SECURITIES AND EXCHANGE COMMISSION
                       Washington, D.C. 20549

                                                                 
FORM 10-KSB

  X   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE 
----- SECURITIES EXCHANGE ACT OF 1934 {FEE REQUIRED}

            For fiscal year ended September 29, 1996
                                  ------------------

       TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
-----  SECURITIES EXCHANGE ACT OF 1934 {NO FEE REQUIRED}

Commission File No: 0-14650
                    -------
                     RUDY'S RESTAURANT GROUP, INC.
                 -------------------------------------
           (Exact name of registrant as specified in its charter)

        Nevada                               88-0210808
-----------------------------            ------------------
(State or other jurisdiction             (I.R.S. Employer 
       of incorporation)               Identification Number)

 11900 Biscayne Boulevard, Suite 806, Miami, Florida     33181
 --------------------------------------------------------------
 (Address of principal executive offices)             (Zip Code)

Registrant's telephone number,
 including area code: (305) 895-7200
                       -------------
Registrant's fax number, including area code: (305) 895-2881
                                               -------------

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

Securities registered pursuant to Section 12 (g) of the Act: 
Common Stock, par value $ .01 per share

Check 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 report(s)
and (2) has been subject to such filing requirements for the past
90 days.      X  Yes          No
            -----        -----

Check 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-KSB. [ X ]

Issuer's revenues for its most recent fiscal year:$14,665,000
                                                   ----------

The aggregate market value of the registrant's Common Stock, $.01
par value, held by non-affiliates of the registrant as of
December 20, 1996 was approximately $3,328,000 based on the
average of the bid ($2.81) and ask ($3.50) prices on that date.
As of December 20, 1996, 3,765,000 shares of the registrant's
Common Stock, $.01 par value, were outstanding.

Exhibit table is on page   24  
                         -----
<PAGE>
                       TABLE OF CONTENTS

       FORM 10-KSB ANNUAL REPORT YEAR ENDED SEPTEMBER 29, 1996

                     RUDY'S RESTAURANT GROUP, INC. 

PART I:                                                     Page
Item 1.     Description of Business                          3

Item 2.     Description of Properties                        4

Item 3.     Legal Proceedings                                5

Item 4.     Submission of Matters to a Vote of Security 
            Holders                                          5

PART II
Item 5.     Market for Common Equity and Related 
            Stockholder Matters                              5

Item 6.     Management's Discussion and Analysis of 
            Results of Operations                            6

Item 7.     Financial Statements                             9 

Item 8.     Changes In and Disagreements With Accountants 
            on Accounting and Financial Disclosure          21

PART III
Item 9.      Directors and Executive Officers of the 
             Registrant; Compliance with 
             Section 16(a) of the Exchange Act              21

Item 10.    Executive Compensation                          22 

Item 11.    Security Ownership of Certain Beneficial 
            Owners and Management                           24

Item 12.    Certain Relationships and Related Transactions  24

PART IV

Item 13.    Exhibits and Reports on Form 8-K                24

SIGNATURES                                                  27
<PAGE>
               PART I

Item 1.   DESCRIPTION OF BUSINESS
          ----------------------

     GENERAL

     Rudy's Restaurant Group, Inc. (the "Company") is a Nevada
corporation which, through its wholly-owned subsidiaries, owns
and operates nine Japanese steak and seafood restaurants located
throughout eastern and mid-eastern United States. The Company
owns 100% of the stock of The Samurai, Inc. ("The Samurai"),
Maxwell's International, Inc. ("Maxwell's") and Rudy's Sirloin
SteakBurgers, Inc. ("Rudy's"). The Company acquired its interest
in The Samurai and Maxwell's from Bright Star Holding, Inc.
("BSH") in 1985. The Samurai currently owns and operates five
Samurai restaurants. Maxwell's currently owns and operates one
Samurai restaurant and three Kyoto restaurants (see Business
Acquisition below).The Company acquired its interest in Rudy's in
1985. Substantially all of the assets, liabilities and operations
of the Rudy's subsidiary were sold in 1991 and this subsidiary is
currently inactive.

     BUSINESS ACQUISITION 

      In February 1996, through its Maxwell's subsidiary, the
Company acquired substantially all of the assets and business
operations of three Japanese steak and seafood restaurants owned
by Asian Restaurants International, Inc. ("ARI").The newly
acquired restaurants operate under the name Kyoto Japanese Steak
and Seafood ("Kyoto"). This acquisition has been accounted for as
a purchase and the results of operations of the acquired
restaurants have been included in the Company's consolidated
financial statements since the date acquired.

     The above summary of the Asset Purchase and Sale Agreement
by and between ARI and Maxwell's is qualified in its entirety by
reference to Exhibit 10.22 of this Report.

     RESTAURANT OPERATIONS 

     The Company's  restaurants feature "teppanyaki" cooking, in
which steak, chicken, shrimp and other seafood are prepared on a
grill which forms the focal point at the center of a large table
seating from eight to ten patrons. The decor of each restaurant
features a traditional Japanese theme. The restaurants range in
size from approximately 5,000 to 10,000 square feet and include a
bar and lounge area designed to provide a casual and comfortable
atmosphere. Seating capacity ranges from 128 to 192 and averages
156 persons.

     In addition to entrees prepared at the table, a variety of
Japanese appetizers are available, as are alcoholic and non-alcoholic 
beverages. In addition, three restaurants have a
"sushi" bar offering various types of raw fish served either in
the traditional manner or as "sashimi".  

     Restaurants are open for lunch and dinner. Dinner entrees
range in price from $12.50 to $26.95; the average dinner check is
$20.50. The average luncheon check is $10.50. Sales of alcoholic
beverages represent approximately 14% of restaurant sales.

     The Company's restaurant format includes several features
which limit costs. The "teppanyaki" table arrangement improves
efficiency of service since most seats at the table are occupied
at the same time. Service is coordinated at the table by the
presiding chef so that meals begin and end simultaneously.
Limited menu choices, portion controlled servings and preparation
of entrees at the table minimize waste, contributing to savings
in food costs. In addition, labor costs are reduced by combining
such functions as order taking, preparation and serving.

     Quality and uniformity at the Company's restaurants are
maintained through training and careful supervision of personnel.
Restaurant operations are under the general supervision of the
Company's President and Chief Operating and Financial Officer as
well as the direct supervision of a Supervisor of Restaurant
Operations. Each restaurant has a head manager, assistant
managers and head chefs. The restaurants are operated in
accordance with uniform specifications, as set forth in operating
manuals, relating to food and beverage preparation, maintenance
of premises and conduct of employees. Operational reviews are
conducted periodically to ensure adherence to standards of
quality in food preparation and customer service.
<PAGE>
     Each restaurant manager is responsible for the purchase and
receipt of restaurant supplies. Food is purchased from a minimum
of two suppliers to provide a reliable source of fresh food at
competitive prices. The Company believes that many alternative
food suppliers are available.

     Financial control is maintained through the use of automated
data processing, including centralized accounting and management
reports. Sales information, vendor invoices, payroll data and
other operating information are forwarded periodically to the
Company's headquarters for review and processing.

     EXPANSION

     Expansion, if any, is dependent upon the availability of and
competition for appropriate locations and the Company's ability
to obtain financing for the acquisition of existing restaurant
operations and/or development, construction and opening of new
restaurants. See Item  6. Management's Discussion and Analysis of
Results of Operations for a discussion of a business acquisition 
completed in fiscal 1996.

     COMPETITION

     The restaurant business is highly competitive and is
affected by changes in the public's taste and eating habits,
local and national economic conditions affecting spending habits
and population and traffic patterns.  While the principal
competitive factors in the industry are the quality and price of
the food products offered, name recognition, restaurant location,
service and attractiveness of facilities are also of importance.

     Since the success of the Company's restaurants is primarily
dependent upon the popularity of oriental food and the
"teppanyaki" style of cooking in the communities within which the
restaurants are located, the Company relies heavily on local
newspaper and other forms of print media to promote its
restaurants.

     GOVERNMENT REGULATION

     The Company is subject to Federal, state and local laws
affecting the operation of the restaurants, including zoning,
health, sanitation and safety regulations and alcoholic beverage
licensing requirements. The suspension of a food service or
liquor license could cause an interruption of operations at the
affected restaurant.

     The Company is also subject to the Federal Fair Labor
Standards Act and state and local labor regulations which govern
minimum wage, overtime and other working conditions. Accordingly,
any change in such regulations, such as the recently enacted
change in the Federal minimum wage, may affect the Company's
results of operations.

     SERVICE MARKS

     The Company has registered the service mark and related logo
designs of "Samurai" with the United States Patent and Trademark
Office. The use of these service marks, logo designs and trade
names is one factor supporting the Company's competitive position
in the industry. However, there are no assurances that the
Company will be able to exclusively utilize these trade names. 

     EMPLOYEES

     The Company has approximately 390 employees of which 385 are
employed in restaurant operations and 5 are corporate management
and office personnel. None of the Company's employees are covered
by collective bargaining agreements.

Item 2.     DESCRIPTION OF PROPERTIES 
            -------------------------

     The Company owns the land and improvements associated with
one of its restaurants (see Management's Discussion and Analysis
of Results of Operations). The balance of the Company's
restaurant facilities are leased pursuant to long-term lease
agreements. The following table identifies certain information
with respect to each of the Company's restaurants as of September
29, 1996.
<PAGE>
                   Size          Lease                Lease
Location          (sq ft)   Expiration Date     Extension Options
-----------       -------   ---------------     -----------------
Miami, Florida      7,500         2006          1 5-year+1 3-year
Washington, DC      7,761         2006          2 5-year
Cincinnati, Ohio    5,000         1997          None
Cleveland, OH      10,392         2004          None
Minneapolis, MN    10,000        Owned          NA
Pittsburgh, PA      8,000         2001          3 5-year+1 3-year
Dearborn, Michigan  8,200         2002          None
Farmington Hills, 
      Michigan      7,500         2016          2 5-year
Troy, Michigan      8,200         2016          2 5-year


Aggregate minimum rentals payable by the Company under operating
leases in fiscal 1997 will approximate $918,000. Certain leases
also require additional rental payments based on restaurant sales
as well as real estate taxes, insurance, common area charges and
other costs.

Item 3.   LEGAL PROCEEDINGS
          -----------------

     The Company is subject to such legal proceedings and claims
as may arise in the ordinary course of its business that cover a
wide range of matters, including but not limited to such matters
as workers compensation, general liability and products liability
claims. The Company carries comprehensive insurance to assist in
limiting the Company's exposure to financial loss as a result of
such claims as may arise in the normal course of business.
However, the Company does not carry insurance coverage to assist
in the defense or settlement of those claims which may arise in
employment matters such as alleged harassment or discrimination.
Although the Company is not currently a party to any significant
ongoing legal proceeding not covered by existing insurance,
because the Company is highly labor intensive there are no
assurances that such legal proceedings, should they arise, would
not have a significant adverse effect on the Company's financial
position.

Item 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
            ---------------------------------------------------

            None.

                               PART II

Item 5.     MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
            MATTERS
            ------------------------------------------------

     The common stock of Rudy's Restaurant Group, Inc. is quoted
on The Nasdaq SmallCap Market under the symbol: "RUDY". The
following sets forth the high and low ask and bid quotations for
the Common Stock of the Company. Quotations reflect interdealer
prices and do not necessarily reflect actual transactions.


                                   Quarter
                Beginning     Ending      Ask     Bid 
                ---------   ----------   -----   -----
Fiscal 1995:
  First Quarter   10/3/94    12/25/94    $ .63   $ .31
  Second Quarter 12/26/94     3/19/95    $ .60   $ .38
  Third Quarter   3/20/95     6/11/95    $ .62   $ .44
  Fourth Quarter  6/12/95     10/1/95    $1.03   $ .56
Fiscal 1996:
  First Quarter   10/2/95    12/24/95    $2.37   $ .68
  Second Quarter 12/25/95     3/17/96    $2.72   $2.00
  Third Quarter   3/18/96      6/9/96    $4.62   $2.62
  Fourth Quarter  6/10/96     9/29/96    $5.87   $3.12

     The Company estimates there were approximately 380 holders
of record of the Common Stock of the Company and that the total
number of beneficial holders is in excess of 500 at September 29,
1996. The Company's policy is to retain all available earnings
for the development and growth of its business. Accordingly, the
Company does not contemplate payment of dividends within the
foreseeable future.
<PAGE>
Item 6.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
          OPERATIONS
          --------------------------------------------------

     The consolidated financial statements and related footnotes
should be read in conjunction with the following discussion and
analysis.

Fiscal 1996 Business Overview.
------------------------------

     At September 29, 1996, the Company and its Maxwell's
subsidiary have tax net operating losses ("NOLS") and general
business tax credit carryforwards totaling approximately
$12,300,000 and $280,000, respectively. The NOLS are available to
reduce future federal taxable income through 2007 and the
business tax credits are available to reduce Federal income taxes
through 2011. 

     Statement of Financial Accounting Standards No. 109,
"Accounting for Income Taxes" ("SFAS 109"), requires the Company
to record a deferred tax asset for the future tax benefits of
these NOLS and business tax credits if realization of the tax
benefit is more likely than not. As the result of significant
improvements in the Company's operations and the acquisition of
additional restaurant operations, as more fully discussed below,
management has concluded that the Company's future taxable income
will be sufficient over the available carryforward period to
realize the tax benefit of a significant portion of the available
NOLS and business tax credits. Accordingly, in 1996 the Company
recorded an income tax benefit of $3,807,000 as a reduction in
current year tax expense, resulting in a net income tax benefit
of $3,662,000 in fiscal 1996. 

     The Company's income before giving effect to the income tax
benefit discussed above, improved $772,000, $.20 per share in
1996 compared to 1995. As more fully discussed below, the
Company's 1996 revenues, net income and earnings per share
improved as a result of both an increase in the number of
restaurants operating during the year and reductions in same-restaurant 
costs and expenses achieved primarily through a change
in the Company's marketing strategy. 

     Business Acquisition.  In February 1996, through its
Maxwell's subsidiary, the Company acquired substantially all of
the assets and business operations of three Japanese steak and
seafood restaurants owned by ARI for a total of approximately
$2,200,000, including the cost of a Consulting and Agreement Not
to Compete. This acquisition has been accounted for as a purchase
and the results of operations of the acquired restaurants have
been included in the Company's consolidated financial statements
since the date acquired. The newly acquired restaurants operate
under the name Kyoto Japanese Steak and Seafood ("Kyoto").

     Certain information related to the Kyoto restaurant
operations and to the Samurai same-restaurant operations is
discussed separately herein to facilitate understanding of the
Company's operations.

     Property Acquisition. In September 1996 the Company, through
its Samurai subsidiary, paid $1,150,000 cash to acquire land and
improvements at one of the locations the Company has leased and
operated since 1980. The effect of this acquisition will be to
reduce operating expenses by approximately $123,000 per year, 
the amount of annual lease payments due under the lease canceled
in September 1996.

     Inflation. The impact of inflation on the Company's
operating results has not been significant due to lower inflation
rates experienced in the years covered in this discussion. 

     Federal, State and Local Regulations. The Company presently
pays a significant portion of its employees in excess of the
Federal minimum wage. In addition, a large number of the
Company's employees are tipped employees whose wages are subject
to the Federal tip credit. Therefore, changes in the Federal
minimum wage have not historically had as significant an impact
on the Company's results of operations as might otherwise be
expected. 

     The restaurant business is highly labor intensive. Although
the Company currently provides health insurance to its employees,
management believes the government's introduction of a national
health care program which would require employers to pay a
significant portion of employee health care costs would have a
significant impact on the Company's results of operations.
<PAGE>
     With the exception of the newly rebuilt Miami Samurai and
certain of the Kyoto restaurants, the Company's restaurant
facilities were built prior to the enactment of Federal
regulations regarding equal opportunity for individuals with
disabilities, the Americans with Disabilities Act, "ADA". The ADA
includes certain requirements to alter public facilities,
including restaurants, as necessary to make facilities accessible
to and useable by individuals with disabilities. The Company
began its modernization program in 1996 and at September 29, 1996
one of its restaurants was closed for a significant renovation
including those improvements necessary to comply with ADA
regulations.

     Although Federal regulations consider the cost of
alterations and the overall financial resources of the Company in
determining the nature and timing of ADA compliance, the cost of
such alterations could have a significant impact on the Company's
cash flow. The Company will proceed with required alterations at
its remaining locations as soon as reasonably economically
feasible.  

Liquidity and Capital Resources
-------------------------------

     Net cash provided by operating activities is $2,175,000 in
1996 as compared to $1,424,000 in 1995. Cash and cash equivalents
total $1,199,000 at the end of fiscal 1996 as compared to
$1,477,000 at the end of 1995. At September 29, 1996 the Company
had a working capital deficit of $1,000 as compared to a surplus
of $808,000 at October 1, 1995. Significant business and property
acquisitions made in 1996, discussed below, together with the
cost of renovations at existing restaurants, were the primary
factors contributing to the reduction in cash and working capital
at September 29, 1996.

     Capital expenditures in 1996 total $1,966,000, primarily
relating to $547,600 cash expended to acquire the three Kyoto
restaurants discussed above, $1,150,000 cash expended to acquire
the land and improvements located at one of the Company's
previously leased restaurant facilities and $175,000 cash paid
for the portion of renovation and modernization projects
completed at September 29, 1996. The Company intends to proceed
with additional renovations and modernization in fiscal 1997 and
estimates that, including estimated costs of renovation to
accommodate compliance with ADA regulations, capital expenditures
to be funded out of cash flow from operating activities will
approximate $800,000 in fiscal 1997. 

Year to Year Comparison of Results of  Operations for the Years
Ended September 29, 1996 and October 1, 1995
---------------------------------------------------------------

     Revenues. The Company's fiscal 1996 total revenues increased
$3,575,000, 32.2% when compared to 1995. Substantially all of
this increase is attributable to the addition of the Kyoto
restaurants as Samurai same-restaurant revenues remained
substantially unchanged between years. 

     Management adopted a program in fiscal 1996 to reduce
discounted meals offered through coupons in order to better
utilize facilities and limited personnel during peak hours of
operation. Although Samurai same-restaurant revenues did not
change substantially between years, management's decision to
reduce the availability of discounted meals resulted in a decline
in fiscal 1996 customer traffic of 2.7%. At the same time,
increased menu prices and the change in customer eating habits to
more expensive menu items resulted in an increase in average
check of 3% when compared to fiscal 1995. Due to the higher gross
margin on full-priced items and other economies realized, as more
fully discussed below, Samurai same-restaurant earnings from restaurant
operations increased $365,000, to 18% of fiscal 1996 same-restaurant 
revenues as compared to 14.8% in fiscal 1995.

     The average check at the Kyoto restaurants is significantly
higher than the average check at the Samurai restaurants
primarily because these restaurants do not employ significant
discounting. The average check at the Kyoto restaurants increased
approximately 2.8% and customer traffic increased approximately
6.7% in 1996 compared to available information from the previous
year for the approximately eight months included in the Company's
operations.
<PAGE>
     Although the change in marketing will continue to effect the
Samurai same-restaurant customer traffic and average check for a
portion of fiscal 1997, management does not believe the current
year changes in traffic and average check to be indicative of a
trend.

     Costs and expenses applicable to revenues. Costs and
expenses applicable to revenues decreased 3.7% to 50% of revenues
in fiscal 1996, as compared to 53.7% in fiscal 1995 summarized as
follows:

                            Improvement In
                Food, Beverage
                 And Supplies     Labor         Total
                --------------   -------       -------
Same Restaurant       2.5%         .4%           2.9%
Kyoto                  .1          .7             .8  
                      ----        ----           ----
                      2.6%        1.1%           3.7%
                      ====        ====           ====

     Because of their higher average check, costs and expenses
applicable to revenues at the Kyoto restaurants are lower than
those of the Samurai restaurants which resulted in an overall .8%
improvement in costs and expenses variable with revenues.
However, as shown, the most significant improvement in reduced
costs was realized through reduced same restaurant costs and
expenses.

     The cost of seafood, meat and chicken, the major components
of the Company's food, beverage and supplies costs, varies with
supply and demand and other market conditions. Approximately 1%
of the 2.5% improvement in same-restaurant costs is the result of
declining costs of seafood, which decreased approximately 7% in
1996, and meat and chicken costs which decreased approximately 5%
in 1996. The balance of the improvement in these costs is the
result of the higher average check discussed above.

     The .4% improvement in same-restaurant labor and related
benefit costs is due entirely to the higher check average
discussed above. Wage rates on a per check basis increased
slightly. Although the increase in the Federal minimum wage is
not expected to have significant direct impact on the Company's
labor costs, higher wages are expected to continue in fiscal 1997
as a result of the domino effect of minimum wage rate changes and
increased costs of living and higher prevailing local wage
scales.

     Expenses of restaurant operations: General operations.
General operations expense includes restaurant management and
supervision, occupancy costs, repairs and maintenance, utilities,
advertising, and insurance. A substantial portion of these
expenses vary at least to some degree with revenues. These
expenses increased $1,039,000 in 1996, including expenses of
$1,082,000 related to the Kyoto restaurant operations and a
$43,000 decrease in  expenses related to Samurai same-restaurant
operations. As a percent of revenues, general operations expense
remained unchanged at 29.3% of revenues in 1996 and 1995. General
operations expense at the Kyoto restaurants is approximately 2%
higher than at the Samurai restaurants due to higher occupancy
costs. 

     Same-restaurant general operations costs declined $43,000 in
1996 compared to 1995 primarily due to reductions in management
labor achieved through the installation of computerized sales
systems, reductions in general liability costs achieved through
improved experience ratings and negotiated reductions in credit
card discount fees. Repairs and maintenance costs increased
$38,000, primarily due to costs to repair aging air conditioning
and exhaust equipment; occupancy costs increased approximately
$19,000 due to higher rents incurred as certain rent abatements
negotiated in 1992 expired.

     Corporate overhead: General and administrative expenses.
General and administrative rose $98,000 in  1996 compared to
1995. This increase is due to several factors, the most
significant of which are non-recurring expenses including 1)
approximately $46,000 cost of living wage adjustments due the
chief operating and financial officer for the period 1991 to
present, 2) $25,000 related to audit and accounting fees
associated with the Kyoto operations and 3) $8,000 associated
with relisting on NASDAQ. The balance of the increase in these
costs, $19,000, is due primarily to expenses related to the
general administration of the additional Kyoto restaurants.
<PAGE>
     Interest Expense. Interest expense increased $67,500 in 1996
compared to 1995. This increase is directly related to debt
incurred with the acquisition of the Kyoto restaurants.

     Fiscal 1995 Non-operating expense. Settlement costs and
expenses. In May 1995, the Company's Samurai subsidiary and
certain employees of The Samurai were named defendants in a
lawsuit alleging discrimination under the Civil Rights Act of
1870, 42 U.S.C. 1981, as amended (1992 Supp).

     Although the Company believes that the claims as set forth
in the complaint were without merit, due to the prohibitive costs
of defending such allegations, in September 1995 the Company and
Plaintiff entered into a Settlement Agreement wherein, in return
for certain monetary consideration, the Plaintiff agreed to
release all existing claims against the Company and its
employees. Pursuant to the terms of the Agreement, the complaint
was dismissed in September 1995. The costs of settlement,
including legal fees incurred, totaled approximately $50,000.
Accordingly, the Company recorded a nonrecurring charge of
$50,000, included in the accompanying statements of operations as
non-operating expense in fiscal 1995.

     Although the Company is not currently a party to any
significant ongoing legal proceedings, the Company is subject to
such legal proceedings and claims as may arise in the ordinary
course of its business that cover a wide range of matters,
including but not limited to such matters as workers
compensation, general liability and products liability claims.
The Company carries comprehensive insurance to assist in limiting
the Company's exposure to financial loss as a result of
substantially all claims as may arise in the normal course of
business. However, the Company does not carry insurance coverage
to assist in the defense or settlement of those claims which may
arise in employment matters such as alleged harassment or
discrimination. Although the Company is not currently a party to
any significant ongoing legal proceedings not covered by existing
insurance, because the Company is highly labor intensive there
are no assurances that such legal proceedings, should they arise,
would not have a significant adverse effect on the Company's
financial position.

Item 7.   FINANCIAL STATEMENTS
          --------------------

     The following documents are filed on the pages listed below,
as part of Part II, Item 7 of this report:

                                                            Page
  Independent Auditors' Report                               10
  Consolidated Financial Statements:
    Balance Sheets - September 29, 1996 and October 1, 1995  11
    Statements of Operations - Years ended September 29, 
      1996 and October 1, 1995                               12
    Statements of Stockholders' Equity - Years ended 
      September 29, 1996 and October 1, 1995                 13
    Statements of Cash Flows - Years ended September 29,
      1996 and October 1, 1995                               14
    Notes to Consolidated Financial Statements               16


<PAGE>
INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders of
 Rudy's Restaurant Group, Inc.:

We have audited the accompanying consolidated balance sheets of
Rudy's Restaurant Group, Inc. and Subsidiaries (the "Company") as
of September 29, 1996 and October 1, 1995, and the related
consolidated statements of operations, stockholders' equity, and
cash flows for each of the two years in the period ended
September 29, 1996. These consolidated financial statements are
the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated
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
these consolidated financial statements are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in these
consolidated 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, such consolidated financial statements present
fairly, in all material respects, the financial position of the
Company as of September 29, 1996 and October 1, 1995, and the
results of its operations and its cash flows for each of the two
years in the period ended September 29, 1996 in conformity with
generally accepted accounting principles.

DELOITTE & TOUCHE LLP
Certified Public Accountants
Miami, Florida

December 20, 1996

<PAGE>

                     RUDY'S RESTAURANT GROUP, INC.
                            AND SUBSIDIARIES

                      Consolidated Balance Sheets

                September 29, 1996 and October 1, 1995
<TABLE>
<S>                                         <C>           <C>
   Assets                                   1996          1995
   ------                              ------------   -----------
Current Assets:
 Cash and cash equivalents              $ 1,199,384    $1,476,652 
 Accounts receivable (Notes 4 and 9)         51,604         5,915 
 Inventories                                225,414       162,685 
 Prepaid expenses                            91,078       107,924 
                                       ------------   -----------
  Total current assets                   1,567,480     1,753,176 
                                       ------------   -----------
Land, Property and Equipment, 
  net (Notes 2 and 3)                    5,174,747     2,094,841 

Goodwill, net of accumulated 
  amortization of $334,418
  at September 29, 1996 and 
  $309,441 at October 1, 1995              595,455       529,658 

Other assets (Notes 4, 8 and 9)          4,535,739       204,783 
                                       ------------   -----------
                                       $11,873,421    $4,582,458 

   Liabilities and Stockholders' Equity
   ------------------------------------

Current Liabilities:                     
 Current maturities of note payable 
  and other long-term debt (Note 6)    $   352,023    $      --- 
 Due to related parties (Note 9)           110,152       105,076 
 Accounts payable and accrued 
  expenses (Notes 5 and 8)               1,106,110       840,364 
                                       ------------   -----------

    Total current liabilities            1,568,285       945,440 
                                       ------------   -----------
Note payable and other long-term debt,
 excluding current maturities (Note 6)   1,065,909           --- 
                                       ------------   -----------
  Total liabilities                      2,634,194       945,440 
                                       ------------   -----------

Commitments and contingencies (Note 10)

Stockholders' Equity:
 Preferred stock, $.01 par value; 
  authorized 10,000,000 shares, none
  issued.
 Common stock, $.01 par value;
  authorized 30,000,000 shares; 
  issued and outstanding 3,765,000
  shares and 3,520,000, respectively 
  (Note 7)                                   37,650       35,200 
Paid-in capital                          17,852,403   17,823,603 
Accumulated (deficit)                    (8,650,826) (14,221,785)
                                        ------------  -----------

  Total stockholders' equity              9,239,227    3,637,018 
                                        ------------  -----------
                                        $11,873,421   $4,582,458 
                                        ============  ===========

   See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
                    RUDY'S RESTAURANT GROUP, INC.
                           AND SUBSIDIARIES

                Consolidated Statements of Operations

       Years ended September 29, 1996 and October 1, 1995
<TABLE>
<S>                                     <C>            <C>
                                         1996          1995
Revenues:                             ------------   ------------
 Net sales                            $14,588,835    $11,052,603 
 Other income                              76,630         38,273 
                                      ------------   ------------
   Total revenues                      14,665,465     11,090,876 

Costs and expenses applicable to 
  revenues:
 Food, beverage and supplies            3,941,042      3,267,129 
 Labor and related costs                3,389,707      2,684,946 
                                      ------------   ------------
   Total costs and expenses applicable
     to revenues                        7,330,749      5,952,075 
                                      ------------   ------------

Costs and expenses of restaurant
  operations:
 General operations                     4,290,606      3,251,503 
 Depreciation and amortization            349,021        243,852 
                                      ------------   ------------
  Total costs and expenses of 
   restaurant operations                4,639,627      3,495,355 
                                      ------------   ------------

Earnings from restaurant operations     2,695,089      1,643,446 
                                      ------------   ------------
Corporate overhead:
 General and administrative expenses      614,587        516,354 
 Depreciation and amortization             87,168         32,685 
 Interest expense                          73,656          6,126 
                                      ------------   ------------
    Total corporate overhead              775,411        555,165 
                                      ------------   ------------
Non-Operating expenses:
 Settlement cost and expense (Note 10)        ---        (50,000)
 Loss on retirement of assets             (10,719)          (550)
                                      ------------   ------------
    Total non-operating expenses          (10,719)       (50,550)
                                      ------------   ------------

Income before income taxes               1,908,959      1,037,731 

Income tax (benefit) expense (Note 8)  (3,662,000)        46,000 
                                      ------------   ------------

Net Income                            $ 5,570,959    $   991,731 
                                      ============   ============

Primary earnings per share            $      1.48    $       .27 
                                      ============   ============
Fully diluted earnings per share      $      1.48    $       .26 
                                      ============   ============
Weighted average number of common 
shares and common equivalent shares 
outstanding: Primary                    3,761,984      3,718,358 
                                      ============   ============
             Fully Diluted              3,761,984      3,734,660
                                      ============   ============

     See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
                    RUDY'S RESTAURANT GROUP, INC.
                          AND SUBSIDIARIES

          Consolidated Statements of Stockholders' Equity

         Years ended September 29, 1996 and October 1, 1995

<TABLE>
<S>               <C>          <C>            <C>          <C>

                                                          Total 
                                                           Stock- 
                  Common     Paid-in     Accumulated     holders'
                  Stock      Capital      (Deficit)       Equity
                 -------   -----------  -------------  ----------
Balance 
October 2, 1994  $35,200   $17,823,603  $(15,213,516)  $2,645,287

Net Income           ---           ---       991,731      991,731
                 -------   -----------  -------------  ----------

Balance 
October 1, 1995   35,200    17,823,603   (14,221,785)   3,637,018

Proceeds from
issuance of 
common stock       2,450        28,800           ---       31,250

Net Income           ---           ---     5,570,959    5,570,959
                 -------   -----------   ------------  ----------
Balance 
September 29, 
1996             $37,650   $17,852,403   $(8,650,826)  $9,239,227
                 =======   ===========   ============  ==========



    See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
                  RUDY'S RESTAURANT GROUP, INC.
                         AND SUBSIDIARIES

              Consolidated Statements of Cash Flows

       Years ended September 29, 1996 and October 1, 1995

<TABLE>
<S>                                       <C>             <C>
                                           1996           1995   
                                        ===========   ===========
CASH FLOWS FROM OPERATING ACTIVITIES:
 Net income                             $5,570,959    $  991,731 
 Non-cash items:
  Depreciation and amortization            436,189       276,536 
  Loss on retirement of assets              10,719           550 
  Deferred tax benefit                  (3,807,000)          --- 
 Changes in assets and liabilities:
  (Increase)/Decrease in accounts 
   receivable                              (36,307)        2,198 
  (Increase) in inventories                (62,729)       (9,463)
  Decrease/(Increase) in prepaid expenses   16,845        (4,144)
  Increase in accounts payable and 
   accrued expenses                         41,109       161,999 
  Increase in indebtedness to related 
   parties                                   5,076         5,076 
                                        -----------   -----------
  Total adjustments                      (3,396,098)      432,752 
                                        -----------   -----------
 Net cash provided by operating
  activities                             2,174,861     1,424,483 
                                        -----------   -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
 Capital expenditures                   (1,966,047)     (282,794)
 Purchased goodwill                        (90,774)          --- 
 Note receivable advanced to officer       (47,000)          --- 
 Principal received on note receivable
  from officer                                 413           --- 
 Purchase of other assets                 (208,002)       (6,514)
                                        -----------   -----------
 Net cash (used in) investing activities(2,311,410)     (289,308)
                                        -----------   -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
 Proceeds from issuance of common stock     31,250           --- 


 Principal payments under note payable 
  and other long-term debt                 (171,969)          --- 
                                        -----------   -----------

 Net cash (used in) financing activities   (140,719)          --- 
                                        -----------   -----------
Net (Decrease)/Increase in Cash and
 Cash Equivalents                          (277,268)    1,135,175 

Cash and Cash Equivalents, 
 Beginning of Year                       1,476,652       341,477 
                                        -----------   -----------
Cash and Cash Equivalents, 
 End of Year                            $1,199,384    $1,476,652 
                                        ===========   ===========

   See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
                RUDY'S RESTAURANT GROUP, INC.
                       AND SUBSIDIARIES

             Consolidated Statements of Cash Flows

      Years ended September 29, 1996 and October 1, 1995
                         -continued-
<TABLE>
<S>                                     <C>              <C>
                                          1996          1995     
                                        ----------   ---------
Supplemental disclosures of cash 
 flow information:
  Cash paid for: 
   Interest                             $   65,770   $   6,000 
                                        ==========   =========
   Income taxes                         $  182,086   $  42,000
                                        ==========   ========= 
  Non Cash Transactions:
   Accrued and unpaid asset additions
    at year end                         $  224,636   $  16,300
                                        ==========   ========= 
   Liabilities assumed in acquisition 
    of restaurants:
     7% Promissory Note                 $1,253,221 
                                        ==========
     Consulting and Agreement Not to 
      Compete, discounted at 7%        $   336,680
                                       =========== 


    See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
         RUDY'S RESTAURANT GROUP, INC. AND SUBSIDIARIES

           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1: NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES

Nature of Business. Rudy's Restaurant Group, Inc. (the
"Company"), is a Nevada corporation which, through its wholly-owned
 subsidiaries, owns and operates nine Japanese steak and
seafood restaurants. The Company owns 100% of the stock of The
Samurai, Inc. ("The Samurai"),  Maxwell's International Inc.
("Maxwell's") and Rudy's Sirloin SteakBurgers, Inc. ("Rudy's").

The Company's fiscal year includes either 52 or 53 weeks
consisting of 13 four-week accounting periods or 12 four-week
accounting periods and 1 five-week accounting period, ending on
the Sunday closest to September 30. Fiscal years 1996 and 1995
each include 52 weeks of operations.

Principles of Consolidation.  The consolidated financial
statements include the accounts of the Company and its 
wholly-owned subsidiaries. All material intercompany transactions are
eliminated in consolidation.

Cash Equivalents.  The Company considers all highly liquid debt
instruments with an initial maturity of three months or less to
be cash equivalents for purposes of the statements of cash flows. 

Inventories.  Inventories, consisting primarily of food,
beverages and restaurant supplies, are stated at the lower of
cost (first-in, first-out method) or market.

Use of Estimates.  The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from
those estimates.

Land, Property and Equipment.  Land, property and equipment are
stated at cost. Depreciation and amortization are provided on a
straight-line method over the lesser of the estimated useful life
of the asset or the remaining term of the lease, as applicable.

Goodwill.  The Company evaluates the propriety of goodwill, the
excess of the purchase value of net tangible assets of acquired
businesses over recorded value, and the related amortization
policy periodically by review of many factors including current
operating trends, the value of intangibles held by the Company
such as trademarks and leasehold interests, and the current
national economy particularly as it relates to the Company's
business plan and operations. Absent evidence to the contrary the
Company's policy is to amortize goodwill using the straight-line
method over fifteen (15) to forty (40) years. Under the current
policy goodwill will be fully amortized in the year 2021.

Earnings Per Share.  Earnings per share is calculated using the
weighted average number of shares of common stock outstanding and
common stock equivalents if dilutive. 

Income Taxes. Income taxes are accounted for using the asset and
liability method. Under such method, deferred taxes are adjusted
for tax rate changes as they occur and deferred income tax assets
and liabilities are computed annually for differences between the
financial reporting and tax bases of assets and liabilities that
will result in taxable or deductible amounts in the future based
on enacted tax laws and rates applicable to the periods in which
the differences are expected to affect taxable income. An
allowance is provided when necessary to reduce net deferred tax
assets to amounts that are more likely than not to be realized.

Fair Value of Financial Instruments. The carrying value of cash
and cash equivalents, accounts receivable and accounts payable
approximate fair value due to their short-term nature. The fair
value of the note receivable from Company officer (see Note 9),
note payable and other long-term debt is based on estimated cost
of replacing these financial instruments at current interest
rates. The carrying value of the note receivable from Company
officer (see Note 9), note payable and other long-term debt
approximates the fair value of these financial instruments.  

New Accounting Pronouncements.  In 1995, the Financial Accounting
Standards board issued Statement No. 121 ("SFAS 121"), Accounting
for the Impairment of Long-Lived Assets and Long-Lived Assets to
Be Disposed of. SFAS 121 requires that long-lived assets and
certain identifiable intangibles to be held and used by an entity
be reviewed for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may
not be recoverable. SFAS 121 is effective for fiscal year 1997.
Although management has not yet completed the process of
evaluation of the impact of adoption of this statement on the
Company's financial statements, the Company believes that the
adoption of this statement will not have a significant effect on
the Company's financial position and results of operations.
<PAGE>

NOTE 2: LAND, PROPERTY AND EQUIPMENT AND ACQUISITIONS

Land, property and equipment consist of the following:
<TABLE>
<S>                                <C>         <C>     <C>
                                  1996      1995    Useful lives
                             ---------- ---------- --------------
Land                         $  900,637 $      ---  
Building and Leasehold 
  improvements                4,468,993  3,151,918   3 - 25 yrs 
Restaurant equipment          1,971,890  1,573,427   3 - 7 yrs 
Office equipment                283,654    157,907   3 - 7 yrs 
Other                           317,504    259,638   2 - 7 yrs 
                             ---------- ----------   
                              7,942,678  5,142,890
Accumulated depreciation 
  and amortization            2,767,931  3,048,049
                             ---------- ----------
                             $5,174,747 $2,094,841
                             ========== ==========
</TABLE>

Business Acquisition. On February 5, 1996 the Company, through
its Maxwell's subsidiary, acquired substantially all of the
assets and business operations of three Japanese steak and
seafood restaurants owned by Asian Restaurants International,
Inc. ("ARI") for a total of $2,200,800.The Company paid $547,600
in cash, issued a 7% promissory note for $1,253,221 and entered
into a Consulting and Agreement Not to Compete with the owner of
ARI calling for payments totaling $400,000 to be paid over five
years. The Consulting and Agreement Not to Compete has been
recorded at its discounted value, $336,680, in the Company's
consolidated financial statements as an other asset, to be amortized
over five (5) years, and long-term
obligation. The acquisition has been accounted for as a purchase
and the results of operations of the three restaurants acquired
have been included in the accompanying consolidated financial
statements since the date  acquired. The cost of the acquisition
has been allocated on the basis of the estimated fair market
value of the assets acquired and the liabilities assumed. This
allocation resulted in goodwill of approximately $91,000 which is
being amortized over 15 years.

Substantially all of the assets acquired are held as collateral
for the 7% promissory note issued.

The following unaudited proforma consolidated results of
operations give effect to the acquisition as though it had
occurred on October 3, 1994.

                                      Unaudited                   
                               September      October   
Fiscal Years Ended             29, 1996       1, 1995   
                              -----------   -----------
   Revenues                   $16,517,000   $17,319,000
   Net Income                 $ 5,673,000   $ 1,612,000
   Net income per share:
      Primary                 $      1.51   $       .43
      Fully diluted           $      1.51   $       .43

The above unaudited proforma information is presented to provide
the reader with information about the continuing impact of this
acquisition by showing how it might have affected historical
financial statements and is not necessarily indicative of results
of operations that would have occurred had the acquisition been
made on October 3, 1994 or of future results of operations of the
Company.

Land, Property Acquisition: In September 1996, the Company,
through its Samurai subsidiary, acquired the land and
improvements at one of the locations the Company has leased and
operated since 1980. The Company paid $1,150,000 in cash to
acquire this property.

NOTE 3: LEASES

The Company leases land, restaurant buildings and other
facilities under noncancellable operating leases expiring at
varying times through 2016.  Lease agreements frequently include
renewal options and require the Company to pay all expenses
related to the property. Certain leases include provisions for
contingent rentals based on a percent of sales. Future minimum
lease payments under noncancellable leases as of September 29,
1996 are as follows: 
<PAGE>
                                      Fiscal Year     Operating 
                                         Ending         Leases   
                                      ------------  -----------
                                         1997       $   918,456
                                         1998           872,057
                                         1999           855,721
                                         2000           862,887
                                         2001           882,843
                     Thereafter, through 2016         7,245,141
                                                    -----------
                                                    $11,637,105
                                                    ===========

Rent expense is summarized as follows:
                                            1996         1995  
                                         ----------   ---------
                      Minimum rentals    $  902,717   $ 648,485
                      Contingent rentals    133,376      91,080
                                         ----------   ---------
                      Total rent expense $1,036,093   $ 739,565
                                         ==========   =========

NOTE 4: ACCOUNTS RECEIVABLE AND OTHER ASSETS

Accounts receivable include credit card, other miscellaneous
receivables and the current portion of note receivable from
officer.

Other assets include the following:
                                                1996       1995
                                             ----------  --------
  Liquor licenses, net of accumulated
    amortization of $40,594 and $31,225 
    in 1996 and 1995, respectively           $  217,645  $ 71,534
  Restaurant supplies                           110,050    80,577
  Note receivable from officer, net of
   current portion $9,382                        37,205       ---
  Consulting and Agreement Not to Compete       292,680       ---
  Net deferred tax assets                     3,807,000       ---
  Deposits and other                             71,159    52,672
                                             ----------  --------
                                             $4,535,739  $204,783
                                             ==========  ========

The note receivable from officer bears interest at 7%. Principal
and interest are due every two weeks through September, 2000.

NOTE 5: ACCOUNTS PAYABLE AND ACCRUED EXPENSES

Accounts payable and accrued expenses are summarized as follows:

                                               1996      1995     
                                           ----------  ---------
     Trade accounts payable                $  538,036  $ 372,409
     Sales and property taxes                  69,092      8,031
     Accrued payroll and related costs        310,769    226,064
     Rent                                      61,811     90,866
     State and local income taxes               4,427     39,367
     Gift certificates payable                 37,775     23,130
     Professional and other fees               35,846     23,805
     Insurance                                    ---     39,634
     Other                                     48,354     17,058
                                           ----------   --------
                                           $1,106,110   $840,364
                                           ==========   ========

NOTE 6: NOTE PAYABLE AND OTHER LONG-TERM DEBT

Note payable and other long-term debt include:

   7% Promissory Note due ARI, $30,010 principal 
   and interest due monthly through March, 2000      $1,115,023

   Consulting and Agreement Not-to-Compete, total
   due $400,000, discounted using 7% interest 
   rate, $6,667 principal and interest due 
   monthly through February, 2001                       302,909
                                                     -----------

   Total long-term debt                             $ 1,417,932
   Less current maturities                              352,023
                                                    -----------
   Long-term debt excluding current maturities      $ 1,065,909
                                                    ===========
<PAGE>
Substantially all of the assets of the Kyoto restaurants are held
as collateral for the 7% promissory note due ARI.

Interest expense, interest paid and accrued unpaid interest
including interest paid and/or due officers and directors (see
Note 9) are:


                                                1996      1995   
                                              -------   ---------
  Interest expense                            $73,656   $   6,126
                                              =======   =========
  Interest paid                               $65,770   $   1,050
                                              =======   =========
  Accrued unpaid interest other than to 
   officers and directors                     $ 7,886   $     ---
                                              =======   =========
  Interest payable to officers and directors  $10,152   $   5,076
                                              =======   =========
  Interest paid officers and directors        $   ---   $     ---
                                              =======   =========

NOTE 7: CAPITAL STOCK

The Company's 1985 Employee Stock Option Plan, as amended (the
"Plan") provided that options to purchase up to 600,000 shares of
the Company's common stock may be granted. The Plan was designed
so that either options intended to satisfy the requirements of
the Internal Revenue Code with respect to "Incentive Stock
Options" ("ISO's") or options that are not intended to satisfy
such requirements ("Non ISO's") may be granted. Exercise prices
for the options ranged from 100% to 110% of the fair market value
of the Company's common stock, with the option price dependent
upon whether the option was qualified as an ISO and whether the
optionee had prior holdings in excess of 10% of the outstanding
common stock at the time of the grant. The following summarizes
stock option transactions for fiscal years ended 1996 and 1995:

Outstanding and exercisable options 
   at October 2, 1994                     258,125    $.10 - $4.63
  Expired                                 (13,125)  $1.23 - $4.63
                                          --------
Outstanding and exercisable options 
   at October 1, 1995                     245,000     $.10 - $.15
  Expired                                     ---
  Exercised                              (245,000)    $.10 - $.15
                                         ---------    
Outstanding and exercisable options 
   at September 29, 1996                    None   
                                         =========

The Plan terminated in May 1995 and all outstanding options were
exercised in December 1995.

NOTE 8: INCOME TAXES

At September 29, 1996, the Company and its Maxwell's subsidiary
have tax net operating losses ("NOLS") and general business tax
credit carryforwards totaling approximately $12,300,000 and
$280,000, respectively. The NOLS are available to reduce future
federal taxable income at varying times through 2007 and the
business tax credits are available to reduce Federal income taxes
at varying times through 2011. 

The Company adopted Statement of Financial Accounting Standards
No. 109, "Accounting for Income Taxes" ("SFAS 109") in 1994. SFAS
109 requires the Company to record a deferred tax asset for the
future tax benefits of  NOLS and business tax credits if
realization of the tax benefit is more likely than not. There was
no cumulative effect of adoption of SFAS No. 109 in fiscal 1994
due to a valuation allowance established to reflect uncertainties
associated with realization of tax benefits from the utilization
of then existing tax loss carryforwards and unused business tax
credits.

In 1996, as a result of the acquisition of the Kyoto restaurants
and improvements in same-restaurant earnings which have continued
for a number of years, the Company now believes it is more likely
than not that sufficient levels of income will be achieved in the
future to assure realization of NOLS. Accordingly, in 1996 the
Company reduced its valuation allowance by $4,289,300 and
recorded an income tax benefit of $3,807,000 as a reduction in
current year tax expense.

Significant components of the Company's deferred tax assets
(liabilities) as of September 29, 1996 and October 1, 1995 are as
follows:
                                             1996        1995     
                                        -----------  ------------
Deferred tax assets:
  Tax benefits of net operating loss 
   carryforwards                        $4,179,000   $ 4,786,700 
  Business tax credit carryforwards        280,400       193,300 
  Valuation allowance                     (510,700)   (4,800,000)
                                        -----------  ------------
     Net deferred tax assets            $3,948,700   $   180,000 
                                        -----------  ------------



Deferred tax liabilities:
  Tax depreciation in excess of book    $ (112,000)  $  (180,000)
  Other timing differences                 (29,700)          ---
                                        -----------  ------------
     Net deferred tax liabilities       $ (141,700)  $  (180,000)
                                        -----------  ------------
Total net deferred tax assets           $ 3,807,000  $       --- 
                                        ===========  ============
<PAGE>
Provision for income tax expense (benefit) includes the
following:
                                            Fiscal Years Ended    
                                            1996         1995   
                                         -----------   --------
  Current:
    State and local income taxes           $ 108,900   $ 32,500
    Federal income taxes                      36,100     13,500
  Deferred:
    Change in net deferred taxes          (3,807,000)       ---
                                         ------------  --------
                                         $(3,662,000)  $ 46,000
                                         ============  ========

The actual income tax rate for income differs from the expected
statutory Federal income tax rate of 34% as follows:

                                             Fiscal Years Ended   
                                            1996         1995   
                                         -----------  -----------
Expected Federal tax provision           $  649,000   $  352,800 
Increases (decreases) in income taxes 
   resulting from:
   State and local income taxes, net of
   Federal tax benefit                      105,700       42,800 
   Differences in book/tax depreciation      29,900       (6,800)
   Book expenses taken as tax credits, 
    net of Federal tax cost                 (52,500)     (44,700)
   Non-deductible items                       9,100        8,800 
   Current year utilization of loss 
     carryforwards                         (596,200)    (306,900)
Change in net deferred taxes             (3,807,000)         --- 
                                        ------------    ---------
                                        $(3,662,000)    $ 46,000
                                        ============    =========


At September 29, 1996 income taxes due currently and included in
current liabilities, net of estimated taxes paid, total $4,400. 

NOTE 9:  RELATED PARTY TRANSACTIONS AND GUARANTEES

Transactions with Majority Shareholder, Officer and Director.
Guarantees. Pursuant to the terms of an agreement related to the
acquisition of the Rudy's subsidiary in 1985 between the Company
and Douglas Rudolph, a director, Chairman of the Board of
Directors and President of the Company ("Mr. Rudolph"), the
Company owes Mr. Rudolph a total of $110,152, including $72,712
accruing interest at 7%. The Company intends to reduce the
balance due Mr. Rudolph as cash flow permits. Accordingly, the
balance due Mr. Rudolph at September 29, 1996 has been classified
as a current liability in the financial statements.

Employment Agreement. The Company has an employment agreement
with Mr. Rudolph and a consulting agreement with a company wholly
owned by Mr. Rudolph. These agreements provide a total annual
compensation of $150,000, a possible incentive bonus up to
$100,000 annually to be determined by the board of directors, and
reimbursements for certain expenses incurred. No bonus was
awarded in fiscal 1996 or 1995. Amounts paid or accrued under
these agreements and for continuing services rendered and
expenses incurred totaled $160,800 in 1996 and 1995.

Advances to Officers and Directors.  The Company's Employee Stock
Option Plan provided that monies required to exercise stock
options may be advanced by the Company. In December 1995 the
Company advanced Mr. Rudolph and Marie Peterson, the Company's
Chief Operating and Financial Officer ("Ms. Peterson") funds to
exercise their then outstanding options.

In August 1996 the Company advanced Ms. Peterson $47,000. This
advance is evidenced by a note, bears interest at 7% and is to be
repaid bi-weekly, through September, 2000.

Other. Each director receives an annual fee of $12,000 plus
$1,000 per meeting attended. Director fees and costs totaled
$36,000 in 1996 and 1995.

NOTE 10: LEGAL PROCEEDINGS, COMMITMENTS AND CONTINGENCIES

In May 1995 the Company's Samurai subsidiary and certain
employees of The Samurai were named defendants in a lawsuit
alleging discrimination under the Civil Rights Act of 1870, 42
U.S.C. 1981, as amended (1992 Supp).

Although the Company believed that the claims as set forth in the
complaint were without merit, due to the prohibitive costs of
defending such allegations, in September 1995 the Company entered
into a Settlement Agreement wherein, in return for certain
monetary consideration, the plaintiff agreed to release all
existing claims against the Company and its employees. Pursuant
to the terms of the Agreement the complaint was dismissed in
September 1995. The costs of settlement, including legal fees
incurred, totaled approximately $50,000. Accordingly, the Company
recorded a nonrecurring charge of $50,000, included in the
accompanying statements of operations of fiscal 1995 as non-operating expense.
<PAGE>
The Company is subject to such legal proceedings and claims as
may arise in the ordinary course of its business that cover a
wide range of matters, including but not limited to such matters
as workers compensation, general liability and products liability
claims. The Company carries comprehensive insurance to assist in
limiting the Company's exposure to financial loss as a result of
such claims as may arise in the normal course of business.
However, the Company does not carry insurance coverage to assist
in the defense or settlement of those claims which may arise in
employment matters such as alleged harassment or discrimination.
Although the Company is not currently a party to any significant
ongoing legal proceeding not covered by existing insurance, there
are no assurances that such legal proceedings, should they arise,
would not have a significant adverse effect on the Company's
financial position.

Item 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
        ACCOUNTING AND FINANCIAL DISCLOSURE
        -------------------------------------------------

        None.

                           PART III

Item 9. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT;
        COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT; 
        ---------------------------------------------------
(a)  Identification of Directors.
     ----------------------------

The following sets forth certain information with respect to all
directors of the Company:
                                                         Term of
Name               Age   Position and Offices Held        Office
----               ---   -------------------------       --------
Douglas M. Rudolph  45   President, Chairman of the       1985 -
                         Board, Chief Executive           Present
                         Officer, Secretary and Director

Peter Graham        41   Director                         1986 -
                                                          Present

Eli Boyer           77   Director                         1986 -
                                                          Present

The Company's Board of Directors is divided into four classes
defined to provide continuity of management by staggering the
term of office of each director. The term of office of Class A
expires in one year and the term of office of the remaining three
classes expires in the second (Class B), third (Class C) and
fourth (Class D) succeeding years. Subsequent terms of office for
each class expire the fourth year after election to the initial
term of office. 

Mr. Boyer comprises the member of Class A, the term of which was
to have expired in 1991. Mr. Graham comprises the member of Class
B which was to have expired in 1993. Mr. Rudolph comprises the
member of Class D, the term of which was to expire in 1991. The
terms of all the directors have been extended until the next
Meeting of Shareholders. 

Mr. Rudolph has held the positions of director, President and
Chairman of the Board of Rudy's Restaurant Group, Inc. and its
subsidiaries since prior to 1990. He is a member of the Executive
Committee and the Transactions Committee of the Company's Board
of Directors. Mr. Rudolph is the principal shareholder and
president of Rudolph Entertainment, Inc. ("REI") and a registered
Florida real estate salesman.

Peter Graham was elected a director of the Company in June 1986.
He is a member of the Executive Committee, Transactions
Committee, Stock Option and Executive Compensation Committee and
Audit Committee of the Company's Board of Directors. Mr. Graham
is president and a director of Ladenburg Thalmann & Co. Inc., an
investment banking firm, and has been associated with such firm
for over ten years. Mr. Graham serves as a director of 
SPI-Suspension and Parts Industries Ltd., Regency Equities Corp. and
Seventh Generation. 

Eli Boyer was elected a director of the Company in April 1986. He
is a member of the Stock Option and Executive Compensation
Committee and Audit Committee of the Company's Board of
Directors. Previously Mr. Boyer was a senior partner in the
accounting firm of Laventhol & Horwath. Mr. Boyer now performs
consulting services. He is a director of Total Film Group, Inc.,
a company engaged in the motion picture entertainment business.

(b)  Identification of Executive Officers.
     ------------------------------------

The following sets forth certain information with respect to all
executive officers of the Company:

Name                  Age    Position(s) Held
----                  ---    ------------------------------------
Douglas M. Rudolph     45    President, Chief Executive Officer,
                             Secretary and Director

Marie G. Peterson      49    Vice President, Treasurer, Chief
                             Operating and Financial Officer


See "Identification of Directors" for a biography of Mr. Rudolph.
<PAGE>
Ms. Peterson is the Vice President of Finance, Treasurer and
Chief Financial Officer of  Rudy's Restaurant Group, Inc. and its
subsidiaries and has held these positions since prior to 1990.
She was named Chief Operating Officer of the Company and its
subsidiaries in 1995. 

(c)  Compliance with Section 16(a) of the Securities Exchange Act
     ------------------------------------------------------------

Section 16(a) of the Securities Exchange Act requires the
Company's executive officers and directors and persons who own
more than ten percent of the Company's common stock to file
reports of ownership and changes in ownership of the Company's
Common Stock and any other equity securities of the Company with
the Securities and Exchange Commission (the "SEC"). Executive
officers, directors and greater than ten percent shareholders are
required by SEC regulation to furnish the Company with copies of
all Section 16(a) forms filed.

Based solely on its review of the copies of such forms received
by the Company, or written representations from certain reporting
persons that no Form 5's were required for those persons, the
Company believes that all its executive officers, directors and
greater than 10% shareholders complied with all applicable filing
requirements during 1996.

Item 10.  EXECUTIVE COMPENSATION
          ----------------------

     Cash Compensation
     -----------------

The following sets forth certain information with respect to
annual compensation for all executive officers of the Company for
fiscal years ended September 29, 1996, October 1, 1995 and
October 2, 1994:

Name and Principal     Year                               Options
Position(s) Held      Ended    Salary    Bonus    Other   Granted
------------------    -----    ------    -----    -----   -------
Douglas M. Rudolph,
President, CEO, 
Secretary, Director   1996   $150,000    None    $22,800   None
                      1995   $150,000    None    $22,800   None
                      1994   $150,000    None    $22,800   None
Marie G. Peterson,
VP, Treasurer, COO 
and CFO               1996    $95,000    None    $35,600   None
                      1995    $84,000    None    None      None
                      1994    $84,000    None    None      None

Mr. Rudolph's other compensation includes an annual expense
allowance of $10,800 and annual Director's fees of $12,000. Ms.
Peterson's other compensation represents cost of living wage
adjustments due pursuant to the terms of her employment agreement
from 1991 through 1995.

The executive officers of the Company are provided with insurance
coverage under the Company's group medical plan under the same
terms and conditions as are available to other salaried
employees.

Mr. Rudolph renders services to the Company on a full time basis
pursuant to the terms of an employment agreement and a consulting
agreement with his wholly owned company, REI. These agreements
provide Mr. Rudolph a total annual compensation of $150,000,
reimbursement for certain expenses incurred by him, and a
possible annual incentive bonus of up to $100,000 annually as
determined by the Company's Board of Directors (the "Board"). The
Company believes that the terms of its existing arrangements with
Mr. Rudolph are no less favorable to the Company than similar
arrangements which might have been entered into with similarly
qualified unrelated parties. All references to such employment
agreement and consulting agreement are qualified in entirety by
reference to Exhibits 10.19 and 10.20 of this report,
respectively.

Ms. Peterson renders services to the Company on a full time basis
pursuant to the terms of an employment agreement entered into in
February 1990. The initial term of the employment agreement was
for a term of one year with certain renewal periods, as agreed by
the parties. All references to such employment contract are
qualified in its entirety by reference to Exhibit 10.11 of this
report.

Each director (including employee directors) earns an annual fee
of $12,000 for serving on the Board of Directors plus $1,000 per
meeting attended. In addition, the Company reimburses all
directors for travel and other reasonable and normal expenses
incurred on behalf of the Company. Directors fees, all of which
were paid, totaled $36,000 in 1996 and 1995. 
<PAGE>
     Employee Stock Option Plan
     --------------------------

The Company's 1985 Employee Stock Option Plan, as amended (the
"Plan") terminated in May 1995. The Plan provided that options to
purchase up to 600,000 shares of the Company's Common Stock may
be granted. The Plan was designed so that either options that are
intended to satisfy the requirements of the Internal Revenue Code
with respect to "Incentive Stock Options" ("ISO's") or options
that are not intended to satisfy such requirements ("Non ISO's")
were authorized. 

Pursuant to Plan provisions, the Board designated the Stock
Option and Executive Compensation Committee (the "Committee"),
consisting of Messrs. Graham and Boyer, to administer the Plan.
Within the applicable limits of the Plan, the Committee had full
authority to select from among eligible individuals those to whom
options would be granted under the Plan,  the number of shares
subject to each option and the price, terms and conditions of any
options to be granted thereunder. The Board of Directors had full
authority to amend the Plan, provided, however, that any
amendment which (i) increases the number of shares which may be
the subject of stock options granted under the Plan, (ii) expands
the class of individuals eligible to receive options under the
Plan, (iii) increases the period during which options may be
granted or the permissible term of options under the Plan, or
(iv) decreases the minimum exercise price of such options, could
only be adopted by the Board of Directors, subject to
shareholders approval.

Executive officers and key employees of the Company and its
subsidiaries were eligible to receive options under the Plan. The
exercise price of any option was to be not be less than 100% (or,
in the case of an ISO granted to a 10% shareholder, 110%) of the
fair market value of the shares purchasable thereunder on the
date of grant.

Payment for shares purchased upon the exercise of options were
authorized to be made in cash, certified check or by transfer to
the Company of a number of shares of the Company's Common Stock
whose aggregate market value is equal to the aggregate option
price (provided that, unless waived by the Committee, with
respect to options issued after April 19, 1988 the shares of
Common Stock shall have been owned at least six months). This
latter provision would include the "pyramiding" of shares in
successive simultaneous exercise. Thus, an optionee could
initially exercise an option in part, acquiring a few shares of
Common Stock, and thereafter effect further exercises of the
option, using the Common Stock acquired upon the earlier
exercises to pay for the increasingly greater number of shares
received on each successive exercise. This procedure would permit
an optionee to pay the option price with only a single share of
Common Stock and to acquire a number of shares of Common Stock
having an aggregate fair market value equal to the excess of (a)
the fair market value of all shares to which the option relates
over (b) the aggregate exercise price under the option. The
Company was authorized to make loans to an optionee for the
purpose of fully or partially exercising an option under the
Plan.

From June 1, 1985 to May 31, 1995, employees received options to
purchase 538,155 shares of Common Stock of which 245,000 with a
weighted option price of $.13 per share were exercised in
December 1995.

Inasmuch as the purpose of the Plan was to attract and retain
qualified employees, the Company intends to establish an employee
stock option plan with terms similar to those outlined herein in
1997.

The above summary is qualified in its entirety by reference to a
full description of the Plan, found in Exhibit 10.1 of this
report.

Stock Options of Executive Officers
-----------------------------------

The following sets forth certain information with respect to
stock options granted executive officers of the Company under the
Company's 1985 Employee stock option plan.

                                                    All Officers
                         Douglas M.   Marie G.      consisting of
Stock Options             Rudolph     Peterson    two individuals
-----------------------------------------------------------------
Options granted 
June 1985 through 
September 29, 1996        248,750      53,125          301,875

Average per share 
exercise price              $ .12       $ .73            $ .25

Options exercised
June 1985 through 
September 29, 1996        200,000      40,000          240,000

Options expiring 
June 1985 through 
September 29, 1996         48,750      13,125           61,875

Unexercised Options at
September 29, 1996           None        None             None


The exercise price of each option was at or above the approximate
fair market value of the Company's Common Stock on the date the
option was granted. Directors who are not executive officers of
the Company have not received any options to purchase shares of
Common Stock. All unexercised options were exercised in December
1995.
<PAGE>
Item 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
          MANAGEMENT
          ---------------------------------------------------

     (a)     Security Ownership of Certain Beneficial Owners
             -----------------------------------------------

The following sets forth certain information as of December 20,
1996 with respect to the Common Stock of the Company beneficially
owned by any person who is known to the Company to be the
beneficial owner of more than 5% of the Company's voting
securities. The percent of common stock shown is as of December
20, 1996:
<TABLE>
<S>                                    <C>               <C>
Name and Address of                 Amount of          Percent of 
Beneficial Owner               Beneficial Ownership  Common Stock
-----------------------------------------------------------------
Bright Star Holding, Inc.            450,000             12.0%
101 Convention Center Drive
Las Vegas, NV 89109

Douglas M. Rudolph
212 Bal Bay Drive
Miami, FL 33154                    2,086,100<F1>         55.4%


<FN>
<F1>Does not include (i) 11,500 shares owned by Judi Male, Mr. Rudolph's 
sister, (ii) 8,500 shares owned by Richard Rudolph, Mr. Rudolph's brother,
(iii) 12,900 shares owned by Muriel Rudolph, Mr. Rudolph's mother. Mr. 
Rudolph may be deemed a parent of the Company as that term is defined 
under the Securities Act of 1933, as amended.
</FN>
</TABLE>

    (b)    Security Ownership of Management
           --------------------------------

The following sets forth certain information as of December 20,
1996 with respect to the Common Stock of the Company beneficially
owned by all directors and nominees (other than directors listed
as principal shareholders in the preceding table) and by all
executive officers and directors as a group. The persons
identified in this table have sole voting and investment power
with respect to the shares according to information furnished to
the Company by each of them.

 
Name of Individual or             Amount of           Percent of
Identity of Group            Beneficial Ownership    Common Stock
-----------------------------------------------------------------
Eli Boyer                          1,000             Less than 1%
Peter Graham                     100,000                     2.7%
Marie G. Peterson                 40,000                     1.1%
All executive officers and
directors as a group 
(consisting of 4 individuals)  2,227,100                    59.2%


     (c)   Change in Control
           -----------------  

In June 1993 BSH sold 1,467,000 shares held by BSH to Mr.
Rudolph. As a result of this and certain other transactions BSH's
stock ownership was reduced from 59% to 12.8%, resulting in a
change in control of the Company. At December 20, 1996, Mr.
Rudolph and BSH hold 55.4% and 12%, respectively, of the
Company's outstanding Common Stock.

A change in control of the Company constitutes an event
triggering certain severance provisions of certain employment
contracts between the Company and its executive officers. As of
December 20, 1996 the Company's executive officers have not
elected to exercise their rights under such severance provisions.

Item 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
          ----------------------------------------------

See Note 9 to the Company's financial statements regarding
transactions with BSH, the Company's majority shareholder and
related transactions.

                        PART IV

Item 13.    EXHIBITS  AND REPORTS ON FORM 8-K.
            ----------------------------------

(a) Exhibits
    --------

3.1  Amended and Restated Articles of Incorporation of the
Company dated April 24, 1986. Incorporated by reference to
Exhibit 3.1 to the Company's Registration Statement on Form S-18
as filed with the Securities and Exchange Commission File No. 33-5362,
effective June 18, 1986 (the "Registration Statement").
<PAGE>
3.2  By-Laws of the Company. Incorporated by reference to Exhibit
3.1 of the Company's Quarterly Report on Form 10-Q for the fiscal
quarter ended June 5, 1988.

4.1  Specimen of Common Stock Certificate.  Incorporated by
reference to Exhibit 4.1 of the Registration Statement.

4.2  $750,000 10% Convertible Subordinated Secured Note of Rudy's
Sirloin SteakBurgers, Inc. issued to Douglas M. Rudolph. 
Incorporated by reference to Exhibit 4.2 of the Company's Annual
Report on Form 10-K for the fiscal year ended September 27, 1987
(the "1987 Form 10-K").

4.3  $750,000 10% Convertible Subordinated Secured Note of Rudy's
Sirloin SteakBurgers, Inc. issued to Sidney J. Rudolph. 
Incorporated by reference to Exhibit 4.3 of the 1987 Form 10-K.

4.4  $296,250 Promissory Note of Rudy's Sirloin SteakBurgers,
Inc. issued to Douglas M. Rudolph, as amended.  Incorporated by
reference to Exhibit 4.4  of the 1987 Form 10-K.

4.5  $296,250 Promissory Note of Rudy's Sirloin SteakBurgers,
Inc. issued to Sidney J. Rudolph, as amended.  Incorporated by
reference to Exhibit 4.5 of the 1987 Form 10-K.

4.6  Rights Agreement dated as of April 21, 1988 between Rudy's
Restaurant Group, Inc. and Bank of America National Trust and
Savings Association.  Incorporated by reference to Exhibit 2.1 of
the Company's Form 8-A dated May 6, 1988.

10.1  1985 Employee Stock Option Plan of the Company, as amended. 
Incorporated by reference to Exhibit 10.1 of the Company's Annual
Report on Form 10-K for the fiscal year ended October 2, 1988
(the "1988 Form 10-K").

10.2  Non-transferable Stock Purchase Warrant issued to Sidney J.
Rudolph. Incorporated by reference to Exhibit 10.3 of the
Registration Statement.

10.3  Non-transferable Stock Purchase Warrant issued to Judi
Male.  Incorporated by reference to Exhibit 10.3 of the
Registration Statement.

10.4  Amendment to Employment Agreement dated as of April 30,
1989 among Rudy's Restaurant Group, Inc., Rudy's Sirloin
SteakBurgers, Inc., The Samurai, Inc. and Douglas M. Rudolph.
Incorporated by reference to Exhibit 10.4 of the Company's Annual
Report on Form 10-K for the fiscal year ended October 1, 1989
(the "1989 Form 10-K").

10.5  Consulting Agreement dated as of October 1, 1988 between
Rudy's Restaurant Group, Inc. and Peter Graham.  Incorporated by
reference to Exhibit 10.8 of the 1988 Form 10-K.

10.6  Collateral Agreement between BSH and the Company.
Incorporated by reference to Exhibit 10.13 of the Registration
Statement.

10.7  Acquisition Agreement dated as of October 21, 1985 among
the Company, BSH, Sidney J. Rudolph, Douglas M. Rudolph and
Rudy's Sirloin SteakBurgers, Inc. Incorporated by reference to
Exhibit 10.5 of the Registration Statement.

10.8  Directors and Officers Liability Indemnification Agreement
dated as of April 1, 1987 among BSH and the officers and
directors of BSH, the Company and all subsidiaries thereof,
Directors and Officers Liability Indemnification Trust dated
April 1, 1987 among BSH, as Settlor, and Jeffrey Mischel, Peter
Graham, and Eli Boyer, as original Co-Trustees; Mortgage dated
April 3, 1987 from BSH to Directors and Officers Liability
Indemnification Trust.  Incorporated by reference to Exhibit
10.12 of the 1987 Form 10-K.

10.9  Loan and Security Agreement dated as of December 8, 1988 by
and among Rudy's Restaurant Group, Inc., Rudy's Sirloin
SteakBurgers, Inc., The Samurai, Inc. and Heller Financial, Inc. 
Incorporated by reference to the Company's Report on Form 8-K
dated December 19, 1988.

10.10  Letter Agreement dated December 8, 1988 among Donald
Schupak, Rudy's Restaurant Group, Inc., Rudy's Sirloin
SteakBurgers, Inc., The Samurai, Inc. and Heller Financial, Inc. 
Incorporated by reference to Exhibit 10.13 to the 1988 Form 10-K.

10.11  Form of Employment Agreement between the Company and
certain of its executive officers.  Incorporated by reference to
Exhibit 10.11 to the December 24, 1989 Form 10-Q.
<PAGE>
10.12  Stipulation of Settlement filed in that certain action
styled Chemical Bank v. Bright Star Holding, Inc., Rudy's
Restaurant Group, Inc., Sidney Rudolph and Douglas Rudolph, (U.S.
District Court, Southern District of New York) 89 Civ. 0609 (WK)
dated April 20, 1990. Incorporated by reference to the Company's
Current Report on Form 8-K dated April 25, 1990.

10.13  Agreement for Acquisition of Assets and Assumption of
Certain Liabilities of Rudy's Sirloin SteakBurgers, Inc. by and
between Rudy's Sirloin SteakBurgers, Inc. and Euro-American
Holding Corporation, Inc., dated December 24, 1990;
Indemnification and Security Agreement from RSSB, Inc., a Florida
corporation in favor of Rudy's Sirloin SteakBurgers, Inc.,
executed on January 25, 1991; Guaranty of payment from Euro-American
Holding Corporation, Inc., a Florida Corporation and
East-West Logistics, Inc., a Liberian corporation, in favor of
Rudy's Sirloin SteakBurgers, Inc., dated January 25, 1991;
Agreement for Sale and Purchase of Proprietary Information dated
December 24, 1990. Incorporated by reference to the Company's
Report on Form 8-K dated January 25, 1991.

10.14  Asset Purchase Agreement by and between Rudy's Sirloin
SteakBurgers, Inc. and Supreme Chicken of Kendall, Inc. dated
10/30/90. Incorporated by reference to the Company's Report on
Form 8-K dated January 25, 1991.

10.15  Settlement Stipulation and Agreement dated April 9, 1991
by and between Chester Del Bello, Trustee for the Amended and
Restated Irrevocable Trusts for Dale Del Bello Jr. and Danielle
Del Bello and The Samurai, Inc. and Rudy's Restaurant Group, Inc.
Incorporated by reference to Exhibit 10.15 of the Company's
Quarterly Report on Form 10-Q for the quarter ended March 17,
1991.

10.16  Settlement Stipulation dated April 7, 1992 by and between
12605 Biscayne, Rudy's Restaurant Group, Inc. and Rudy's Sirloin
SteakBurgers, Inc. Incorporated by reference to Exhibit 10.16 of
the Company's Quarterly Report on Form 10-Q for the quarter ended
March 15, 1992.

10.17  Joint Stipulation of the Parties to Settlement dated June
24, 1992 by and between Metlife Capital Corporation, Rudy's
Sirloin SteakBurgers, Inc. and Rudy's Restaurant Group, Inc.
Incorporated by reference to Exhibit 10.17 of the Company's
Quarterly Report on Form 10-Q for the quarter ended June 7, 1992.

10.18  Joint Motion for Approval of Stipulation and Compromise of
Claim dated December 17, 1992 by and between RSSB, Inc., and
Rudy's Sirloin SteakBurgers, Inc. Incorporated by reference to
Exhibit 10.18 of the Company's Annual Report on Form 10-K for the
fiscal year ended October 2, 1994 (the "1992 Form 10-K").

10.19  Employment Agreement by and between Rudy's Restaurant
Group, Inc. and Douglas M. Rudolph dated July 1, 1992 and
Amendment to Employment Agreement dated April 1, 1992.
Incorporated by reference to Exhibit 10.19 of the 1992 Form 10-K.

10.20  Consulting Agreement by and between The Samurai, Inc. and
Rudolph Entertainment, Inc. ("REI") dated April 1, 1992.
Incorporated by reference to Exhibit 10.20 of the 1992 Form 10-K.

10.21  Rudolph Obligation Agreement by and between Rudy's
Restaurant Group, Inc. and Douglas M. Rudolph dated June 1, 1994.
Incorporated by reference to Exhibit 10.21 of the 1994 Form 10-K.

10.22  Asset Purchase and Sale Agreement by and between Asian
Restaurants International, Inc., Kyoto West, Inc., Kyoto North,
Inc., Kyoto Restaurants, Inc. and Asian Restaurants, Inc.
("Seller") and Maxwell's International, Inc. ("Buyer") dated
December 27, 1995. Incorporated by reference to Exhibit 10.22 of
the Company's Quarterly Report (Form 10-QSB) for the quarter
ended December 24, 1995.

22  Subsidiaries of the Company.  Incorporated by reference to
Exhibit 22 of the 1986 Form 10-K.

(b)  Reports on Form 8-K:
     --------------------

     Acquisition of Assets on September 17, 1996

<PAGE>
                         SIGNATURES
                         ----------

Pursuant to the requirements of Section 13 or 15(d) of the
Securities and Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                RUDY'S RESTAURANT GROUP, INC.
                                         (Registrant)

                                By: /s/ Douglas M. Rudolph
                                --------------------------
                                Douglas M. Rudolph
                                Chief Executive Officer
                                Chairman of the Board


Dated:   January 14, 1997 
      -------------------

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:


/s/ Douglas M. Rudolph   President, Chairman     January 14, 1997
----------------------   Of the Board, Chief 
Douglas M. Rudolph       Executive Officer, 
                         Secretary and Director

/s/ Marie G. Peterson    Vice President,         January 14, 1997
---------------------    Treasurer, Chief  
Marie G. Peterson        Financial and Operating 
                         Officer, and Principal
                         Accounting Officer

/s/ Eli Boyer            Director                January 14, 1997
---------------------
Eli Boyer

/s/ Peter Graham         Director                January 14, 1997
---------------------
Peter Graham
<PAGE>