QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 27, 2004

Commission File Number: 000-18668

MAIN STREET RESTAURANT GROUP, INC.

(Exact name of registrant as specified in its charter)

DELAWARE		11-948370
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

5050 N. 40TH STREET, SUITE 200, PHOENIX, ARIZONA 85018

(Address of principal executive offices) (Zip Code)

(602) 852-9000

(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 ý 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 ý

Number of shares of common stock, $.001 par value, of registrant outstanding at November 8, 2004: 14,642,000

MAIN STREET RESTAURANT GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In Thousands, Except Par Value and Share Data)

	September 27,			December 29,
	2004			2003
	(unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	4,139		$	4,600
Accounts receivable, net	1,080			1,494
Inventories	2,636			2,762
Prepaid expenses	833			971
Total current assets	8,688			9,827
Property and equipment, net	68,305			68,129
Other assets, net	2,054			2,218
Notes receivable, net	1,198			1,657
Goodwill	21,685			21,685
Franchise fees, net	1,899			1,999
Purchased franchise territories, net	665			692
Total assets	$	104,494		$	106,207

LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	3,914		$	3,815
Accounts payable	5,217			6,408
Other accrued liabilities	17,956			16,577
Total current liabilities	27,087			26,800
Long-term debt, net of current portion	43,823			47,869
Other liabilities and deferred credits	2,328			2,441
Total liabilities	73,238			77,110

Commitments and contingencies

Stockholders’ equity:
Preferred stock, $.001 par value, 2,000,000 shares authorized; no shares issued and outstanding in 2004 and 2003	—			—
Common stock, $.001 par value, 25,000,000 shares authorized; 14,642,000 and 14,142,000 shares issued and outstanding in 2004 and 2003, respectively	15			15
Additional paid-in capital	54,927			54,927
Accumulated deficit	(21,584		)	(23,792		)
Accumulated other comprehensive loss	(2,102		)	(2,053		)
Total stockholders’ equity	31,256			29,097
Total liabilities and stockholders’ equity	$	104,494		$	106,207

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

MAIN STREET RESTAURANT GROUP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In Thousands, Except Per Share Amounts)

	Three Months Ended
	(unaudited)
	September 27,		September 29,
	2004		2003

Revenue	$	54,845	$	54,173

Restaurant operating expenses
Cost of sales	14,197		14,334
Payroll and benefits	16,862		17,216
Depreciation and amortization	2,176		2,051
Other operating expenses	17,737		17,681
Total restaurant operating expenses	50,972		51,282

Depreciation and amortization of intangible assets	189		137
General and administrative expenses	2,249		2,246
Preopening expenses	195		129
New manager training expenses	41		12
Impairment charges and other	—		2,810

PART I. FINANCIAL INFORMATION

Item 1.	Financial Statements -Main Street Restaurant Group, Inc.

		Condensed Consolidated Balance Sheets – September 27, 2004 (unaudited) and December 29, 2003

		Condensed Consolidated Statements of Operations – Three and Nine Months Ended September 27, 2004 and September 29, 2003 (unaudited)

		Condensed Consolidated Statements of Cash Flows – Nine Months Ended September 27, 2004 and September 29, 2003 (unaudited)

		Notes to Condensed Consolidated Financial Statements (unaudited)

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

Item 3.	Quantitative and Qualitative Disclosures About Market Risk

Item 4.	Controls and Procedures

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings
Item 2.	Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities
Item 3.	Defaults Upon Senior Securities
Item 4.	Submission of Matters to a Vote of Security Holders
Item 5.	Other Information
Item 6.	Exhibits

SIGNATURES