafeteria and buffet style service designed
          to minimize customer waiting time and facilitate table turnover.
          The decor of a Sbarro restaurant incorporates booth and table
          seating (for "in-line" restaurants), with a contemporary motif
          that blends with the characteristics of the surrounding area.

                    As of December 29, 1996, there were 252 ``in-line''
          Sbarro restaurants and 556 ``food court'' Sbarro restaurants.  In
          addition, franchisees operated eight free-standing Sbarro
          restaurants, including five in the Middle East and one in each of
          the Bahamas, Puerto Rico and Minnesota.  "In-line" restaurants,
          which are self-contained restaurants, usually occupy
          approximately 1,500-3,000 square feet, contain the space and
          furniture to seat approximately 60-120 people and employ 10-40
          persons, including part-time personnel.  "Food court" restaurants
          are primarily located in areas of shopping malls designated
          exclusively for restaurant use and share a common dining area
          provided by the mall.  These restaurants generally occupy
          approximately 500-1,000 square feet and contain only kitchen and
          service areas.  They frequently have a more limited menu than an
          "in-line" restaurant and employ 6-30 persons, including part-time
          personnel.

                    Sbarro restaurants are generally open seven days a week
          serving lunch, dinner and, in a limited number of locations,
          breakfast, with hours conforming to those of the major department
          stores or other large retailers in the mall or trade area.
          Typically, mall restaurants are open to serve customers 10 to 12
          hours a day, except on Sunday, when mall hours may be more
          limited.  For Company-owned restaurants open a full year, average
          sales in 1996 and 1995 were $698,000 and $702,000, respectively,
          for "in-line" restaurants and $486,000 and $487,000,
          respectively, for "food court" restaurants.

                    Sbarro restaurants feature a menu of popular Italian
          food, including pizza with a variety of toppings, a selection of
          pasta dishes and other hot and cold Italian entrees, salads,
          sandwiches, cheesecake and other desserts.  In addition to soft
          drinks, some of the larger restaurants serve beer and wine,
          although alcoholic beverage sales are not emphasized.

                    All food products are prepared fresh daily in each
          restaurant according to special recipes developed by the Sbarro
          family.  Emphasis is placed on serving generous portions of
          quality Italian-style food at value prices.  Entree selections,

                                         -4-
          excluding pizza, generally range in price from $2.99 to $5.29.
          The Company believes that pizza, which is sold predominantly by
          the slice, accounts for approximately one-half of Sbarro
          restaurant sales.





                    The Company's ``signature'' cheesecakes are prepared in
          its original kitchen located in Brooklyn, New York.
          Substantially all of the food ingredients and related restaurant
          supplies used by the restaurants are purchased from a national
          independent wholesale food distributor, while breads, pastries,
          produce, fresh dairy and certain meat products are purchased
          locally for each restaurant.  The Company requires that the
          distributor adhere to established product specifications for all
          food products sold to its restaurants.  The Company believes that
          there are other distributors who would be able to service the
          Company's needs and that satisfactory alternative sources of
          supply are generally available for all items regularly used in
          the restaurants.

                    Restaurant Management

                    Each Sbarro restaurant is managed by one General
          Manager and one or two Co-Managers or Assistant Managers.
          Managers are required to participate in Company training sessions
          in restaurant management and operations prior to the assumption
          of their duties.  In addition, each restaurant Manager is
          required to comply with an extensive operations manual containing
          procedures for assuring uniformity of operations and consistent
          high quality of products.

                    The Company has a Restaurant Management Bonus Program
          which provides the management teams of Company-owned Sbarro
          restaurants with the opportunity to receive a percentage of
          restaurant sales in cash bonuses based on certain performance -
          related criteria.

                    The Company also employs 70 - 75 Area Directors, each
          of whom is typically responsible for the operations of 7 - 15
          Company-owned Sbarro restaurants in a given area.  Before each
          new restaurant opening, the Company assigns an Area Director to
          coordinate opening procedures.  Each Area Director reports to one
          of the ten Regional Directors.  The Regional Directors recruit
          and supervise the managerial staff of all Company-owned Sbarro
          restaurants and report to one of the five Regional Vice
          Presidents.  The Regional Vice Presidents coordinate the
          activities of the Regional Directors assigned to their areas of
          responsibility and report to one of two Corporate Vice
          Presidents.  The Corporate Vice Presidents have total
          responsibility for their geographic areas.

                    Franchise Development

                    While the Company continues to emphasize expansion
          through Company-owned units, growth in franchise operations is
                                         -5-
          also anticipated through the establishment of new Sbarro
          restaurants by new franchisees and by existing franchisees
          capable of multi-unit operations.  The Company relies principally
          upon its reputation and the strength of its existing restaurants
          to attract new franchisees.





                    As of December 29, 1996, the Company had 219 franchised
          Sbarro restaurants operated by 73 franchisees in 30 states as
          well as Aruba, Australia, the Bahamas, Belgium, Canada, Chile,
          France, Israel, Japan, Korea, Kuwait, Lebanon, the Philippines,
          Puerto Rico, Qatar, Saudi Arabia and the United Kingdom.  The
          Company is presently considering additional franchise
          opportunities in the United States and other countries.

                    In certain instances, franchise locations have been
          established through territorial agreements under which the
          Company granted, for specified time periods, exclusive rights to
          enter into franchise agreements for restaurant units in certain
          geographic areas, primarily in foreign countries, or for
          specified non-mall locations (such as for certain toll roads or
          airports) in the United States or foreign countries.

                    The Company's basic franchise agreement generally
          requires payment of an initial license fee of $35,000 and
          requires continuing payments of fees of 5% - 7% of gross
          revenues. Franchise agreements entered into prior to 1988
          generally have an initial term of 15 years with the franchisee
          having a year renewal option, provided that the agreement has not
          been previously terminated by either party for specified reasons.
          Since 1988, the Company has required the franchise agreements to
          be coterminous with the underlying lease, but generally not less
          than ten nor more than twenty years.  Since 1990, the Company has
          granted a renewal option subject to certain conditions, including
          a remodel or image enhancement requirement.  Franchise agreements
          granted under territorial agreements contain negotiated terms and
          conditions other than those contained in the Company's basic
          franchise agreement.  The Company retains the right to terminate
          a franchisee for a variety of reasons, including insolvency or
          bankruptcy, failure to operate its restaurant according to
          standards, understatement of gross receipts, failure to pay fees,
          or material misrepresentation on an application for a franchise.

                    New Ventures

                    During 1995, the Company entered into joint venture
          arrangements for the purpose of developing three new restaurant
          concepts.  The first venture is a casual dining chain in a Rocky
          Mountain steakhouse motif.  This venture, in which the Company
          has a 40% interest, presently operates two restaurants





                                         -6-
          under the name Boulder Creek Steaks & Saloon, with two additional
          restaurants under construction.  The second venture, in which the
          Company has a 70% interest, is a moderately priced, table service
          restaurant chain featuring an Italian Mediterranean menu under
          the names Bice Med Grille, Salute and Cafe Med.  Two restaurants
          in New York City and one on Long Island, New York are currently
          operating.  The third venture is a family restaurant concept





          under the name Umberto of New Hyde Park featuring pizza and other
          Italian-style foods, in which the Company has an 80% interest.
          This venture currently operates one restaurant in a strip
          shopping center on Long Island, New York and three food court
          units in regional shopping malls in Chicago, Las Vegas and White
          Plains, New York.  The Company intends to monitor the results of
          these three concepts for the purpose of evaluating their
          potential future growth.

                    Employees

                    As of December 29, 1996, the Company (exclusive of
          joint ventures to which the Company is a party) employed
          approximately 7,770 persons, of whom approximately 2,700 were
          full-time field and restaurant personnel, 4,900 were part-time
          restaurant personnel and 170 were Headquarters Office personnel.
          None of the Company's employees are covered by collective
          bargaining agreements.  The Company believes its employee
          relations are satisfactory.

                    Competition

                    The restaurant business is highly competitive with
          respect to price, service, location and food quality, and is
          often affected by changes in consumer tastes, economic
          conditions, population and traffic patterns.  There is active
          competition for management personnel and attractive commercial
          shopping mall, center city and other locations suitable for
          restaurants.  The Company competes in each market in which it
          operates with locally-owned restaurants as well as with national
          and regional restaurant chains.

                    Trademarks

                    The Sbarro restaurants operate under the "Sbarro" and
          "Sbarro The Italian Eatery" service marks which are registered
          with the United States Patent and Trademark Office for terms
          presently expiring in 2004 and 2001, respectively.  Registered
          service marks may continually be renewed for 10 year periods.
          The Company has also registered or filed applications to register
          "Sbarro" and "Sbarro The Italian Eatery" in several other
          countries.  The Company believes that these marks continue to be
          materially important to the Company's business.  The joint
          ventures, to which the Company is a party, have also applied for
          United States trademarks covering trade names used by them.


                                         -7-
                    Governmental Regulation

                    The Company is subject to various Federal, state and
          local laws affecting its business.  The restaurants of the
          Company and its franchisees are subject to a variety of
          regulatory provisions relating to wholesomeness of food,
          sanitation, health, safety and, in certain cases, licensing of
          the sale of alcoholic beverages.  The Company is also subject to





          a substantial number of state laws and regulations governing the
          offer and sale of franchises.  Such laws impose registration and
          disclosure requirements on franchisors in the offer and sale of
          franchises and may also apply substantive standards to the
          relationship between franchisor and franchisee.  The Company is
          also subject to Federal Trade Commission regulations governing
          disclosure requirements in the sale of franchises. In addition,
          the Fair Labor Standards Act, governing such matters as minimum
          wage requirements, overtime, employment of minors and other
          working conditions, is applicable to the Company.  The Company
          believes it is in compliance with such laws in all material
          aspects.


          ITEM 2.  PROPERTIES

                    All Sbarro restaurants are operated in leased premises.
          As of December 29, 1996, the Company leased 628 restaurants, of
          which 34 were subleased to franchisees under terms which cover
          all obligations of the Company under the lease.  The remaining
          franchisees directly lease their restaurant spaces.  Most of the
          Company's restaurant leases provide for the payment of base rents
          plus real estate taxes, utilities, insurance, common area charges
          and certain other expenses, as well as contingent rents generally
          ranging from 8% to 10% of net restaurant sales in excess of
          stipulated amounts.  Leases to which the Company were a party at
          December 29, 1996 have initial terms expiring as follows:


           Years Initial Lease Number of Company-  Number of Franchised
             Terms Expire      owned Restaurants       Restaurants

             1997                   38                     1
             1998 - 2001           213                    19
             2002 - 2006           318                    13
             2007 - 2013            25                     1


                    Since May 1986, the Company's headquarters have been
          located in a two-story 20,000 square foot office building located
          in Commack, New York, which is subleased for a period of fifteen
          years from a partnership owned by certain shareholders of the
          Company at a current annual base rental of $337,000.  In
          addition, the Company pays real estate taxes, utilities,
          insurance and certain other expenses for the facility.

                                         -8-
                    In March 1994, the Company purchased a 100,000 square
          foot office building in Melville, New York, for $5,350,000.  The
          Company is in the process of refurbishing the building at an
          estimated additional cost of approximately $7 million and intends
          to occupy a portion of the building in 1997 as its corporate
          headquarters and lease the remainder of the building.






          ITEM 3.  LEGAL PROCEEDINGS

                    From time to time the Company is a party to certain
          claims and legal proceedings in the ordinary course of business.
          There are no pending claims or proceedings which, in the opinion
          of the Company, would have a material adverse effect on the
          Company's financial position or results of operations.



          ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

                    Not applicable.




                                       PART II




          ITEM 5.   MARKET FOR REGISTRANT'S COMMON EQUITY
                    AND RELATED SHAREHOLDER MATTERS


                    The Company's Common Stock is listed on the New York
          Stock Exchange under the symbol ``SBA''.  The range of high and
          low sales prices of the Company's Common Stock on the New York
          Stock Exchange for the last two fiscal years is as follows:


                    1996                                    1995

          Quarter Ended  High      Low       Quarter Ended  High      Low

          April 21    $27.00    $21.38       April 23    $27.88    $22.75
          July 14     $28.13    $24.13       July 16     $26.00    $19.88
          October 6   $26.00    $22.88       October 8   $25.00    $21.50
          December 29 $27.50    $24.25       December 31 $23.25    $20.88





                                         -9-
                    As of March 1, 1997, there were approximately 570
          holders of record of the Company's Common Stock, exclusive of
          shareholders whose shares were held by brokerage firms,
          depositories and other institutional firms in "street name" for
          their customers.

                    In 1996 and 1995, the Company declared quarterly
          dividends of $.23 per share and $.19 per share, respectively,
          aggregating $.92 per share and $.76 per share for the respective





          years.  On February 20, 1997, the Company's Board of Directors
          declared an increase in the quarterly dividend to $.27 per share,
          beginning with the quarterly cash dividend to be paid on April 2,
          1997 to shareholders of record on March 18, 1997.









































                                        -10-





     ITEM 6.  SELECTED FINANCIAL DATA

          The following Selected Financial Data should be read in conjunction
     with Management's Discussion and Analysis included in Item 7 of this Report
     and the consolidated financial statements of the Company and the related
     notes included in Item 8 of this Report, which consolidated financial
     statements have been audited and reported on by Arthur Andersen LLP,
     independent public accountants.

                                                          Years Ended
                                    Dec. 29, Dec. 31,  Jan. 1, Jan. 2,  Jan. 3,
     Income Statement Data:         1996      1995     1995    1994      1993
                                (In thousands, except share and per share data)

     Revenues:
      Restaurant sales           $319,315 $310,132 $288,808 $259,213 $231,796
      Franchise related income      6,375    5,942    5,234    4,758    4,433
      Interest income               3,798    3,081    1,949    1,579    1,319
                                  329,488  319,155  295,991  265,550  237,548

     Costs and expenses:
      Cost of food and
        paper products             68,668   67,361   61,877   55,428   51,078
      Restaurant operating expenses:
      Payroll & other
        employee benefits          78,258   78,342   70,849   64,653   57,555
      Occupancy & other expenses   85,577   84,371   76,353   68,241   62,819
      Depreciation and
        amortization               22,910   23,630   21,674   18,599   16,174
      General and administrative   14,940   16,089   13,319   12,913   12,388
      Provision for unit
        closings (Note A)               -   16,400        -        -        -
      Other income                (1,171)  (1,359)   (1,351) (1,244)   (1,287)
                                  269,182  284,834   242,721 218,590   198,727

     Income before income taxes and cumulative
      effect of change in method of accounting for
      income taxes                 60,306   34,321    53,270  46,960   38,821
     Income taxes                  22,916   13,042    20,244  18,612   14,752
     Income before cumulative effect
      of accounting change         37,390   21,279    33,026  28,348   24,069
     Cumulative effect of change
      in method of accounting
        for income taxes                -        -         -   1,010        -
     Net income  (Note A)         $37,390  $21,279   $33,026 $29,358  $24,069

     Per share data:
      Earnings per common and common
       equivalent share before
       cumulative effect of change
       in method of accounting
       for income taxes             $1.84    $1.05    $1.63    $1.40    $1.18
      Cumulative effect of
       change in method of
       accounting for income taxes      -        -        -      .05         -
      Earnings per common and





       common equivalent share
       (Notes A and B)              $1.84    $1.05    $1.63    $1.45     $1.18

     Dividends declared             $0.92    $0.76    $0.64    $0.52         -

     Weighted average number
      of shares used in the
       computation
       (Note B)          20,369,128 20,336,809 20,310,283 20,280,816 20,322,863


                                 Dec. 29,  Dec. 31,  Jan. 1, Jan. 2,  Jan. 3,
     Balance Sheet Data:            1996     1995      1995     1994    1993
                                                         (In thousands)


     Total assets                $258,659 $242,730 $232,051 $207,733 $183,045
     Working capital               73,619   57,645   43,271   45,218   41,456
     Shareholders' equity         205,200  185,666  179,580  159,037  139,974


     Number of Restaurants at End of Period:

     Company-owned and
      operated (Note A)               597      571      567      515      456
     Franchised                       219      200      162      134      131

     Total  (Note C)                  816      771      729      649      587



     Note A:  In 1995, a provision of $16,400,000 before tax ($10,168,000 or
     $0.50 per share after tax) was established for the closing of approximately
     40 under-performing restaurants.  Had the provision not been made, 1995 net
     income would have been $31,447,000 or $1.55 per share.

     Note B:  All share and per share data have been adjusted to give effect to
     a 3-for-2 stock split in the form of a 50% stock dividend distributed on
     September 22, 1994 to shareholders of record on September 9, 1994.

     Note C:  Excludes kiosks operated by franchisees and restaurants owned and
     operated by joint ventures to which the Company is a party (other than
     three mall locations of a joint ventrue which are included in the table as
     Company-owned and operated units).







                                        -11-





          ITEM 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                    CONDITION AND RESULTS OF OPERATIONS

          Results of Operations

               1996 Compared to 1995

                    Restaurant sales from Company-owned units increased
          3.0% to $319,315,000 in 1996 from $310,132,000 in 1995. The
          increase resulted from the higher contribution to sales in 1996
          than in 1995 from units opened during 1995 together with the
          contribution to sales from units opened during 1996 offset, in
          part, by the loss of sales from underperforming units closed at
          the end of 1995.  Another factor affecting sales was the
          selective menu price increases of approximately .5% and 1% in mid
          April 1996 and mid July 1996.  Comparable unit sales remained
          relatively unchanged at $292,088,000 in 1996 and $292,622,000 in
          1995.  Comparable restaurant sales are made up of sales at
          locations that were open during the entire current year and
          entire prior fiscal year.

                    Franchise related income increased 7.3% to $6,375,000
          in 1996 from $5,942,000 in 1995.  This increase resulted from
          higher royalties due principally to a larger number of franchise
          units in operation in the current year than in 1995, offset
          somewhat by lower initial franchise licensing fees due to less
          unit openings.  Comparable sales at franchise locations did not
          change significantly.

                    Interest income increased to $3,798,000 in 1996 from
          $3,081,000 in 1995.  This increase was primarily due to larger
          amounts of cash invested, offset somewhat by slightly lower
          yields on cash equivalents and marketable securities for the
          fiscal year.

                    Cost of food and paper products decreased as a
          percentage of restaurant sales to 21.5% in 1996 from 21.7% in
          1995.  This improvement resulted principally from the effects of
          the closing of underperforming units in late 1995, which had
          higher food cost relationships than more typical Company
          locations, lower prices of various paper products and food items
          and, to a limited extent, the selective menu price increases,
          offset by higher cheese prices during the second and third
          quarters of 1996, which increased food costs by approximately
          $1,800,000.  Current cheese prices are slightly below cheese
          prices that were in effect at this time in 1996.

                    Restaurant operating expenses - payroll and other
          employee benefits decreased to 24.5% of restaurant sales in 1996
          from 25.3% of restaurant sales in 1995.  Restaurant operating
          expenses - occupancy and other expenses decreased to 26.8% of
          restaurant sales in 1996 from 27.2% of restaurant sales in 1995.
          These improvements were principally due to the Company's program

                                        -12-





          of closing underperforming units which had higher payroll and
          other restaurant cost relationships, improved supervision and
          controls over costs and, to a limited extent, the impact of menu
          price increases.

                    Depreciation and amortization expenses decreased to
          $22,910,000 in 1996 from $23,630,000 in 1995.  This decrease was
          principally due to the closing of underperforming units in late
          1995, offset somewhat from new unit openings in 1996.

                    General and administrative expenses were $14,940,000 in
          1996 or 4.5% of revenues and $16,089,000 in 1995 or 5.0% of
          revenues.  The decrease in dollars was principally due to
          improved controls in supervising and administering restaurants.
          The decrease in this category of expenses as a percentage of
          revenues was, in addition to the dollar decrease, favorably
          impacted by the spreading of non-variable costs over a larger
          revenue base.

                    The effective income tax rate was 38.0% for 1996 and
          1995.


               1995 Compared to 1994

                    Restaurant sales from Company-owned units increased
          7.4% to $310,132,000 in 1995 from $288,808,000 in 1994.  The
          increase resulted primarily from the higher number of units in
          operation during 1995, in addition to a .5% increase in
          comparable restaurant sales to $273,927,000 from $272,460,000 in
          1994.  In March 1995, the Company selectively increased menu
          prices which did not materially affect 1995 sales.  Comparable
          unit sales are made up of sales at locations that were open
          during the entire current and prior fiscal year.

                    Franchise related income increased 13.5% to $5,942,000
          in 1995 from $5,234,000 in 1994.  This increase resulted from
          higher royalties due to a larger number of franchise units in
          operation in the current year than in 1994 on relatively stable
          comparable unit sales, as well as an increase in the number of
          new franchise units resulting in higher initial franchise fees.

                    Interest income increased to $3,081,000 in 1995 from
          $1,949,000 in 1994.  This increase was primarily due to larger
          amounts of cash invested and higher investment yields on invested
          cash and marketable securities for the fiscal year.

                    Cost of food and paper products increased as a
          percentage of restaurant sales to 21.7% in 1995 from 21.4% in
          1994.  This increase was primarily due to higher prices of cheese
          and paper products in 1995.



                                        -13-





                    Restaurant operating expenses - payroll and other
          employee benefits increased to 25.3% of restaurant sales in 1995
          from 24.5% of restaurant sales in 1994.  This percentage increase
          was attributable to the higher costs of providing benefits to
          employees and a slower growth in comparable unit sales in 1995.
          Restaurant operating expenses - occupancy and other expenses
          increased to 27.2% of restaurant sales in 1995 from 26.4% of
          restaurant sales in 1994.  This percentage increase was
          attributable to higher occupancy related charges and a slower
          growth in comparable unit sales in 1995.

                    Depreciation and amortization increased to $23,630,000
          in 1995 from $21,674,000 in 1994.  The increase was the result of
          the number of additional Company-owned units in operation during
          1995 over the number of units in operation during 1994.

                    General and administrative expenses were $16,089,000 in
          1995 or 5.0% of revenues and $13,319,000 in 1994 or 4.5% of
          revenues.  This increase was primarily due to increased costs
          associated with supervising and administering the additional
          restaurants in operation and adding management level personnel.

                    In 1995, a provision of $16,400,000 before tax
          ($10,168,000 or $0.50 per share after tax) was established for
          the closing of approximately 40 under-performing restaurants.
          These units produced sales of approximately $8 million in 1995
          and pretax losses of approximately $3.2 million ($2 million or
          $0.10 per share after tax).

                    The effective income tax rate was 38.0% for 1995 and
          1994.


          Impact of Inflation

                    Food, labor, construction and equipment costs are the
          items most affected by inflation in the restaurant business.
          Although for the past several years inflation has not been a
          significant factor, there can be no assurance that this trend
          will continue.  In addition, food and paper product costs may be
          temporarily or permanently affected by weather, economic and
          other factors beyond the Company's control that may reduce
          available supply and, accordingly, increase the price of food
          stuff and paper products.  The increase in the Federal minimum
          wage, the first phase of which went into effect in October 1996,
          did not materially affect the Company's fiscal 1996 results of
          operations.  The second phase, which is scheduled to go into
          effect in September 1997, is not expected to materially affect
          the Company's results of operations in fiscal 1997 or in later
          years.




                                        -14-
          Seasonality






                    The Company's business is subject to seasonal
          fluctuations, the effects of weather and economic conditions.
          Earnings have been highest in its fourth fiscal quarter due
          primarily to increased volume in shopping malls during the
          holiday shopping season.  The fourth fiscal quarter normally
          accounts for approximately 40% of net income for the year.  In
          1996, the fourth fiscal quarter accounted for 39% of net income
          for the year.  The length of the holiday shopping period between
          Thanksgiving and Christmas and the number of weeks in the fourth
          quarter produce changes in the fourth quarter earnings
          relationship from year to year.  (See also, ``Accounting
          Period''.)

          Liquidity and Capital Resources

                    During 1996, operating activities contributed $54.0
          million to cash flow resulting primarily from net income of $37.4
          million and a non-cash expense of $22.9 million for depreciation
          and amortization, which were somewhat offset by increases in
          deferred charges ($1.3 million) and other assets ($1.8 million)
          and a decrease in accounts payable and accrued expenses ($4.3
          million).  During the year, the Company expended approximately
          $25.9 million for the acquisition of property and equipment
          related, primarily, to the opening of 29 Company-owned
          restaurants, construction costs related to the joint venture
          operations and the renovation of the Company's new headquarters
          building.  In addition, $17.9 million was used to pay four
          quarterly cash dividends to the Company's shareholders.

                    At December 29, 1996, the Company had cash, cash
          equivalents and marketable securities of approximately $114.8
          million and its working capital was approximately $73.6 million.

                    The Company anticipates that approximately 40 Company-
          owned and operated units will be opened during 1997 and that its
          capital expenditures (including approximately $7 million to
          complete the renovation and equipping of the Company's new
          headquarters building) will approximate $25 million in 1997.  The
          Company does not anticipate making material expenditures for
          remodeling of Company-owned restaurants during 1997.  From time
          to time, the Company has the opportunity to contract for and
          secure price protection for certain of its raw ingredients.  Such
          situations may require the advance outlay of funds for
          inventories of these items.

                    In 1996, the Company declared quarterly dividends of
          $0.23 per share aggregating $0.92 per share (or $18.7 million)
          for the year.  In February 1997, the Company's Board of Directors
          declared an increase in its quarterly dividend to $0.27 per


                                        -15-
          share.  The first such quarterly cash dividend will be paid on
          April 2, 1997 to shareholders of record on March 18, 1997.





                    The Company believes, based on current projections,
          that its liquid assets presently on hand, together with funds
          expected to be generated from operations, should be sufficient
          for its presently contemplated operations, dividends and the
          investment in property and equipment for the opening of
          additional restaurant locations, as well as the completion of the
          renovation and equipping of the Company's new headquarters
          building.

          Accounting Period

                    The Company's fiscal year ends on the Sunday nearest to
          December 31, with fiscal quarters of sixteen weeks in the first
          quarter and twelve weeks in each succeeding quarter (except in a
          53 week year, which has a thirteen week fourth quarter, the next
          of which will be fiscal 1998).  The Company's 1996, 1995 and 1994
          fiscal years each contained, and its 1997 fiscal year will
          contain, 52 weeks.





          ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

                    Annexed hereto starting on Page F-1.



          ITEM 9.  DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

                    None







                                      PART III

                    The information called for by Part III (Items 10, 11,
          12 and 13) of Form 10-K is incorporated herein by reference to
          such information which will be contained in the Company's
          definitive Proxy Statement to be used in connection with the
          Company's 1997 Annual Meeting.





                                        -16-





                                       PART IV

          ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS
                    ON FORM  8-K

          (a) (1) and (a) (2) and (d) Financial Statements and Financial
               Statement Schedule

               Financial Statements                                Page

               Report of Independent Public Accountants             F-1

               Consolidated Balance Sheets at December 29, 1996
                and December 31, 1995                               F-2

               Consolidated Statements of Income for each of the
                years in the three-year period ended December 29,
                1996                                                F-4

               Consolidated Statements of Shareholders' Equity
                for each of the years in the three-year period
                ended December 29, 1996                             F-5

               Consolidated Statements of Cash Flows for each
                of the years in the three-year period ended
                December 29, 1996                                   F-6

               Notes to Consolidated Financial Statements           F-8

               Financial Statement Schedules

               Report of Independent Public Accountants on
                Schedule                                            S-1

               II - Valuation and Qualifying Accounts               S-2

               Information required by other schedules called for under
          Regulation S-X is either not applicable or is included in the
          consolidated financial statements or notes thereto.

          (b)  Reports on Form 8-K

               No Reports on Form 8-K were filed during the fourth quarter
          of the Company's fiscal year ended December 29, 1996.

          (c)  Exhibits:

               * 3.01(a) Restated Certificate of Incorporation of the
                         Company as filed with the Department of State of
                         the State of New York on March 29, 1985.
                         (Exhibit 3.01 to the Company's Registration
                         Statement on Form S-1, File No. 2-96807)


                                        -17-
          (c)  Exhibits  (continued):






               * 3.01(b) Certificate of Amendment to the Company's Restated
                         Certificate of Incorporation as filed with the
                         Department of State of the State of New York on
                         April 3, 1989.  (Exhibit 3.01(b) to the Company's
                         Annual Report on Form 10-K for the year ended
                         January 1, 1989, File No. 1-8881)

               * 3.01(c) Certificate of Amendment to the Company's Restated
                         Certificate of Incorporation as filed with the
                         Department of State of the State of New York on
                         May 31, 1989.  (Exhibit 4.01 to the Company's
                         Quarterly Report on Form 10-Q for the quarter
                         ended April 23, 1989, File No. 1-8881)

               * 3.01(d) Certificate of Amendment to the Company's Restated
                         Certificate of Incorporation as filed with the
                         Department of State of the State of New York on
                         June 1, 1990.  (Exhibit 4.01 to the Company's
                         Quarterly Report on Form 10-Q for the quarter
                         ended April 22, 1990, File No. 1-8881)

               * 3.02    By-Laws of the Company, as amended.  (Exhibit 4.02
                         to the Company's Quarterly Report on Form 10-Q for
                         the quarter ended April 23, 1989, File No. 1-8881)

               *10.01    Commack, New York Corporate Headquarters Sublease.
                         (Exhibit 10.04 to the Company's Registration
                         Statement on Form S-1, File No. 2-96807)

            +  *10.02(a) 1985 Incentive Stock Option Plan, as amended.
                         (Exhibit 10.1 to the Company's Quarterly Report on
                         Form 10-Q for the quarter ended October 6, 1996
                         File No. 33-4380)

            +  *10.02(b) 1991 Stock Incentive Plan, as amended.  (Exhibit
                         10.2 to the Company's Quarterly Report on Form 10-
                         Q for the quarter ended October 6, 1996, File No.
                         1-8881)

            +  *10.02(c) Form of Stock Option Agreement dated May 30, 1990
                         between the Company and each of Anthony Sbarro,
                         Joseph Sbarro and Mario Sbarro, together with a
                         schedule, pursuant to Instruction 2 to Item 601 of
                         Regulation S-K, identifying the details in which
                         the actual agreements differ from the exhibit
                         filed herewith.  (Exhibit 10.02(c) to the
                         Company's Annual Report on Form 10-K for the year
                         ended December 30, 1990, File No. 1-8881)




                                        -18-





          (c)  Exhibits  (continued):


            +  *10.02(d) 1993 Non-Employee Director Stock Option Plan.
                         (Exhibit 10.02 (d) to the Company's Annual Report
                         on Form 10-K for the year ended January 3, 1993,
                         File No. 1-8881)

            +  *10.03    Consulting Agreement (including option) dated June
                         3, 1985 between the Company and Bernard Zimmerman
                         & Company, Inc. (Exhibit 10.04 to the Company's
                         Annual Report on Form 10-K for the year ended
                         January 1, 1989, File No. 1-8881)

            +  *10.04    Form of Indemnification Agreement between the
                         Company and each of its directors and officers.
                         (Exhibit 10.04 to the Company's Annual Report on
                         Form 10-K for the year ended December 31, 1989,
                         File No. 1-8881)

                *21.01   List of subsidiaries.  (Exhibit 22.01 to the
                         Company's Annual Report on Form 10-K for the year
                         ended January 2, 1994, File No. 1-8881)

                 23.01   Consent of Arthur Andersen LLP.

                 27.01   Financial Data Schedule.
          _____________________________
           * Incorporated by reference to the document indicated.

           + Management contract or compensatory plan.





















                                        -19-






                                     SIGNATURES



                    Pursuant to the requirements of Section 13 or 15(d) 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 on March 26, 1997.



                                   SBARRO, INC.



                                   By:  /s/ MARIO SBARRO
                                        Mario Sbarro, Chairman of the Board

































                                        -20-






               Pursuant to the requirements of the Securities Exchange Act

          of 1934, this report has been signed below by the following

          persons on behalf of the registrant and in the capacities and on

          the dates indicated.



          Signature                     Title                    Date




          /s/ MARIO SBARRO         Chairman of the Board    March 26, 1997
          Mario Sbarro             (Principal Executive
                                   Officer) and Director




          /s/ ROBERT S. KOEBELE    Vice President-Finance   March 26, 1997
          Robert S. Koebele        (Chief Financial and
                                   Accounting Officer)




          /s/ JOSEPH SBARRO        Director                 March 26, 1997
          Joseph Sbarro




          /s/ ANTHONY SBARRO       Director                 March 26, 1997
          Anthony Sbarro




          /s/ HAROLD KESTENBAUM    Director                 March 26, 1997
          Harold Kestenbaum




          /s/ RICHARD A. MANDELL   Director                 March 26, 1997
          Richard A. Mandell




                                        -21-










          Signature                     Title               Date





          /s/ PAUL A. VATTER            Director       March 26, 1997
          Paul A. Vatter




          /s/ TERRY VINCE               Director       March 26, 1997
          Terry Vince




          /s/ BERNARD ZIMMERMAN         Director       March 26, 1997
          Bernard Zimmerman





























                                        -22-
                                 ARTHUR ANDERSEN LLP








                      REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


          To the Board of Directors and Shareholders
           of Sbarro, Inc.:

          We have audited the accompanying consolidated balance sheets of
          Sbarro, Inc. (a New York corporation) and subsidiaries as of
          December 29, 1996 and December 31, 1995, and the related
          consolidated statements of income, shareholders' equity and cash
          flows for each of the three years in the period ended December
          29, 1996.  These financial statements are the responsibility of
          the Company's management.  Our responsibility is to express an
          opinion on these financial statements based on our audits.

          We conducted our audits in accordance with generally accepted
          auditing standards.  Those standards require that we plan and
          perform the audit to obtain reasonable assurance about whether
          the financial statements are free of material misstatement.  An
          audit includes examining, on a test basis, evidence supporting
          the amounts and disclosures in the financial statements.  An
          audit also includes assessing the accounting principles used and
          significant estimates made by management, as well as evaluating
          the overall financial statement presentation.  We believe that
          our audits provide a reasonable basis for our opinion.

          In our opinion, the financial statements referred to above
          present fairly, in all material respects, the financial position
          of Sbarro, Inc. and subsidiaries as of December 29, 1996 and
          December 31, 1995, and the results of their operations and their
          cash flows for each of the three years in the period ended
          December 29, 1996, in conformity with generally accepted
          accounting principles.

                                        /s/  Arthur Andersen LLP



          New York, New York
          February 7, 1997










                                         F-1






                            SBARRO, INC. AND SUBSIDIARIES

                             CONSOLIDATED BALANCE SHEETS

                                       ASSETS


                                                        (In thousands)
                                             December 29,    December 31,
                                                 1996            1995

          Current assets:
            Cash and cash equivalents        $104,818          $93,501
            Marketable securities               2,500

            Receivables:
             Franchisees                          743              741
             Other                              1,122            1,863

                                                1,865            2,604

            Inventories                         2,841            2,763

            Prepaid expenses                    1,409            1,754

             Total current assets             113,433          100,622

          Marketable securities                 7,500           10,000

          Property and equipment, net
            (Notes 3 and 9)                   130,993          126,757

          Other assets:
            Deferred charges, net of
             accumulated amortization
             of $1,436,000 at December
             29, 1996 and $1,573,000
             at December 31, 1995               1,633            1,767
            Other                               5,100            3,584

                                                6,733            5,351

                                             $258,659         $242,730








                                     (continued)


                                         F-2





                            SBARRO, INC. AND SUBSIDIARIES

                       CONSOLIDATED BALANCE SHEETS (CONTINUED)

                        LIABILITIES AND SHAREHOLDERS' EQUITY


                                                         (In thousands)
                                             December 29,    December 31,
                                                 1996            1995

          Current liabilities:
            Accounts payable                   $7,173           $7,399
            Accrued expenses  (Note 4)         22,663           27,005
            Dividend payable                    4,691            3,865
            Income taxes  (Note 5)              5,287            4,708

             Total current liabilities         39,814           42,977



          Deferred income taxes  (Note 5)      13,645           14,087


          Commitments  (Note 6)



          Shareholders' equity  (Note 8):
            Preferred stock, $1 par value;
             authorized 1,000,000 shares;
             none issued
            Common stock, $.01 par value;
             authorized 40,000,000 shares;
             issued and outstanding
             20,392,909 shares at
             December 29, 1996 and
             20,345,483 shares at
             December 31, 1995                    204              203
            Additional paid-in capital         31,219           30,330
            Retained earnings                 173,777          155,133
                                              205,200          185,666

                                              $258,659        $242,730





                   See notes to consolidated financial statements

                                         F-3

                            SBARRO, INC. AND SUBSIDIARIES

                          CONSOLIDATED STATEMENTS OF INCOME

                                   (In thousands, except share data)

                                             For the Years Ended

                                     December 29,  December 31,  January 1,
                                         1996         1995         1995
          Revenues:
           Restaurant sales           $319,315      $310,132     $288,808
           Franchise related income      6,375         5,942        5,234
           Interest income               3,798         3,081        1,949
             Total revenues            329,488       319,155      295,991

          Costs and expenses:
           Cost of food and paper
            products                    68,668        67,361       61,877
           Restaurant operating
            expenses:
             Payroll and other
              employee benefits         78,258        78,342       70,849
             Occupancy and other
              expenses                  85,577        84,371       76,353
           Depreciation and
             amortization               22,910        23,630       21,674
           General and administrative   14,940        16,089       13,319
           Provision for unit
             closings  (Note 9)                       16,400
           Other income                 (1,171)       (1,359)      (1,351)
             Total costs and expenses  269,182       284,834      242,721

          Income before income taxes    60,306        34,321       53,270
          Income taxes  (Note 5)        22,916        13,042       20,244

          Net income                   $37,390       $21,279      $33,026

           Earnings per common and
            common equivalent share      $1.84         $1.05        $1.63

           Dividends declared            $0.92         $0.76        $0.64

           Weighted average number
            of shares used in the
            computation             20,369,128    20,336,809   20,310,283









                   See notes to consolidated financial statements


                                         F-4





                            SBARRO, INC. AND SUBSIDIARIES

                   CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY


                              (In thousands, except share data)
                                   Common stock

                                              Additional
                          Number of            paid-in    Retained
                           shares      Amount  capital   earnings   Total

          Balance at
           January 2,    13,531,161     $135   $29,615   $129,287  $159,037
             1994

          Exercise of
           stock options      24,124               519                  519

          3-for-2 stock
           split           6,773,696      68       (68)

          Net income                                       33,026    33,026

          Dividends declared                             (13,002)  (13,002)

          Balance at
           January 1,
            1995          20,328,981     203    30,066    149,311   179,580

          Exercise of
           stock options      16,502               264                  264

          Net income                                       21,279    21,279

          Dividends declared                             (15,457)  (15,457)

          Balance at
           December 31,
            1995          20,345,483     203     30,330   155,133   185,666

          Exercise of
           stock options      47,426       1        889                 890

          Net income                                       37,390    37,390

          Dividends declared                             (18,746)  (18,746)

          Balance at
           December 29,
            1996            20,392,909  $204    $31,219  $173,777  $205,200

                   See notes to consolidated financial statements


                                         F-5





                            SBARRO, INC. AND SUBSIDIARIES

                        CONSOLIDATED STATEMENTS OF CASH FLOWS


                                                       (In thousands)

                                                     For the Years Ended

                                       December 29,December 31,  January 1,
                                          1996         1995         1995

          Operating activities:

          Net income                     $37,390      $21,279     $33,026
          Adjustments to reconcile
           net income to net cash
           provided by operating
           activities:
            Depreciation and
             amortization                 22,910       23,630      21,674
            (Decrease) increase
             in deferred income taxes      (442)      (5,183)       1,192
            Provision for unit closings                16,400

          Changes in operating assets
           and liabilities:
           Decrease (increase)
            in receivables                   739           58      (1,441)
           (Increase) decrease
            in inventories                  (78)           29        (257)
           Decrease (increase)
            in prepaid expenses              268        (292)        (103)
           Increase in deferred charges  (1,298)      (1,400)      (1,605)
           Increase in other assets      (1,750)      (2,425)        (122)
           (Decrease) increase in
            accounts payable
             and accrued expenses        (4,309)        2,638       1,736
           Increase (decrease)
            in income taxes payable          579        (154)         301

          Net cash provided by
           operating activities           54,009       54,580      54,401








                                     (continued)



                                         F-6





                            SBARRO, INC. AND SUBSIDIARIES

                 CONSOLIDATED STATEMENTS OF CASH FLOWS  (CONTINUED)

                                        (In thousands)

                                        For the Years Ended

                                      December 29, December 31,  January 1,
                                          1996         1995         1995
          Investing activities:

          Proceeds from maturities of
           marketable securities                      28,618
          Proceeds from sales of
           marketable securities                                  526,192
          Purchases of marketable
           securities                                            (527,555)
          Purchases of property
           and equipment                (25,928)     (17,513)     (32,058)
          Proceeds from disposition of
           property and equipment            266           34          14

          Net cash provided by (used in)
           investing activities         (25,662)       11,139     (33,407)

          Financing activities:

          Proceeds from exercise of
           stock options                     890          264         519
          Cash dividends paid           (17,920)     (14,844)     (12,456)

          Net cash used in
           financing activities         (17,030)     (14,580)     (11,937)

          Increase in cash and cash
           equivalents                    11,317       51,139       9,057
          Cash and cash equivalents at
           beginning of year              93,501       42,362      33,305

          Cash and cash equivalents
           at end of year               $104,818      $93,501     $42,362









                   See notes to consolidated financial statements



                                         F-7





                            SBARRO, INC. AND SUBSIDIARIES

                     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

          1.   Summary of significant accounting policies:

               Basis of financial statement presentation:

               The consolidated financial statements include the accounts
               of Sbarro, Inc., its wholly-owned subsidiaries (together,
               the "Company") and the accounts of its joint ventures.  All
               material intercompany accounts and transactions have been
               eliminated.

               The preparation of financial statements in conformity with
               generally accepted accounting principles requires management
               to make estimates and assumptions that may affect the
               amounts reported in the financial statements and
               accompanying notes.  Actual results could differ from those
               estimates.

               Cash equivalents:

               All highly liquid debt instruments with a maturity of three
               months or less at the time of purchase are considered to be
               cash equivalents.

               Marketable securities:

               The Company classifies its investments in marketable
               securities as ``held to maturity''.  These investments are
               stated at amortized cost, which approximates market, and are
               comprised primarily of direct obligations of the U.S.
               Government and its agencies.  Securities classified as long-
               term mature in 1998.

               Inventories:

               Inventories, consisting primarily of food, beverages and
               paper supplies, are stated at cost which is determined by
               the first-in, first-out method.

               Property and equipment and depreciation:

               Property and equipment are stated at cost.  Depreciation is
               provided for principally by the straight-line method over
               the estimated useful lives of the assets.  Amortization of
               leasehold improvements is provided for by the straight-line
               method over the estimated useful lives of the assets or the
               lease term, whichever is shorter.  One-half year of
               depreciation and amortization is recorded in the year in
               which the restaurant commences operations.



                                         F-8





                            SBARRO, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

          1.   Summary of significant accounting policies (continued):

               Deferred charges:

               Certain costs and expenses incurred which are directly
               related to new restaurant openings (primarily crew payroll
               costs and travel expenses incurred prior to opening) are
               deferred and amortized on a straight-line basis over a
               twenty-four month period.  One-half year of amortization is
               recorded in the year in which the restaurant commences
               operations.

               Deferred income:

               Deferred income relates to vendor cash advances for
               allowances to be based on product usage.

               Franchise related income:

               Initial franchise fees are recorded as income as restaurants
               are opened by the franchisee and all services have been
               substantially performed by the Company.  Development fees
               are amortized over the number of restaurant openings covered
               under each development agreement.  Royalty and other fees
               from franchisees are accrued as earned.  Revenues and
               expenses related to construction of franchised restaurants
               are recognized when contractual obligations are completed
               and the restaurants are opened.

               Stock based compensation plan:

               In accordance with Accounting Principles Board Opinion
               (``APB'') No. 25, ``Accounting for Stock Issued to
               Employees,''and related Interpretations, compensation cost
               for stock options is measured as the excess, if any, of the
               quoted market price of the Company's stock at the date of
               grant over the amount an employee must pay to acquire the
               stock.  (See Note 8).

               Income taxes:

               The Company files a consolidated Federal income tax return.
               Deferred income taxes result primarily from differences
               between financial and tax reporting of depreciation and
               amortization.






                                         F-9





                            SBARRO, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

          1.   Summary of significant accounting policies (continued):

               Accounting period:

               The Company's fiscal year ends on the Sunday nearest to
               December 31, with fiscal quarters of sixteen weeks in the
               first quarter and twelve weeks in each succeeding quarter
               (except in a 53 week year, which has a thirteen week fourth
               quarter).  The Company's 1996, 1995 and 1994 fiscal years
               each contained 52 weeks.

               Per share data:

               Earnings per share is computed using the weighted average
               number of common shares outstanding and, where applicable,
               common equivalent shares issuable upon exercise of stock
               options calculated under the treasury stock method.


               Supplemental disclosures of cash flow information:

                                              (In thousands)

                                            For the Years Ended

                                 December 29,   December 31,January 1,
                                    1996           1995       1995
               Cash paid for:

                  Income taxes    $23,143       $18,880     $18,992



          2.   Description of business:

               The Company, its subsidiaries and franchisees develop and
               operate family oriented cafeteria style Italian restaurants
               under the ``Sbarro'' and ``Sbarro The Italian Eatery'' names.
               The restaurants are located throughout the United States and
               overseas, principally in shopping malls and other high
               traffic locations.










                                        F-10





                            SBARRO, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (CONTINUED)

          2.   Description of business:

               The following tabulates the number of units in operation as
               of:

                                      December 29, December 31,  January 1,
                                         1996        1995         1995

                    Company-owned        597         571          567
                    Franchised           219         200          162

                                         816         771          729


          3.   Property and equipment:
                                                  (In thousands)

                                        December 29,      December 31,
                                           1996               1995

               Leasehold improvements      $154,507         $142,341
               Furniture, fixtures and
                equipment                    91,644           83,679
               Construction-in-progress *    14,139            9,278
                                            260,290          235,298

               Less accumulated depreciation
                and amortization            129,297          108,541

                                           $130,993         $126,757

               (*)  Includes $10,609 in 1996 and $6,351 in 1995 related to
               the acquisition and improvement of the Company's new
               corporate headquarters.


          4.   Accrued expenses:
                                                  (In thousands)

                                         December 29,     December 31,
                                            1996              1995

               Compensation                 $4,392           $4,905
               Payroll and sales taxes       3,672            4,196
               Rent                          6,427            6,330
               Provision for store
                closings  (Note 9)           1,922            6,767
               Other                         6,250            4,807
                                           $22,663          $27,005


                                        F-11





                            SBARRO, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (CONTINUED)


          5.   Income taxes:

                                             (In thousands)
                                             For the Years Ended

                                   December 29,   December 31,   January 1,
                                       1996           1995         1995
               Federal:
                Current                $19,216     $14,897       $15,606
                Deferred                 (322)      (4,158)          948
                                        18,894      10,739        16,554

               State and local:
                Current                  4,142       3,328         3,446
                Deferred                 (120)      (1,025)          244
                                         4,022       2,303         3,690
                                       $22,916     $13,042       $20,244


               Deferred tax liabilities are comprised of the following:


                                                  (In thousands)
                                           December 29,     December 31,
                                               1996              1995

               Depreciation and
                amortization                $16,427          $16,360
               Deferred charges                 448              554
               Other                             55              102
               Gross deferred tax
                liabilities                  16,930           17,016

               Accrued expenses              (1,620)          (2,527)
               Deferred income               (1,580)           (336)
               Other                            (85)            (66)
               Gross deferred tax assets     (3,285)         (2,929)
                                            $13,645         $14,087












                                        F-12





                            SBARRO, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (CONTINUED)

          5.   Income taxes (continued):

               Actual tax expense differs from ``expected'' tax expense
               (computed by applying the Federal corporate rate of 35% for
               the years ended December 29, 1996, December 31, 1995 and
               January 1, 1995) as follows:

                                             (In thousands)
                                             For the Years Ended

                                     December 29,  December 31,  January 1,
                                        1996          1995          1995
               Computed "expected"
                tax expense             $21,108      $12,012      $18,645
               Increase (reduction)
                in income taxes
                resulting from:
                 State and local income
                  taxes, net of Federal
                  income tax benefit     2,614       1,497         2,399
                 Tax exempt interest
                  income                  (63)        (311)         (337)
                 Other, net              (743)        (156)         (463)
                                       $22,916     $13,042       $20,244


               Deferred income taxes are provided for temporary differences
               between financial and tax reporting.  These differences and
               the amount of the related deferred tax provision are as
               follows:

                                             (In thousands)
                                            For the Years Ended

                                   December 29,   December 31,   January 1,
                                        1996          1995          1995

               Depreciation and
                amortization          $(1,397)     $(2,781)       $1,210
               Accrued expenses          1,791      (2,482)          104
               Other                     (836)          80          (122)
                                     $   (442)     $(5,183)       $1,192









                                        F-13





                            SBARRO, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (CONTINUED)


          6.   Commitments:

               The Company conducts all of its operations in leased
               facilities.  Most of the Company's restaurant leases provide
               for the payment of base rents plus real estate taxes,
               utilities, insurance, common area charges and certain other
               expenses, as well as contingent rents generally ranging from
               8% to 10% of net restaurant sales in excess of stipulated
               amounts.

               Rental expense under operating leases, including common area
               charges, other expenses and additional amounts based on
               sales, are as follows:

                                                       (In thousands)

                                                  For the Years Ended

                                    December 29,  December 31,   January 1,
                                        1996         1995          1995

               Minimum rentals         $36,383     $35,142       $31,146
               Contingent rentals        2,819       3,082         3,269
               Common area charges      11,303      10,846         9,586
                                       $50,505     $49,070       $44,001

               Future minimum rental and other payments required under non-
               cancelable operating leases for Company-operated restaurants
               that were open on December 29, 1996 and the existing
               corporate office are as follows (in thousands):

                    Years ending:

                    December 28, 1997       $55,372
                    January 3, 1999          53,078
                    January 2, 2000          50,109
                    January 1, 2001          47,713
                    December 31, 2001        43,342
                    Later years              97,483
                                           $347,097







                                        F-14





                            SBARRO, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)


          6.   Commitments (continued):

               The Company is the principal lessee under operating leases
               for certain franchised restaurants which are subleased to
               the individual franchisees.  Franchisees pay rent and
               related expenses directly to the landlord.  Future minimum
               rental payments required under these non-cancelable
               operating leases for franchised restaurants that were open
               as of December 29, 1996 are as follows (in thousands):

                         Years ending:

                         December 28, 1997       $1,751
                         January 3, 1999          1,754
                         January 2, 2000          1,608
                         January 1, 2001          1,277
                         December 31, 2001          990
                         Later years              2,005
                                                 $9,385

               As of February 7, 1997, future minimum rental payments
               required under non-cancelable operating leases for
               restaurants which had not as yet opened as of December  29,
               1996 are as follows (in thousands):

                         Years ending:

                         December 28, 1997         $386
                         January 3, 1999            638
                         January 2, 2000            637
                         January 1, 2001            665
                         December 31, 2001          671
                         Later years              3,455
                                                 $6,452

               The Company has entered into contracts aggregating
               $1,343,000 with respect to the construction of restaurants
               and $7 million with respect to the Company's new corporate
               headquarters building to be opened in 1997.  No payments
               have been made on those contracts as of December 29, 1996.

               One of the joint ventures in which the Company is a partner
               has entered into a contract to purchase the land, on which a
               restaurant is being constructed at the end of a five year
               lease on such property in 2002 for $1,000,000.  The Company
               and one of its co-venturers have jointly and severally
               guaranteed the underlying lease and the purchase price until


                                        F-15





                            SBARRO, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)


          6.   Commitments (continued):

               the restaurant is substantially completed.  In connection
               with the construction of the restaurant which will open in
               1997, the joint venture has entered into contracts
               aggregating approximately $1,820,000.

          7.   Transactions with related parties:

               In May 1986, the Company entered into a fifteen year
               sublease with a partnership owned by certain shareholders of
               the Company for its present corporate headquarters office
               building.  In each of the years 1996, 1995 and 1994 the
               Company incurred rent expense for such building of $298,000.
               Rent for the remainder of the lease is $337,000.  Management
               believes that such rents are comparable to the rents that
               would be charged by an unaffiliated third party.

               A member of the Board of Directors acts as a consultant to
               the Company for which he received $106,100 in the year ended
               December 29, 1996 and $96,000 in each of the years ended
               December 31, 1995 and January 1, 1995.


          8.   Stock options:

               The Company's Board of Directors has adopted and
               shareholders have approved a 1991 Stock Incentive Plan (the
               ``1991 Plan''), which replaced the Company's 1985 Incentive
               Stock Option Plan, and a 1993 Non-Employee Director Stock
               Option Plan (the ``1993 Plan'').

               Under the 1991 Plan, the Company may grant, until February
               2001, incentive stock options and non-qualified stock
               options alone or in tandem with stock appreciation rights
               (``SARS'') to employees and consultants of the Company and
               its subsidiaries.  Options and SARs may not be granted at
               exercise prices less 100% of the fair market value of common
               stock on the date of grant.  The Board of Directors'
               Committee administering the 1991 Plan is empowered to
               determine, within the limits of the 1991 Plan, the number of
               shares subject to each option and SAR, the exercise price,
               and the time period (which may not exceed ten years) and
               terms under which each may be exercised.






                                        F-16





                            SBARRO, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

          8.   Stock options (continued):


               The 1993 Plan provides for the automatic grant to each non-
               employee director of an option to purchase 3,750 shares of
               common stock following each annual shareholders' meeting.
               Each option has a five year term and is exercisable in full
               commencing one year after grant at 100% of the fair market
               value of the Company's common stock on the date of grant.
               In 1996, 1995 and 1994 each of the six (five in 1996) non-
               employee directors were granted options to purchase 3,750
               shares at $28.50, $21.50 and $23.71 per share, respectively.
               No options granted under this plan have been exercised.



               A summary of the status of the Company's option plans are
               presented in the table below:

                                     1996             1995          1994
                                    Weighted-      Weighted-      Weighted-
                                      Average        Average        Average
                                     Exercise       Exercise       Exercise
                              Shares  Price   Shares Price   Shares  Price
               Options outstanding,
                beginning of
                 period      717,712  $24.97 765,964 $24.75  703,757 $25.01
               Granted       378,750  $25.55  37,500 $22.53  151,000 $21.99
               Exercised     (47,426) $18.24 (16,502)$15.97 (32,306) $16.11
               Canceled
                or expired  (114,200) $24.84 (69,244)$21.44 (56,502) $25.02
               Options
                outstanding,
                end of
                period       934,836  $25.57 717,712 $24.97  765,964 $24.75
               Options
                exercisable,
                end of period534,214  $25.89 463,962 $25.89  279,957 $25.60
               Weighted average
                fair value of
                options granted     $5.75          $5.30

               Of the options outstanding at December 29, 1996, options to
               purchase 144,086 shares with exercise prices between $14.75







                                        F-17





                            SBARRO, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

          8.   Stock options (continued):


               and $22.13, with a weighted average exercise price of $21.16
               and a weighted average remaining contractual life of 6.7
               years, of which 74,714 were exercisable, with a weighted
               average exercise price of $20.82.  The remaining options to
               purchase 790,750 shares had exercise prices between $22.14
               and $28.75, with a weighted average exercise price of $26.41
               and a weighted average remaining contractual life of 7.1
               years, of which 459,500 are exercisable, with a weighted
               average exercise price of $26.72.  At December 29, 1996,
               there were 818,700 shares available for option grants under
               the 1991 and 1993 Plans.

               The fair value of each option grant is estimated on the date
               of grant using the Black-Scholes option pricing model with
               the following assumptions:

                                         1996           1995
               Expected life (years)       4              4
               Interest rate            6.53%          6.51%
               Volatility                 28%            28%
               Dividend yield           3.50%          3.50%

               The Company has adopted the pro forma disclosure provisions
               of Statement of Financial Accounting Standards (SFAS) No.
               123, ``Accounting for Stock-Based Compensation''.
               Accordingly, no compensation cost has been recognized for
               the stock option plans.  Had compensation cost for the
               Company's stock option plans been determined under SFAS No.
               123, the Company's net income and earnings per share would
               approximate the pro forma amounts below:



                                  (In thousands, except per share data)
                                                      1996    1995

               Net Income:            As Reported   37,390   21,279
                                      Pro Forma     37,160   21,258
               Earnings Per Share:    As Reported    $1.84    $1.05
                                      Pro Forma      $1.82    $1.05


               Because the SFAS No. 123 method of accounting is not applied
               to options granted prior to January 1, 1995, the resulting
               pro forma compensation cost may not be representative of
               that to be expected in future years.


                                        F-18





                            SBARRO, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

          8.   Stock options (continued):

               The foregoing tables includes options granted in 1996 under
               the 1991 Plan to the Company's Chairman of the Board and
               President and Senior Executive Vice President to purchase
               100,000 and 50,000 shares, respectively, at $24.75 per share
               and options granted in 1993 to the Company's Chairman of the
               Board and President, Vice Chairman of the Board and Senior
               Executive Vice President and one non-employee director to
               purchase 120,000, 90,000, 75,000 and 37,500 shares,
               respectively, at $27.09 per share.  Each such option was
               granted at the fair market value of the Company's common
               stock on the date of grant and is exercisable for 10 years
               from the date of grant.  Such options remain unexercised.

               In addition to the foregoing, in 1990, shareholder approved
               options were granted to the Company's Chairman of the Board
               and President, Vice Chairman of the Board and Senior
               Executive Vice President to purchase 150,000, 75,000 and
               75,000 shares, respectively, at $20.67 per share, the fair
               market value of the Company's common stock on the date of
               grant, for a period of 10 years from the date of grant.
               Such options remain unexercised.


          9.   Provision for unit closings:

               A provision for restaurant closings in the amount of
               $16,400,000 ($10,168,000 or $0.50 per share after tax) was
               established in 1995 for the closing of approximately 40
               under-performing restaurants.


          10.  Dividends:

               In 1996 and 1995, the Company declared quarterly dividends
               of $0.23 per share and $0.19 per share, respectively,
               aggregating $0.92 per share and $0.76 per share for the
               respective years.  In February 1997, the Company's Board of
               Directors declared an increase in the quarterly dividend to
               $0.27 per share, beginning with the quarterly cash dividend
               to be paid on April 2, 1997 to shareholders of record on
               March 18, 1997.








                                        F-19





                            SBARRO, INC. AND SUBSIDIARIES

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)


          11.  Quarterly financial information (unaudited):

                                 (In thousands, except per share data)

                                  First      Second     Third    Fourth
                                 Quarter     Quarter   Quarter   Quarter

          Fiscal year 1996

          Revenues               $88,057   $71,128   $78,421   $91,882
          Gross profit (a)        66,722    53,560    59,284    71,081
          Net income               6,975     6,642     9,188    14,585
          Earnings per share      $0.34     $0.33     $0.45     $0.72


          Fiscal year 1995

          Revenues               $84,607   $68,764   $75,789   $89,995
          Gross profit (a)        64,252    52,171    57,536    68,812
          Net income               4,610     5,485     8,125     3,059 (b)
          Earnings per share      $0.23     $0.27     $0.40     $0.15  (b)





          (a)  Gross profit represents the difference between restaurant
               sales and the cost of food and paper products.

          (b)  See Note 9.




















                                        F-20





                                 ARTHUR ANDERSEN LLP




                REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS ON SCHEDULE




          To the Board of Directors and Shareholders
           of Sbarro, Inc.:

          We have audited, in accordance with generally accepted auditing
          standards, the consolidated financial statements of Sbarro, Inc.
          and subsidiaries, included in this filing and have issued our
          report thereon dated February 7, 1997.  Our audits were made for
          the purpose of forming an opinion on the basic financial
          statements taken as a whole.  The accompanying schedule is the
          responsibility of the Company's management and is presented for
          purposes of complying with the Securities and Exchange
          Commission's rules and is not part of the basic financial
          statements.  This schedule has been subjected to the auditing
          procedures applied in the audit of the basic financial statements
          and, in our opinion, fairly states in all material respects the
          financial data required to be set forth therein in relation to
          the basic financial statements taken as a whole.


                                        /s/  Arthur Andersen LLP




          New York, New York
          February 7, 1997












                                         S-1

                                                                SCHEDULE II
                            SBARRO, INC. AND SUBSIDIARIES
                          VALUATION AND QUALIFYING ACCOUNTS
                                   (In thousands)

                              FOR THE THREE YEARS ENDED

         COLUMN A          COLUMN B         COLUMN C      COLUMN D COLUMN E
                                           ADDITIONS
                           Balance    Charged  Charged
                              at         to   to Other  Deductions   Balance
                          Beginning Costs and  Accounts  Describe    End of
         Description     of Period   Expenses  Describe     (1)      Period

         December 29, 1996:
         Accumulated
          amortization of
          deferred charges  $1,573    $1,432            $(1,569)    $1,436

         Accumulated
          amortization of
          Canadian develop-
          ment rights (2)      368        56                           424

         Accumulated
          amortization of
          Purchased Leasehold
          rights (2)           764       178                           942
                            $2,705    $1,666            $(1,569)    $2,802

         December 31, 1995:
         Accumulated
          amortization of
          deferred charges  $1,548    $1,507            $(1,482)    $1,573

         Accumulated
          amortization of
          Canadian develop-
          ment rights (2)      311        57                           368

         Accumulated
          amortization of
          Purchased Leasehold
          rights (2)           586       178                           764
                            $2,445    $1,742            $(1,482)    $2,705

         January 1, 1995:
         Accumulated
          amortization of
          deferred charges  $1,360    $1,460            $(1,272)    $1,548

         Accumulated
          amortization of
          Canadian develop-
          ment rights (2)      264        47                           311

         Accumulated
          amortization of
          Purchased Leasehold
          rights (2)           410       176                           586
                            $2,034    $1,683            $(1,272)    $2,445

         (1)    Write-off of fully amortized deferred charges
         (2)    Included in other assets

                                              S-2

                                    EXHIBIT INDEX



         Exhibit Number           Description

           *3.01(a)   Restated Certificate of Incorporation of the Company
                      as file with the Department of State of the State of
                      New York on March 29, 1985.  (Exhibit 3.01 to the
                      Company's Registration Statement on Form S-1, File
                      No. 2-96807)

           *3.01(b)   Certificate of Amendment to the Company's Restated
                      Certificate of Incorporation as filed with the
                      Department of State of the State of New York on April
                      3, 1989.  (Exhibit 3.01(b) to the Company's Annual
                      Report on Form 10-K for the year ended January 1,
                      1989, File No. 1-8881)

           *3.01(c)   Certificate of Amendment to the Company's Restated
                      Certificate of Incorporation as filed with the
                      Department of State of the State of New York on May
                      31, 1989.  (Exhibit 4.01 to the Company's Quarterly
                      Report on Form 10-Q for the quarter ended April 23,
                      1989, File No. 1-8881)

           *3.01(d)   Certificate of Amendment to the Company's Restate
                      Certificate of Incorporation as filed with the
                      Department of State of the State of New York on June
                      1, 1990.  (Exhibit 4.01 to the Company's Quarterly
                      Report on Form 10-Q for the quarter ended April 22,
                      1990, File No. 1-8881)

           *3.02      By-Laws of the Company, as amended.  (Exhibit 4.02 to
                      the Company's Quarterly Report on Form 10-Q for the
                      quarter ended April 23, 1989, File No. 1-8881)

           *10.01     Commack, New York Corporate Headquarters Sublease.
                      (Exhibit 10.04 to the Company's Registration
                      Statement on Form S-1, File No. 2-96807)

          +*10.02(a)  1985 Incentive Stock Option Plan, as amended.
                      (Exhibit 4.01 to Post-Effective Amendment No. 1 to
                      the Company's Registration Statement on Form S-8 File
                      No. 33-4380)

         Exhibit Index (continued):

         Exhibit Number


          +*10.02(b)  1991 Stock Incentive Plan, as amended.  (Exhibit 10.1
                      to the Company's Quarterly Report on Form 10-Q for
                      the quarter ended April 24, 1994, File No. 1-8881)



          +*10.02(c)  Form of Stock Option Agreement dated May 30, 1990
                      between the Company and each of Anthony Sbarro,
                      Joseph Sbarro and Mario Sbarro, together with a
                      schedule, pursuant to Instruction 2 to Item 601 of
                      Regulation S-K, identifying the details in which the
                      actual agreements differ from the exhibit filed
                      herewith.  (Exhibit 10.02(c) to the Company's Annual
                      Report on Form 10-K for the year ended December 30,
                      1990, File No. 1-8881)

          +*10.02(d)  1993 Non-Employee Director Stock Option Plan.
                      (Exhibit 10.02(d) to the Company's Annual Report on
                      Form 10-K for the year ended January 3, 1993, File
                      No. 1-8881)

          +*10.03     Consulting Agreement (including option) dated June 3,
                      1985 between the Company and Bernard Zimmerman &
                      Company, Inc.  (Exhibit 10.04 to the Company's Annual
                      Report on Form 10-K for the year ended January 1,
                      1989, File No. 1-8881)

          +*10.04     Form of Indemnification Agreement between the Company
                      and each of its directors and officers.  (Exhibit
                      10.04 to the Company's Annual Report on Form 10-K for
                      the year ended December 31, 1989, File No. 1-8881)

           *21.01     List of subsidiaries.  (Exhibit 22.01 to the
                      Company's Annual Report on Form 10-K for the year
                      ended January 2, 1994, File No. 1-8881)

            23.01     Consent of Arthur Andersen LLP.

            27.01     Financial Data Schedule.

         * Incorporated by reference to the document indicated.

         + Management contract or compensatory plan.