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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



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Form 10-Q

QUARTERLY REPORT UNDER SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended November 2, 2002

Commission File Number 1-9647



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MAYORS JEWELERS, INC.(Exact name of registrant as specified in its charter)

|                                                               |  |                                  
|-------------------------------------------------------------- |  | ---------------------------------
|Delaware                                                       |  | 59-2290953                       
|(State or other jurisdiction of
incorporation or organization) |  | (IRS Employer
Identification No.)

14051 N.W. 14th Street
Sunrise, Florida 33323(Address of principal executive offices) (Zip Code)

(954) 846-2709(Registrants telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

Yes   x   
NO   o

Indicate by check
mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act.)

Yes   o   
NO   x

Indicate the number of shares outstanding of each of the issuers classes
of common stock, as of the latest practicable date.

19,569,858 SHARES ($.0001 PAR VALUE)
AS OF DECEMBER 13, 2002



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TABLE OF CONTENTS



|                                              |                                                                                                |                                                             |  |  |  |  |  | 
|--------------------------------------------- | ---------------------------------------------------------------------------------------------- | ----------------------------------------------------------- |  |  |  |  |  | 
|PART I: FINANCIAL INFORMATION                
|                                              | Item 1. Consolidated Condensed Financial Statements                                           
|                                              |                                                                                                | CONSOLIDATED CONDENSED BALANCE SHEETS  UNAUDITED          
|                                              |                                                                                                | CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS  UNAUDITED
|                                              |                                                                                                | CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS  UNAUDITED
|                                              |                                                                                                | NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS   
|                                              | Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.
|                                              | Item 3. Quantitative and Qualitative Disclosures about Market Risks                           
|                                              | Item 4. Controls and Procedures.                                                              
|PART II: OTHER INFORMATION                   
|                                              | Item 6. Exhibits and Reports on Form 8-K                                                      
|SIGNATURES                                   
|CERTIFICATION                                
|EMPLOYMENT AGREEMENT - ALBERT RAHM II        
|EMPLOYMENT AGREEMENT - AIDA ALVAREZ          
|AMENDED EMPLOYMENT AGREEMENT - ALBERT RAHM II
|AMENDED EMPLOYMENT AGREEMENT - AIDA ALVAREZ  
|AMENDED EMPLOYMENT AGREEMENT - MARC WEINSTEIN
|EMPLOYMENT AGREEMENT - JOSEPH KEIFER III     
|EMPLOYMENT AGREEMENT - THOMAS ANDRUSKEVICH   
|CERTIFICATION OF CHIEF EXECUTIVE OFFICER     
|CERTIFICATION OF CHIEF FINANCIAL OFFICER     



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FORM 10-Q
QUARTERLY REPORT

THIRTEEN WEEKS ENDED NOVEMBER 2, 2002

TABLE OF CONTENTS

|                                                                                                                    |                                                                                               |                                                      |  |          |      | 
|------------------------------------------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------- | ---------------------------------------------------- |  | -------- | ---- | 
|                                                                                                                    |                                                                                               |                                                      |  | Page No.
|                                                                                                                    |                                                                                               |                                                      |  |         
|PART I: FINANCIAL INFORMATION                                                                                       |                                                                                               |                                                      |  |         
|                                                                                                                    | Item 1. Consolidated Financial Statements  Unaudited
Consolidated Condensed Balance Sheets   |                                                      |  | 3        |     
|                                                                                                                    |                                                                                               | Consolidated Condensed Statements of Operations      |  |          | 4-5  | 
|                                                                                                                    |                                                                                               | Consolidated Condensed Statements of Cash Flows      |  |          | 6-7  | 
|                                                                                                                    |                                                                                               | Notes to Consolidated Condensed Financial Statements |  |          | 8-11 | 
|                                                                                                                    | Item 2. Managements Discussion and Analysis of
Financial Condition and Results of Operations |                                                      |  | 12-15    |     
|                                                                                                                    | Item 3. Quantitative and Qualitative Disclosures About Market Risks                           |                                                      |  | 15       |     
|                                                                                                                    | Item 4. Controls and Procedures                                                               |                                                      |  | 16       |     
|PART II: OTHER INFORMATION                                                                                          |                                                                                               |                                                      |  |         
|Items 1, 3, 4, and 5 have been omitted because they are not applicable
with respect to the current reporting period |                                                                                               |                                                      |  |         
|                                                                                                                    | Item 6. Exhibits and Reports on Form 8-K                                                      |                                                      |  | 17       |     

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PART I: FINANCIAL INFORMATION




Item 1.Consolidated Condensed Financial Statements

MAYORS JEWELERS, INC. AND SUBSIDIARIES




CONSOLIDATED CONDENSED BALANCE SHEETS  UNAUDITED


(Amounts shown in thousands except share and per share data)


|                                                                                                                                                            |                            |                          |          |             |        |             |          |        |         | 
|----------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------- | ------------------------ | -------- | ----------- | ------ | ----------- | -------- | ------ | ------- | 
|                                                                                                                                                            |                            |                          |          | November 2, |        | February 2,
|                                                                                                                                                            |                            |                          |          | 2002        |        | 2002       
|                                                                                                                                                            |                            |                          |          |             |        |            
|ASSETS                                                                                                                                                      |                            |                          |          |             |        |             |          |       
|Current Assets:                                                                                                                                             |                            |                          |          |             |        |             |          |       
|Cash and cash equivalents                                                                                                                                   |                            | $                        | 537      |             |        | $           | 2,886    |       
|Accounts receivable (net of allowance for doubtful accounts
of $1,000 and $1,487, respectively)                                                             |                            |                          | 6,030    |             |        |             | 31,845   |       
|Inventories                                                                                                                                                 |                            |                          | 75,914   |             |        |             | 80,716   |       
|Other current assets                                                                                                                                        |                            |                          | 2,405    |             |        |             | 2,604    |       
|                                                                                                                                                            |                            |                          |          |             |        |             |          |       
|                                                                                                                                                            |                            | Total current assets     |          |             | 84,886 |             |          |        | 118,051 | 
|                                                                                                                                                            |                            |                          |          |             |        |             |          |       
|Property, net                                                                                                                                               |                            |                          | 17,236   |             |        |             | 25,455   |       
|Other assets                                                                                                                                                |                            |                          | 811      |             |        |             | 1,083    |       
|                                                                                                                                                            |                            |                          |          |             |        |             |          |       
|                                                                                                                                                            |                            | Total non-current assets |          |             | 18,047 |             |          |        | 26,538  | 
|                                                                                                                                                            |                            |                          |          |             |        |             |          |       
|Total assets                                                                                                                                                |                            | $                        | 102,933  |             |        | $           | 144,589  |       
|                                                                                                                                                            |                            |                          |          |             |        |             |          |       
|LIABILITIES AND STOCKHOLDERS EQUITY                                                                                                                        |                            |                          |          |             |        |             |          |       
|Current Liabilities:                                                                                                                                        |                            |                          |          |             |        |             |          |       
|Accounts payable                                                                                                                                            |                            | $                        | 17,658   |             |        | $           | 10,769   |       
|Accrued expenses                                                                                                                                            |                            |                          | 7,750    |             |        |             | 7,318    |       
|Accrued restructuring                                                                                                                                       |                            |                          | 2,646    |             |        |             | 8,574    |       
|Note payable and credit facility                                                                                                                            |                            |                          | 27,459   |             |        |             | 53,464   |       
|                                                                                                                                                            |                            |                          |          |             |        |             |          |       
|                                                                                                                                                            | Total current liabilities  |                          |          | 55,513      |        |             |          | 80,125 |        
|Other long term liabilities                                                                                                                                 |                            |                          | 3,648    |             |        |             | 3,357    |       
|                                                                                                                                                            |                            |                          |          |             |        |             |          |       
|                                                                                                                                                            | Total liabilities          |                          |          | 59,161      |        |             |          | 83,482 |        
|                                                                                                                                                            |                            |                          |          |             |        |             |          |       
|Stockholders Equity:                                                                                                                                       |                            |                          |          |             |        |             |          |       
|Series A convertible preferred stock, $.001 par value, 15,050 shares
authorized, 15,050 and 0 shares issued, respectively; liquidation value
of $15,050,000 |                            |                          |         |             |        |             |         |       
|Common stock, $.0001 par value, 50,000,000 shares
authorized, 29,553,812 and 29,509,703 shares issued,
respectively                                         |                            |                          | 3        |             |        |             | 3        |       
|Additional paid-in capital                                                                                                                                  |                            |                          | 208,092  |             |        |             | 194,526  |       
|Accumulated deficit                                                                                                                                         |                            |                          | (134,923 | )           |        |             | (104,022 | )     
|Less: 9,983,954 shares of treasury stock, at cost                                                                                                           |                            |                          | (29,400  | )           |        |             | (29,400  | )     
|                                                                                                                                                            |                            |                          |          |             |        |             |          |       
|                                                                                                                                                            | Total stockholders equity |                          |          | 43,772      |        |             |          | 61,107 |        
|                                                                                                                                                            |                            |                          |          |             |        |             |          |       
|Total liabilities and stockholders equity                                                                                                                  |                            | $                        | 102,933  |             |        | $           | 144,589  |       
|                                                                                                                                                            |                            |                          |          |             |        |             |          |       

See notes to consolidated condensed financial statements.

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MAYORS JEWELERS, INC. AND SUBSIDIARIES




CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS  UNAUDITED


(Amounts shown in thousands except share and per share data)


|                                                       |  |                  |            |                  |  |   |            |  
|------------------------------------------------------ |  | ---------------- | ---------- | ---------------- |  | - | ---------- | -
|                                                       |  | Thirteen         |            | Thirteen        
|                                                       |  | Weeks Ended      |            | Weeks Ended     
|                                                       |  | November 2, 2002 |            | November 3, 2001
|                                                       |  |                  |            |                 
|Net sales                                              |  | $                | 25,654     |                  |  | $ | 33,881     |  
|Cost of sales                                          |  |                  | 17,917     |                  |  |   | 21,124     |  
|                                                       |  |                  |            |                  |  |   |            |  
|Gross profit                                           |  |                  | 7,737      |                  |  |   | 12,757     |  
|Store operating and selling expenses                   |  |                  | 8,941      |                  |  |   | 14,091     |  
|                                                       |  |                  |            |                  |  |   |            |  
|Store contribution                                     |  |                  | (1,204     | )                |  |   | (1,334     | )
|                                                       |  |                  |            |                  |  |   |            |  
|General and administrative expenses                    |  |                  | 2,888      |                  |  |   | 2,501      |  
|Advertising and marketing expenses                     |  |                  | 1,411      |                  |  |   | 3,324      |  
|Other charges                                          |  |                  | 730        |                  |  |   | 63         |  
|Depreciation and amortization                          |  |                  | 1,127      |                  |  |   | 2,474      |  
|                                                       |  |                  |            |                  |  |   |            |  
|                                                       |  |                  | 6,156      |                  |  |   | 8,362      |  
|                                                       |  |                  |            |                  |  |   |            |  
|Operating loss                                         |  |                  | (7,360     | )                |  |   | (9,696     | )
|Interest and other income                              |  |                  | 79         |                  |  |   | 3          |  
|Interest expense and debt costs                        |  |                  | (2,769     | )                |  |   | (1,119     | )
|                                                       |  |                  |            |                  |  |   |            |  
|Loss before income taxes                               |  |                  | (10,050    | )                |  |   | (10,812    | )
|Income taxes                                           |  |                  | 2          |                  |  |   |           |  
|                                                       |  |                  |            |                  |  |   |            |  
|Net loss                                               |  | $                | (10,052    | )                |  | $ | (10,812    | )
|                                                       |  |                  |            |                  |  |   |            |  
|Weighted average shares outstanding,
basic and diluted |  |                  | 19,569,858 |                  |  |   | 19,488,919 |  
|Basic and diluted loss per share                       |  | $                | (0.53      | )                |  | $ | (0.55      | )

See notes to consolidated condensed financial statements.

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MAYORS JEWELERS, INC. AND SUBSIDIARIES

CONSOLIDATED CONDENSED
STATEMENTS OF OPERATIONS  UNAUDITED  (Continued)


(Amounts shown in thousands except share and per share data)


|                                                       |  |                  |            |                  |  |   |            |  
|------------------------------------------------------ |  | ---------------- | ---------- | ---------------- |  | - | ---------- | -
|                                                       |  | Thirty-nine      |            | Thirty-nine     
|                                                       |  | Weeks Ended      |            | Weeks Ended     
|                                                       |  | November 2, 2002 |            | November 3, 2001
|                                                       |  |                  |            |                 
|Net sales                                              |  | $                | 81,411     |                  |  | $ | 105,321    |  
|Cost of sales                                          |  |                  | 56,399     |                  |  |   | 64,470     |  
|                                                       |  |                  |            |                  |  |   |            |  
|Gross profit                                           |  |                  | 25,012     |                  |  |   | 40,851     |  
|Store operating and selling expenses                   |  |                  | 30,632     |                  |  |   | 36,482     |  
|                                                       |  |                  |            |                  |  |   |            |  
|Store contribution                                     |  |                  | (5,620     | )                |  |   | 4,369      |  
|                                                       |  |                  |            |                  |  |   |            |  
|General and administrative expenses                    |  |                  | 9,652      |                  |  |   | 11,925     |  
|Advertising and marketing expenses                     |  |                  | 3,267      |                  |  |   | 6,920      |  
|Other charges                                          |  |                  | 2,783      |                  |  |   | 1,795      |  
|Depreciation and amortization                          |  |                  | 4,350      |                  |  |   | 7,405      |  
|                                                       |  |                  |            |                  |  |   |            |  
|                                                       |  |                  | 20,052     |                  |  |   | 28,045     |  
|                                                       |  |                  |            |                  |  |   |            |  
|Operating loss                                         |  |                  | (25,672    | )                |  |   | (23,676    | )
|Interest and other income                              |  |                  | 1,071      |                  |  |   | 30         |  
|Interest expense and debt costs                        |  |                  | (5,572     | )                |  |   | (2,822     | )
|                                                       |  |                  |            |                  |  |   |            |  
|Loss before income taxes                               |  |                  | (30,173    | )                |  |   | (26,468    | )
|Income taxes                                           |  |                  | 450        |                  |  |   |           |  
|                                                       |  |                  |            |                  |  |   |            |  
|Net loss                                               |  | $                | (30,623    | )                |  | $ | (26,468    | )
|                                                       |  |                  |            |                  |  |   |            |  
|Weighted average shares outstanding,
basic and diluted |  |                  | 19,545,945 |                  |  |   | 19,387,453 |  
|Basic and diluted loss per share                       |  | $                | (1.58      | )                |  | $ | (1.37      | )

See notes to consolidated condensed financial statements.

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MAYORS JEWELERS, INC. AND SUBSIDIARIES




CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS  UNAUDITED


(Amounts shown in thousands)


|                                                     |                                                                         |   |        |                  |   |                  |         |          |   | 
|---------------------------------------------------- | ----------------------------------------------------------------------- | - | ------ | ---------------- | - | ---------------- | ------- | -------- | - | 
|                                                     |                                                                         |   |        | Thirty-nine      |   | Thirty-nine     
|                                                     |                                                                         |   |        | Weeks Ended      |   | Weeks Ended     
|                                                     |                                                                         |   |        | November 2, 2002 |   | November 3, 2001
|                                                     |                                                                         |   |        |                  |   |                 
|Cash flows from operating activities:                |                                                                         |   |        |                  |   |                  |         |         
|                                                     | Cash received from customers                                            |   | $      | 95,079           |   |                  | $       | 110,812  |  
|                                                     | Cash paid to suppliers and employees                                    |   |        | 97,933           |   |                  |         | (118,108 | )
|                                                     | Interest and other income received                                      |   |        | 1,071            |   |                  |         | 30       |  
|                                                     | Interest paid                                                           |   |        | (3,517           | ) |                  |         | (2,822   | )
|                                                     | Income taxes paid                                                       |   |        | (450             | ) |                  |         | -       |  
|                                                     |                                                                         |   |        |                  |   |                  |         |         
|Net cash provided by (used in)
continuing operations |                                                                         |   | (5,750 | )                |   |                  | (10,088 | )       
|Net cash used in discontinued operations             |                                                                         |   |       |                  |   |                  | (4,839  | )       
|                                                     |                                                                         |   |        |                  |   |                  |         |         
|Net cash used in
operating activities                |                                                                         |   | (5,750 | )                |   |                  | (14,927 | )       
|                                                     |                                                                         |   |        |                  |   |                  |         |         
|Cash flows from investing activities:                |                                                                         |   |        |                  |   |                  |         |         
|                                                     | Capital expenditures, net                                               |   |        | (1,587           | ) |                  |         | (9,239   | )
|                                                     | Proceeds from sale of fixed assets                                      |   |        | 5,455            |   |                  |         | 16       |  
|                                                     |                                                                         |   |        |                  |   |                  |         |         
|Net cash provided by (used in)
investing activities  |                                                                         |   | 3,868  |                  |   |                  | (9,223  | )       
|                                                     |                                                                         |   |        |                  |   |                  |         |         
|Cash flows from financing activities:                |                                                                         |   |        |                  |   |                  |         |         
|                                                     | Proceeds from issuance of preferred
convertible stock and warrants, net |   |        | 13,553           |   |                  |         |         |  
|                                                     | Dividends payable to preferred stockholders                             |   |        | (278             | ) |                  |         |         |  
|                                                     | Sale
of private label credit card receivables                           |   |        | 12,147           |   |                  |         |         |  
|                                                     | Proceeds from sale of employee stock plans                              |   |        | 14               |   |                  |         | 657      |  
|                                                     | Borrowings under line
of credit and term loan                           |   |        | 113,896          |   |                  |         | 142,295  |  
|                                                     | Line of credit repayments                                               |   |        | (139,902         | ) |                  |         | (118,623 | )
|                                                     | Payment of commitment fee related
to line of credit                     |   |        | (188             | ) |                  |         | (392     | )
|                                                     | Other                                                                   |   |        | 291              |   |                  |         | 1,598    |  
|                                                     |                                                                         |   |        |                  |   |                  |         |         
|Net cash (used in) provided by
financing activities  |                                                                         |   | (467   | )                |   |                  | 25,535  |         
|                                                     |                                                                         |   |        |                  |   |                  |         |         
|Net (decrease) increase in cash and
cash equivalents |                                                                         |   | (2,349 | )                |   |                  | 1,385   |         
|Cash and cash equivalents at beginning
of period     |                                                                         |   | 2,886  |                  |   |                  | 1,363   |         
|                                                     |                                                                         |   |        |                  |   |                  |         |         
|Cash and cash equivalents at end of period           |                                                                         | $ | 537    |                  |   | $                | 2,748   |         
|                                                     |                                                                         |   |        |                  |   |                  |         |         

(continued)

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MAYORS JEWELERS, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS  UNAUDITED(Continued)
(Amounts shown in thousands)

|                                                                                          |                                       |                          |         |                  |        |                  |         |       |       |  
|----------------------------------------------------------------------------------------- | ------------------------------------- | ------------------------ | ------- | ---------------- | ------ | ---------------- | ------- | ----- | ----- | -
|                                                                                          |                                       |                          |         | Thirty-nine      |        | Thirty-nine     
|                                                                                          |                                       |                          |         | Weeks Ended      |        | Weeks Ended     
|                                                                                          |                                       |                          |         | November 2, 2002 |        | November 3, 2001
|                                                                                          |                                       |                          |         |                  |        |                 
|Reconciliation of net loss to net cash used in operating activities:                      |                                       |                          |         |                  |        |                  |         |      
|Net loss                                                                                  |                                       | $                        | (30,623 | )                |        | $                | (26,468 | )    
|Adjustments to reconcile net loss to net cash provided by
(used in) operating activities: |                                       |                          |         |                  |        |                  |         |      
|                                                                                          | Depreciation and amortization         |                          |         | 4,350            |        |                  |         | 7,405 |      
|                                                                                          | Provision for doubtful accounts       |                          |         | 2,099            |        |                  |         | 2,153 |      
|                                                                                          | Write-off of deferred financing costs |                          |         | 2,055            |        |                  |         |      |      
|                                                                                          | (Increase) decrease in assets:        |                          |         |                  |        |                  |         |       |      
|                                                                                          |                                       | Accounts receivable, net |         |                  | 11,568 |                  |         |       | 3,338 |  
|                                                                                          |                                       | Inventories              |         |                  | 4,802  |                  |         |       | 384   |  
|                                                                                          |                                       | Other                    |         |                  | (1,395 | )                |         |       | 611   |  
|                                                                                          | Increase (decrease) in liabilities:   |                          |         |                  |        |                  |         |       |      
|                                                                                          |                                       | Accounts payable         |         |                  | 6,889  |                  |         |       | 2,996 |  
|                                                                                          |                                       | Accrued expenses         |         |                  | 433    |                  |         |       | (507  | )
|                                                                                          |                                       | Accrued restructuring    |         |                  | (5,928 | )                |         |       | -    |  
|                                                                                          |                                       |                          |         |                  |        |                  |         |      
|Net cash used in continuing operations                                                    |                                       |                          | (5,750  | )                |        |                  | (10,088 | )    
|Net cash used in discontinued operations                                                  |                                       |                          | -      |                  |        |                  | (4,839  | )    
|                                                                                          |                                       |                          |         |                  |        |                  |         |      
|Net cash used in operating activities                                                     |                                       | $                        | (5,750  | )                |        | $                | (14,927 | )    
|                                                                                          |                                       |                          |         |                  |        |                  |         |      

See notes to consolidated condensed financial statements.

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MAYORS JEWELERS, INC. AND SUBSIDIARIES




NOTES TO THE CONSOLIDATED CONDENSED FINANCIAL STATEMENTS


(Unaudited)


A.     Basis of Presentation

The Companys consolidated condensed financial statements as of November
2, 2002 and February 2, 2002, and for the thirteen and thirty-nine week periods
ended November 2, 2002 and November 3, 2001 have not been audited by certified
public accountants, but in the opinion of the management of Mayors Jewelers,
Inc. and its subsidiaries (the Company or Mayors) reflect all adjustments
(which include normal recurring accruals) necessary to present fairly the
financial position, results of operations and cash flows for those periods.
Results of the thirteen and thirty-nine week periods ended November 2, 2002 and
November 3, 2001 are not necessarily indicative of annual results because of
the seasonality of the Companys business.

The accompanying consolidated condensed financial statements have been
prepared on a going concern basis, which contemplates the realization of assets
and the satisfaction of liabilities in the normal course of business. The
Company has incurred recurring losses from continuing operations and certain
vendors had expressed concerns about the Companys financial condition. These
factors and the need to obtain additional financing indicated that the Company
may not have been able to continue as a going concern for a reasonable period
of time. As a result thereof, on August 20, 2002, the Company closed on a gross
$15 million equity investment transaction with Henry Birks & Sons Inc.
(Birks) as well as restructured its credit facility and secured a term loan
to sustain its operations and to execute its restructuring plan (the
Restructuring Plan) adopted in the fourth quarter of 2001.

The consolidated condensed financial statements do not include any
adjustments relating to the recoverability and classification of recorded asset
amounts or the amounts and classifications of liabilities that might be
necessary should the Company be unable to continue as a going concern. While
there can be no assurance thereof, management of the Company believes that the
new relationship with Birks and the debt financing obtained will alleviate this
situation.

B.     Restructuring, Asset Impairments and Other Charges

The multi-faceted Restructuring Plan adopted during the fourth quarter of
fiscal 2001 included, among other significant initiatives, an infusion of
equity, the refinancing of the Companys bank debt, the closing of thirteen
unprofitable and under-performing stores, the liquidation of certain
non-performing assets and the reduction of various field and corporate costs.

The stores to be closed as part of the plan included eleven properties
outside of the Companys core Florida and Georgia marketplace, as well as two
stores in Florida. Through November 30, 2002, twelve locations were closed with
one additional store to close as soon as practicable. The closing of these
stores marks a significant retrenchment of the Companys recent expansion
strategy into states where Mayors does not enjoy the brand loyalty that it has
enjoyed in Florida and Georgia.

Assets earmarked for liquidation included certain unproductive
inventories, a significant portion of which were liquidated during the second
quarter, the Companys headquarters building and associated real estate in
Sunrise, Florida, which were sold on July 12, 2002, fixed assets in the closed
stores and certain other assets.

Additionally, on August 20, 2002, Mayors closed on a gross $15 million
equity investment transaction with Birks. At the closing, Mayors received $10
million in cash and a promissory note from Birks due and paid on September 30,
2002 for $5 million. As consideration for the $15 million investment, Birks
received shares of Series A Convertible Preferred Stock that upon conversion
into common stock would give Birks approximately a 72% interest in Mayors. The
investment also provides Birks with the right to appoint a majority of the
members of the Companys Board of Directors and provides warrants to acquire
additional shares which, upon exercise, would increase Birks interest in
Mayors to approximately 82%. The shares of Series A Convertible Preferred
Stock issued to Birks have an aggregate liquidation value of $15,050,000.

On May 30, 2002, the Company executed a credit agreement with Fleet Retail
Finance and Back Bay Capital for a three year $55 million revolving facility
and a $12.5 million junior secured term loan. This credit agreement was
replaced on August 20, 2002 with a new facility which included GMAC as part of
the lending group. The new facility increased the revolving facility to $58
million and improved the loan availability and interest rates, while keeping the Back Bay junior secured term loan at $12.5 million. The credit agreement
contains certain covenants, including, but not limited, to inventory and
capital expenditure financial covenants.

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The Restructuring Plan, originally expected to be completed during the end
of the second quarter of 2002, is now expected to be essentially completed by
the end of the fourth quarter of 2002. The Restructuring Plan included the
elimination of approximately 207 positions in the field as well as Mayors
former chief executive officer and the closing of 13 stores as previously
discussed.

During the thirty-nine weeks ended November 2, 2002, approximately $5.9
million of the accrued restructuring costs were paid primarily for lease
terminations and severance costs and costs associated with exiting the stores.
As of November 2, 2002, the accrued restructuring balance was approximately
$2.6 million and related primarily to lease terminations and associated costs.

Other charges for the thirteen and thirty-nine weeks ended November 2,
2002 consist of one time charges for professional fees related to the execution
of the Restructuring Plan, severance costs, a charge related to the sale of
certain private label credit card receivables to Wells Fargo and fees related
to costs associated with the exit from the unprofitable stores. Other charges
for the thirteen and thirty-nine weeks ended November 3, 2001 consist of one
time charges for strategic cost reduction projects, non-recurring legal fees
associated with stockholder related matters and severance costs.

C.     Credit Facilities

Prior to May 30, 2002, the Company had an $80 million working capital
credit facility in place with a bank group led by Citicorp. The Company was
operating under an amendment that required a restructuring or refinancing of
the facility by May 30, 2002. Accordingly, on May 30, 2002, the Company
executed a $55 million working capital credit facility with Fleet Retail
Finance and a $12.5 million junior secured term loan with Back Bay Capital.
Both of the debt facilities had an expiration date of May 30, 2005. The credit
facilities were replaced on August 20, 2002, with a new facility with GMAC as a
member of the lending group joining the revolving facility lender group with a
maturity date of May 30, 2005. The revolving facility line increased from $55
million to $58 million, while the term loan remained at $12.5 million.
Inventory loan availability was increased and the effective interest rate
decreased from prime plus 2.75% to prime plus 1.50%. There is an unused
facility fee of 0.25%. The availability block was reduced from $8 million to $7
million for the July to December periods and to $6 million for the January to
June periods. The $12.5 million junior secured term loan with Back Bay Capital
remains, but with the effective interest rate decreased from 19.5% to 18.25%.
Availability under the working capital facility is determined based upon a
percentage formula applied to inventory less amounts outstanding under the term
loan. Both facilities are collateralized by substantially all the Companys
assets. The credit agreements include certain covenants.

Based on this, the Company had a $56.5 million borrowing capacity at
November 2, 2002. At November 2, 2002, the Company had approximately $27.5
million outstanding under its facility and term loan and had $750,000 in
letters of credit outstanding. This means the Company had an excess
availability of approximately $29 million.

D.     Recently Issued Accounting Standards

In June 2001, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 141, Business
Combinations, and SFAS No. 142, Goodwill and Other Intangible Assets. These
standards establish accounting and reporting for business combinations. SFAS
No. 141 requires all business combinations entered into subsequent to June 30,
2001 to be accounted for using the purchase method of accounting. SFAS No. 142
provides that goodwill and other intangible assets with indefinite lives will
not be amortized, but will be tested for impairment on an annual basis. Mayors
adopted SFAS No. 142 in the first quarter of 2002. The adoption has not had a
material effect on Mayors financial statements.

In August 2001, the FASB issued SFAS No. 144, Accounting for the
Impairment or Disposal of Long-Lived Assets, which is effective for fiscal
years beginning after December 15, 2001. This Statement addresses financial
accounting and reporting for the impairment or disposal of long-lived assets
and supersedes SFAS No. 121, Accounting for the Impairment of Long-Lived
Assets and for Long-Lived Assets to Be Disposed Of, and accounting and
reporting provisions of Accounting Principles Board Opinion No. 30, Reporting
the Results of Operations  Reporting the Effects of Disposal of a Segment of a
Business, and Extraordinary, Unusual and Infrequently Occurring Events and
Transactions, for the disposal of a segment of a business (as previously
defined in that opinion). This statement also amends Accounting Research
Bulletin No. 51, Consolidated Financial Statements, to eliminate the
exception to consolidation for subsidiaries for which control is likely to be
temporary. Mayors adopted SFAS No. 144 in the first quarter of 2002. The
adoption has not had a material effect on Mayors financial statements.

In April 2002, the FASB issued SFAS 145, Rescission of FASB Statements
No. 4, 44, and 64, Amendment of FASB Statement No. 13, and Technical
Correction. This Statement eliminates extraordinary accounting treatment of
reporting gain or loss on debt extinguishment, and amends other existing
authoritative pronouncements to make various technical corrections, clarifies
meanings, or

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describes their applicability under changed conditions. The provisions of
this Statement are effective for the Company with the beginning of fiscal year
2003; however, early application of the Statement is encouraged. Debt
extinguishments reported as extraordinary items prior to scheduled or early
adoption of this Statement would be reclassified in most cases following
adoption. The Company does not anticipate a significant impact on its results
of operations from adopting this Statement.

In June 2002, the FASB issued SFAS 146, Accounting for Costs Associated
with Exit or Disposal Activities. This Statement requires recording costs
associated with exit or disposal activities at their fair values when a
liability has been incurred. Under previous guidance, certain exit costs were
accrued upon managements commitment to an exit plan. Adoption of this
Statement is required with the beginning of fiscal year 2003. The Company does
not anticipate a significant impact on its results of operations from adopting
this Statement.

E.     Accounts Receivable

On October 1, 2002, the Company sold $13.1 million of its $18.5 million
credit card portfolio to Wells Fargo on a non-recourse basis. A charge on
disposal of the portfolio of $473,000 related to the sale is included in Other
Charges. The Company retained gross receivables of $5.4 million relating to
customers with balances greater than an agreed upon amount and certain accounts
that Wells Fargo did not wish to purchase. The Company will continue
to provide Wells Fargo the opportunity to purchase accounts receivable on a discount basis
going forward. The Company has provisions totaling $1 million which management
feels is sufficient to cover any loss.

F.     Inventories

Inventories are summarized as follows:

|               |  |                              |        |                  |  |   |        | 
|-------------- |  | ---------------------------- | ------ | ---------------- |  | - | ------ | 
|               |  | November 2, 2002             |        | February 2, 2002
|               |  |                              |        |                 
|               |  | (amounts shown in thousands)
|Raw materials  |  | $                            | 1,321  |                  |  | $ | 656    | 
|Finished goods |  |                              | 74,593 |                  |  |   | 80,060 | 
|               |  |                              |        |                  |  |   |        | 
|               |  | $                            | 75,914 |                  |  | $ | 80,716 | 
|               |  |                              |        |                  |  |   |        | 

G.     Income and Other Taxes

The Company has federal net operating loss carryforwards (NOL) from fiscal
years ending February 2, 2002 and earlier of approximately $33.0 million and
state NOL carryforwards of approximately $21.6 million. The amount of Mayors
subsidiarys NOL included in the $33.0 million is approximately $1.4 million
which is subject the limitations of Section 382 of the U.S. Internal Revenue
Code of 1986, as amended. The federal NOL carryforwards expire in years
beginning in 2010 through 2020 and the state NOL carryforwards expire in years
beginning in 2005 through to 2020. The change of control as a result
of the equity investment from Birks will limit the availability of the carryforward
of these NOLs. The Company also has an alternative minimum tax credit
carryforward of approximately $1.8 million to offset future federal income
taxes. A valuation allowance has been recorded for $1.8 million and the net
deferred tax asset is nil.

The Company is undergoing a Florida sales tax related audit. Management
does is not expect that the impact of this audit on the Companys financial
condition, results of operation and cash flows to be material due to that fact
that management believes it has recorded adequate reserves to cover these
items.

Mayors subsidiarys 1994, 1995 and 1996 federal income tax returns are
currently under examination by the IRS. The impact of the IRS examination on
the Companys financial condition, results of operation, and cash flow cannot
be ascertained at this time.

H.     Related Party Transactions

On August 20, 2002, the Company closed on a gross $15.05 million equity
investment transaction with Birks. The Company incurred expenses related to
the raising of the capital of approximately $1.5 million. As consideration for
the investment, Birks received shares of Series A Convertible
Preferred Stock
that upon conversion would give Birks approximately a 72% interest in Mayors.
The shares carry a cumulative annual dividend yield of $1,429,750 of which
$278,006 was accrued in the third quarter.

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Birks also received warrants that, upon exercise, would increase Birks
interest to approximately 82%. Of the net proceeds raised of $13.55 million, a
fair value of $1.0 million has been allocated to the warrants.

Included in General and Administrative Expenses are $390,000 of fees paid
to Birks in the second quarter of Fiscal 2002 for merchandising and other
consulting services prior to the equity investment transaction. In the third
quarter, Mayors reimbursed Birks $96,000 of costs related to the management of
Mayors. Also, during the third quarter, Mayors purchased $24,000 of
merchandise from Birks. As of November 2, 2002, the Company had an amount of
$120,000 payable to Birks.

I.     Commitments and Contingencies

The Company is involved in litigation arising from the normal course of
business. In these pending matters, the Company believes the facts and the law
support its positions and these matters should not materially affect the
Companys financial position; however, there can be no assurance as to the
final result of these legal matters.

Pending and potential litigation connected with the Companys exit of
unprofitable stores has been avoided or resolved with lease termination
agreements. With respect to the remaining location targeted for closure, the
Company anticipates an amicable resolution and is not expected to have a
material adverse effect on the financial statements, but no assurances can be
given.

In July 2002, the Company reached a settlement with former Mayors
stockholders related to the 1998 acquisition of Mayors by Jan Bell Marketing,
Inc. and received $0.9 million more than what was recorded in Due from Escrow
in the Other Assets section of the Consolidated Condensed Balance Sheet. The
$0.9 million gain is included in Interest and Other Income on the Condensed
Consolidated Statement of Operations, because all goodwill related to the
transaction was previously written off.

The Company had $6.6 million in consignment inventory as of November 2,
2002 versus $9.6 million as of November 3, 2001 and $7.9 million as of February
2, 2002.

J.     Loss per Share

The following provides a reconciliation of the basic and diluted loss per
share amounts for the thirteen and thirty-nine week periods ended November 2,
2002 and November 3, 2001:

|                                             |  |                  |            |                  |  |                  |            |                  |  |   |            |   |  |   |            |  
|-------------------------------------------- |  | ---------------- | ---------- | ---------------- |  | ---------------- | ---------- | ---------------- |  | - | ---------- | - |  | - | ---------- | -
|                                             |  | Thirteen         |            | Thirteen         |  | Thirty-nine      |            | Thirty-nine     
|(in thousands)                               |  | Weeks Ended      |            | Weeks Ended      |  | weeks ended      |            | weeks ended     
|except share data                            |  | November 2, 2002 |            | November 3, 2001 |  | November 2, 2002 |            | November 3, 2001
|                                             |  |                  |            |                  |  |                  |            |                 
|Net loss                                     |  | $                | (10,052    | )                |  | $                | (10,812    | )                |  | $ | (30,623    | ) |  | $ | (26,468    | )
|Plus: Preferred stock dividends              |  |                  | (278       | )                |  |                  |           |                  |  |   | (278       | ) |  |   |           |  
|                                             |  |                  |            |                  |  |                  |            |                  |  |   |            |   |  |   |            |  
|Net loss attributable to common
shareholders |  | $                | (10,330    | )                |  | $                | (10,812    | )                |  | $ | (30,901    | ) |  | $ | (26,468    | )
|                                             |  |                  |            |                  |  |                  |            |                  |  |   |            |   |  |   |            |  
|Weighted average shares                      |  |                  | 19,569,858 |                  |  |                  | 19,488,919 |                  |  |   | 19,545,945 |   |  |   | 19,387,453 |  
|                                             |  |                  |            |                  |  |                  |            |                  |  |   |            |   |  |   |            |  
|Basic and diluted loss per share             |  | $                | (0.53      | )                |  | $                | (0.55      | )                |  | $ | (1.58      | ) |  | $ | (1.37      | )
|                                             |  |                  |            |                  |  |                  |            |                  |  |   |            |   |  |   |            |  

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

Results of Operations

The discussion and analysis below contains trend analysis and other
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended (the Exchange Act). The discussion should be read in
conjuction with, and is qualified in its entirely by reference to, the
Consolidated Condensed Financial Statements and related Notes to Consolidated
Condensed Financial Statements appearing elsewhere in this report. The
Companys actual results could differ materially from those anticipated in any
forward-looking statements as a result of certain factors set forth below and
elsewhere in this report and in the Companys annual report on Form 10-K for
the year ended February 2, 2002 and other reports filed with the Securities and
Exchange Commission (SEC).

The multi-faceted Restructuring Plan adopted during the fourth quarter of
fiscal 2001 included, among other significant initiatives, an infusion of
equity, the refinancing of the Companys bank debt, the closing of thirteen
unprofitable and under-performing stores, the liquidation of certain
non-performing assets and the reduction of various field and corporate costs.

The stores to be closed as part of the plan included eleven properties
outside of the Companys core Florida and Georgia marketplace, and two stores
in Florida. The closing of these stores marks a significant retrenchment of the
Companys recent expansion strategy into states where Mayors does not enjoy
the brand loyalty that it has enjoyed in Florida and Georgia. Twelve
under-performing stores were closed between March, 2002 and the end of
November, 2002, with an additional location scheduled to be closed as soon as
practicable. One lease commitment for a location yet to be built was also
terminated. Two new stores were opened in November, 2002 in the Companys core
marketplace: one at Merrick Park in Coral Gables, Florida and one at the Mall
at Millenia in Orlando, Florida. As of December 13, 2002, Mayors operated 31
luxury stores in four states.

Assets earmarked for liquidation included certain unproductive
inventories, a significant portion of which were liquidated during the second
quarter, the Companys headquarters building and associated real estate in
Sunrise, Florida, which were sold on July 12, 2002, fixed assets in the closed
stores and certain other assets.

Additionally, on August 20, 2002, Mayors closed on a gross $15 million
equity investment transaction with Birks. At the closing Mayors received $10
million in cash and a promissory note from Birks due and paid on September 30,
2002 for $5 million. As consideration for the $15 million investment, Birks
received shares of Series A Convertible Preferred Stock that upon conversion
into common stock would give Birks approximately a 72% interest in Mayors. The
investment also provides Birks with the right to appoint a majority of the
members of the Companys Board of Directors and provides warrants to acquire
additional shares which, upon exercise, would increase Birks interest in
Mayors to approximately 82%. The shares of Series A Convertible Preferred
Stock have an aggregate liquidation value of $15,050,000 and a cumulative annual
dividend yield of $1,429,750, of which $278,006 was accrued in the third
quarter. A significant condition to the investment by Birks was the negotiated
closing of 13 unprofitable stores and the termination of one lease commitment
for a store that was not built. The Company opened two new stores in Florida
during the fourth quarter of 2002 that the Company believes will enhance its
core market. There can be no assurance, however, that the new stores will
enhance its core markets. In connection with the equity investment transaction,
the Company incurred expenses related to the raising of the capital of $1.5
million, which have been netted against the gross proceeds. Of the net
proceeds raised of $13.55 million, a fair value of $1.0 million has been
allocated to the warrants.

On May 30, 2002, the Company executed a $55 million working capital credit
facility with Fleet Retail Finance and a $12.5 million junior secured term loan
with Back Bay Capital. Both of the debt facilities had an expiration date of
May 30, 2005. The credit facilities were replaced on August 20, 2002, with a
new facility with GMAC as a member of the lending group joining the revolving
facility lender group with a maturity date of May 30, 2005. The revolving
facility line increased from $55 million to $58 million, while the term loan
remained at $12.5 million.The credit agreement contains certain conditions,
including but not limited to inventory and capital expenditure financial
covenants.

The Company believes short-term growth will come from rebuilding the
Companys presence within existing markets where Mayors has enjoyed strong
brand recognition.

As the Company refocuses on its core business, it plans to execute a
productive merchandising strategy in its remaining 31 stores. The Company
believes that with the additional capital resources that the above mentioned
equity infusion will provide, combined with

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the somewhat improved availability under its loan facilities, as well as
the direction and support of Birks, it will be able to execute initiatives that
will drive the business toward positive comparable store sales results; there
can be no assurance, however, that such results will occur.

The Companys net sales for the thirteen and thirty-nine weeks ended
November 2, 2002 were $25.7 million and $81.4 million, respectively, compared
to $33.9 million and $105.3 million, respectively, for the thirteen and
thirty-nine weeks ended November 3, 2001. The decrease in revenues for the
thirteen and thirty-nine weeks ended November 2, 2002 is primarily due to store
closures and merchandising and marketing issues related to the Companys
significant reduction in available capital, coupled with the continued slowdown
of the economy. In addition, sales were negatively affected by certain
suppliers withholding shipments, principally Rolex. Subsequent to the equity
investment on August 20, 2002, these suppliers resumed normal shipments. Delays
in receiving some of these shipments reduced sales during the quarter ended
November 2, 2002. Comparable store sales decreased 18.2% and 24.6% for the
thirteen and thirty-nine weeks ended November 2, 2002, respectively.

The retail jewelry market is particularly subject to the impact of the
level of consumer confidence and discretionary income on the type and value of
goods purchased. A second factor facing the industry is the consolidation of
the retail industry. The Company believes that competition both within the
luxury goods retail industry and with other competing general and specialty
retailers and discounters will continue to increase. The luxury watch brands
business, which depends upon the Companys ability to effectively market
high-end watches constitutes a significant portion of Mayors business. If, for
any reason, the Company were unable to sell certain brands of watches, this
inability could have a material adverse effect on the Companys business,
financial condition and operating results. Please refer below to Item 3
Forward Looking Statements.

Gross profit was 30.2% and 30.7% for the thirteen and thirty-nine weeks
ended November 2, 2002, respectively, compared to 37.7% and 38.8% for the
thirteen and thirty-nine weeks ended November 3, 2001, respectively. The
decrease in gross profit as a percentage of net sales for the thirteen and
thirty-nine weeks ended November 2, 2002 is primarily due to the liquidation of
slow moving and discontinued inventory at reduced margins, primarily in the
non-core market stores which were closed.

The Company believes that the opportunity exists to increase gross profit
over the next couple of years. Areas for gross margin improvement include
strategies to lower the cost of merchandise purchased, to increase the sales of
merchandise exclusive to the Company and to move the mix of sales towards
higher margin jewelry items. In addition, the Company expects to refine the
allocation, replenishment and management of inventory in its stores. As the
slow moving and discontinued inventory is liquidated, other direct costs such
as slow moving inventory reserves are expected to decrease. There can be no
assurance, however, that the Company will be able to increase gross profit.

Store operating and selling expenses were $8.9 million or 34.9% of net
sales and $30.6 million or 37.6% of net sales for the thirteen and thirty-nine
weeks ended November 2, 2002, respectively, compared to $14.1 million or 41.6%
of net sales and $36.5 million or 34.6% of net sales for the thirteen and
thirty-nine weeks ended November 3, 2001, respectively. The decrease in store
operating and selling expenses for the thirteen weeks ended November 2, 2002 is
mainly attributable to the closing of the 12 stores as previously discussed.
The increase in store operating and selling expenses as a percentage of net
sales for the thirty-nine weeks ended November 2, 2002 is mainly attributable
to a decline in comparable store sales and the liquidation of inventory at
reduced prices in the new stores. The Company does not believe there is
significant opportunity to reduce these expenses other than the decrease that
occurred as a result of the store closings discussed above.

General and administrative expenses were $2.9 million or 11.3% of net
sales and $9.7 million or 11.9% of net sales for the thirteen and thirty-nine
weeks ended November 2, 2002, respectively, compared to $2.5 million or 7.4% of
net sales and $11.9 million or 11.3% of net sales for the thirteen and
thirty-nine weeks ended November 3, 2001, respectively. The increase in general
and administrative expenses for the thirteen weeks ended November 2, 2002 is
primarily a result of increases in D&O liability insurance. The decrease in
general and administrative expenses for the thirty-nine weeks ended November 2,
2002 is primarily a result of a corporate restructuring, net of increases in
liability insurance. Included in general and administrative expenses are
$390,000 of fees paid to Birks in the second quarter of fiscal year 2002 for
merchandising and other consulting services. In the third quarter, Mayors
reimbursed Birks $96,000 of costs related to the management of Mayors.

Advertising and marketing expenses were $1.4 million and $3.3 million for
the thirteen and thirty-nine weeks ended November 2, 2002, respectively,
compared to $3.3 million and $6.9 million for the thirteen and thirty-nine
weeks ended November 3, 2001, respectively. The decreases in advertising and
marketing expenses are primarily attributable to capital constraints.

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Other charges for the thirteen and thirty-nine weeks ended November 2,
2002 were $0.7 million and $2.8 million, respectively. These charges consist of
one time charges for professional fees related to the execution of the
Restructuring Plan, severance costs, the charge associated with the sale of
certain private label credit card receivables to Wells Fargo and fees related
to costs associated with the closing of the unprofitable stores. Other charges
for the thirteen and thirty-nine weeks ended November 3, 2001 were $63,000 and
$1.8 million, respectively. These charges consist of one time charges for
strategic cost reduction projects, non-recurring legal fees associated with
stockholder related matters and severance costs.

Depreciation and amortization expenses were $1.1 million and $4.4 million
for the thirteen and thirty-nine weeks ended November 2, 2002, respectively,
compared to $2.5 million and $7.4 million for the thirteen and thirty-nine
weeks ended November 3, 2001. The decrease in depreciation and amortization
expenses for the thirteen and thirty-nine weeks ended November 2, 2002 is a
result of the goodwill impairment writedown at the end of fiscal 2001, and the
disposal of fixed assets previously located at the corporate headquarters,
which was sold on July 12, 2002, and the closing of the closed stores.

Interest and other income was $79,000 and $1.1 million for the thirteen
and thirty-nine weeks ended November 2, 2002, respectively, compared to $3,000
and $30,000 for the thirteen and thirty-nine weeks ended November 3, 2001,
respectively. Other income includes a payment of $0.9 million received in
connection with a settlement with former Mayors stockholders of $.9 million.
Interest expense related to the Companys working capital facility was $2.8
million and $5.6 million for the thirteen and thirty-nine weeks ended November
2, 2002, respectively, compared to $1.1 million and $2.8 million for the
thirteen and thirty-nine weeks ended November 3, 2001, respectively.

Liquidity and Capital Resources

As of November 2, 2002, the Company had a $58 million working capital
facility with Fleet Retail Finance and GMAC and a $12.5 million junior secured
term loan with Back Bay Capital. Both of the debt facilities have an expiration
of August 20, 2005 and are collateralized by substantially all of the Companys
assets. Availability under the working capital facility is determined based
upon a percentage formula applied to inventory and accounts receivable. The
interest rate under this current facility is prime plus 1.5%. The rate on the
facility as of December 13, 2002 was 5.75%.

The credit facility has restrictions regarding borrowing availability. The
Company is required to decrease the lesser of collateral availability or the
$58 million cap provided by the facility by $7 million for the July to December
periods and $6 million for the January to June periods.

As of November 2, 2002, after accounting for the foregoing borrowing
restrictions, the Company had approximately $56.5 million of borrowing capacity
and, after netting the outstanding borrowings of $27.5 million and letter of
credit commitments of $750,000, the Company had an excess availability of
approximately $29 million.

The working capital facility currently contains financial covenants that
limit capital expenditures and require certain levels of inventory investment.
There can be no assurance that the Companys future operating results will be
sufficient to meet the requirements of the foregoing covenants.

The junior secured term loan currently bears an effective interest rate of
18.25% and is subject to similar restrictions as the working capital facility.
The term loan also has covenants regarding limitations on capital expenditures.

During the thirty-nine weeks ended November 2, 2002, cash flows from
operating activities provided $5.7 million in cash. The Companys business is
highly seasonal. Consequently, seasonal working capital needs peak in October
and November, before the holiday shopping season.

Net cash provided by investing activities was $3.9 million during the
thirty-nine weeks ended November 2, 2002, primarily from the sale of the
corporate headquarters building. Net cash used in financing activities was
$0.5 million during the thirty-nine weeks ended November 2, 2002.

The Company sold the majority of its private label credit card receivables
to an outside company in the third quarter 2002. This transaction resulted in
additional liquidity. On October 1, 2002, the Company sold $13.1 million of
the $18.5 million of its credit card portfolio to on a non-recourse basis to
Wells Fargo. The Company retained gross receivables of $5.4 million of credit
card receivables relating to high end customers and accounts under collection.
The Company will continue to process credit card receivables for these

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high end clients in the future (individual sales greater than $25,000).
The Company has allowance for doubtful accounts totaling $1 million which it
feels is sufficient to cover any potential loss.

The accompanying consolidated condensed financial statements have been
prepared on a going concern basis, which contemplates the realization of assets
and the satisfaction of liabilities in the normal course of business. The
Company has incurred recurring losses from continuing operations and certain
vendors had expressed concerns about the Companys financial condition.

The consolidated condensed financial statements do not include any
adjustments relating to the recoverability and classification of recorded asset
amounts or the amounts and classifications of liabilities that might be
necessary should the Company be unable to continue as a going concern. While
there can be no assurance thereof, management of the Company believes that the
new relationship with Birks as well as the new secured debt financing will
alleviate this situation.




Item 3.Quantitative and Qualitative Disclosures about Market Risks

Interest Rate Risks

The disclosure in the Annual Report on Form 10-K filed May 20, 2002 is
incorporated by reference herein. The Company does not believe that the risk
related to interest rate changes is materially different than it was at the
date of the referenced report.

Forward-Looking Statements

This report and other written reports and releases and oral statements
made from time to time by the Company contain forward-looking statements which
can be identified by their use of words like plans, expects, believes,
will, anticipates, intends, projects, estimates, could, would,
may, planned, goal, and other words of similar meaning. All statements
that address expectations, possibilities or projections about the future,
including without limitation statements about the Companys strategies for
growth, expansion plans, sources or adequacy of capital, expenditures and
financial results are forward-looking statements.

One must carefully consider such statements and understand that many
factors could cause actual results to differ from the forward-looking
statements, such as inaccurate assumptions and other risks and uncertainties,
some known and some unknown. No forward-looking statement is guaranteed and
actual results may vary materially. Such statements are made as of the date
provided, and the Company assumes no obligation to update any forward-looking
statements to reflect future developments or circumstances.

One should carefully evaluate such statements by referring to the factors
described in the Companys filings with the SEC, especially on Forms 10-K, 10-Q
and 8-K. Particular review is to be made of Items 1, 2, 3 and 7 of the Form
10-K for the year ended February 2, 2002 and Item 2 of this Form 10-Q where
the Company discusses in more detail various important risks and uncertainties
that could cause actual results to differ from expected or historical results.
Since it is not possible to predict or identify all such factors, the
identified items are not a complete statement of all risks or uncertainties.

Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with accounting
principles generally accepted in the United States of America requires the
Company to make estimates and assumptions about future events and their impact
on amounts reported in the financial statements and related notes. Since future
events and their impact cannot be determined with certainty, the actual results
may differ from those estimates. These estimates and assumptions are evaluated
on an on-going basis and are based on historical experience and on various
factors that are believed to be reasonable.

The Company has identified certain critical accounting policies below.

Provision for slow moving and obsolete inventory.The Company writes down
its inventory for estimated unmarketable inventory or obsolescence equal to the
difference between the cost of inventory and the estimated market value based
on assumptions about future demand and market conditions. If actual market
conditions are less favorable than those projected by management, additional
inventory write-downs may be required.

Allowance for doubtful accounts. The Company maintains allowances for
doubtful accounts for estimated losses resulting from the inability of its
customers to make required payments. If the financial condition of Mayors
customers were to deteriorate, resulting in an impairment of their ability to
make payments, additional allowances may be required.

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Item 4.Controls and Procedures.

(a)  Evaluation of Disclosure Controls and Procedures:



| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | Within the 90 days prior to the date of this Quarterly Report, we carried out
an evaluation, under the supervision and with the participation of our
management, including our Chief Executive Officer and Chief Financial
Officer, of the effectiveness of the design and operation of our disclosure
controls and procedures. Based upon that evaluation, the Chief Executive
Officer and Chief Financial Officer concluded that our disclosure controls
and procedures were effective as of the date of their evaluation in timely
alerting them to material information relating to our company (including our
consolidated subsidiaries) required to be included in reports we file or
submit under the Exchange Act.

(b)  Changes in Internal Controls



| |                                                                                                                                                                                            
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | There were no significant changes in our internal controls or in other
factors that could significantly affect such internal controls subsequent to
the date of our most recent evaluation.

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PART II: OTHER INFORMATION

Item 2.Changes in Securities and
Use of Proceeds

On August 20, 2002, Mayors Jewelers, Inc. sold 15,050,000 shares of
preferred stock to Henry Birks & Sons Inc. As consideration, Mayors received
$15,050,000 in cash. Exemption from registration for these securities is in accordance with Section
4(2) of the Securities Act of 1933. Each share of preferred stock is
convertible into 3,333.33 shares of common stock.




Item 6.Exhibits and Reports on Form 8-K



|(a) |  | The following list of schedules and exhibits are incorporated by
reference as indicated in this Form 10-Q:
|--- |  | ----------------------------------------------------------------------------------------------------------

|      |  |                                                                                            
|----- |  | -------------------------------------------------------------------------------------------
|10.17 |  | Employment Agreement dated May 10, 2001, between Albert Rahm II and the Company.           
|     
|10.18 |  | Employment Agreement dated May 10, 2001, between Aida Alvarez and the Company.             
|     
|10.19 |  | Amended Employment Agreement dated July 19, 2002, between Albert Rahm II and the Company.  
|     
|10.20 |  | Amended Employment Agreement dated July 19, 2002, between Aida Alvarez and the Company.    
|     
|10.21 |  | Amended Employment Agreement dated July 19, 2002, between Marc Weinstein and the Company.  
|     
|10.22 |  | Employment Agreement dated October 1, 2002, between Joseph Keifer III and the Company.     
|     
|10.23 |  | Employment Agreement dated October 29, 2002, between Thomas Andruskevich and the Company.  
|     
|99.1  |  | Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act.
|     
|99.2  |  | Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act.



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



| |                                                                                                                                                                                                                                                                                      
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | 4.1 Certificate of Designation of Series A Convertible Preferred Shares,
incorporated by reference herein from the current report on Form 8-K filed
with the SEC on September 5, 2002.                                                                                               
|
| | 4.2 Warrant Agreement, dated August 20, 2002, between the Registrant and
Birks to purchase shares of Common Stock at 30 cents per share,
incorporated by reference herein from the current report on Form 8-K filed
with the Securities and Exchange Commission on September 5, 2002.
|
| | 4.3 Warrant Agreement, dated August 20, 2002, between the Registrant and
Birks to purchase shares of Common Stock at 35 cents per share,
incorporated by reference herein from the current report on Form 8-K filed
with the Securities and Exchange Commission on September 5, 2002.
|
| | 4.4 Warrant Agreement, dated August 20, 2002, between the Registrant and
Birks to purchase shares of Common Stock at 40 cents per share,
incorporated by reference herein from the current report on Form 8-K filed
with the Securities and Exchange Commission on September 5, 2002.
|
| | 4.5 Registration Rights Agreement, dated August 20, 2002, between the
Registrant and Birks, incorporated by reference herein from the current
report on Form 8-K filed with the Securities and Exchange Commission on
September 5, 2002.                                             

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

|                        |  |                                     |  |                           
|----------------------- |  | ----------------------------------- |  | --------------------------
|                        |  | MAYORS JEWELERS, INC.
(Registrant)
|                        |  |                                     |  |                           
|                        |  |                                     |  |                           
|                        |  | By:                                 |  | /s/ Thomas A. Andruskevich
|                        |  |                                     |  |                           
|                        |  |                                     |  | Chief Executive Officer   
|                       
|                       
|                       
|                        |  | By:                                 |  | /s/ John Ball             
|                        |  |                                     |  |                           
|                        |  |                                     |  | Chief Financial Officer   
|                        |  |                                     |  |                           
|Date: December 17, 2002 |  |                                     |  |                           

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CERTIFICATION

I, Thomas A. Andruskevich, certify that:

1.     I have reviewed this quarterly report on Form 10-Q of Mayors Jewelers, Inc.

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

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

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

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

b) evaluated the effectiveness of the registrants disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the Evaluation Date); and

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

5.     The registrants other certifying officer and I have disclosed, based on our
most recent evaluation, to the registrants auditors and the audit committee of
registrants board of directors (or persons performing the equivalent
functions):

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

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

6.     The registrants other certifying officer and I have indicated in this
quarterly report whether there were significant changes in internal controls or
in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions
with regard to significant deficiencies and material weaknesses.

Date: December 17, 2002

/s/ Thomas A. Andruskevich

Thomas A. Andruskevich
Chief Executive Officer

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CERTIFICATION

I, John Ball, certify that:

1.     I have reviewed this quarterly report on Form 10-Q of Mayors Jewelers, Inc.

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

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

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

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

b) evaluated the effectiveness of the registrants disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the Evaluation Date); and

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

5.     The registrants other certifying officer and I have disclosed, based on our
most recent evaluation, to the registrants auditors and the audit committee of
registrants board of directors (or persons performing the equivalent
functions):

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

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

6.     The registrants other certifying officer and I have indicated in this
quarterly report whether there were significant changes in internal controls or
in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions
with regard to significant deficiencies and material weaknesses.

Date: December 17, 2002

/s/ John Ball

John Ball
Chief Financial Officer

20