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<SEC-DOCUMENT>0000825324-09-000006.txt : 20090220
<SEC-HEADER>0000825324-09-000006.hdr.sgml : 20090220
<ACCEPTANCE-DATETIME>20090220134958
ACCESSION NUMBER:		0000825324-09-000006
CONFORMED SUBMISSION TYPE:	10-Q
PUBLIC DOCUMENT COUNT:		4
CONFORMED PERIOD OF REPORT:	20081231
FILED AS OF DATE:		20090220
DATE AS OF CHANGE:		20090220

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			GOOD TIMES RESTAURANTS INC
		CENTRAL INDEX KEY:			0000825324
		STANDARD INDUSTRIAL CLASSIFICATION:	RETAIL-EATING PLACES [5812]
		IRS NUMBER:				841133368
		STATE OF INCORPORATION:			NV
		FISCAL YEAR END:			0930

	FILING VALUES:
		FORM TYPE:		10-Q
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-18590
		FILM NUMBER:		09624446

	BUSINESS ADDRESS:	
		STREET 1:		601 CORPORATE CIRCLE
		CITY:			GOLDEN
		STATE:			CO
		ZIP:			80401
		BUSINESS PHONE:		3033841400

	MAIL ADDRESS:	
		STREET 1:		601 CORPORATE CIRCLE
		CITY:			GOLDEN
		STATE:			CO
		ZIP:			80401

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	PARAMOUNT VENTURES INC
		DATE OF NAME CHANGE:	19900205
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>firstquarter10q41.htm
<TEXT>
<html>

<head>
<!-- Document Prepared With E-Services, LLC HTML Software-->
<!-- Copyright 2006 E-Services, LLC.-->
<!-- All rights reserved EDGAR2.com -->



<title>UNITED STATES</title>



</head>

<body lang=EN-US vlink=purple>















<p class=MsoNormal align=center style='text-align:center'>UNITED
STATES</p>

<p class=MsoNormal align=center style='text-align:center'>SECURITIES
 AND EXCHANGE COMMISSION</p>

<p class=MsoNormal align=center style='text-align:center'>WASHINGTON, D.C. 20549</p>



<p class=MsoNormal align=center style='text-align:center'>FORM 10-Q</p>



<p class=MsoNormal style='margin-left:40.5pt'>(Mark One)</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='margin-left:.45in;border-collapse:collapse'>
 <tr>
  <td width=672 valign=top style='width:7.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b><u>X</u></b>
  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE</p>
  </td>
 </tr>
 <tr>
  <td width=672 valign=top style='width:7.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>ACT OF
  1934</p>
  </td>
 </tr>
 <tr>
  <td width=672 valign=top style='width:7.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=672 valign=top style='width:7.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>For the
  quarterly period ended December 31, 2008</p>
  </td>
 </tr>
 <tr>
  <td width=672 valign=top style='width:7.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=672 valign=top style='width:7.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>OR</p>
  </td>
 </tr>
 <tr>
  <td width=672 valign=top style='width:7.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=672 valign=top style='width:7.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>__&nbsp;TRANSITION
  REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES</p>
  </td>
 </tr>
 <tr>
  <td width=672 valign=top style='width:7.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>EXCHANGE
  ACT OF 1934</p>
  </td>
 </tr>
 <tr>
  <td width=672 valign=top style='width:7.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>Commission
  File Number: 0-18590</p>
  </td>
 </tr>
 <tr>
  <td width=672 valign=top style='width:7.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=672 valign=top style='width:7.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>GOOD
  TIMES RESTAURANTS, INC.</p>
  </td>
 </tr>
 <tr>
  <td width=672 valign=top style='width:7.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>(Exact
  Name of Registrant as Specified in Its Charter)</p>
  </td>
 </tr>
</table>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='margin-left:67.5pt;border-collapse:collapse'>
 <tr style='height:15.45pt'>
  <td width=263 style='width:197.1pt;padding:0in 0in 0in 0in;height:15.45pt'>
  <p class=MsoNormal align=center style='text-align:center'>&nbsp;NEVADA &nbsp;</p>
  </td>
  <td width=14 style='width:10.75pt;padding:0in 0in 0in 0in;height:15.45pt'>

  </td>
  <td width=299 style='width:224.15pt;padding:0in 0in 0in 0in;height:15.45pt'>
  <p class=MsoNormal align=center style='text-align:center'>&nbsp;84-1133368</p>
  </td>
 </tr>
 <tr style='height:30.95pt'>
  <td width=263 style='width:197.1pt;padding:0in 0in 0in 0in;height:30.95pt'>
  <p class=MsoNormal align=center style='text-align:center'>(State
  or Other Jurisdiction of &nbsp;</p>
  <p class=MsoNormal align=center style='text-align:center'>Incorporation
  or Organization)</p>
  </td>
  <td width=14 style='width:10.75pt;padding:0in 0in 0in 0in;height:30.95pt'>

  </td>
  <td width=299 valign=top style='width:224.15pt;padding:0in 0in 0in 0in;
  height:30.95pt'>
  <p class=MsoNormal align=center style='text-align:center'>&nbsp;&nbsp;
  (I.R.S. Employer Identification Number)</p>
  </td>
 </tr>
</table>



<p class=MsoNormal align=center style='text-align:center'>601
CORPORATE CIRCLE, GOLDEN, CO 80401</p>

<p class=MsoNormal align=center style='text-align:center'>(Address
of Principal Executive Offices, Including Zip Code)</p>

<p class=MsoNormal align=center style='text-align:center'>(303)
384-1400</p>

<p class=MsoNormal align=center style='text-align:center'>(Registrant's
Telephone Number, Including Area Code)</p>



<p class=MsoNormal>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.</p>

<p class=MsoNormal>Yes &#61472;&#61472;<b><u>X</u></b>&nbsp; No &#61472;&#61472;__</p>



<p class=MsoNormal>Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting
company, as defined in Rule&nbsp;12b-2 of the Exchange Act<a
name="v122293_10q_htm_bm_______"></a> .</p>



<p class=MsoNormal>Large accelerated filer </p>

<p class=MsoNormal>Accelerated filer&#61472;&nbsp;</p>

<p class=MsoNormal>Non-accelerated filer </p>

<p class=MsoNormal>Smaller reporting company&#61472; <b><u>X</u></b></p>



<p class=MsoNormal>Indicate by check mark whether the registrant is a shell company
(as defined in Rule&nbsp;12b-2 of the Exchange Act).</p>

<p class=MsoNormal>Yes __ No &#61472;<b><u>X</u></b></p>



<p class=MsoNormal>As of February 17, 2009, there were 3,898,559 shares of the
Registrant's common stock, par value $0.001 per share, issued and outstanding.</p>

<p class=MsoFooter align=center style='text-align:center'><a name=pgbrk></a>&nbsp;</p>

<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade style='color:navy' align=center>

</div>





<br clear=all style='page-break-before:always'>




<p class=MsoNormal style='line-height:1.0pt'><a name=ftr></a><a name=glftr></a><a
name=pn></a><a name=hdr></a><a name=glhdr></a>&nbsp;</p>







<p class=MsoNormal><b>Form
10-Q</b></p>

<p class=MsoNormal><b>Quarter
Ended December 31, 2008</b></p>



<div align=center>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal><b>&nbsp;</b></p>
  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal><b><u>INDEX</u></b></p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'><b><u>PAGE</u></b></p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal><b>PART
  I - FINANCIAL INFORMATION</b></p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Item
  1.</p>
  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='text-align:justify'>Financial Statements</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='text-align:justify'>Condensed Consolidated Balance Sheets -</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent style='margin:0in;margin-bottom:.0001pt'>December 31, 2008 (unaudited) and September 30, 2008</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent align=right style='margin-top:0in;margin-right:
  8.1pt;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:
  right'>3 - 4</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent style='margin:0in;margin-bottom:.0001pt'>Condensed
  Consolidated Statements of Operations (unaudited)&nbsp; </p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoList2 style='margin-left:0in;text-indent:0in'>For the three
  months ended December 31, 2008 and 2007</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoList2 align=right style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  text-indent:0in'>5</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoList2 style='margin-left:0in;text-indent:0in'>Condensed
  Consolidated Statements of Cash Flow (unaudited) </p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoList2 style='margin-left:0in;text-indent:0in'>For the three
  months ended December 31, 2008 and 2007</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoList2 align=right style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  text-indent:0in'>6</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Notes
  to Financial Statements</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>7 - 10</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Item
  2.</p>
  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Management's
  Discussion and Analysis of Financial Condition and Results of Operations</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>11 - 16</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Item
  3.</p>
  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Quantitative
  and Qualitative Disclosures About Market Risk</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>16</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-right:-.1in'>Item 4T.</p>
  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Controls
  and Procedures</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>16</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal><b>PART
  II - OTHER INFORMATION</b></p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal><a name="OLE_LINK3">Item 1.</a></p>
  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Legal
  Proceedings</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>17</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-right:-5.4pt'>Item 1A.</p>
  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Risk
  Factors</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>17</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Item
  2.</p>
  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Unregistered
  Sales of Equity Securities and Use of Proceeds</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>17</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Item
  3.</p>
  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Defaults
  Upon Senior Securities</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>17</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Item
  4.</p>
  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Submission
  of Matters to a Vote of Security Holders</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>17</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Item
  5.</p>
  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Other
  Information.</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>17</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Item
  6.</p>
  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Exhibits
  </p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>17</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal><b>SIGNATURES</b></p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>17</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal><b>&nbsp;</b></p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal><b>CERTIFICATIONS</b></p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>Exhibit 31.1</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal><b>&nbsp;</b></p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>Exhibit 31.2</p>
  </td>
 </tr>
 <tr>
  <td width=67 valign=top style='width:.7in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=450 valign=top style='width:337.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal><b>&nbsp;</b></p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>Exhibit 32.1</p>
  </td>
 </tr>
</table>

</div>



<p class=MsoFooter align=center style='text-align:center'>2</p>

<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade style='color:navy' align=center>

</div>





<br clear=all style='page-break-before:always'>












<p class=MsoNormal align=center style='margin-bottom:12.0pt;text-align:center'><b>PART I - FINANCIAL
INFORMATION</b></p>

<p class=MsoNormal style='margin-bottom:12.0pt'><b>ITEM 1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; FINANCIAL STATEMENTS</b></p>

<p class=MsoNormal align=center style='text-align:center'><b>GOOD TIMES
RESTAURANTS INC. AND SUBSIDIARIES</b></p>

<p class=MsoNormal align=center style='text-align:center'><b>CONDENSED
CONSOLIDATED BALANCE SHEETS</b></p>

<p class=MsoNormal align=center style='margin-bottom:12.0pt;text-align:center'><b>ASSETS</b></p>

<div align=center>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='margin-left:1.5pt;border-collapse:collapse'>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:-.9pt;
  margin-bottom:0in;margin-left:8.1pt;margin-bottom:.0001pt;text-align:center'><b>Unaudited</b></p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:-.9pt;
  margin-bottom:0in;margin-left:8.1pt;margin-bottom:.0001pt;text-align:center'>December 31,</p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:-.9pt;
  margin-bottom:0in;margin-left:3.15pt;margin-bottom:.0001pt;text-align:right'>September 30,</p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:-.9pt;margin-bottom:
  0in;margin-left:30.6pt;margin-bottom:.0001pt'><u>2008</u></p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:-.9pt;
  margin-bottom:0in;margin-left:3.15pt;margin-bottom:.0001pt;text-align:center'><u>2008</u></p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>CURRENT
  ASSETS:</p>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash
  and cash equivalents</p>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.75pt;text-align:right'>$786,000</p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:9.8pt;
  margin-bottom:0in;margin-left:3.15pt;margin-bottom:.0001pt;text-align:right'>$1,414,000</p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Receivables,
  net of allowance for doubtful</p>
  <p class=MsoNormal style='margin-left:18.85pt'>accounts of $0</p>
  </td>
  <td width=117 valign=bottom style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.75pt;text-align:right'>158,000</p>
  </td>
  <td width=16 valign=bottom style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=bottom style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:9.8pt;
  margin-bottom:0in;margin-left:3.15pt;margin-bottom:.0001pt;text-align:right'>160,000</p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Prepaid
  expenses and other</p>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.75pt;text-align:right'>75,000</p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:9.8pt;
  margin-bottom:0in;margin-left:3.15pt;margin-bottom:.0001pt;text-align:right'>79,000</p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inventories</p>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.75pt;text-align:right'>215,000</p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:9.8pt;text-align:right'>240,000</p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Notes
  receivable</p>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.75pt;text-align:right'><u>33,000</u></p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='text-align:justify'><u>&nbsp;</u></p>
  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:9.8pt;
  margin-bottom:0in;margin-left:19.45pt;margin-bottom:.0001pt;text-align:right'><u>35,000</u></p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total
  current assets</p>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.75pt;text-align:right'>1,267,000</p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:9.8pt;text-align:right'>1,928,000</p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>PROPERTY
  AND EQUIPMENT, at cost:</p>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Land
  and building</p>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.75pt;text-align:right'>6,586,000</p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:9.8pt;text-align:right'>6,566,000</p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Leasehold
  improvements</p>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.75pt;text-align:right'>4,107,000</p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:9.8pt;text-align:right'>4,017,000</p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fixtures
  and equipment</p>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.75pt;text-align:right'><u>8,387,000</u></p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='text-align:justify'><u>&nbsp;</u></p>
  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:9.8pt;
  margin-bottom:0in;margin-left:19.45pt;margin-bottom:.0001pt;text-align:right'><u>8,303,000</u></p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.75pt;text-align:right'>19,080,000</p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:9.8pt;text-align:right'>18,886,000</p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent align=right style='margin-top:0in;margin-right:
  5.75pt;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:
  right'><u>&nbsp;</u></p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent align=right style='margin-top:0in;margin-right:
  9.8pt;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:
  right'><u>&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent style='margin:0in;margin-bottom:.0001pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Less
  accumulated depreciation and amortization</p>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent align=right style='margin-top:0in;margin-right:
  5.75pt;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:
  right'><u>(10,913,000)</u></p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent align=right style='margin-top:0in;margin-right:
  9.8pt;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:
  right'><u>(10,602,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.75pt;text-align:right'>8,167,000</p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:9.8pt;text-align:right'>8,284,000</p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>&nbsp;</h3>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:5.75pt;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>&nbsp;</h3>
  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:9.8pt;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Assets
  held for sale</h3>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:5.75pt;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:right'>1,595,000</h3>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>&nbsp;</h3>
  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:9.8pt;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:right'>1,574,000</h3>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>&nbsp;</h3>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:5.75pt;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>&nbsp;</h3>
  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:9.8pt;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>OTHER
  ASSETS:</h3>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:5.75pt;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>&nbsp;</h3>
  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:9.8pt;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Notes
  receivable, net of current portion</p>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.75pt;text-align:right'>102,000</p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:9.8pt;text-align:right'>83,000</p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits
  and other assets</p>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.75pt;text-align:right'><u>49,000</u></p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:9.8pt;
  margin-bottom:0in;margin-left:19.45pt;margin-bottom:.0001pt;text-align:right'><u>51,000</u></p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.75pt;text-align:right'><u>151,000</u></p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:9.8pt;
  margin-bottom:0in;margin-left:19.45pt;margin-bottom:.0001pt;text-align:right'><u>134,000</u></p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>TOTAL
  ASSETS</p>
  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.75pt;text-align:right'><u>$11,180,000</u></p>
  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:9.8pt;text-align:right'><u>$11,920,000</u></p>
  </td>
 </tr>
 <tr>
  <td width=362 valign=top style='width:271.75pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=117 valign=top style='width:87.65pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=16 valign=top style='width:11.8pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=134 valign=top style='width:100.25pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
</table>

</div>

<h3>LIABILITIES AND STOCKHOLDERS' EQUITY</h3>

<div align=center>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
  <td width=361 valign=top style='width:270.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:0in;text-align:left;
  line-height:normal'>&nbsp;CURRENT
  LIABILITIES:</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=361 valign=top style='width:270.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent style='margin:0in;margin-bottom:.0001pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current
  maturities of long-term debt</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent align=right style='margin-top:0in;margin-right:
  13.05pt;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:
  right'>$3,440,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent align=right style='margin-top:0in;margin-right:
  8.55pt;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:
  right'>$2,304,000</p>
  </td>
 </tr>
 <tr>
  <td width=361 valign=top style='width:270.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accounts
  payable</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:13.05pt;text-align:right'>364,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.55pt;text-align:right'>628,000</p>
  </td>
 </tr>
 <tr>
  <td width=361 valign=top style='width:270.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deferred
  income</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:13.05pt;text-align:right'>74,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.55pt;text-align:right'>139,000</p>
  </td>
 </tr>
 <tr>
  <td width=361 valign=top style='width:270.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other
  accrued liabilities</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:13.05pt;text-align:right'><u>1,031,000</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:8.55pt;
  margin-bottom:0in;margin-left:12.15pt;margin-bottom:.0001pt;text-align:right'><u>939,000</u></p>
  </td>
 </tr>
 <tr>
  <td width=361 valign=top style='width:270.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total
  current liabilities</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:13.05pt;text-align:right'>4,909,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.55pt;text-align:right'>4,010,000</p>
  </td>
 </tr>
 <tr>
  <td width=361 valign=top style='width:270.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=361 valign=top style='width:270.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>LONG-TERM
  LIABILITIES:</h3>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:13.05pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>&nbsp;</h3>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:8.55pt;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
 </tr>
 <tr>
  <td width=361 valign=top style='width:270.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent style='margin:0in;margin-bottom:.0001pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt, net of
  current portion</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent align=right style='margin-top:0in;margin-right:
  13.05pt;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:
  right'>-</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent align=right style='margin-top:0in;margin-right:
  8.55pt;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:
  right'>846,000</p>
  </td>
 </tr>
 <tr>
  <td width=361 valign=top style='width:270.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deferred
  liabilities</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:13.05pt;text-align:right'><u>995,000</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.55pt;text-align:right'><u>1,071,000</u></p>
  </td>
 </tr>
 <tr>
  <td width=361 valign=top style='width:270.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total
  long-term liabilities</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:13.05pt;text-align:right'>995,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.55pt;text-align:right'>1,917,000</p>
  </td>
 </tr>
 <tr>
  <td width=361 valign=top style='width:270.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr style='height:4.0pt'>
  <td width=361 valign=top style='width:270.9pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p class=MsoNormal style='page-break-after:avoid'>MINORITY INTERESTS IN PARTNERSHIPS</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p class=MsoNormal align=right style='margin-right:13.05pt;text-align:right;
  page-break-after:avoid'>546,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p class=MsoNormal align=right style='margin-right:8.55pt;text-align:right;
  page-break-after:avoid'>584,000</p>
  </td>
 </tr>
</table>

</div>

<p class=MsoList2 align=center style='margin-left:0in;text-align:center;
text-indent:0in'><a name="OLE_LINK2">&nbsp;</a></p>

<p class=MsoFooter align=center style='text-align:center'>3</p>

<p class=MsoFooter align=center style='text-align:center'>See accompanying
notes to condensed consolidated financial statements</p>

<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade style='color:navy' align=center>

</div>



<br clear=all style='page-break-before:always'>










<p class=MsoNormal align=center style='text-align:center'><b>GOOD TIMES
RESTAURANTS INC. AND SUBSIDIARIES</b></p>

<p class=MsoNormal align=center style='margin-bottom:12.0pt;text-align:center'><b>CONDENSED
CONSOLIDATED BALANCE SHEETS (Continued)</b></p>

<div align=center>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='margin-left:.9pt;border-collapse:collapse'>
 <tr style='height:16.65pt'>
  <td width=360 style='width:3.75in;padding:0in 5.4pt 0in 5.4pt;height:16.65pt'>
  <h3 align=center style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</h3>
  </td>
  <td width=126 style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt;height:16.65pt'>
  <p class=MsoNormal align=center style='margin-right:-.9pt;text-align:center'><b>Unaudited</b></p>
  </td>
  <td width=18 style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt;height:16.65pt'>

  </td>
  <td width=120 style='width:1.25in;padding:0in 5.4pt 0in 5.4pt;height:16.65pt'>

  </td>
 </tr>
 <tr style='height:16.65pt'>
  <td width=360 style='width:3.75in;padding:0in 5.4pt 0in 5.4pt;height:16.65pt'>
  <h3 align=center style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</h3>
  </td>
  <td width=126 style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt;height:16.65pt'>
  <p class=MsoNormal align=center style='margin-right:-.9pt;text-align:center'>December 31,</p>
  </td>
  <td width=18 style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt;height:16.65pt'>

  </td>
  <td width=120 style='width:1.25in;padding:0in 5.4pt 0in 5.4pt;height:16.65pt'>
  <p class=MsoNormal align=center style='margin-right:-.9pt;text-align:center'>September 30,</p>
  </td>
 </tr>
 <tr>
  <td width=360 style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=center style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</h3>
  </td>
  <td width=126 style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=center style='margin-top:0in;margin-right:8.1pt;margin-bottom:0in;
  margin-left:8.1pt;margin-bottom:.0001pt;text-align:center'><u>2008</u></h3>
  </td>
  <td width=18 style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=center style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</h3>
  </td>
  <td width=120 style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=center style='margin-top:0in;margin-right:8.1pt;margin-bottom:0in;
  margin-left:12.6pt;margin-bottom:.0001pt;text-align:center'><u>2008</u></h3>
  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>STOCKHOLDERS'
  EQUITY:</h3>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:12.6pt;margin-bottom:0in;
  margin-left:-.9pt;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:-.9pt;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Preferred
  stock, $.01 par value;</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-left:.3in;text-indent:-.3in'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5,000,000
  shares authorized, none issued</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  and outstanding as of September 30, 2008 and</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  December 31, 2008</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:12.6pt;
  margin-bottom:0in;margin-left:-.9pt;margin-bottom:.0001pt;text-align:right'>-</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:12.6pt;text-align:right'>-</p>
  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Common
  stock, $.001 par value; 50,000,000 shares</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  Authorized, 3,898,559 shares issued and</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  Outstanding as of December 31, 2008 and</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  3,898,559 shares issued and outstanding as</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  of September 30, 2008</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:12.6pt;
  margin-bottom:0in;margin-left:-.9pt;margin-bottom:.0001pt;text-align:right'>4,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:12.6pt;text-align:right'>4,000</p>
  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  Accumulated other comprehensive loss</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:12.6pt;
  margin-bottom:0in;margin-left:-.9pt;margin-bottom:.0001pt;text-align:right'>-</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:12.6pt;text-align:right'>(68,000)</p>
  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent style='margin:0in;margin-bottom:.0001pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Capital
  contributed in excess of par value</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent align=right style='margin-top:0in;margin-right:
  12.6pt;margin-bottom:0in;margin-left:-.9pt;margin-bottom:.0001pt;text-align:
  right'>17,652,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent align=right style='margin-top:0in;margin-right:
  12.6pt;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:
  right'>17,633,000</p>
  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent style='margin:0in;margin-bottom:.0001pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accumulated
  deficit</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent align=right style='margin-top:0in;margin-right:
  12.6pt;margin-bottom:0in;margin-left:-.9pt;margin-bottom:.0001pt;text-align:
  right'><u>(12,926,000)</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent align=right style='margin-top:0in;margin-right:
  12.6pt;margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:
  right'><u>(12,160,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total
  stockholders' equity</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:12.6pt;
  margin-bottom:0in;margin-left:-.9pt;margin-bottom:.0001pt;text-align:right'><u>4,730,000</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:12.6pt;text-align:right'><u>5,409,000</u></p>
  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=360 valign=top style='width:3.75in;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>TOTAL
  LIABILITIES AND STOCKHOLDERS' EQUITY</h3>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:12.6pt;margin-bottom:0in;
  margin-left:-.9pt;margin-bottom:.0001pt;text-align:right'><u>$ 11,180,000</u></h3>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:12.6pt;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:right'><u>$11,920.000</u></h3>
  </td>
 </tr>
</table>

</div>

<p class=MsoFooter align=center style='text-align:center'>4</p>

<p class=MsoFooter align=center style='text-align:center'>See accompanying
notes to condensed consolidated financial statements</p>

<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade style='color:navy' align=center>

</div>



<br clear=all style='page-break-before:always'>










<p class=MsoList2 align=center style='margin-left:0in;text-align:center;
text-indent:0in'><b>GOOD
TIMES RESTAURANTS INC. AND SUBSIDIARIES</b></p>

<p class=MsoNormal align=center style='text-align:center'><b>CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS</b></p>

<p class=MsoNormal align=center style='margin-bottom:12.0pt;text-align:center'><b>(Unaudited)</b></p>

<div align=center>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='margin-left:.9pt;border-collapse:collapse'>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>&nbsp;</h3>
  </td>
  <td width=240 colspan=3 valign=top style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=center style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:8.1pt;margin-bottom:.0001pt;text-align:center'>For the Three Months Ended</h3>
  <h3 align=center style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:8.1pt;margin-bottom:.0001pt;text-align:center'>December 31,</h3>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>&nbsp;</h3>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=center style='margin-top:0in;margin-right:.05in;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:center'><u>2008</u></h3>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=center style='margin:0in;margin-bottom:.0001pt;text-align:center'>&nbsp;</h3>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=center style='margin-top:0in;margin-right:.05in;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:center'><u>2007</u></h3>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>&nbsp;</h3>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:10.35pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>&nbsp;</h3>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>NET REVENUES:</h3>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:10.35pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>&nbsp;</h3>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Restaurant
  sales, net</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'>$5,507,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'>$6,035,000</p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Franchise
  revenues</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'><u>139,000</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'><u>161,000</u></p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total
  net revenues</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'>5,646,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'>6,196,000</p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>RESTAURANT
  OPERATING COSTS:</h3>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:10.35pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:5.85pt;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Food
  and packaging costs</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'>1,855,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'>1,846,000</p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Payroll and other employee benefit costs</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'>2,065,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'>2,129,000</p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Occupancy
  and other operating costs</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'>1,204,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'>1,119,000</p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accretion
  of deferred rent</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'>-</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'>7,000</p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; New
  store opening costs</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'>15,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'>-</p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Depreciation
  and amortization</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'><u>311,000</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'><u>308,000</u></p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total
  restaurant operating costs</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'>5,450,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'>5,409,000</p>
  </td>
 </tr>
 <tr style='height:13.95pt'>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:13.95pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt;
  height:13.95pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:13.95pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:13.95pt'>

  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; General
  and administrative costs</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'>489,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'>555,000</p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Advertising
  costs</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'>315,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'>370,000</p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  Franchise costs</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'>40,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'>96,000</p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Gain
  on sale of restaurant building</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'><u>(8,000)</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'><u>(8,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>LOSS
  FROM OPERATIONS</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'>(640,000)</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'>(226,000)</p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>OTHER
  INCOME AND (EXPENSES)</h3>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:10.35pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:5.85pt;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Minority
  income (expense), net</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'>34,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'>(32,000)</p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  Unrealized loss on interest rate swap</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'>(119,000)</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'>-</p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest
  income (expense), net</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'><u>(41,000)</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'><u>3,000</u></p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total
  other income and (expenses)</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'><u>(126,000)</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'><u>(29,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>NET LOSS</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'><u>($766,000)</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'><u>($255,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>&nbsp;</h3>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:10.35pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:5.85pt;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>BASIC
  AND DILUTED LOSS PER COMMON SHARE</h3>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:10.35pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;text-align:right'><u>$(.20)</u></h3>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:5.85pt;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:right'><u>$(.07)</u></h3>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 style='margin:0in;margin-bottom:.0001pt'>WEIGHTED
  AVERAGE COMMON SHARES AND EQUIVALENTS USED IN PER SHARE CALCULATION:</h3>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:10.35pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3 align=right style='margin-top:0in;margin-right:5.85pt;margin-bottom:0in;
  margin-left:0in;margin-bottom:.0001pt;text-align:right'>&nbsp;</h3>
  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=426 valign=top style='width:319.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; BASIC
  AND DILUTED</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:10.35pt;text-align:right'><u>3,898,559</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:5.85pt;text-align:right'><u>3,873,795</u></p>
  </td>
 </tr>
</table>

</div>

<p class=MsoFooter align=center style='text-align:center'>5</p>

<p class=MsoFooter align=center style='text-align:center'>See accompanying
notes to condensed consolidated financial statements</p>

<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade style='color:navy' align=center>

</div>



<br clear=all style='page-break-before:always'>










<p class=MsoList2 align=center style='margin-left:0in;text-align:center;
text-indent:0in'><b>GOOD
TIMES RESTAURANTS INC. AND SUBSIDIARIES</b></p>

<p class=MsoNormal align=center style='text-align:center'><b>CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS</b></p>

<p class=MsoNormal align=center style='margin-bottom:12.0pt;text-align:center'><b>(Unaudited)</b></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=726
 style='margin-left:.9pt;border-collapse:collapse'>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=234 colspan=3 valign=top style='width:175.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:12.6pt;margin-bottom:.0001pt;text-align:center'>For the Three
  Months Ended</p>
  <p class=MsoNormal align=center style='margin-left:12.6pt;text-align:center'>December 31,</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>CASH FLOWS FROM
  OPERATING ACTIVITIES:</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp; Net
  loss</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>($766,000)</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>($255,000)</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp; Adjustments
  to reconcile net loss to net cash</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;
  provided by (used in) operating activities:</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Depreciation
  and amortization</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>311,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>308,000</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stock
  based compensation expense</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>19,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>24,000</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Unrealized
  loss on interest rate swap</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>119,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>-</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accretion
  of deferred rent</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>-</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>7,000</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Minority
  interest</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>(34,000)</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>32,000</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Recognition
  of deferred (gain) on sale of restaurant building</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>(8,000)</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>(8,000)</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes
  in operating assets and liabilities:</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Increase)
  decrease in:</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr style='height:4.0pt'>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Receivables
  and other</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>6,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:4.0pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>(22,000)</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inventories</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>25,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>&nbsp;(5,000)</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits
  and other</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>9,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>(3,000)</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Decrease)
  increase in:</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accounts
  payable</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>(264,000)</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>(64,000)</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accrued
  liabilities and deferred income</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'><u>(90,000)</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:8.1pt;margin-bottom:.0001pt;text-align:right'><u>(66,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net
  cash used in operating activities</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>(673,000)</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>(52,000)</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>CASH FLOWS USED IN
  INVESTING ACTIVITIES</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp; Payments
  for the purchase of property and equipment</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>(215,000)</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>(95,000)</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp; Loans
  made to franchisees and to others</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>(31,000)</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>-</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp; Payments
  received on loans to franchisees and to others</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'><u>14,000</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:8.1pt;margin-bottom:.0001pt;text-align:right'><u>24,000</u></p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net
  cash used in investing activities</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>(232,000)</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>(71,000)</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>CASH FLOWS FROM
  FINANCING ACTIVITIES:</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp; Principal
  payments on notes payable, capital leases, and long-term debt</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>(30,000)</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>(29,000)</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp; Net
  Proceeds (repayments) on revolving lines of credit</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>320,000</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>(750,000)</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp; Proceeds
  from exercise of options</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>-</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>37,000</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp; Distributions,
  net of contributions paid to minority interests in partnerships</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'><u>(13,000)</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:12.6pt;margin-bottom:.0001pt;text-align:right'><u>(74,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net
  cash provided by (used in) financing activities</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'><u>277,000</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:12.6pt;margin-bottom:.0001pt;text-align:right'><u>(816,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>NET CHANGE IN CASH AND CASH EQUIVALENTS</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'>(628,000)</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:8.1pt;text-align:right'>(939,000)</p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>CASH AND CASH EQUIVALENTS, beginning of period</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'><u>$1,414,000</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:8.1pt;margin-bottom:.0001pt;text-align:right'><u>$2,465,000</u></p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>CASH AND CASH EQUIVALENTS, end of period</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'><u>$786,000</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:8.1pt;margin-bottom:.0001pt;text-align:right'><u>$1,526,000</u></p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>SUPPLEMENTAL
  DISCLOSURES OF CASH FLOW INFORMATION:</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp; Cash
  paid for interest</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'><u>$68,000</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:8.1pt;margin-bottom:.0001pt;text-align:right'><u>$24,000</u></p>
  </td>
 </tr>
 <tr>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>&nbsp;&nbsp;&nbsp;&nbsp; Non-cash
  deferred hedging losses</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:.05in;text-align:right'><u>$&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; -</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=114 valign=top style='width:85.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:8.1pt;margin-bottom:.0001pt;text-align:right'><u>$28,000</u></p>
  </td>
 </tr>
</table>



<p class=MsoFooter align=center style='text-align:center'>6</p>

<p class=MsoFooter align=center style='text-align:center'>See accompanying
notes to condensed consolidated financial statements</p>

<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade style='color:navy' align=center>

</div>





<br clear=all style='page-break-before:always'>












<p class=MsoNormal align=center style='text-align:center'><b>GOOD TIMES
RESTAURANTS INC. AND SUBSIDIARIES</b></p>

<p class=MsoNormal align=center style='text-align:center'><b>NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS</b></p>

<p class=MsoNormal align=center style='margin-bottom:12.0pt;text-align:center'><b>(Unaudited)</b></p>

<p class=MsoBodyText align=left style='margin-top:0in;margin-right:0in;
margin-bottom:6.0pt;margin-left:0in;text-align:left;line-height:normal'><b>Note 1. Basis of Presentation</b></p>

<p class=MsoBodyText style='margin-right:0in;line-height:normal'>In the opinion of management, the
accompanying unaudited condensed consolidated financial statements contain all of
the normal recurring adjustments necessary to present fairly the financial
position of the Company as of December 31, 2008, the results of its operations
and its cash flows for the three month period ended December 31, 2008.&nbsp; Operating results for the three month period ended December 31, 2008 are not necessarily indicative of the results that may be expected for the year ending September 30, 2009.</p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>The
condensed consolidated balance sheet as of September 30, 2008 is derived from the audited financial statements, but does not include all disclosures
required by generally accepted accounting principles.&nbsp; As a result, these
financial statements should be read in conjunction with the Company's Form
10-KSB for the fiscal year ended September 30, 2008.</p>

<p class=MsoNormal style='margin-top:6.0pt;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in'><strong>Note
2. Recent Developments</strong></p>

<p class=BodyText1 style='margin-bottom:6.0pt;text-indent:0in'>After several years of same store sales growth,
including several months of double digit growth in fiscal 2007 and early fiscal
2008, we experienced a dramatic change in our sales trends, beginning in early
calendar 2008, and continuing through January 2009, as the economy began to
slow and competitive pricing pressures intensified.&nbsp; Due to the dramatic
decline in consumer spending, the unprecedented rise in commodity costs and the
upheaval in the credit markets, we suspended most of our restaurant development.</p>

<p class=MsoNormal style='margin-top:6.0pt;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in'><strong>Note
3. Debt Covenant Compliance</strong></p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>As reported on the
form 8-K filed on January 23, 2009, we are in default of certain technical loan
covenants as of December 31, 2008 on our note payable to Wells Fargo Bank, N.A.
(&quot;the Bank&quot;), therefore, all amounts owing under this facility are reflected as
current in the accompanying Condensed Consolidated Balance Sheet as of December
31, 2008. We have never been in payment default on the note and expect to be
able to remain current on payments in fiscal 2009, depending on our sales
trends and cash flow from operations.&nbsp; On February 9, 2009 we received a
Reservation of Rights letter from the Bank formally notifying us of the default
of the Earnings Before Interest Taxes and Depreciation (&quot;EBITDA&quot;) Coverage
Ratio of not less than 1.5 to 1.0 and the Tangible Net Worth of not less than
$5,000,000 as set forth in the Credit Agreement for the period ending December
31, 2008. The letter serves as notice that notwithstanding the foregoing events
of default, the Bank is reserving all of its rights and remedies under the
Credit Agreement and related agreements.</p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>The Bank is not now
accelerating the Loan and is willing to continue to accept regularly scheduled
payments of principal and interest under the Loan, however the acceptance of
payments under the Loan does not constitute a modification of the Credit
Agreement or a waiver of any of the covenants or of the Bank's rights or
remedies under the Credit Agreement, including the right to accelerate the loan
in the future after the giving of notice.&nbsp; We will continue to work with the
Bank on a Required Corrective Action for compliance with existing or modified
loan covenants.&nbsp; There can be no assurance that the Bank will agree to modify
or waive any of the loan covenants or waive any of its rights or remedies under
the Credit Agreement and we would require additional financing to repay the
loan balance.&nbsp; The loan is secured by security agreements in the equipment of
four restaurants and a blanket security on all equipment not covered by prior
existing security agreements.</p>

<p class=MsoNormal style='margin-top:6.0pt;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in'><strong>Note
4. Stock-Based Compensation</strong></p>

<p class=MsoBodyText2 style='margin-bottom:12.0pt;text-align:justify'>The Company measures the compensation
cost associated with share-based payments by estimating the fair value of stock
options as of the grant date using the Black-Scholes option pricing model. The
Company believes that the valuation technique and the approach utilized to
develop the underlying assumptions are appropriate in calculating the fair
values of the Company's stock options granted during all years presented. Estimates
of fair value are not intended to predict actual future events or the value
ultimately realized by the employees who receive equity awards.</p>

<p class=MsoFooter align=center style='text-align:center'>7</p>

<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade style='color:navy' align=center>

</div>



<br clear=all style='page-break-before:always'>










<p class=MsoBodyText2 style='margin-bottom:6.0pt;text-align:justify'>Our net loss for the three months
ended December 31, 2008 and December 31, 2007 includes $19,000 and $24,000,
respectively, of compensation costs related to our stock-based compensation
arrangements.</p>

<p class=MsoNormal style='margin-top:0in;margin-right:4.3pt;margin-bottom:6.0pt;
margin-left:0in;text-align:justify'>During the three months ended December 31, 2008, we granted 12,000 non-statutory stock options and 68,400 incentive stock options
both with exercise prices of $1.47. The per share weighted average fair value was
$.97 for both non-statutory stock option grants and incentive stock option
grants.</p>

<p class=MsoNormal style='margin-top:0in;margin-right:4.3pt;margin-bottom:6.0pt;
margin-left:0in;text-align:justify'>In addition to the exercise and grant date prices of the
awards, certain weighted average assumptions that were used to estimate the
fair value of stock option grants are listed in the following table:</p>

<div align=center>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
  <td width=168 valign=top style='width:1.75in;padding:0in 0in 0in 0in'>

  </td>
  <td width=192 valign=top style='width:2.0in;border:none;border-bottom:solid black 1.0pt;
  padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'><strong>Incentive Stock
  Options</strong></p>
  </td>
  <td width=228 valign=top style='width:171.0pt;border:none;border-bottom:solid black 1.0pt;
  padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'><strong>Non-Statutory Stock
  Options</strong></p>
  </td>
 </tr>
 <tr>
  <td width=168 valign=top style='width:1.75in;background:silver;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-right:4.5pt'>Expected term (years)</p>
  </td>
  <td width=192 valign=top style='width:2.0in;background:silver;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'><strong>6.5&nbsp;</strong></p>
  </td>
  <td width=228 valign=top style='width:171.0pt;background:silver;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'>6.7&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=168 valign=top style='width:1.75in;background:white;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-right:4.5pt'>Expected volatility</p>
  </td>
  <td width=192 valign=top style='width:2.0in;background:white;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'><strong>69.7%</strong></p>
  </td>
  <td width=228 valign=top style='width:171.0pt;background:white;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'>69.2%</p>
  </td>
 </tr>
 <tr>
  <td width=168 valign=top style='width:1.75in;background:silver;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-right:4.5pt'>Risk-free interest rate</p>
  </td>
  <td width=192 valign=top style='width:2.0in;background:silver;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'><strong>2.79%</strong></p>
  </td>
  <td width=228 valign=top style='width:171.0pt;background:silver;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'>2.84%</p>
  </td>
 </tr>
 <tr>
  <td width=168 valign=top style='width:1.75in;background:white;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-right:4.5pt'>Expected dividends</p>
  </td>
  <td width=192 valign=top style='width:2.0in;background:white;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'><strong>0</strong></p>
  </td>
  <td width=228 valign=top style='width:171.0pt;background:white;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'>0</p>
  </td>
 </tr>
</table>

</div>

<p class=MsoNormal style='margin-top:6.0pt;margin-right:4.3pt;margin-bottom:
6.0pt;margin-left:0in;text-align:justify'>We estimate expected volatility based on
historical weekly price changes of our common stock for a period equal to the
current expected term of the options. The risk-free interest rate is based on
the United States treasury yields in effect at the time of grant corresponding
with the expected term of the options. The expected option term is the number
of years we estimate that options will be outstanding prior to exercise
considering vesting schedules and our historical exercise patterns.</p>

<p class=MsoBodyText2 style='margin-top:0in;margin-right:4.3pt;margin-bottom:
6.0pt;margin-left:0in;text-align:justify'>SFAS
123(R) requires the cash flows resulting from the tax benefits for tax
deductions in excess of the compensation expense recorded for those options
(excess tax benefits) to be classified as financing cash flows. These excess
tax benefits were $0 for the quarter ended December 31, 2008.</p>

<p class=MsoBodyText2 style='margin-top:0in;margin-right:4.3pt;margin-bottom:
6.0pt;margin-left:0in;text-align:justify'>A
summary of stock option activity under our share-based compensation plan for
the quarter ended December 31, 2008 is presented in the following table:</p>

<div align=center>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
  <td width=193 valign=top style='width:144.4pt;padding:0in 5.4pt 0in 5.4pt'><a
  name="OLE_LINK1"></a>
  <p class=MsoNormal style='margin-right:4.5pt'><b>&nbsp;</b></p>
  </td>
  <td width=91 valign=bottom style='width:68.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'><b><u>Options</u></b></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'><b>Weighted Average <u>Exercise
  Price</u></b></p>
  </td>
  <td width=132 valign=bottom style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'><b>Weighted Average
  Remaining Contractual</b></p>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'><b><u>Life (Yrs.)</u></b></p>
  </td>
  <td width=97 valign=bottom style='width:72.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'><b>Aggregate Intrinsic
  <u>Value</u></b></p>
  </td>
 </tr>
 <tr>
  <td width=193 valign=top style='width:144.4pt;background:silver;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-right:4.5pt'>Outstanding-beg of year</p>
  </td>
  <td width=91 valign=top style='width:68.0pt;background:silver;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:4.5pt;text-align:right'>&nbsp;353,942</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;background:silver;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:17.1pt;margin-bottom:.0001pt;text-align:center'>$4.04</p>
  </td>
  <td width=132 valign=top style='width:99.0pt;background:silver;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=97 valign=top style='width:72.9pt;background:silver;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=193 valign=top style='width:144.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-right:4.5pt'>Granted</p>
  </td>
  <td width=91 valign=top style='width:68.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:4.5pt;text-align:right'>&nbsp;80,400</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:17.1pt;margin-bottom:.0001pt;text-align:center'>$1.47</p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=97 valign=top style='width:72.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=193 valign=top style='width:144.4pt;background:silver;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-right:4.5pt'>Exercised</p>
  </td>
  <td width=91 valign=top style='width:68.0pt;background:silver;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:4.5pt;text-align:right'>-</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;background:silver;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=132 valign=top style='width:99.0pt;background:silver;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=97 valign=top style='width:72.9pt;background:silver;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=193 valign=top style='width:144.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-right:4.5pt'>Forfeited </p>
  </td>
  <td width=91 valign=top style='width:68.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:4.5pt;text-align:right'>&nbsp;(14,760)</p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:17.1pt;margin-bottom:.0001pt;text-align:center'>$4.91</p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=97 valign=top style='width:72.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=193 valign=top style='width:144.4pt;background:silver;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-right:4.5pt'>Expired</p>
  </td>
  <td width=91 valign=top style='width:68.0pt;background:silver;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:4.5pt;text-align:right'>&nbsp;<u> (39,951)</u></p>
  </td>
  <td width=126 valign=top style='width:94.5pt;background:silver;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:17.1pt;margin-bottom:.0001pt;text-align:center'><a
  name="OLE_LINK4"><u>$3.11</u></a></p>
  </td>
  <td width=132 valign=top style='width:99.0pt;background:silver;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=97 valign=top style='width:72.9pt;background:silver;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=193 valign=top style='width:144.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-right:4.5pt'>Outstanding Dec 31, 2008</p>
  </td>
  <td width=91 valign=top style='width:68.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-right:4.5pt;text-align:right'><u>379,631</u></p>
  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:17.1pt;margin-bottom:.0001pt;text-align:center'><u>$3.55</u></p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'><u>6.3</u></p>
  </td>
  <td width=97 valign=top style='width:72.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'><u>$0</u></p>
  </td>
 </tr>
 <tr>
  <td width=193 valign=top style='width:144.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=91 valign=top style='width:68.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=126 valign=top style='width:94.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=97 valign=top style='width:72.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr style='height:12.15pt'>
  <td width=193 valign=top style='width:144.4pt;background:silver;padding:0in 5.4pt 0in 5.4pt;
  height:12.15pt'>
  <p class=MsoNormal style='margin-right:4.5pt'>Exercisable Dec 31, 2008</p>
  </td>
  <td width=91 valign=top style='width:68.0pt;background:silver;padding:0in 5.4pt 0in 5.4pt;
  height:12.15pt'>
  <p class=MsoNormal align=right style='margin-right:4.5pt;text-align:right'><u>271,356</u></p>
  </td>
  <td width=126 valign=top style='width:94.5pt;background:silver;padding:0in 5.4pt 0in 5.4pt;
  height:12.15pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:17.1pt;margin-bottom:.0001pt;text-align:center'><u>$3.68</u></p>
  </td>
  <td width=132 valign=top style='width:99.0pt;background:silver;padding:0in 5.4pt 0in 5.4pt;
  height:12.15pt'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'><u>5.1</u></p>
  </td>
  <td width=97 valign=top style='width:72.9pt;background:silver;padding:0in 5.4pt 0in 5.4pt;
  height:12.15pt'>
  <p class=MsoNormal align=center style='margin-right:4.5pt;text-align:center'><u>$0</u></p>
  </td>
 </tr>
</table>

</div>

<p class=MsoBodyText2 style='margin-top:6.0pt;margin-right:4.3pt;margin-bottom:
6.0pt;margin-left:0in;text-align:justify'>As
of December 31, 2008, the total remaining unrecognized compensation cost
related to unvested stock-based arrangements was $86,000 and is expected to be
recognized over a period of 2.88 years.</p>

<p class=MsoBodyText2 style='margin-right:4.3pt;text-align:justify'>There were no stock options exercised
during the three months ended December 31, 2008.</p>

<p class=MsoNormal style='margin-top:6.0pt;margin-right:4.3pt;margin-bottom:
6.0pt;margin-left:0in;text-align:justify'><strong>Note 5. Comprehensive Income (Loss)</strong></p>

<p class=MsoNormal style='margin-top:0in;margin-right:4.3pt;margin-bottom:6.0pt;
margin-left:0in;text-align:justify'>Comprehensive income includes net income or loss, changes
in certain assets and liabilities that are reported directly in equity such as
adjustments resulting from unrealized gains or losses on held-to-maturity
investments and certain hedging transactions.</p>

<p class=MsoNormal style='margin-top:0in;margin-right:4.5pt;margin-bottom:6.0pt;
margin-left:0in;text-align:justify'>In May 2007, the Company entered into an interest rate
swap agreement, designated as a cash flow hedge, which hedges the Company's
exposure to interest rate fluctuations on the Company's floating rate
$1,100,000 term loan. The contract requires monthly settlements of the
difference between the amounts to be received and paid under the agreement, the
amount of which is recognized in current earnings as interest expense.</p>

<p class=MsoFooter align=center style='text-align:center'>8</p>

<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade style='color:navy' align=center>

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<br clear=all style='page-break-before:always'>










<p class=MsoNormal style='text-align:justify'>As of December 31, 2008 we were in default of
certain technical covenants on the underlying term loan, see note 3 above, and
we have therefore recognized an unrealized loss of $119,000 in the accompanying
Condensed Consolidated Statement of Operations. As long as the underlying loan
is in covenant default we will adjust the unrealized gain or loss through the
statement of operations as non-cash income or expense.</p>

<p class=MsoBodyText style='margin-top:6.0pt;margin-right:0in;margin-bottom:
6.0pt;margin-left:0in;line-height:normal'><b>Note
6. Contingent Liabilities</b></p>

<p class=MsoNormal style='text-align:justify'>We remain contingently liable on various land
leases underlying restaurants that were previously sold to franchisees.&nbsp; We
have never experienced any losses related to these contingent lease
liabilities, however if a franchisee defaults on the payments under the leases,
we would be liable for the lease payments as the assignor or sublessor of the
lease.&nbsp; Currently there are no leases in default by the franchisees, however
there can be no assurance that there will not be in the future which could have
a material effect on our future operating results.</p>

<p class=MsoNormal style='margin-top:6.0pt;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in'><b>Note
7. Assets Held for Sale</b></p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>We have classified
$1,595,000 as assets held for sale in the accompanying condensed consolidated
balance sheet. These costs are related to a site in Firestone, Colorado which has been fully developed.&nbsp;&nbsp; A sale and leaseback agreement that was under contract
in the first quarter of fiscal 2009 was terminated and the restaurant is being
marketed for sale and leaseback.&nbsp; The proceeds of a sale leaseback transaction,
if consummated, are required to be used for the reduction of the line of credit
payable to PFGI II, LLC. The effect on our operating cash flow is not material
as the interest expense on the line of credit is approximately equal to the
proposed rental rate on a sale leaseback transaction.</p>

<p class=MsoNormal style='margin-bottom:6.0pt'><b>Note 8. </b><b>Im</b><b>pairment of
Long-Lived Assets</b></p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>Annually we review
the undiscounted cash flows of each restaurant as compared to the net book
value of each restaurant's respective properties.&nbsp; If the undiscounted cash
flows of each restaurant are less than their respective net book values, the
respective properties are written down to their fair market values. To date we
have not written down any assets due to impairment, however if we continue to
experience declining restaurant sales an asset impairment may materially affect
future operating results.</p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'><b>Note 9. Fair Value
Measurements</b></p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>In
September 2006, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 157, &quot;Fair Value
Measurements&quot; (&quot;SFAS 157&quot;). SFAS 157 defines fair value,
establishes a framework for measuring fair value and expands disclosures about
fair value measurements. Effective October 1, 2008, the Company adopted the provisions of SFAS 157 related to financial assets and liabilities, as well as
other assets and liabilities carried at fair value on a recurring basis. These
provisions, which have been applied prospectively, did not have a material
impact on the Company's consolidated financial statements. Certain other
provisions of SFAS 157 related to other non-financial assets and liabilities
will be effective for the Company on July 1, 2009, and will be applied prospectively. The adoption of the provisions of SFAS 157 related to other
non-financial assets and liabilities is not expected to have a material impact
on the consolidated financial statements of the Company.</p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>SFAS 157
defines three levels of inputs that may be used to measure fair value and
requires that the assets or liabilities carried at fair value be disclosed by
the input level under which they were valued. The input levels defined under
SFAS 157 are as follows:</p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>Level 1:
Quoted market prices in active markets for identical assets and liabilities.</p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>Level 2:
Observable inputs other than defined in Level 1, such as quoted prices for
similar assets or liabilities; quoted prices in markets that are not active; or
other inputs that are observable or can be corroborated by observable market
data for substantially the full term of the assets or liabilities.</p>

<p class=MsoNormal style='text-align:justify'>Level 3: Unobservable inputs that
are not corroborated by observable market data.</p>

<p class=MsoNormal style='text-align:justify'>The following table summarizes
financial assets and liabilities that are measured at fair value on a recurring
basis as of December 31, 2008:</p>

<p class=MsoNormal style='margin-top:6.0pt;margin-right:0in;margin-bottom:0in;
margin-left:2.0in;margin-bottom:.0001pt;text-align:justify'><u>Level 1</u></p>

<p class=MsoNormal style='margin-left:2.0in;text-align:justify'>Interest
Rate Swap liability&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; $118,880</p>

<p class=MsoFooter align=center style='text-align:center'>9</p>

<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade style='color:navy' align=center>

</div>



<br clear=all style='page-break-before:always'>










<p class=MsoNormal style='margin-bottom:6.0pt'><b>Note 10. Accounting Policies</b></p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>In June 2006, the
FASB issued FIN 48, &quot;Accounting for Uncertainty in Income Taxes - an
interpretation of FASB Statement 109,&quot; which clarifies the accounting for
uncertainty in income taxes recognized in an enterprise's financial statements
in accordance with FAS 109, &quot;Accounting for Income Taxes.&quot;&nbsp; FIN
48 provides interpretive guidance for the financial statement recognition and
measurement of a tax position taken, or expected to be taken, in a tax return.
FIN 48 requires the affirmative evaluation that it is more-likely-than-not,
based on the technical merits of a tax position, that an enterprise is entitled
to economic benefits resulting from positions taken in income tax returns. If a
tax position does not meet the &quot;more-likely-than-not&quot; recognition threshold,
the benefit of that position is not recognized in the financial statements.&nbsp;
FIN 48 was effective for the fiscal year beginning October&nbsp;1, 2007 and there is no cumulative effect of applying FIN 48.</p>

<p class=MsoNormal style='text-align:justify'>In February 2007, the Financial Accounting
Standards Board (&quot;FASB&quot;) issued SFAS No. 159.&nbsp; &quot;The Fair Value Option for
Financial Assets and Financial Liabilities - including an amendment of FASB
Statement No. 115&quot; (&quot;SFAS 159&quot;). SFAS 159 provides companies with an option to
report selected financial assets and financial liabilities at fair value.&nbsp;
Unrealized gains and losses on items for which the fair value option has been
elected are reported in earnings at each subsequent reporting date.&nbsp; SFAS 159 was
effective for the fiscal year beginning October 1, 2008. The adoption of SFAS 159 did not have any effect on the Company's financial position, results of
operations or cash flows.</p>

<p class=MsoNormal style='margin-top:6.0pt;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;text-align:justify'><b>Note 11. Income Taxes</b></p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>On October 1, 2007, the Company adopted the provisions of FIN 48. There were no material tax
positions not meeting the &quot;more-likely-than-not&quot; recognition threshold and therefore
there is no cumulative effect of applying FIN 48.</p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>Although the Company
has not incurred interest and penalties associated with unrecognized tax
benefits; future interest and penalties associated with unrecognized tax
benefits, if any, will be recognized in income tax expense in the Consolidated
Statements of Operations and the corresponding liability in&nbsp;income taxes
payable or income taxes receivable, net on the Consolidated Balance Sheets. </p>

<p class=MsoNormal style='text-align:justify'>The Company is currently not undergoing any
examinations by any taxing jurisdictions, with the tax years for the Fiscal
Years Ending September 30, 2004 through 2008 remaining open to examination.</p>

<p class=MsoNormal style='margin-top:6.0pt;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in'><b>Note
12. New Accounting Pronouncements</b></p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>In December 2007, the
FASB issued FASB Statement No. 141 (revised 2007), &quot;Business Combinations&quot;
(&quot;FAS 141 (R)&quot;), which establishes accounting principles and disclosure
requirements for all transactions in which a company obtains control over
another business.&nbsp; This accounting pronouncement is effective for fiscal years
beginning after December 15, 2008, which will effective for our fiscal year
beginning October 1, 2009.&nbsp; The requirements of FAS 141 will only impact future
business combination transactions that we may enter into.</p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>In December 2007, the
FASB issued FASB Statement No. 160, &quot;Noncontrolling Interests in Consolidated
Financial Statements and amendment to ARB No. 51&quot; (&quot;FAS 160&quot;).&nbsp; This standard
prescribes the accounting by a parent company for minority interests held by
other parties in a subsidiary of the parent company.&nbsp; FAS 160 is effective for
fiscal years beginning after December 15, 2008, which will be effective for our
fiscal year beginning October 1, 2009.&nbsp; We are currently evaluating the
requirements of FAS 160 and have not yet determined the impact on our financial
statements.</p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>In March 2008, the
FASB issued SFAS No. 161, &quot;Disclosures about Derivative instruments and Hedging
Activities&quot; (&quot;SFAS 161&quot;).&nbsp; SFAS 161 amends and expands the disclosure
requirements in SFAS 133, &quot;Accounting for Derivative Instruments and Hedging Activities&quot;.&nbsp;
SFAS 161 is effective for fiscal years and interim periods beginning after November 15, 2008, which will be effective for our interim period beginning January 1, 2009.&nbsp; We are currently evaluating the requirements of FAS 161 and have not yet
determined the impact on our financial statements.</p>

<p class=MsoNormal style='margin-top:6.0pt;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in'><b>Note
13. Stock Transactions</b></p>

<p class=MsoBodyText2 style='margin-bottom:12.0pt'>None.</p>

<p class=MsoFooter align=center style='text-align:center'>10</p>

<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade style='color:navy' align=center>

</div>



<br clear=all style='page-break-before:always'>










<p class=MsoBodyText2><b>ITEM 2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION</b></p>

<p class=MsoNormal style='margin-bottom:12.0pt'><b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; AND RESULTS OF OPERATIONS</b></p>

<h3><u>General</u></h3>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>This
Form 10-Q contains or incorporates by reference forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended and
the disclosure of risk factors in the Company's form 10-KSB for the fiscal year
ended September 30, 2008.&nbsp; Also, documents subsequently filed by us with the
SEC and incorporated herein by reference may contain forward-looking
statements.&nbsp; We caution investors that any forward-looking statements made by
us are not guarantees of future performance and actual results could differ
materially from those in the forward-looking statements as a result of various
factors, including but not limited to the following:</p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:31.5pt;text-indent:-31.5pt;line-height:normal'>(I)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; We compete with numerous
well established competitors who have substantially greater financial resources
and longer operating histories than we do.&nbsp; Competitors have increasingly
offered selected food items and combination meals, including hamburgers, at
discounted prices, and continued discounting by competitors may adversely
affect revenues and profitability of Company restaurants.</p>

<p class=MsoBlockText style='margin-top:0in;margin-right:0in;margin-bottom:
6.0pt;margin-left:31.7pt;text-align:justify;text-indent:-31.7pt'>(II)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; We may be
negatively impacted if we continue to experience consistent same store sales
declines.&nbsp; Same store sales comparisons will be dependent, among other things,
on the success of our advertising and promotion of new and existing menu
items.&nbsp; No assurances can be given that such advertising and promotions will in
fact be successful.</p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>We
may also be negatively impacted by other factors common to the restaurant
industry such as: changes in consumer tastes away from red meat and fried
foods; increases in the cost of food, paper, labor, health care, workers'
compensation or energy; inadequate number of hourly paid employees; and/or
decreases in the availability of affordable capital resources.&nbsp; We caution the
reader that such risk factors are not exhaustive, particularly with respect to
future filings.</p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:97%'><i>Restaurant
Locations</i></p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;
margin-left:0in;line-height:normal'>We
currently operate and franchise a total of fifty-two Good Times restaurants, of
which forty-eight are in Colorado, with forty-three in the Denver greater
metropolitan area, three in Colorado Springs, one in Grand Junction and one in
Silverthorne. Eight of these restaurants are &quot;dual brand&quot;, operated pursuant to
a Dual Brand Test Agreement with Taco John's International, of which there is one
in North Dakota, two in Wyoming, and five in Colorado.</p>

<table class=MsoNormalTable border=1 cellspacing=0 cellpadding=0
 style='margin-left:5.4pt;border-collapse:collapse;border:none'>
 <tr>
  <td width=270 valign=top style='width:202.5pt;border:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal><b>&nbsp;</b></p>

  </td>
  <td width=48 valign=bottom style='width:.5in;border:solid windowtext 1.0pt;
  border-left:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>Total</b></p>
  </td>
  <td width=102 valign=bottom style='width:76.5pt;border:solid windowtext 1.0pt;
  border-left:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>Denver</b><b>, CO</b></p>
  <p class=MsoNormal align=center style='text-align:center'><b>Greater Metro</b></p>
  </td>
  <td width=78 valign=bottom style='width:58.5pt;border:solid windowtext 1.0pt;
  border-left:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>Colorado</b></p>
  <p class=MsoNormal align=center style='text-align:center'><b>Other</b></p>
  </td>
  <td width=54 valign=bottom style='width:40.5pt;border:solid windowtext 1.0pt;
  border-left:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>Idaho</b></p>
  </td>
  <td width=84 valign=bottom style='width:63.0pt;border:solid windowtext 1.0pt;
  border-left:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>Wyoming</b></p>
  </td>
  <td width=84 valign=bottom style='width:63.0pt;border:solid windowtext 1.0pt;
  border-left:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>North Dakota</b></p>
  </td>
 </tr>
 <tr>
  <td width=270 valign=top style='width:202.5pt;border:solid windowtext 1.0pt;
  border-top:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Good
  Times co-owned &amp; co-developed</p>
  </td>
  <td width=48 valign=top style='width:.5in;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>27</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>24</p>
  </td>
  <td width=78 valign=top style='width:58.5pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>3</p>
  </td>
  <td width=54 valign=top style='width:40.5pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=84 valign=top style='width:63.0pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=84 valign=top style='width:63.0pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=270 valign=top style='width:202.5pt;border:solid windowtext 1.0pt;
  border-top:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Good
  Times franchised</p>
  </td>
  <td width=48 valign=top style='width:.5in;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>17</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>14</p>
  </td>
  <td width=78 valign=top style='width:58.5pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>2</p>
  </td>
  <td width=54 valign=top style='width:40.5pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>1</p>
  </td>
  <td width=84 valign=top style='width:63.0pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=84 valign=top style='width:63.0pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=270 valign=top style='width:202.5pt;border:solid windowtext 1.0pt;
  border-top:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Dual
  brand co-owned</p>
  </td>
  <td width=48 valign=top style='width:.5in;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>3</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>3</p>
  </td>
  <td width=78 valign=top style='width:58.5pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=54 valign=top style='width:40.5pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=84 valign=top style='width:63.0pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=84 valign=top style='width:63.0pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=270 valign=top style='width:202.5pt;border:solid windowtext 1.0pt;
  border-top:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Dual
  brand franchised</p>
  </td>
  <td width=48 valign=top style='width:.5in;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.5pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>5</p>
  </td>
  <td width=102 valign=top style='width:76.5pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.5pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>2</p>
  </td>
  <td width=78 valign=top style='width:58.5pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.5pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=54 valign=top style='width:40.5pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.5pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=84 valign=top style='width:63.0pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.5pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>2</p>
  </td>
  <td width=84 valign=top style='width:63.0pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.5pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>1</p>
  </td>
 </tr>
 <tr>
  <td width=270 valign=top style='width:202.5pt;border:solid windowtext 1.0pt;
  border-top:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='text-align:right'><b>Total</b></p>
  </td>
  <td width=48 valign=top style='width:.5in;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>52</b></p>
  </td>
  <td width=102 valign=top style='width:76.5pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>43</b></p>
  </td>
  <td width=78 valign=top style='width:58.5pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>5</b></p>
  </td>
  <td width=54 valign=top style='width:40.5pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>1</b></p>
  </td>
  <td width=84 valign=top style='width:63.0pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>2</b></p>
  </td>
  <td width=84 valign=top style='width:63.0pt;border-top:none;border-left:none;
  border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>1</b></p>
  </td>
 </tr>
</table>



<table class=MsoNormalTable border=1 cellspacing=0 cellpadding=0
 style='margin-left:22.5pt;border-collapse:collapse;border:none'>
 <tr>
  <td width=220 valign=top style='width:165.3pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=213 colspan=2 valign=top style='width:159.6pt;border:none;
  border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>January</b></p>
  </td>
 </tr>
 <tr>
  <td width=220 valign=top style='width:165.3pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=106 valign=top style='width:79.8pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>2008</b></p>
  </td>
  <td width=106 valign=top style='width:79.8pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>2009</b></p>
  </td>
 </tr>
 <tr>
  <td width=220 valign=top style='width:165.3pt;border:solid windowtext 1.0pt;
  border-top:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='text-align:justify'>Company-owned restaurants</p>
  </td>
  <td width=106 valign=top style='width:79.8pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>18</p>
  </td>
  <td width=106 valign=top style='width:79.8pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>21</p>
  </td>
 </tr>
 <tr>
  <td width=220 valign=top style='width:165.3pt;border:solid windowtext 1.0pt;
  border-top:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='text-align:justify'>Joint venture restaurants</p>
  </td>
  <td width=106 valign=top style='width:79.8pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>9</p>
  </td>
  <td width=106 valign=top style='width:79.8pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>9</p>
  </td>
 </tr>
 <tr>
  <td width=220 valign=top style='width:165.3pt;border-top:none;border-left:
  solid windowtext 1.0pt;border-bottom:solid windowtext 1.5pt;border-right:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='text-align:justify'>Franchise operated restaurants</p>
  </td>
  <td width=106 valign=top style='width:79.8pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.5pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>25</p>
  </td>
  <td width=106 valign=top style='width:79.8pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.5pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'>22</p>
  </td>
 </tr>
 <tr>
  <td width=220 valign=top style='width:165.3pt;border:solid windowtext 1.0pt;
  border-top:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='text-align:right'><b>Total restaurants</b></p>
  </td>
  <td width=106 valign=top style='width:79.8pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>52</b></p>
  </td>
  <td width=106 valign=top style='width:79.8pt;border-top:none;border-left:
  none;border-bottom:solid windowtext 1.0pt;border-right:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='text-align:center'><b>52</b></p>
  </td>
 </tr>
</table>

<p class=MsoNormal style='margin-top:12.0pt;margin-right:0in;margin-bottom:
6.0pt;margin-left:0in;text-align:justify'><i>Fiscal 2008:</i> In January 2008 a North Dakota franchise terminated their Good Times franchise agreement in the dual brand
concept and stopped selling Good Times products in their two locations.&nbsp; In
March 2008 we purchased two Good Times restaurants from an existing
franchisee.&nbsp; In June 2008 the Good Times franchisee operating at the University of Wyoming Food Court ceased operations when the contract to operate in the food
court expired.&nbsp; There are no plans for this franchisee to operate in another
location.</p>

<p class=MsoFooter align=center style='text-align:center'>11</p>

<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade style='color:navy' align=center>

</div>



<br clear=all style='page-break-before:always'>










<p class=MsoNormal style='margin-top:6.0pt;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;text-align:justify'><i>Fiscal 2009:</i> In October 2008 we
opened one new company-owned restaurant in Firestone, Colorado. In December
2008 a Wyoming franchise terminated their Good Times franchise agreement in the
dual brand concept and has stopped selling Good Times products in one location.
Also in December 2008 a franchisee opened a new dual brand restaurant in Sheridan, Wyoming.</p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;
margin-left:0in;line-height:normal'>The
following presents certain historical financial information of our operations.&nbsp;
This financial information includes results for the three months ended December 31, 2007 and results for the three months ended December 31, 2008.</p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'><b><u>Results
of Operations</u></b></p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'><i>Net
Revenues</i></p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>Net
revenues for the three months ended December 31, 2008 decreased $550,000 (8.9%) to $5,646,000 from $6,196,000 for the three months ended December 31, 2007.&nbsp; Same store restaurant sales decreased $711,000 (14.8%) during the three months
ended December 31, 2008 for the restaurants that were open for the full periods
ending December 31, 2008 and December 31, 2007.&nbsp; Restaurants are included in
same store sales after they have been open a full fifteen months and only Good
Times restaurants are included with dual branded restaurants excluded.&nbsp;
Restaurant sales increased $295,000 due to seven company-owned restaurants not
included in same store sales. One was opened in late fiscal 2007, three are
dual branded restaurants, two were purchased from a franchisee in March 2008
and one opened in October 2008.&nbsp; Restaurant sales decreased $112,000 due to one
non-traditional company-owned restaurant not included in same store sales.</p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>Our
first quarter same store restaurant sales decline of 14.8% reflects the adverse
impact the macroeconomic environment is having on consumers' discretionary
spending and the proliferation of heavy promotion of $1 value menus and
discounting by competitors.&nbsp; Additionally, we are comparing the 2009 sales
decline to a same store sales increase of 11.6% in the same quarter of fiscal
2008. We had shown same store sales growth in sixteen consecutive quarters
leading into the third quarter of fiscal 2008. Our outlook for fiscal 2009
remains cautious as the economic pressures may continue to impact consumer
spending and we anticipate that we will continue to face increased competitive
pricing pressure.</p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>While
we are implementing several broad product and brand initiatives during fiscal
2009 to improve our core value proposition, we are not planning to implement a
broader $1 menu and our sales may be adversely affected during the economic
recession.</p>

<p class=MsoBodyText style='margin-right:0in;line-height:normal'>Franchise revenues decreased $22,000
to $139,000 from $161,000 for the three months ended December 31, 2007 due to a decrease in franchise royalties of $35,000 off set by an increase in
franchise fee income of $12,000. Same store Good Times franchise restaurant
sales decreased 12.7% during the three months ended December 31, 2008 for the franchise restaurants that were open for the full periods ending December 31, 2008 and December 31, 2007.&nbsp; Dual branded franchise restaurant sales decreased
16.3% during the three months ended December 31, 2008, compared to the same prior year period, primarily due to the closure of two restaurants in January 2008.</p>

<p class=MsoBodyText style='margin-top:6.0pt;margin-right:0in;margin-bottom:
6.0pt;margin-left:0in;line-height:normal'><i>Restaurant
Operating Costs</i></p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>Restaurant
operating costs as a percent of restaurant sales were 99.0% during the three
months ended December 31, 2008 compared to 89.6% in the same prior year period.</p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>The
changes in restaurant-level costs are explained as follows:</p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='margin-left:24.0pt;border-collapse:collapse'>
 <tr>
  <td width=509 valign=top style='width:5.3in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:0in;text-align:left;
  line-height:normal'>Restaurant-level
  costs for the three month period ended December 31, 2007</p>
  </td>
  <td width=84 valign=top style='width:63.3pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:8.1pt;text-align:left;
  line-height:normal'>89.6%</p>
  </td>
 </tr>
 <tr>
  <td width=509 valign=top style='width:5.3in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:0in;text-align:left;
  line-height:normal'>Increase
  in food and packaging costs</p>
  </td>
  <td width=84 valign=top style='width:63.3pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:8.1pt;text-align:left;
  line-height:normal'>&nbsp;3.1%</p>
  </td>
 </tr>
 <tr>
  <td width=509 valign=top style='width:5.3in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:0in;text-align:left;
  line-height:normal'>Increase
  in payroll and other employee benefit costs</p>
  </td>
  <td width=84 valign=top style='width:63.3pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:8.1pt;text-align:left;
  line-height:normal'>&nbsp;2.2%</p>
  </td>
 </tr>
 <tr>
  <td width=509 valign=top style='width:5.3in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:0in;text-align:left;
  line-height:normal'>Increase in
  occupancy and other operating costs</p>
  </td>
  <td width=84 valign=top style='width:63.3pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:8.1pt;text-align:left;
  line-height:normal'>&nbsp;3.3%</p>
  </td>
 </tr>
 <tr>
  <td width=509 valign=top style='width:5.3in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:0in;text-align:left;
  line-height:normal'>Increase in
  depreciation and amortization</p>
  </td>
  <td width=84 valign=top style='width:63.3pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:8.1pt;text-align:left;
  line-height:normal'>&nbsp;&nbsp;&nbsp; .6%</p>
  </td>
 </tr>
 <tr>
  <td width=509 valign=top style='width:5.3in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:0in;text-align:left;
  line-height:normal'>Increase
  in new store opening costs</p>
  </td>
  <td width=84 valign=top style='width:63.3pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:8.1pt;text-align:left;
  line-height:normal'>&nbsp;&nbsp;&nbsp; .3%</p>
  </td>
 </tr>
 <tr>
  <td width=509 valign=top style='width:5.3in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:0in;text-align:left;
  line-height:normal'>Decrease
  in deferred rent</p>
  </td>
  <td width=84 valign=top style='width:63.3pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:8.1pt;text-align:left;
  line-height:normal'>&nbsp;(.1%)</p>
  </td>
 </tr>
 <tr>
  <td width=509 valign=top style='width:5.3in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:0in;text-align:left;
  line-height:normal'>Restaurant-level
  costs for the three month period ended December 31, 2008</p>
  </td>
  <td width=84 valign=top style='width:63.3pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyText align=left style='margin-right:8.1pt;text-align:left;
  line-height:normal'>99.0%</p>
  </td>
 </tr>
</table>

<p class=MsoBodyText align=left style='margin-top:0in;margin-right:0in;
margin-bottom:6.0pt;margin-left:0in;text-align:left;line-height:normal'><i>&nbsp;</i></p>

<p class=MsoFooter align=center style='text-align:center'>12</p>

<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade style='color:navy' align=center>

</div>



<br clear=all style='page-break-before:always'>










<p class=MsoBodyText align=left style='margin-top:0in;margin-right:0in;
margin-bottom:6.0pt;margin-left:0in;text-align:left;line-height:normal'><i>Food and Packaging Costs</i></p>

<p class=MsoNormal style='text-align:justify'>For the three months ended December 31, 2008
our food and paper costs, increased $9,000 to $1,855,000 (33.7% of restaurant
sales) from $1,846,000 (30.6% of restaurant sales) compared to the same prior
year period. We experienced
unprecedented increases in commodity costs during fiscal 2008 including beef,
bakery, soft drinks, dairy and packaging costs with the majority of those
increases occurring in May through July 2008. Our weighted food and packaging
costs increased approximately 12% in the fiscal 2008 year. The cumulative
weighted menu price increases taken during fiscal 2008 were approximately
4.8%.&nbsp; We anticipate limited price increases in fiscal 2009 with more stable
commodity costs.</p>

<p class=MsoBodyText align=left style='margin-top:6.0pt;margin-right:0in;
margin-bottom:6.0pt;margin-left:0in;text-align:left;line-height:normal'><i>Payroll</i><i> and Other Employee Benefit Costs</i></p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>For
the three months ended December 31, 2008 our payroll and other employee benefit
costs decreased $64,000 to $2,065,000 (37.5% of restaurant sales) from $2,129,000
(35.3% of restaurant sales) compared to the same prior year period.&nbsp; The increase in payroll and other
employee benefit expenses as a percent of restaurant sales is primarily the
result of lower restaurant sales. Because
payroll costs are semi-variable in nature they increase as a percentage of
restaurant sales when there is a decrease in store sales. &nbsp;Additionally, our new restaurant
operated at a higher labor cost as a percent of sales due to higher initial
labor costs until it reaches mature staffing levels.</p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>The
current three month period ending December 31, 2008 includes two additional company-owned restaurants purchased from a franchisee in March 2008 and one new
company-owned restaurant opened in October 2008, which represents $167,000 of
the total costs in the current period.</p>

<p class=MsoNormal style='text-align:justify'>Beginning in December 2008 we reduced our
labor hours allocation through increased efficiencies and improved our sales
per employee hour efficiencies on service hours, thereby eliminating
approximately $190,000 of annual payroll costs. In addition, beginning in March
2009 we anticipate further reductions in our employee and other benefit costs
totaling approximately $300,000 in annual costs through the restructuring of regional supervision personnel along with other reductions in fixed employee benefit costs.</p>

<p class=MsoBodyText align=left style='margin-top:6.0pt;margin-right:0in;
margin-bottom:6.0pt;margin-left:0in;text-align:left;line-height:normal'><i>Occupancy and Other Operating Costs</i></p>

<p class=MsoBodyText style='margin-right:0in;line-height:normal'>For the three months ended December
31, 2008 our occupancy and other operating costs increased $85,000 to $1,204,000
(21.9% of restaurant sales) from $1,119,000 (18.5% of restaurant sales)
compared to the same prior year period.&nbsp; The current three month period ending December 31, 2008 includes two additional company-owned restaurants purchased from a
franchisee in March 2008 and
one new company-owned restaurant opened in October 2008, which represents $82,000 of the
increase compared to the same prior year period. Occupancy and other operating
costs may increase as a percent of sales as new company-owned restaurants are
developed due to higher rent associated with sale-leaseback operating leases,
as well as higher property taxes at those locations.</p>



<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'><i>Opening
Costs</i></p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>For
the three months ended December 31, 2008 our new store opening costs <a
name="OLE_LINK9">were $15,000 compared to $0 in the same prior year period.</a>
&nbsp;The current year costs are related to a new company-owned restaurant that
opened in October 2008.</p>

<p class=MsoHeader style='margin-top:6.0pt;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in'><i>Depreciation
and Amortization</i></p>

<p class=MsoBodyText style='margin-right:0in;line-height:normal'>For the three months ended December 31 , 2008, our depreciation and amortization increased $3,000 to $311,000 (5.6%
of restaurant sales) from $308,000 (5.1% of restaurant sales) compared to the
same prior year period. The $3,000 increase in depreciation and amortization
for the three months ended December 31, 2008 is due to $25,000 of depreciation
expense in the three acquired and new company-owned restaurants, offset by
declining depreciation expense in our aging company-owned restaurants.</p>

<p class=MsoBodyText style='margin-top:6.0pt;margin-right:0in;margin-bottom:
6.0pt;margin-left:0in;line-height:normal'><i>General
and Administrative Costs</i></p>

<p class=MsoBodyText style='margin-right:0in;line-height:normal'>For the three months ended December 31, 2008, general and administrative costs decreased $66,000 to $489,000 (8.7% of
total revenues) from $555,000 (9.0% of total revenues) for the same prior year
period.&nbsp; The decrease in general and administrative costs compared to the same
prior year period is primarily attributable to decreases in: 1) payroll and employee
benefit costs of $33,000, &nbsp;2) professional services of $17,000 and 3) training
and recruiting costs of $22,000.</p>



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<p class=MsoNormal style='margin-top:6.0pt;text-align:justify'>We have reduced annualized
selling, general and administrative and franchise costs by approximately
$450,000 for fiscal 2009, compared to fiscal 2008, through the elimination of
executive management positions, salary reductions and professional services
costs.</p>

<p class=MsoNormal style='margin-top:6.0pt;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;text-align:justify'><i>Advertising Costs</i></p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>For
the three months ended December 31, 2008 advertising costs decreased $55,000 to
$315,000 (5.7% of restaurant sales) from $370,000 (6.1% of restaurant sales)
for the same prior year period.&nbsp; The decrease in advertising costs is primarily
due to the decrease in restaurant sales, as contributions are made to the advertising materials fund
and regional advertising cooperative based on a percentage of sales. In
addition, $20,000 of payroll and employee benefit costs were eliminated in the
current year period when our Vice President of Marketing retired in November
2008. We currently have no plans to fill the position in the immediate future.</p>

<p class=MsoBodyText align=left style='margin-top:6.0pt;margin-right:0in;
margin-bottom:6.0pt;margin-left:0in;text-align:left;line-height:normal'><i>Franchise Costs</i></p>

<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:-.7pt;text-align:justify'>For the three months ended December 31, 2008, franchise costs decreased $56,000 to $40,000 (.7% of total revenues) from $96,000 (1.6% of
total revenues) for the same prior year period.&nbsp; The decrease in franchise costs
is primarily attributable to the reduction in payroll and employee benefit
costs related to the Vice President of Franchise Development position that was
eliminated in July 2008 in conjunction with Good Times' exit from the planned Omaha, Nebraska expansion. We also incurred $13,000 in legal costs in the prior three month
period ended December 31, 2007 related to franchise registration filings.</p>

<p class=MsoBodyText style='margin-top:6.0pt;margin-right:0in;margin-bottom:
6.0pt;margin-left:0in;line-height:normal'><i>Loss
from Operations</i></p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>We
had a loss from operations of ($640,000) in the three months ended December 31, 2008 compared to a loss from operations of ($226,000) for the same prior year
period. The increase in loss from operations of $414,000 is due primarily to
the decrease in net revenues and by other matters discussed in the
&quot;Restaurant Operating Costs&quot;, &quot;General and Administrative
Costs&quot; and &quot;Franchise Costs&quot; sections of Item 2.</p>

<p class=MsoBodyText style='margin-top:6.0pt;margin-right:0in;margin-bottom:
6.0pt;margin-left:0in;line-height:normal'><i>Net
Loss</i></p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;
margin-left:0in;line-height:normal'>The
net loss was ($766,000) for the three months ended December 31, 2008 compared to a net loss of ($255,000) for the same prior year period. The change from
the three month period ended December 31, 2007 to December 31, 2008 was
primarily attributable to the increase in loss from operations for the three
months ended December 31, 2008, as well as: 1) a decrease in minority interest
expense of $64,000 compared to the same prior year period; 2) an increase in
net interest expense of $38,000 compared to the same prior year period; and 3)
the current period includes a $119,000 unrealized loss related to our interest
rate swap liability.</p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'><b><u>Liquidity
and Capital Resources</u></b></p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'><i>Cash
and Working Capital</i></p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>As
of December 31, 2008, we had $786,000 cash and cash equivalents on hand. We
currently plan to use the cash balance and any cash generated from operations
for our working capital needs in fiscal 2009. If we continue to experience
significant declines in our sales trends we will require additional working
capital. We begin to compare to negative sales trends from the prior year in
March 2009 and we expect our cash flow from operations to improve during the
last half of fiscal 2009 compared to the first half of fiscal 2009. We have
previously announced our intent to raise up to $500,000 to increase our working
capital.&nbsp; As of the date of this filing we do not have any agreement in place
for any portion of that financing and there can be no assurance that such
financing will be completed.&nbsp; </p>

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<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>As of December 31, 2008, we had a working capital deficit of $3,642,000 primarily from our
development line-of-credit of $2,500,000 shown as a current liability maturing
in July 2009.&nbsp; We have a fully-developed site that we are marketing for a
sale-leaseback transaction, the proceeds of which would be used to reduce the
line of credit with PFGI II, LLC.&nbsp; We are working with PFGI II, LLC to extend
the line of credit maturity for an additional year to July, 2010.&nbsp; In addition,
the entire note payable to Wells Fargo Bank, N.A. of $932,000 is shown as a
current liability due to certain technical loan covenant defaults that exist as
of December 31, 2008, which are described in Note 3&nbsp; of the Condensed Consolidated
Financial Statements. As noted in Note 3 to the Condensed Consolidated
Financial Statements, we have received a Forbearance and Reservation of Rights
letter from Wells Fargo Bank, N.A. stating that they are accepting current
principal and interest payments and are not currently accelerating the note,
subject to agreeing to an acceptable Required Corrective Action for the
covenant defaults.&nbsp; It is unlikely that we will have an acceptable Required
Corrective Action until our Earnings Before Interest Taxes and Depreciation
(&quot;EBITDA&quot;) improves.</p>

<p class=MsoBodyText style='margin-top:6.0pt;margin-right:0in;margin-bottom:
6.0pt;margin-left:0in;line-height:97%'><i>Financing
Activities</i></p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>In May 2007 we
borrowed $1,100,000 from Wells Fargo Bank under a note payable with an eight
year term with a floating interest rate at .50% below prime.&nbsp; We simultaneously
entered into an interest rate swap transaction with Wells Fargo Bank for the
full $1,100,000 with a fixed interest rate of 7.77% for the full eight year
term coinciding with the note payable (see note 5 in item I. above). As
discussed above we are in default of certain technical loan covenants as of December 31, 2008 on this Wells Fargo note, however we are not currently and have never
been in payment default under the note.</p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>On March 1, 2008, we purchased two restaurants from an existing franchisee for total consideration of
$1,330,000.&nbsp; We simultaneously sold the land, building and improvements related
to one of the restaurants in a sale-leaseback transaction, the proceeds of
which were used for the purchase of the restaurants.&nbsp; Net cash used in the
purchase transaction was $272,000.&nbsp; After accounting for both the acquisition
and the sale-leaseback, assets of $490,000 were recorded, a deferred gain of
$26,000 was recognized as a cost of the consideration and notes receivable due
from the franchisee of $250,000 were forgiven.&nbsp; We believe the $1,330,000
represented the fair value of the franchisee acquired.</p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>In July 2008, we
entered into a $2,500,000 promissory note with an unrelated third party (PFGI II, LLC).&nbsp; The promissory note constitutes a revolving line-of-credit for the development of
new restaurants which may be advanced and repaid on a monthly basis from time
to time.&nbsp; Prior to maturity, no principal payments are required and monthly
payments of interest only at the prime rate plus 2% (with a minimum rate of 8%)
are due, with all unpaid principal due in July 2009.&nbsp; The loan is secured by
separate leasehold deeds of trust and security agreements related to six
company-owned restaurants and a first deed of trust on the properties funded by
the line of credit. The total outstanding balance on the line of credit was
$2,500,000 at December 31, 2008.&nbsp; Of the $2,500,000 outstanding balance,
$1,595,000 is related to the construction of one company-owned restaurant in
Firestone, Colorado that opened in October 2008. The fully developed restaurant
is currently being marketed in the sale-leaseback market.&nbsp; The remaining
balance is related to the purchase, entitlement and other development fees on a
parcel of land in Aurora, Colorado that will be either developed into a
company-owned restaurant or sold in fiscal 2009.</p>

<p class=MsoBodyText style='margin-top:6.0pt;margin-right:0in;margin-bottom:
6.0pt;margin-left:0in;line-height:normal'><i>Capital
Expenditures</i></p>

<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify'>We do not have any
plans for any significant capital expenditures for the balance of fiscal 2009,
other than normal recurring capital expenditures for existing restaurants. Additional
commitments for the development of new restaurants in fiscal 2009 and beyond
will depend on the Company's sales trends, cash generated from operations and
our access to additional capital.</p>

<p class=MsoNormal style='margin-top:6.0pt;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;text-align:justify'><i>Cash Flows</i></p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>Net
cash used in operating activities was $673,000 for the three months ended December 31, 2008. The net cash used in operating activities for the three months ended December
31, 2008 was the result of a net loss of ($766,000) as well as cash and
non-cash reconciling items totaling $93,000 (comprised of depreciation and
amortization of $311,000, an unrealized loss of $119,000 related to our
interest rate swap liability, minority interest of $34,000, an accounts payable
decrease of $264,000 and a net decrease in other operating assets and
liabilities of $39,000).</p>

<p class=MsoBodyText align=left style='margin-top:0in;margin-right:0in;
margin-bottom:6.0pt;margin-left:0in;text-align:left;line-height:normal'>Net cash used in operating activities
was $52,000 for the three months ended December 31, 2007.&nbsp; The net cash used in operating activities for the three months ended December 31, 2007 was the result
of a net loss of ($255,000) as well as cash and non-cash reconciling items
totaling $203,000 (comprised of depreciation and amortization of $308,000,
minority interest of $32,000 and a net decrease in other operating assets and
liabilities of $137,000).</p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>Net
cash used in investing activities for the three months ended December 31, 2008
was $232,000 which reflects payments of $215,000 for the purchase of property
and equipment (including $194,000 for new store development and $21,000 for
miscellaneous restaurant related capital expenditures), $31,000 in loans made
to franchisees and $14,000 in principal payments received on loans to
franchisees.</p>

<p class=MsoFooter align=center style='text-align:center'>15</p>

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<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>Net
cash used in investing activities for the three months ended December 31, 2007
was $71,000 which reflects payments of $95,000 for the purchase of property and
equipment (including $31,000 for new store development, $27,000 for restaurant
remodeling costs and $31,000 for miscellaneous restaurant related capital
expenditures) and $24,000 in principal payments received on loans to
franchisees.</p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;line-height:normal'>Net
cash provided by financing activities for the three months ended December 31,
2008 was $277,000, which includes principal payments on notes payable and long
term debt of $30,000; an advance on our revolving line of credit of $320,000; and
distributions to minority interests in partnerships of $13,000.</p>

<p class=MsoBodyText style='margin-right:0in;line-height:normal'>Net cash used in financing activities
for the three months ended December 31, 2007 was $816,000, which includes
principal payments on notes payable and long term debt of $29,000; a repayment
on our revolving line of credit of $750,000; distributions to minority interests
in partnerships of $74,000; and paid in capital activity of $37,000 related to
the exercise of stock options.</p>

<p class=MsoBodyText style='margin-top:6.0pt;margin-right:0in;margin-bottom:
6.0pt;margin-left:0in;line-height:normal'><i>Contingencies</i></p>

<p class=MsoNormal style='text-align:justify'>We remain contingently liable on various land
leases underlying restaurants that were previously sold to franchisees.&nbsp; We
have never experienced any losses related to these contingent lease
liabilities, however if a franchisee defaults on the payments under the leases,
we would be liable for the lease payments as the assignor or sublessor of the
lease.&nbsp; Currently there are not any leases in default by the franchisees,
however there can be no assurance that there will not be in the future, which
could have a material effect on our future operating results.</p>

<p class=MsoBodyText style='margin-top:6.0pt;margin-right:0in;margin-bottom:
6.0pt;margin-left:0in;line-height:97%'><b><u>Impact
of Inflation</u></b></p>

<p class=MsoBodyText style='margin-right:0in;line-height:normal'>We experienced moderation in commodity
costs during fiscal 2005 and 2006 and significant increases in fiscal 2007 and
fiscal 2008.&nbsp; State increases in the minimum wage resulted in an increase in
our average hourly wage of $.60 per employee hour during fiscal 2007 and
approximately $.23 per employee hour in fiscal 2008. It is anticipated that we
will take moderate price increases during fiscal 2009, which may or may not be
sufficient to recover increased commodity costs or increases in other operating
expenses.</p>

<p class=MsoBodyText style='margin-top:6.0pt;margin-right:0in;margin-bottom:
0in;margin-left:0in;margin-bottom:.0001pt;line-height:normal'><b><u>Seasonality</u></b></p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;
margin-left:0in;line-height:normal'>Revenues
of the Company are subject to seasonal fluctuation based primarily on weather
conditions adversely affecting restaurant sales in December, January, February
and March.</p>

<p class=MsoNormal style='margin-bottom:6.0pt'><b>ITEM 3.&nbsp;&nbsp; QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK</b></p>

<p class=MsoBodyText align=left style='margin-top:0in;margin-right:0in;
margin-bottom:12.0pt;margin-left:0in;text-align:left;line-height:97%'>Not required.</p>

<p class=MsoNormal style='margin-bottom:6.0pt'><b>ITEM 4T.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp; CONTROLS AND PROCEDURES</b></p>

<p class=MsoNormal style='text-align:justify;background:white'><b>Conclusion Regarding
the Effectiveness of Disclosure Controls and Procedures </b></p>

<p class=MsoNormal style='margin-top:6.0pt;text-align:justify'>Based on an
evaluation of the Company's disclosure controls and procedures (as defined in
Rules&nbsp;13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as
amended), as of the end of the period covered by this report on form 10Q, the
Company's Chief Executive Officer and Controller (its principal executive
officer and principal financial officer, respectively) have concluded that the
Company's disclosure controls and procedures were effective.</p>

<p class=MsoNormal style='margin-top:6.0pt;margin-right:0in;margin-bottom:6.0pt;
margin-left:0in;text-align:justify;background:white'><b>Changes in Internal Control over
Financial Reporting</b></p>

<p class=MsoNormal style='margin-bottom:12.0pt;text-align:justify;background:
white'>There
have been no significant changes in the Company's internal control over
financial reporting that occurred during the Company's fiscal quarter ended December&nbsp;31,
2008 that have materially affected, or are reasonably likely to materially
affect, the Company's internal control over financial reporting.</p>

<p class=MsoFooter align=center style='text-align:center'>16</p>

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<p class=MsoNormal align=center style='margin-bottom:12.0pt;text-align:center;
background:white'><b>PART
II - OTHER INFORMATION</b></p>

<p class=MsoHeader style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:45.35pt;text-indent:-45.35pt'>Item 1.&nbsp;&nbsp;&nbsp; Legal Proceedings</p>

<p class=MsoBodyText align=left style='margin-top:0in;margin-right:0in;
margin-bottom:12.0pt;margin-left:0in;text-align:left;line-height:normal'>Good Times Restaurants is subject to
legal proceedings which are incidental to its business.&nbsp; These legal
proceedings are not expected to have a material impact on the Company.</p>

<p class=MsoBodyText align=left style='margin-top:0in;margin-right:0in;
margin-bottom:12.0pt;margin-left:0in;text-align:left;line-height:normal'>Item 1A. Risk Factors</p>

<p class=MsoBodyText align=left style='margin-top:0in;margin-right:0in;
margin-bottom:12.0pt;margin-left:0in;text-align:left;line-height:normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Not required.</p>

<p class=MsoBodyText align=left style='margin-top:0in;margin-right:0in;
margin-bottom:6.0pt;margin-left:45.35pt;text-align:left;text-indent:-45.35pt;
line-height:normal'>Item 2.&nbsp;&nbsp;&nbsp; Unregistered
Sales of Equity Securities and Use of Proceeds</p>

<p class=MsoBodyTextIndent style='margin-left:.5in;text-indent:-.25in'>None.</p>

<p class=MsoBodyText align=left style='margin-top:0in;margin-right:0in;
margin-bottom:6.0pt;margin-left:45.35pt;text-align:left;text-indent:-45.35pt;
line-height:normal'>Item 3.&nbsp;&nbsp;&nbsp; Defaults
upon Senior Securities</p>

<p class=MsoBodyText style='margin-top:0in;margin-right:0in;margin-bottom:12.0pt;
margin-left:0in;line-height:normal'>We
are in default of certain technical loan covenants as of December 31, 2008 on our $932,000 note payable to Wells Fargo Bank, N.A. (&quot;the Bank&quot;). We have never
been in payment default on the note. On February 9, 2009 we received a
Reservation of Rights letter from the Bank formally notifying us of the default
of the Earnings Before Interest Taxes and Depreciation (&quot;EBITDA&quot;) Coverage
Ratio of not less than 1.5 to 1.0 and the Tangible Net Worth of not less than
$5,000,000 as set forth in the Credit Agreement for the period ending December
31, 2008. The letter serves as notice that notwithstanding the foregoing events
of default, the Bank is reserving all of its rights and remedies under the
Credit Agreement and related agreements. The Bank is not now accelerating the
Loan and is willing to continue to accept regularly scheduled payments of
principal and interest under the Loan.</p>

<p class=MsoBodyText align=left style='margin-top:0in;margin-right:0in;
margin-bottom:6.0pt;margin-left:45.35pt;text-align:left;text-indent:-45.35pt;
line-height:normal'>Item 4.&nbsp;&nbsp;&nbsp; Submission
of Matters to a Vote of Security Holders</p>

<p class=MsoBodyTextIndent style='margin-left:.5in;text-indent:-.25in'>None.</p>

<p class=MsoBodyText align=left style='margin-top:0in;margin-right:0in;
margin-bottom:6.0pt;margin-left:45.35pt;text-align:left;text-indent:-45.35pt;
line-height:normal'>Item 5.&nbsp;&nbsp;&nbsp; Other
Information</p>

<p class=MsoList2 style='margin-bottom:6.0pt'>None.</p>

<p class=MsoHeader style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:45.35pt;text-indent:-45.35pt'>Item 6.&nbsp;&nbsp;&nbsp; Exhibits</p>

<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:6.0pt;
margin-left:.5in'>(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exhibits.&nbsp;
The following exhibits are furnished as part of this report:</p>

<p class=MsoNormal style='margin-bottom:6.0pt'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Exhibit No.</u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Description</u></p>

<p class=MsoHeader style='margin-left:31.5pt'>*31.1&nbsp;&nbsp;&nbsp;&nbsp; Certification of Chief Executive
Officer pursuant to 18 U.S.C. Section 1350</p>

<p class=MsoHeader style='margin-left:31.7pt'>*31.2&nbsp;&nbsp;&nbsp;&nbsp; Certification of Controller
pursuant to 18 U.S.C. Section 1350</p>

<p class=MsoNormal style='margin-left:31.5pt'>*32.1&nbsp;&nbsp;&nbsp;&nbsp; Certification of Chief Executive
Officer and Controller pursuant to Section 906</p>



<p class=MsoNormal style='margin-bottom:.25in'>*filed herewith</p>

<p class=MsoNormal style='margin-bottom:6.0pt'><b>SIGNATURES</b></p>

<p class=MsoBodyText align=left style='margin-top:0in;margin-right:0in;
margin-bottom:6.0pt;margin-left:0in;text-align:left;line-height:normal'>In accordance with the requirements of
the Exchange Act, the registrant caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.</p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
  <td width=241 valign=top style='width:180.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3>&nbsp;</h3>
  </td>
  <td width=378 valign=top style='width:283.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <h3><b>GOOD TIMES RESTAURANTS INC.</b></h3>
  </td>
 </tr>
 <tr>
  <td width=241 valign=top style='width:180.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>DATE:
  February 20, 2009</p>
  </td>
  <td width=378 valign=top style='width:283.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=241 valign=top style='width:180.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=378 valign=top style='width:283.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=Byline align=left style='margin-top:0in;margin-right:0in;margin-bottom:
  0in;margin-left:.3in;margin-bottom:.0001pt;text-align:left;line-height:normal'><u>/s/ Boyd E. Hoback</u></p>
  </td>
 </tr>
 <tr>
  <td width=241 valign=top style='width:180.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=378 valign=top style='width:283.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoHeader style='margin-left:26.1pt'>Boyd E. Hoback</p>
  <p class=MsoHeader style='margin-left:26.1pt'>President and Chief Executive Officer</p>
  </td>
 </tr>
 <tr>
  <td width=241 valign=top style='width:180.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=378 valign=top style='width:283.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoHeader style='margin-left:.3in'><i>&nbsp;</i></p>
  </td>
 </tr>
 <tr>
  <td width=241 valign=top style='width:180.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=378 valign=top style='width:283.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=Byline align=left style='margin-top:0in;margin-right:0in;margin-bottom:
  0in;margin-left:.3in;margin-bottom:.0001pt;text-align:left;line-height:normal'><u>/s/ Susan M. Knutson</u></p>
  </td>
 </tr>
 <tr>
  <td width=241 valign=top style='width:180.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=378 valign=top style='width:283.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoBodyTextIndent style='margin-top:0in;margin-right:0in;margin-bottom:
  0in;margin-left:26.1pt;margin-bottom:.0001pt'>Susan M. Knutson</p>
  <p class=MsoBodyTextIndent style='margin-top:0in;margin-right:0in;margin-bottom:
  0in;margin-left:26.1pt;margin-bottom:.0001pt'>Controller</p>
  </td>
 </tr>
</table>

<p class=MsoFooter align=center style='text-align:center'>17</p>

<div class=MsoNormal align=center style='text-align:center'>

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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.CERT
<SEQUENCE>2
<FILENAME>exhibit311certceo1.htm
<TEXT>
<html>

<head>
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<title>_</title>


</head>

<body lang=EN-US>



<p class=MsoNormal align=center style='text-align:center'><b>&nbsp;</b></p>

<p class=MsoNormal align=center style='text-align:center'><b>&nbsp;</b></p>









<p class=MsoNormal align=center style='text-align:center'><b>Exhibit 31.1</b></p>

<p class=MsoNormal align=center style='text-align:center'><b>CERTIFICATION OF
THE CHIEF EXECUTIVE OFFICER</b></p>

<p class=MsoNormal align=center style='text-align:center'><b>RULE 13a-14(a)
CERTIFICATION</b></p>

<p class=MsoNormal style='margin-left:22.5pt;text-align:justify;text-indent:
- -22.5pt'>I, Boyd E. Hoback, certify that:</p>

<p class=MsoNormal style='margin-left:.5in;text-align:justify;text-indent:-.5in'>1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; I
have reviewed this quarterly report on Form 10-Q of Good Times Restaurants
Inc.;</p>

<p class=MsoNormal style='margin-left:.5in;text-align:justify;text-indent:-.5in'>2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Based
on my knowledge, this 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 report;</p>

<p class=MsoNormal style='margin-left:.5in;text-align:justify;text-indent:-.5in'>3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Based
on my knowledge, the financial statements, and other financial information
included in this 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 report;</p>

<p class=MsoNormal style='margin-left:.5in;text-align:justify;text-indent:-.5in'>4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 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-15(e) and 15d-15(e)) and internal control over financial reporting
(as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant
and have:</p>

<p class=MsoNormal style='margin-left:1.0in;text-align:justify;text-indent:
- -.5in'>(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Designed such disclosure controls and procedures, or caused
such disclosure controls and procedures to be designed under our supervision,
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 report is being prepared;</p>

<p class=MsoNormal style='margin-left:1.0in;text-align:justify;text-indent:
- -.5in'>(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Designed such internal control over financial reporting, or
caused such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles;</p>

<p class=MsoNormal style='margin-left:1.0in;text-align:justify;text-indent:
- -.5in'>(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Evaluated the effectiveness of the registrant's disclosure
controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this report based on such evaluation; and</p>



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</div>



<br
clear=all style='page-break-before:always'>










<p class=MsoNormal style='margin-left:1.0in;text-align:justify;text-indent:
- -.5in'>(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disclosed in this report any change in the registrant's
internal control over financial reporting that occurred during the registrant's
most recent fiscal quarter (the registrant's fourth fiscal quarter in the case
of an annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting;
and</p>

<p class=MsoNormal style='margin-left:.5in;text-align:justify;text-indent:-.5in'>5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The
registrant's other certifying officer and I have disclosed, based on our most
recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):</p>

<p class=MsoNormal style='margin-left:1.0in;text-align:justify;text-indent:
- -.5in'><a name="OLE_LINK1">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; All significant deficiencies and material
weaknesses in the design or operation of internal control over financial
reporting which are reasonably likely to adversely affect the registrant's
ability to record, process, summarize and report financial information; and</a></p>

<p class=MsoNormal style='margin-left:1.0in;text-align:justify;text-indent:
- -.5in'>(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Any fraud, whether or not material, that involves management
or other employees who have a significant role in the registrant's internal
control over financial reporting.</p>

<p class=MsoNormal>Date:&nbsp; February 20, 2009</p>



<p class=MsoNormal><u>/s/ Boyd E. Hoback</u></p>

<p class=MsoNormal><u>&nbsp;</u></p>

<p class=MsoNormal>Boyd E. Hoback</p>

<p class=MsoFooter>President and Chief Executive Officer</p>

<div class=MsoNormal align=center style='text-align:center'>

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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.CERT
<SEQUENCE>3
<FILENAME>exhibit312certofcontroller1.htm
<TEXT>
<html>

<head>
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<!-- Copyright 2006 E-Services, LLC.-->
<!-- All rights reserved EDGAR2.com -->



<title>_</title>


</head>

<body lang=EN-US>



<p class=MsoNormal align=center style='text-align:center'><b>&nbsp;</b></p>

<p class=MsoNormal align=center style='text-align:center'><b>&nbsp;</b></p>









<p class=MsoNormal align=center style='text-align:center'><b>Exhibit 31.2</b></p>

<p class=MsoNormal align=center style='text-align:center'><b>CERTIFICATION OF
THE CONTROLLER</b></p>

<p class=MsoNormal align=center style='text-align:center'><b>RULE 13a-14(a)
CERTIFICATION</b></p>



<p class=MsoNormal style='margin-left:22.5pt;text-align:justify;text-indent:
- -22.5pt'>I, Susan M. Knutson, certify that:</p>

<p class=MsoNormal style='margin-left:.5in;text-align:justify;text-indent:-.5in'>1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; I
have reviewed this annual report on Form 10-Q of Good Times Restaurants Inc.;</p>

<p class=MsoNormal style='margin-left:.5in;text-align:justify;text-indent:-.5in'>2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Based
on my knowledge, this 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 report;</p>

<p class=MsoNormal style='margin-left:.5in;text-align:justify;text-indent:-.5in'>3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Based
on my knowledge, the financial statements, and other financial information
included in this 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 report;</p>

<p class=MsoNormal style='margin-left:.5in;text-align:justify;text-indent:-.5in'>4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 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-15(e) and 15d-15(e)) and internal control over financial reporting
(as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant
and have:</p>

<p class=MsoNormal style='margin-left:1.0in;text-align:justify;text-indent:
- -.5in'>(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Designed such disclosure controls and procedures, or caused
such disclosure controls and procedures to be designed under our supervision,
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 report is being prepared;</p>

<p class=MsoNormal style='margin-left:1.0in;text-align:justify;text-indent:
- -.5in'>(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Designed such internal control over financial reporting, or
caused such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of
financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles;</p>

<p class=MsoNormal style='margin-left:1.0in;text-align:justify;text-indent:
- -.5in'>(c)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Evaluated the effectiveness of the registrant's disclosure
controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the
period covered by this report based on such evaluation; and</p>



<div class=MsoNormal align=center style='text-align:center'>

<hr size=2 width="100%" noshade style='color:navy' align=center>

</div>



<br
clear=all style='page-break-before:always'>










<p class=MsoNormal style='margin-left:1.0in;text-align:justify;text-indent:
- -.5in'>(d)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Disclosed in this report any change in the registrant's
internal control over financial reporting that occurred during the registrant's
most recent fiscal quarter (the registrant's fourth fiscal quarter in the case
of an annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant's internal control over financial reporting;
and</p>

<p class=MsoNormal style='margin-left:.5in;text-align:justify;text-indent:-.5in'>5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The
registrant's other certifying officer and I have disclosed, based on our most
recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of
directors (or persons performing the equivalent functions):</p>

<p class=MsoNormal style='margin-left:1.0in;text-align:justify;text-indent:
- -.5in'><a name="OLE_LINK1">(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; All significant deficiencies and material
weaknesses in the design or operation of internal control over financial
reporting which are reasonably likely to adversely affect the registrant's
ability to record, process, summarize and report financial information; and</a></p>

<p class=MsoNormal style='margin-left:1.0in;text-align:justify;text-indent:
- -.5in'>(b)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Any fraud, whether or not material, that involves management
or other employees who have a significant role in the registrant's internal
control over financial reporting.</p>

<p class=MsoNormal>Date:&nbsp; February 20, 2009</p>



<p class=MsoNormal><u>/s/ Susan M. Knutson</u></p>

<p class=MsoNormal><u>&nbsp;</u></p>

<p class=MsoNormal>Susan M. Knutson</p>

<p class=MsoFooter>Controller</p>

<div class=MsoNormal align=center style='text-align:center'>

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</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.906 CERT
<SEQUENCE>4
<FILENAME>exh321ceocontrol1.htm
<TEXT>
<html>

<head>
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<!-- All rights reserved EDGAR2.com -->



<title>_</title>


</head>

<body lang=EN-US>



<p class=MsoNormal align=center style='text-align:center'><b>&nbsp;</b></p>

<p class=MsoNormal align=center style='text-align:center'><b>&nbsp;</b></p>









<p class=MsoNormal align=center style='text-align:center'><b>Exhibit 32.1</b></p>

<p class=titlec align=center style='text-align:center'><b>CERTIFICATION
PURSUANT TO 18 U.S.C. SECTION 1350,</b></p>

<p class=titlec align=center style='text-align:center'><b>AS ADOPTED PURSUANT
TO</b></p>

<p class=titlec align=center style='text-align:center'><b>SECTION 906 OF THE
SARBANES-OXLEY ACT OF 2002</b></p>

<p class=bodytext5 style='text-align:justify'>In connection with the Quarterly
Report on Form 10-Q of Good Times Restaurants Inc. (the &quot;Company&quot;) for the period
ended December 31, 2008 as filed with the Securities and Exchange Commission on
the date hereof (the &quot;Report&quot;), I, Boyd E. Hoback, as Chief Executive Officer
of the Company, and Susan M. Knutson, as Controller of the Company, each hereby
certifies, pursuant to and solely for the purpose of 18 U.S.C. 1350, as adopted
pursuant to 906 of the Sarbanes-Oxley Act of 2002, that to the best of my
knowledge and belief:</p>

<p class=bodytext5 style='margin-left:.5in;text-align:justify;text-indent:-.5in'>(1)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The
Report fully complies with the requirements of section 13(a) or 15(d) of the
Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and</p>

<p class=bodytext5 style='margin-left:.5in;text-align:justify;text-indent:-.5in'>(2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The
information contained in the Report fairly presents, in all material respects,
the financial condition and results of operations of the Company.</p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
  <td width=319 valign=top style='width:239.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>/s/ Boyd E. Hoback</p>
  </td>
  <td width=319 valign=top style='width:239.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>/s/ Susan M. Knutson</p>
  </td>
 </tr>
 <tr>
  <td width=319 valign=top style='width:239.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=319 valign=top style='width:239.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=319 valign=top style='width:239.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Boyd E. Hoback</p>
  </td>
  <td width=319 valign=top style='width:239.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Susan M. Knutson</p>
  </td>
 </tr>
 <tr>
  <td width=319 valign=top style='width:239.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Chief Executive Officer</p>
  </td>
  <td width=319 valign=top style='width:239.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Controller (principal financial officer)</p>
  </td>
 </tr>
 <tr>
  <td width=319 valign=top style='width:239.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>February 20, 2009</p>
  </td>
  <td width=319 valign=top style='width:239.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>February 20, 2009</p>
  </td>
 </tr>
</table>



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