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Originator-Name: webmaster@www.sec.gov
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<SEC-DOCUMENT>0000825324-10-000029.txt : 20101223
<SEC-HEADER>0000825324-10-000029.hdr.sgml : 20101223
<ACCEPTANCE-DATETIME>20101223115237
ACCESSION NUMBER:		0000825324-10-000029
CONFORMED SUBMISSION TYPE:	10-K
PUBLIC DOCUMENT COUNT:		5
CONFORMED PERIOD OF REPORT:	20100930
FILED AS OF DATE:		20101223
DATE AS OF CHANGE:		20101223

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-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-18590
		FILM NUMBER:		101271281

	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-K
<SEQUENCE>1
<FILENAME>final10kfile1.htm
<TEXT>
<html>

<head>
<!-- Document Prepared With E-Services, LLC HTML Software-->
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<title>UNITED STATES</title>


</head>

<body lang=EN-US link=blue vlink=purple>

<div class=WordSection1>

<div align=center>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=733
 style='width:549.45pt;border-collapse:collapse'>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>&nbsp;</b></p>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>&nbsp;</b></p>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>UNITED STATES</b></p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>SECURITIES AND EXCHANGE COMMISSION</b></p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>WASHINGTON, D.C. 20549</b></p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>FORM 10-K</p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>[x]
  Annual Report Pursuant to Section 13 or 15(d) Of the Securities Exchange Act
  of 1934</p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:1.5in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>For
  the fiscal year ended September 30, 2010</p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr style='height:12.95pt'>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt;
  height:12.95pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>[
  ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
  Exchange Act of 1934.</p>
  </td>
 </tr>
 <tr style='height:12.95pt'>
  <td width=733 colspan=5 style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt;
  height:12.95pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:99.35pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>For
  the transition period from _______ to _______</p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:.3in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>Commission
  file number 000-18590</p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>GOOD TIMES RESTAURANTS INC.</b></p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>(Exact name of registrant as specified
  in its charter)</p>
  </td>
 </tr>
 <tr>
  <td width=378 valign=top style='width:283.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=355 colspan=4 valign=top style='width:265.95pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><u>&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=378 valign=top style='width:283.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><u>Nevada</u></p>
  </td>
  <td width=355 colspan=4 valign=top style='width:265.95pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><u>84-1133368</u></p>
  </td>
 </tr>
 <tr>
  <td width=378 valign=top style='width:283.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>(State or other jurisdiction of
  incorporation or organization)</p>
  </td>
  <td width=355 colspan=4 valign=top style='width:265.95pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>(I.R.S. Employer Identification
  Number)</p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=379 colspan=2 valign=top style='width:283.95pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>601 Corporate Circle, Golden, Colorado</p>
  </td>
  <td width=354 colspan=3 valign=top style='width:265.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>80401</p>
  </td>
 </tr>
 <tr>
  <td width=379 colspan=2 valign=top style='width:283.95pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>(Address of principal executive
  offices)</p>
  </td>
  <td width=354 colspan=3 valign=top style='width:265.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>(Zip Code)</p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Issuer's telephone number: (303)
  384-1400</p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Securities registered pursuant to
  Section 12(b) of the Act:</p>
  </td>
 </tr>
 <tr>
  <td width=411 colspan=3 valign=top style='width:308.35pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=321 colspan=2 valign=top style='width:241.1pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><u>&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=411 colspan=3 valign=top style='width:308.35pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><u>Title of each class</u></p>
  </td>
  <td width=321 colspan=2 valign=top style='width:241.1pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><u>Name of each exchange on which
  registered</u></p>
  </td>
 </tr>
 <tr>
  <td width=411 colspan=3 valign=top style='width:308.35pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Common Stock $.001 par value,
  Preferred Stock $.01 par</p>
  </td>
  <td width=321 colspan=2 valign=top style='width:241.1pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>The NASDAQ Stock Market, LLC</p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Securities registered pursuant to
  Section 12(g) of the Act: None</p>
  </td>
 </tr>
 <tr>
  <td width=574 colspan=4 valign=top style='width:430.35pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=159 valign=top style='width:119.1pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=574 colspan=4 valign=top style='width:430.35pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Indicate
  by check mark if the registrant is a well-known seasoned issuer, as defined
  in Rule 405 of the Securities Act.</p>
  </td>
  <td width=159 style='width:119.1pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Yes [ ]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; No [x]</p>
  </td>
 </tr>
 <tr>
  <td width=574 colspan=4 valign=top style='width:430.35pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=159 style='width:119.1pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=574 colspan=4 valign=top style='width:430.35pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Indicate
  by check mark if the registrant is not required to file reports pursuant to
  Section 13 or Section 15(d) of the Act.</p>
  </td>
  <td width=159 style='width:119.1pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Yes [ ]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; No [x]</p>
  </td>
 </tr>
 <tr>
  <td width=574 colspan=4 valign=top style='width:430.35pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=159 style='width:119.1pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=574 colspan=4 valign=top style='width:430.35pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>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 and (2) has been subject to such filing requirements
  for the past 90 days.</p>
  </td>
  <td width=159 style='width:119.1pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Yes [x]&nbsp;&nbsp;&nbsp;&nbsp; No [ ]</p>
  </td>
 </tr>
 <tr>
  <td width=574 colspan=4 valign=top style='width:430.35pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=159 style='width:119.1pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=574 colspan=4 valign=top style='width:430.35pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Indicate
  by check mark whether the registrant has submitted electronically and posted
  on its corporate Web site, if any, every interactive Data File required to be
  submitted and posted pursuant to Rule 405 of Regulation S-T during the
  preceding 12 months (or for such shorter period that the registrant was
  required to submit and post such files)</p>
  </td>
  <td width=159 style='width:119.1pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Yes [ ]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; No [x]</p>
  </td>
 </tr>
 <tr>
  <td width=574 colspan=4 valign=top style='width:430.35pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=159 style='width:119.1pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=574 colspan=4 valign=top style='width:430.35pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Indicate
  by check mark if disclosure of delinquent filers pursuant to Item 405 or
  Regulation S-K is not contained herein, and will not be contained, to the
  best of registrant's knowledge, in definitive proxy of information statements
  incorporated by reference in Part III of this Form 10-K or any amendment to
  this Form 10-K.</p>
  </td>
  <td width=159 style='width:119.1pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>[x]</p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify'>Indicate
  by check mark whether the registrant is a large accelerated filer, an
  accelerated filer, a non-accelerated filer or a smaller reporting company.&nbsp;
  See definition of &quot;large accelerated filer&quot;, &quot;accelerated filer&quot;,
  &quot;non-accelerated filer&quot; and &quot;smaller reporting company&quot; in Rule 12b-2 of the
  Exchange Act. (Check one):</p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Large
  Accelerated Filer [ ]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accelerated Filer [ ]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-Accelerated
  Filer [ ]&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Smaller Reporting Company[x]</p>
  </td>
 </tr>
 <tr>
  <td width=574 colspan=4 valign=top style='width:430.35pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=159 valign=top style='width:119.1pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=574 colspan=4 valign=top style='width:430.35pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Indicate
  by check mark whether the registration is a shell company (as defined in Rule
  12b-2 of the Exchange Act).</p>
  </td>
  <td width=159 style='width:119.1pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Yes [ ]&nbsp;&nbsp;&nbsp;&nbsp; No [x]</p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>As
  of December 15, 2010, the aggregate market value of the 2,639,441 shares of
  common stock held by non affiliates of the issuer, based on the closing sales
  price of the common stock on December 15, 2010 of $.60 per share as reported
  on the Nasdaq Capital Market, was $1,583,665.</p>
  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=733 colspan=5 valign=top style='width:549.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>As
  of December 15, 2010, the issuer had 8,177,989 shares of common stock
  outstanding.</p>
  </td>
 </tr>
 <tr height=0>
  <td width=378 style='border:none'></td>
  <td width=1 style='border:none'></td>
  <td width=33 style='border:none'></td>
  <td width=163 style='border:none'></td>
  <td width=159 style='border:none'></td>
 </tr>
</table>

</div>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

<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:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>TABLE OF CONTENTS</b></p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
  <td width=637 valign=top style='width:477.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>DISCLOSURE
  REGARDING FORWRAD-LOOKING STATEMENTS</p>
  </td>
 </tr>
</table>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>&nbsp;</b></p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>PAGE</u></p>
  </td>
 </tr>
 <tr style='height:.1in'>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt;
  height:.1in'>

  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:.1in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>PART I</b></p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt;
  height:.1in'>

  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  1</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Business</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>1 - 10</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  1A</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Risk
  Factors</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>10 - 13</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  1B</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Unresolved
  Staff Comments</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>13</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  2</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Properties</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>14</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  3</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Legal
  Proceedings</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>14</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  4</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Removed
  and Reserved</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>14</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>&nbsp;</b></p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>PART II</b></p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  5</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Market
  for Registrant's Common Equity, Related Stockholder Matters and Issuer
  Purchases of Equity Securities</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>15 - 16</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  6</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Selected
  Financial Data</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>17</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  7</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Management's
  Discussion and Analysis of Financial Condition and Results of Operations</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>18 - 27</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  7A</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Quantitative
  and Qualitative Disclosures About Market Risk</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>27</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  8</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Financial
  Statements and Supplementary Data</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>F1 - F20</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  9</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Changes
  in and Disagreements with Accountants on Accounting and Financial Disclosure</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>28</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  9A</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Controls
  and Procedures</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>28</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  9B</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Other
  Information</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>28</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>&nbsp;</b></p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>PART III</b></p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><b>&nbsp;</b></p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  10</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Directors,
  Executive Officers and Corporate Governance</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>29 - 33</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  11</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Executive
  Compensation</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>34 - 36</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  12</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Security
  Ownership of Certain Beneficial Owners and Management and Related Stockholder
  Matters</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>37</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  13</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Certain
  Relationships, Related Transactions, and Director Independence</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>38 - 39</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  14</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Principal
  Accountant Fees and Services</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>39</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>&nbsp;</b></p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>PART IV</b></p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>&nbsp;</b></p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>&nbsp;</b></p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Item
  15</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Exhibits,
  Financial Statement Schedules</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>40 - 42</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Signatures</p>
  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>43</p>
  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=103 valign=top style='width:77.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>23.1</p>
  </td>
  <td width=492 valign=top style='width:369.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Consent
  of HEIN &amp; ASSOCIATES LLP</p>
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  </td>
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  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
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  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
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  of Controller pursuant to 18 U.S.C. Section 1350</p>
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  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
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  of Chief Executive Officer and Controller pursuant to 18 U.S.C. Section 1350</p>
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<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>PART I</b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>ITEM
1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; BUSINESS</b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Overview:</b> Good Times
Restaurants Inc., a Nevada corporation (the &quot;Company&quot;), was organized in 1987.&nbsp;
The Company is essentially a holding company for its wholly owned subsidiary,
Good Times Drive Thru Inc. (&quot;GTDT&quot;), which is engaged in the business of
developing, owning, operating and franchising hamburger-oriented drive-through
restaurants under the name Good Times Burgers &amp; Frozen Custard.&nbsp; Most of
our restaurants are located in the front-range communities of Colorado but we
also have franchised restaurants in Idaho, North Dakota and Wyoming.&nbsp; The terms
&quot;Good Times&quot;, &quot;we&quot;, &quot;us&quot; and &quot;our&quot; where used herein refer to the operations of
GTDT and of the Company.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Recent
Developments:</b>&nbsp;
We experienced fairly dramatic same store sales declines immediately after the
beginning of the recession in the spring of 2008 that continued through late
spring of 2010 after several years of same store sales increases.&nbsp; Beginning in
June 2010 our sales trends began to flatten out and have increased since August
2010.&nbsp; Beginning in August 2010 and continuing through November 2010 we have
experienced monthly same store sales increases of 0.4%, 7.4%, 20.3% and 5.4%.<b>&nbsp;
</b>While a portion of the sales increases have been due to very favorable
weather in 2010 compared to 2009, we have experienced increases in both
customer traffic and our average transaction amount as a result of the
implementation of more price choice across our menu and several product
initiatives.&nbsp; Those initiatives included the implementation of Fresh Cut Fries
and Wild Fries in a new cooked-to-order platform, five $2.89 Craver Combos,
hand spun custard shakes with seasonal flavors, the introduction of Sweet
Potato Fries as a limited time offer and other product promotions.&nbsp; As
discussed below in Concept and Business Strategy, we are focusing on sustaining
our same store sales momentum through improving our core value proposition for
the consumer and evolving the brand away from mainstream hamburger quick
service restaurants' standard fare.&nbsp; While we are and will remain all about
burgers, fries and frozen custard, we are elevating each category's fresh, handcrafted
and unique offerings.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
August 2009, the Company began exploring and evaluating strategic alternatives
aimed at enhancing shareholder value.&nbsp; Our Board of Directors formed a Special
Committee comprised of directors Geoff Bailey, Richard Stark and Alan Teran to
lead these efforts.&nbsp; In addition, the Company hired Mastodon Ventures, Inc. to
provide strategic advisory services and explore strategic alternatives that may
further the long-term&nbsp;business prospects of the Company and provide
incremental value to its shareholders.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>As
previously disclosed in the Company's current report on Form 8-K filed on
November 3, 2010, the Company entered into a Securities Purchase Agreement (the
&quot;Purchase Agreement&quot;), dated October 29, 2010, with Small Island Investments
Limited, a Bermuda corporation (&quot;SII&quot;), under which the Company agreed to sell,
and SII agreed to purchase, 4,200,000 shares (the &quot;Shares&quot;) of the Company's
common stock, par value $0.001 per share (the &quot;Common Stock&quot;), at a purchase
price of $0.50 per share, or an aggregate of $2,100,000 (the &quot;SII Investment
Transaction&quot;).&nbsp; The Purchase Agreement was amended on December 13, 2010 to
clarify the scope of SII's director designation rights following the Closing.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>On
December 13, 2010, following approval of the SII Investment Transaction and
related matters by the Company's stockholders at a special meeting called for
such purposes (the &quot;Special Meeting&quot;), the Company and SII completed the
issuance and sale of the Shares to SII.&nbsp; On December 13, 2010, the Company and
SII also entered into a Registration Rights Agreement, pursuant to which the
Company granted SII certain registration rights with respect to resale of the
Shares.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
completion of the SII Investment Transaction resulted in a change of control of
the Company, with SII becoming the beneficial owner of approximately 51.4
percent of the Company's outstanding Common Stock.&nbsp; In addition, pursuant to
the Purchase Agreement, SII designated four new members of the Company's Board
of Directors to replace Richard J. Stark, Alan A. Teran, Ron Goodson and David
Grissen, all of whom resigned as directors effective upon the closing of the
SII Investment Transaction.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>At
the Special Meeting, the Company's stockholders also approved a proposal to
give our Board discretion to effect a one-for-three reverse stock split of the
Company's issued and outstanding Common Stock following the closing of the SII Investment
Transaction.&nbsp; The Board subsequently adopted resolutions approving a
one-for-three reverse stock split to be effective as of December 31, 2010.</p>



<p class=MsoNormal style='margin-top:0in;margin-right:1.8pt;margin-bottom:0in;
margin-left:0in;margin-bottom:.0001pt;text-align:justify;line-height:normal'>On February 1,
2010, the Company and GTDT entered into a loan agreement with W Capital, Inc.
(&quot;W Capital&quot;), John T. McDonald (&quot;McDonald&quot;) and Golden Bridge, LLC (&quot;Golden Bridge&quot;),
pursuant to which the lenders made loans totaling $400,000 to be used for
restaurant marketing and other working capital uses of GTDT.&nbsp;&nbsp; The loan
agreement was </p>

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<p class=MsoNormal style='margin-top:0in;margin-right:1.8pt;margin-bottom:0in;
margin-left:0in;margin-bottom:.0001pt;text-align:justify;line-height:normal'>subsequently
amended as of April 1, 2010 to remove Golden Bridge as a lender, replacing it
with additional loans from W Capital and McDonald.&nbsp; The aggregate principal
amount owing to W Capital and McDonald was paid out of the proceeds of the SII
Investment Transaction.&nbsp; In addition, the accrued interest on such loans
through December 13, 2010 of $39,715 was converted into an aggregate of 79,430
shares of our Common Stock.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
connection with the loans, the Company issued warrants to W Capital and
McDonald which entitle them at any time prior to December 13, 2013 to purchase
up to an aggregate of 100,000 shares of our Common Stock at an exercise price
of 25% less than the average price of our Common Stock during the 20 days prior
to exercise, but at not less than $0.75 per share nor more than $1.08 per
share.&nbsp; These warrants remain outstanding and exercisable in accordance with
their terms.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Proceeds
of the SII transaction were also used to repay the outstanding principal amount
of $185,000 due to Golden Bridge on a loan Golden Bridge made to the Company in
2009, to reduce our accounts payable and accrued liabilities, to pay the
expenses related to the SII Investment Transaction, and to increase our working
capital.&nbsp; The SII Investment Transaction also allowed us to renegotiate the
terms and covenants of our loan with Wells Fargo Bank, N.A. (&quot;Wells Fargo&quot;) and
to regain compliance with certain financial loan covenants that had been in
default.&nbsp; We had never been in any payment default under the loan and Wells
Fargo agreed to accept additional building and equipment collateral in exchange
for modifying the covenants of the loan without affecting our interest rate or
repayment term.&nbsp;&nbsp; As a condition to the closing of the SII Investment
Transaction, we entered into a new Credit Agreement and Promissory Note with
Wells Fargo effective as of December 13, 2010.&nbsp; The prior financial defaults
had caused us to show the entire balance of the loan as a short term liability;
however, as of September 30, 2010, it is again largely classified as a long
term note payable.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>SII's
affiliates have ownership interests in other full service restaurant chains
that generate approximately $75 million in annual revenues.&nbsp;&nbsp; The SII
Investment Transaction may successfully position the Company to pursue a larger
platform in the restaurant business through acquisitions, new investment and
improved economies of scale.&nbsp; However, there can be no assurance that any
acquisitions or additional investment will occur.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
shorter term objective for the Good Times brand will be to focus on maximizing
its profitability and development in our core market of Colorado.&nbsp; In fiscal
2010, we closed two Company-operated restaurants and a franchisee closed one
restaurant.&nbsp; We continue to evaluate the near term realizable asset value of
each restaurant compared to its longer term cash flow value and we may choose
to sell, sublease or close additional lower performing restaurants in fiscal
2011as we position the company for growth in new store development.&nbsp; We will
require additional capital sources to develop additional company owned
restaurants.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>See
Financing Activities under the Liquidity and Capital Resources section Part II,
Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations below for further details of the transactions described above.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Concept
and Business Strategy</b>:
We operate with two different formats that have evolved over the course of our
history: a smaller, 880 to 1000 square foot building without indoor seating
that is focused on drive thru service and limited walk up service; and a 2,400
square foot, 70 seat dining room format that has been the model for the last
thirteen restaurants developed in Colorado.&nbsp; We are currently further refining
the prototype design to reduce development costs and improve the return on
investment model for future company-owned and franchised restaurant expansion
with a 1,900 to 2,000 square foot, 40 seat dining room design that will carry
forward all of the core design elements of our prior prototype design.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
light of the last two years' sales declines that began at the start of the
current economic recession, we are primarily focused on maintaining the recent
momentum in positive growth in our existing stores' sales.&nbsp; In addition to the
upgrades in the quality and portions of our core hamburger and chicken products
in 2009, in fiscal 2010 we introduced our Fresh Cut Fries that are hand cut
every day in each restaurant in addition to our Wild Fries and converted our
systems so that we now cook all fries to order.&nbsp; We have sacrificed some speed
of service but we believe the quality improvements outweigh the additional 20
to 30 seconds the customer waits.&nbsp; We also upgraded our shakes to hand spun
custard shakes, more than doubling our shake sales in the summer of 2010.&nbsp; In
June 2010, we introduced our first lower priced menu category with our new $2.89
Craver Combos, which now represents over 15% of customer transactions.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>While
our primary value proposition for the consumer is derived from the quality and
taste of our products, the current competitive and consumer spending
environment continues to redefine value expectations within the quick service
restaurant segment and a larger number of transactions are being driven by the
availability of menu items at lower price points.&nbsp; Our lower priced options are
consistent with our brand strategy to offer fresh, real, handcrafted food with
unique flavor profiles in our core menu categories of burgers, chicken, fries,
frozen custard and fountain products.</p>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>We
will continue to focus on elevating the attributes of our menu items that we
believe give us a unique position in hamburger quick service restaurants -
Fresh All Natural Angus beef that is free from hormones, antibiotics and animal
byproducts in the feed; Fresh Frozen Custard made fresh every few hours in
every restaurant; Fresh Grilled Honey Cured Bacon; Fresh Squeezed Lemonade;
Fresh Cut Fries; 100% Breast of Chicken; and other proprietary recipes and
flavors.&nbsp; We are working on the preparation system and packaging design for our
burgers with the goal of achieving a more hot off the grill, cooked to order
flavor that is more common in fast casual and casual theme concepts than in
quick service restaurants.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Our
core strategies have not changed and we continue to focus on the following
initiatives to maintain positive sales growth and improve our profitability:</p>



<p class=Style63CxSpFirst style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Focus on our most important
drivers of success:</p>

<p class=Style63CxSpMiddle style='margin-left:.75in;text-align:justify;
text-indent:-.25in'>o&nbsp;&nbsp;&nbsp; Values.&nbsp; We strive to build and develop behaviors and
expectations around what we value most throughout the company: integrity,
continued improvement, customer loyalty and respect for each other.</p>

<p class=Style63CxSpMiddle style='margin-left:.75in;text-align:justify;
text-indent:-.25in'>o&nbsp;&nbsp;&nbsp; People.&nbsp; Beginning with our Operating Partner Program,
people are our strongest asset.&nbsp; We seek to hire high quality people throughout
and provide them with comprehensive training programs to ensure that we deliver
consistently superior products and service.</p>

<p class=Style63CxSpMiddle style='margin-left:.75in;text-align:justify;
text-indent:-.25in'>o&nbsp;&nbsp;&nbsp; Distinctive quality.&nbsp; We strive to offer unique,
highly distinctive tastes with the highest quality ingredients available in the
quick service restaurant category.</p>

<p class=Style63CxSpLast style='margin-left:.75in;text-align:justify;
text-indent:-.25in'>o&nbsp;&nbsp;&nbsp; Excellent systems.&nbsp; We strive to provide the best
systems and processes in every area to free our management to focus on leading
their people.</p>



<p class=Style63 style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Offer high quality, unique menu
items that provide exceptional value.&nbsp; Our restaurants feature menu items that
are unique in the quick service segment, and flavor profiles that are
associated more with casual theme restaurants than with fast food.&nbsp; Whenever
possible, products support the brand umbrella of &quot;fresh, high quality
ingredients&quot; such as fresh frozen custard made fresh throughout the day in
every restaurant, 100% all natural beef, fresh squeezed lemonade, grilled honey
cured bacon, sliced Bermuda onions and toppings such as real guacamole,&nbsp;
grilled pineapple and saut&#233;ed mushrooms.&nbsp; Each menu category has signature
recipes with fun, irreverent names that build Good Times' non-traditional
personality such as Wild Fries with Wild Dippin Sauce, Big Daddy Bacon
Cheeseburger, Mighty Deluxe, Burnin' Buffalo Chicken and Cappuccino Mocha Joe,
Raspberry Torte and Strawberry Cheesecake Addiction Custard Spoonbenders.&nbsp; We continue
to make significant changes to our entire menu to leverage our heritage of
quality products and to position the Good Times brand for a more unique and
highly differentiated consumer experience. Those product and system changes
include the following:</p>



<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:63.0pt;margin-bottom:.0001pt;text-align:justify;text-indent:-27.0pt;
line-height:normal'>a.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The
introduction of fresh, never frozen, all natural, purebred Angus beef for all
of our burgers.&nbsp; The beef is Certified Humanely Raised, has never had
antibiotics or growth hormones, and is vegetarian fed.</p>

<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:63.0pt;margin-bottom:.0001pt;text-align:justify;text-indent:-27.0pt;
line-height:normal'>b.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Introduced
a line of five Craver Combos available at $2.89 for a double cheeseburger or
chicken sandwich, fresh cut or Wild fries and a 16 oz soft drink.</p>

<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:63.0pt;margin-bottom:.0001pt;text-align:justify;text-indent:-27.0pt;
line-height:normal'>c.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Introduced
fresh, hand spun custard shakes with rotating seasonal flavors.</p>

<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:63.0pt;margin-bottom:.0001pt;text-align:justify;text-indent:-27.0pt;
line-height:normal'>d.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Introduced
Sweet Potato Fries, Red Head Strawberry Lemonade, the Pawbender and other
proprietary items as limited time offerings.</p>

<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:63.0pt;margin-bottom:.0001pt;text-align:justify;text-indent:-27.0pt;
line-height:normal'>e.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reworked
our chicken category with 100% breast meat sandwiches and tenders with revised
flavor profiles that are unique to fast food.</p>

<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:63.0pt;margin-bottom:.0001pt;text-align:justify;text-indent:-27.0pt;
line-height:normal'>f.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Introduced
Fresh Hand Cut Fries, made daily from whole Idaho russet potatoes &amp;
seasoned with sea salt.</p>

<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:63.0pt;margin-bottom:.0001pt;text-align:justify;text-indent:-27.0pt;
line-height:normal'>g.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Refining
and elevating our custard flavor of the day program and iconic Spoonbender
flavors.</p>



<p class=Style63 style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Establish a unique brand position
in quick service restaurants.&nbsp; We aspire to have Good Times stand for
&quot;providing food the way it used to be.&nbsp; Good Times is bringing real food back
to fast food with pure, wholesome food that tastes the way food used to
taste.&quot;&nbsp; Key brand support for that will include attributes such as &quot;Fresh&quot;, &quot;All
Natural&quot;, &quot;Fresh Grilled&quot;, &quot;Authentic&quot;, &quot;Homemade&quot;, and &quot;Fresh Squeezed&quot; with a
theme of fresh ingredients and hand crafted food.</p>



<p class=Style63 style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Continually improve our fast,
friendly, personal customer service. We strive to optimize and personalize the
interaction between our employees and customers, particularly at the points of
order and payment, to build a reputation as having the friendliest service.&nbsp; We
manage the face to face interaction with our customers through extensive
employee screening and hospitality training to ensure their experience is
punctuated by attentive, friendly service.&nbsp; During fiscal 2009 and 2010 we
introduced a new online screening and hiring system to reduce</p>

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<p class=Style63CxSpFirst style='text-align:justify'>our hourly employee turnover and hire team members that exhibit good
service attitudes.&nbsp; Additionally, we introduced video training tools for the
first time that we believe will enhance consistent execution of our quality
standards. Speed of service through our drive thru lanes is important to the
consumers' need for convenience, but is always secondary to delivering the
highest quality product possible.&nbsp; We monitor each car's service time and have
developed incentive programs for management and employees to maintain our quick
service standards.</p>



<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Build customer loyalty through a
unique brand experience.&nbsp; In addition to fast friendly service and great
tasting products, we strive to maintain clean, safe and appealing facilities
with a particular emphasis on well groomed landscaping, freshly painted
exteriors and merchandising that highlights the unique product attributes and
flavors of our products.&nbsp; We believe that everything the customer sees, smells,
hears and feels influences their overall impression and the reputation of Good
Times and that Good Times' target customer is seeking more out of even a quick service
restaurant experience.</p>



<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Build awareness of the Good Times
Burgers &amp; Frozen Custard brand. We believe that Good Times has built
substantial brand equity among our customers and has become known for our quality,
service and signature tastes, particularly within the hamburger category.&nbsp; We
believe there is significant opportunity to continue to build that reputation
within the hamburger category by continuing to build a stronger overall value
proposition and increase awareness of our frozen custard and fountain category.
As capital becomes available to us to build out the Colorado market, we plan to
sustain our media advertising and increase our store level communications, raising
our overall awareness and building a highly differentiated brand personality.</p>



<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Continually improve our employees'
knowledge and proficiency of our core processes. Our customers' experience is
driven by the ability of our management and employees to consistently execute
clearly defined processes in every area of our business.&nbsp; We believe that our
employees' abilities and attitudes are directly related to our ability to
provide well designed service, production and operating processes and effective
training that allows them to continually learn, improve and succeed.&nbsp; We train,
test, certify and re-train all employees and management on all of our core
operating and management processes to continually improve levels of
proficiency.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b><u>Current Fiscal Year Initiatives</u></b><b>:</b></p>



<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.5in;margin-bottom:.0001pt;text-align:justify;text-indent:-.5in;
line-height:normal'>1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Consistently
Grow Same Store Sales: We will continue to focus on comparable restaurant sales
driven by increases in guest counts and increases in the average guest check.&nbsp;
Same store sales decreased 6.2% in fiscal 2010 compared to fiscal 2009, however,
we experienced a flattening of those trends in June and July and began to see
consecutive monthly same store sales increases in August through November of
2010.&nbsp; As of the date of this filing, we anticipate that December, 2010 same
store sales will maintain that increase in consecutive monthly sales.&nbsp; We hope
to increase guest counts throughout fiscal 2011 through a multi-faceted
approach to continually improve the Good Times brand experience for our
customers by:</p>



<p class=Style63CxSpFirst style='margin-left:.75in;text-align:justify;
text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Continuing to communicate our core
value proposition that is centered on the availability of high quality at lower
price choices and smaller portions.</p>

<p class=Style63CxSpMiddle style='margin-left:.75in;text-align:justify;
text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Shifting our marketing
communications from broadcast media to more store level and trade area focus.</p>

<p class=Style63CxSpMiddle style='margin-left:.75in;text-align:justify;
text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Introducing both permanent and
limited time products that are only available at Good Times.</p>

<p class=Style63CxSpMiddle style='margin-left:.75in;text-align:justify;
text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Improving our execution on
customer service and the delivery of our brand experience through continual re-training
of all of our employees on our standards and heightened expectations.</p>

<p class=Style63CxSpLast style='margin-left:.75in;text-align:justify;
text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Continuing to reinvest in our
existing facilities with a reinvestment in our menu board systems, exterior
signage and selective interior cosmetic improvements.</p>



<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.5in;margin-bottom:.0001pt;text-align:justify;text-indent:-.5in;
line-height:normal'>2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Reduce
our Cost of Sales: In fiscal 2010 our food and packaging costs increased to
35.2% of restaurant sales from 33.6% in fiscal 2009. The increase was primarily
due to an increase in commodity costs as we experienced an 11% increase in our
weighted average food and packaging costs in fiscal 2010 due mainly to
increases in beef, bacon and dairy products.&nbsp; We implemented a cumulative total
menu price increase of 6.2% during fiscal 2010; however, the menu price
increases were not implemented until the last four months of the fiscal year.&nbsp;
We expect to make modest price increases in fiscal 2010.</p>



<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.5in;margin-bottom:.0001pt;text-align:justify;text-indent:-.5in;
line-height:normal'>3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Improve
our Income from Operations by managing the profitability of incremental sales
growth:&nbsp; In addition to reducing our cost of sales, the highest near term
return on our capital investment and opportunity for profit improvement is from
increasing sales in our existing restaurants.&nbsp; Historically, depending on the
sales volume of</p>

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



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

<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:0in;margin-right:0in;margin-bottom:0in;
margin-left:.5in;margin-bottom:.0001pt;text-align:justify;line-height:normal'>each restaurant,
we have experienced a 35% to 50% profit contribution on incremental sales.&nbsp; By
managing the profitability of compounding sales increases, we believe we can
improve our Income from Operations through the operating leverage on existing
assets.</p>



<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.5in;margin-bottom:.0001pt;text-align:justify;text-indent:-.5in;
line-height:normal'>4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Pursue
Strategic Alternatives:&nbsp; As described above, the closing of the SII Investment
Transaction enables us to continue to pursue possible additional strategic
alternatives to enhance shareholder value and leverage the costs related to our
operation as a publicly traded entity.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Expansion
strategy and site selection: Our longer term strategy of becoming a super
regional brand in select contiguous markets depends on our ability to continue our
same store sales trends, on the consumer spending environment and on the
availability of capital, which is currently limited.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Any
new development would involve our new prototype restaurant design on sites that
are on or adjacent to big box or grocery store anchored shopping centers in
high activity and employment areas.&nbsp; Our site selection for new restaurants is
oriented toward slightly higher income demographic areas than many of our urban
locations and most of our targeted trade areas are in relatively high growth
areas of the Denver and northern Colorado markets.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>We
lease most of our sites.&nbsp; When we do purchase and develop a site, we intend to
sell the developed site into the sale-leaseback market under a long term
lease.&nbsp; Our primary site objective is to secure a suitable site, with the
decision to buy or lease as a secondary objective.&nbsp; Our site criteria includes
a mix of substantial daily traffic, density of at least 30,000 people within a
three mile radius, strong daytime population and employment base, retail and
entertainment traffic generators, good visibility and easy access.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Restaurant
locations:</u>&nbsp;
We currently operate and franchise a total of forty-nine Good Times
restaurants, of which forty-five are in Colorado, with forty in the Denver
greater metropolitan area, three in Colorado Springs, one in Grand Junction and
one in Silverthorne.</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=656
 style='border-collapse:collapse'>
 <tr>
  <td width=205 valign=top style='width:153.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=54 valign=bottom style='width:40.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>Total</b></p>
  </td>
  <td width=90 valign=bottom style='width:67.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>Denver, CO Greater Metro</b></p>
  </td>
  <td width=72 valign=bottom style='width:.75in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>Colorado, Other</b></p>
  </td>
  <td width=62 valign=bottom style='width:46.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>Idaho</b></p>
  </td>
  <td width=86 valign=bottom style='width:.9in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>Wyoming</b></p>
  </td>
  <td width=86 valign=bottom style='width:.9in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>North Dakota</b></p>
  </td>
 </tr>
 <tr>
  <td width=205 valign=top style='width:153.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Company-owned
  &amp; Co-developed</p>
  </td>
  <td width=54 style='width:40.5pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>25</p>
  </td>
  <td width=90 style='width:67.5pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>23</p>
  </td>
  <td width=72 style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>2</p>
  </td>
  <td width=62 style='width:46.5pt;border:none;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=86 style='width:.9in;border:none;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=86 style='width:.9in;border:none;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=205 valign=top style='width:153.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Franchised</p>
  </td>
  <td width=54 style='width:40.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>17</p>
  </td>
  <td width=90 style='width:67.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>14</p>
  </td>
  <td width=72 style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>2</p>
  </td>
  <td width=62 style='width:46.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>1</p>
  </td>
  <td width=86 style='width:.9in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=86 style='width:.9in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=205 valign=top style='width:153.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Dual
  brand company-owned</p>
  </td>
  <td width=54 style='width:40.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>2</p>
  </td>
  <td width=90 style='width:67.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>1</p>
  </td>
  <td width=72 style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>1</p>
  </td>
  <td width=62 style='width:46.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=86 style='width:.9in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=86 style='width:.9in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=205 valign=top style='width:153.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Dual
  brand franchised</p>
  </td>
  <td width=54 style='width:40.5pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>5</p>
  </td>
  <td width=90 style='width:67.5pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>2</p>
  </td>
  <td width=72 style='width:.75in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=62 style='width:46.5pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=86 style='width:.9in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>2</p>
  </td>
  <td width=86 style='width:.9in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>1</p>
  </td>
 </tr>
 <tr>
  <td width=205 valign=top style='width:153.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=54 style='width:40.5pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>49</b></p>
  </td>
  <td width=90 style='width:67.5pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>40</b></p>
  </td>
  <td width=72 style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>5</b></p>
  </td>
  <td width=62 style='width:46.5pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>1</b></p>
  </td>
  <td width=86 style='width:.9in;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>2</b></p>
  </td>
  <td width=86 style='width:.9in;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>1</b></p>
  </td>
 </tr>
</table>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
  <td width=204 valign=top style='width:153.35pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>December:</b></p>
  </td>
  <td width=19 valign=top style='width:14.05pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>&nbsp;</b></p>
  </td>
  <td width=108 valign=top style='width:81.0pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>2009</b></p>
  </td>
  <td width=24 valign=top style='width:.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>&nbsp;</b></p>
  </td>
  <td width=102 valign=top style='width:76.5pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>2010</b></p>
  </td>
 </tr>
 <tr>
  <td width=204 valign=top style='width:153.35pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Company-owned
  restaurants</p>
  </td>
  <td width=19 valign=top style='width:14.05pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 valign=top style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>21</p>
  </td>
  <td width=24 valign=top style='width:.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>20</p>
  </td>
 </tr>
 <tr>
  <td width=204 valign=top style='width:153.35pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Co-developed</p>
  </td>
  <td width=19 valign=top style='width:14.05pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>9</p>
  </td>
  <td width=24 valign=top style='width:.25in;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=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>7</p>
  </td>
 </tr>
 <tr>
  <td width=204 valign=top style='width:153.35pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Franchise
  operated restaurants</p>
  </td>
  <td width=19 valign=top style='width:14.05pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 valign=top style='width:81.0pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>21</p>
  </td>
  <td width=24 valign=top style='width:.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>22</p>
  </td>
 </tr>
 <tr>
  <td width=204 valign=top style='width:153.35pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>Total restaurants:</p>
  </td>
  <td width=19 valign=top style='width:14.05pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 valign=top style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>52</p>
  </td>
  <td width=24 valign=top style='width:.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=top style='width:76.5pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>49</p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
October 2009 a franchisee operating a Good Times restaurant in Thornton,
Colorado terminated its franchise agreement and closed the restaurant. In March
2010 we closed and sub-leased one company-owned dual branded restaurant in
Commerce City, Colorado. In June 2010 we closed one co-developed restaurant in
Denver, Colorado. Also in June 2010 we sold our general partnership interest in
one co-developed restaurant in Denver, Colorado to the limited partner who is
operating the restaurant under a franchise agreement. We anticipate that we may
close up to three low volume franchised restaurants during fiscal 2011.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Menu:</b>&nbsp; The menu of a
Good Times Burgers &amp; Frozen Custard restaurant is limited to hamburgers,
cheeseburgers, chicken sandwiches, French fries, onion rings, fresh squeezed
and frozen lemonades, soft drinks and frozen custard products.&nbsp; Each menu item
is made to order at the time the customer places the order and is not
pre-prepared.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
hamburger patty is made with Meyer All Natural, All Angus beef, served on a 4&quot;
bun.&nbsp; Hamburgers and cheeseburgers are garnished with fresh iceberg lettuce,
fresh sliced sweet red onions, mayonnaise, guacamole, fresh grilled honey cured
bacon, and proprietary sauces.&nbsp; The chicken products include a spiced, battered
whole muscle breast patty and a grilled seasoned breast patty, both served with
mayonnaise, lettuce and tomatoes, and Chicken Dunkers, whole breast meat</p>

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



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

<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:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>breaded
Tenders.&nbsp; Signature chicken products include the Burnin' Buffalo, Guacamole
Bacon Chicken, and 100% whole muscle breast meat Dunkers.&nbsp; Equipment has been
automated and equipped with compensating computers to deliver a consistent
product and minimize variability in operating systems.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>All
natural Angus beef is raised without the use of any hormones, antibiotics or
animal byproducts that are normally used in the open beef market.&nbsp; We believe
that all natural beef delivers a better tasting product and, because of the
rigorous protocols and testing that are a part of the Meyer processes, also may
minimize the risk of any food-borne bacteria-related illnesses.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Fresh
frozen custard is a premium ice cream (requiring in excess of 10% butterfat
content and .4% egg yolks) with a proprietary vanilla blend that is prepared
from highly specialized equipment that minimizes the amount of air that is
added to the mix and that creates smaller ice crystals than other frozen dairy
desserts.&nbsp; The custard is scooped similarly to hard-packed ice cream but is
served at a lightly warmer temperature.&nbsp; The resulting product is smoother,
creamier and thicker than typical soft serve or hard-packed ice cream
products.&nbsp; Good Times serves the frozen custard as vanilla and a flavor of the
day in cups and cones, specialty sundaes and &quot;Spoonbenders&quot;, a mix of custard
and toppings, and we anticipate it will continue to become a larger percentage
of sales as we continue to develop custard products and awareness.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Marketing
&amp; Advertising:</b>&nbsp;
Our marketing strategy focuses on: 1) driving comparable restaurant sales
through attracting new customers and increasing the frequency of visits by
current customers; 2) communicating specific product news and attributes to
build strong points of difference from competitors; and 3) communicating a
unique, strong and consistent brand.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Media
is an important component of building Good Times' brand awareness and
distinctiveness.&nbsp; We spent our advertising dollars on both television and radio
media during fiscal 2010.&nbsp; The Colorado market is an expensive media market, so
most of our advertising placement is not in prime time but in early and late
fringe, prime access and late news time slots.&nbsp; As we continue to develop more
and more distinctiveness to Good Times' brand and increase penetration of the
Colorado market, we anticipate we will continue to use media advertising to
increase overall awareness.&nbsp; However, during fiscal 2011, we anticipate we will
reduce our overall advertising expenditures and focus more of our marketing
funds on store level and trade area level communication and activities.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Another
important component of our marketing efforts is point-of-sale and on-site
merchandising.&nbsp; We rotate new four color product point-of-purchase displays
every other month and support new product introductions with extensive
merchandising.&nbsp; Our restaurants with dining rooms have back-lit and front-lit
product displays and product messaging throughout.&nbsp; Menu boards are kept fresh
with new food photography and graphics several times throughout the year.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>We
plan to continue to be active in digital media in order to create more customer
engagement with the Good Times brand.&nbsp; We anticipate leveraging our customer
email database and website to create cost effective channels to target existing
customers and increase their frequency.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b><u>Operations:</u></b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Restaurant
Management:</b>&nbsp;
We have developed Operating Partners in several of our restaurants as we are
able to recruit qualified candidates.&nbsp; We believe that this is a distinct competitive
advantage that provides a higher level of service, quality control and
stability over time.&nbsp; The objective of the Operating Partner Program is to have
each partner develop a relationship with the employees, the customers and the
community at their restaurant and develop an ownership mentality with
commensurate rewards as sales increase over a longer period of time.&nbsp; The
program allows an Operating Partner to earn 25% of a restaurant's improvement
in cash flow over an established baseline.&nbsp; Each Good Times restaurant employs
an operating partner or a general manager, one to two assistant managers and
approximately 15 to 25 employees, most of whom work part-time during three
shifts.&nbsp; An eight to ten week training program is utilized to train restaurant
managers on all phases of the operation.&nbsp; Ongoing training is provided as
necessary.&nbsp; We believe that incentive compensation of our restaurant managers
is essential to the success of our business.&nbsp; Accordingly, in addition to a
salary, managerial employees may be paid a bonus based upon proficiency in
meeting financial, customer service and quality performance objectives tied to
a monthly scorecard of measures.&nbsp; Due to our decline in sales in 2009 and 2010,
we have shifted most of our Operating Partners into a more traditional bonus
plan based on their performance against the monthly scorecard metrics.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Operational
Systems and Processes:</b>&nbsp; We believe that we have some of the best operating
systems and processes in the industry.&nbsp; Detailed processes have been developed
for hourly, daily, weekly and monthly responsibilities that drive</p>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>consistency
across our system of restaurants and performance against our standards within
different day parts.&nbsp; We utilize a labor program to determine optimal staffing
needs of each restaurant based on its actual customer flow and demand.&nbsp; We also
employ several additional operational tools to continuously monitor and improve
speed of service, food waste, food quality, sanitation, financial management
and employee development. &nbsp;We are moving toward automating and computerizing as
many of these systems as possible into an integrated, digital management
system.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
order system at each Good Times restaurant is equipped with an internal timing
device that displays and records the time each order takes to prepare and
deliver.&nbsp; The total transaction time for the delivery of food at the window is
approximately 30 to 60 seconds during peak times.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>We
use several sources of customer feedback to evaluate each restaurant's service
and quality performance, including an extensive, computerized secret shopper
program, customer comment phone line, telephone surveys and website comments.&nbsp;
Additionally, management uses both its own primary consumer research for
product development and to determine customer usage and attitude patterns as
well as third party market research that evaluates Good Times' performance
ratings on several different operating attributes against key competitors.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Training:</b>&nbsp; We strive to
maintain quality and consistency in each of our restaurants through the careful
training and supervision of all our employees at all levels and the
establishment of, and adherence to, high standards relating to personnel
performance, food and beverage preparation and maintenance of our restaurants.&nbsp;
Each manager must complete an eight to ten week training program, be certified
on several core processes and is then closely supervised to show both comprehension
and capability before they allowed to manage autonomously.&nbsp; All of our training
and development is based upon a &quot;train, test, certify, re-train&quot; cycle around
standards and operating processes at all levels.&nbsp; We conduct a semi-annual
performance review with each manager to discuss prior performance and future
performance goals.&nbsp; We have a defined weekly and monthly goal setting process
around future performance goals.&nbsp; We have a defined weekly and monthly goal
setting process around service, employee development, financial management and
store maintenance goals for every restaurant.&nbsp; During fiscal 2009 and 2010, we
implemented video training tools to drive training efficiencies and
consistency.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Recruiting
and Retention:</b>&nbsp;
We seek to hire experienced restaurant managers and Operating Partners.&nbsp; We
support employees by offering competitive wages and benefits, including a
401(k) plan, medical insurance, stock options for regional managers and
incentive plans at every level that are tied to performance against key goals
and objectives.&nbsp; We motivate and prepare our employees by providing them with
opportunities for increased responsibilities and advancement.&nbsp; We also provide
various other incentives, including vacations, car allowances, monthly
performance bonuses and monetary rewards for managers who develop future
managers for our restaurants. &nbsp;In fiscal 2009 and 2010, we implemented an
online screening and hiring tool that has proven to reduce hourly employee
turnover.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Franchising:</b>&nbsp; Good Times has
prepared prototype area rights and franchise agreements, a Uniform Franchise
Disclosure Document (&quot;UFDD&quot;) and advertising material to be utilized in
soliciting prospective franchisees.&nbsp; We seek to attract franchisees that are
experienced restaurant operators, well capitalized and have demonstrated the
ability to develop one to five restaurants.&nbsp; We review sites selected for
franchises and monitor performance of franchise units.&nbsp; We are not currently
soliciting new franchisees and will not do so until capital becomes more
available and we have regained positive same store sales momentum.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>We
estimate that it will cost a franchisee on average approximately $750,000 to
$1,100,000 to open a restaurant with dining room seating, including pre-opening
costs and working capital, assuming the land is leased.&nbsp; A franchisee typically
will pay a royalty of 4% of net sales, an advertising materials fee of at least
1.5% of net sales, plus participation in regional advertising up to an
additional 4% of net sales, or a higher amount approved by the advertising
cooperative, and initial development and franchise fees totaling $25,000 per
restaurant.&nbsp; Among the services and materials which we provide to franchisees
are site selection assistance, plans and specifications for construction of the
Good Times Burgers and Frozen Custard restaurants, an operating manual which
includes product specifications and quality control procedures, training,
on-site opening supervision and advice from time to time relating to operation
of the franchised restaurants.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>After
a franchise agreement is signed, we actively work with and monitor our
franchisees to ensure successful franchise operations as well as compliance
with Good Times systems and procedures.&nbsp; During the development phase, we
assist in the selection of sites and the development of prototype and building
plans, including all required changes by local municipalities and developers.&nbsp;
We provide an opening team of trainers to assist in the opening of the
restaurant and training of the employees.&nbsp; We advise the franchisee on menu,
management training, marketing, and employee development.&nbsp; On an ongoing basis
we conduct standards reviews of all franchise restaurants in key areas
including product quality, service standards, restaurant cleanliness and
sanitation, food safety and people development.</p>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>We
have entered into thirteen franchise agreements in the greater Denver
metropolitan area.&nbsp; Fourteen franchise restaurants and seven joint-venture
restaurants are operating in the Denver metropolitan area media market.&nbsp; Good
Times franchise restaurants also operate in Colorado Springs and Grand
Junction, Colorado and in Boise, Idaho.&nbsp; Dual branded franchised restaurants
operate in Gillette and Sheridan, Wyoming, Ft. Collins and Windsor, Colorado,
and Bismarck, North Dakota.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Management
Information Systems:</b>&nbsp;
Financial and management control is maintained through the use of automated
data processing and centralized accounting and management information systems
that we provide.&nbsp; Sales, labor and cash data is collected daily via a
restaurant back office system which gathers data from the restaurant
point-of-sale system.&nbsp; Management receives daily, weekly and monthly reports
identifying food, labor and operating expenses and other significant indicators
of restaurant performance.&nbsp; We believe that these reporting systems are
sophisticated and enhance our ability to control and manage operations.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Food
Preparation, Quality Control &amp; Purchasing:&nbsp; </b>We believe that
we have some of the highest food quality standards in the quick service
restaurant industry.&nbsp; Our systems are designed to protect our food supply
throughout the preparation process.&nbsp; We inspect specific qualified
manufacturers and work together with those manufacturers to provide
specifications and quality controls.&nbsp; Our operations management teams are trained
in a comprehensive safety and sanitation course provided by the National
Restaurant Association.&nbsp; Minimum cook temperature requirements and line checks
throughout the day ensure the safety and quality of both burgers and other
items we use in our restaurants.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>We
currently purchase 100% of our restaurant food and paper supplies from Yancey's
Food Service.&nbsp; We do not believe that the current reliance on this sole vendor
will have any long-term material adverse effect since we believe that there are
a sufficient number of other suppliers from which food and paper supplies could
be purchased.&nbsp; We do not anticipate any difficulty in continuing to obtain an
adequate quantity of food and paper supplies of acceptable quality and at
acceptable prices.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Employees:</b>&nbsp; At December
15, 2010, we had approximately 509 employees of which 435 are part time hourly
employees and 64 are salaried employees working full time. &nbsp;We consider our
employee relations to be good.&nbsp; None of our employees are covered by a
collective bargaining agreement.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Competition:</b>&nbsp; The restaurant
industry, including the fast food segment, is highly competitive.&nbsp; Good Times
competes with a large number of other hamburger-oriented fast food restaurants
in the areas in which it operates.&nbsp; Many of these restaurants are owned and
operated by regional and national restaurant chains, many of which have greater
financial resources and experience than we do.&nbsp; Restaurant companies that
currently compete with Good Times in the Denver market include McDonald's, Burger
King, Wendy's, Carl's Jr., Sonic and Jack in the Box.&nbsp; Double drive-through
restaurant chains such as Rally's Hamburgers and Checker's Drive-In
Restaurants, which currently operate a total of over 800 double drive-through
restaurants in various markets in the United States, are not currently
operating in Colorado.&nbsp; Culver's and Freddy's are the only significant
competitors offering frozen custard as a primary menu item operating in the
Denver and Colorado Springs markets and both have a significant presence in the
targeted Midwestern markets for expansion.&nbsp; Additional &quot;fast casual&quot; hamburger
restaurants are being developed in the Colorado market, such as Smashburger and
Five Guys; however, they do not have drive-through service and generate an
average per person check that is approximately 50% higher than Good Times.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Our
management believes that we may have a competitive advantage in terms of
quality of product compared to traditional fast food hamburger chains.&nbsp; Early
development of our double drive-through concept in Colorado has given us an
advantage over other double drive-through chains that may seek to expand into
Colorado because of our brand awareness and present restaurant locations.&nbsp;
Nevertheless, we may be at a competitive disadvantage to other restaurant
chains with greater name recognition and marketing capability.&nbsp; Furthermore,
most of our competitors in the fast-food business operate more restaurants,
have been established longer, and have greater financial resources and name
recognition than we do.&nbsp; There is also active competition for management
personnel, as well as for attractive commercial real estate sites suitable for
restaurants.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Trademarks:</b>&nbsp; Good Times has
registered its mark &quot;Good Times! Drive Thru Burgers&quot;(SM) with the
State of Colorado.&nbsp; We have also registered our mark &quot;Good Times Burgers &amp;
Frozen Custard&quot; federally and with the State of Colorado.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Good
Times received approval of its federal registration of &quot;Good Times&quot;
in 2003.&nbsp; In addition we own trademarks or service marks that have been
registered, or for which applications are pending, with the United States
Patent and Trademark Office including but not limited to: &quot;Mighty Deluxe&quot;,
&quot;Wild Fries&quot;, &quot;Spoonbender&quot;, &quot;Chicken Dunkers&quot;, &quot;Big Daddy Bacon
Cheeseburger&quot;, and &quot;Wild Dippin' Sauce&quot;. Our trademarks expire between 2010 and
2015.</p>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Government
Regulation:</b>&nbsp;
Each Good Times restaurant is subject to the regulations of various health,
sanitation, safety and fire agencies in the jurisdiction in which the
restaurant is located.&nbsp; Difficulties or failures in obtaining the required
licenses or approvals could delay or prevent the opening of a new Good Times
restaurant.&nbsp; Federal and state environmental regulations have not had a
material effect on our operations. More stringent and varied requirements of
local governmental bodies with respect to zoning, land use and environmental
factors could delay or prevent development of new restaurants in particular
locations.&nbsp; We are subject to the Fair Labor Standards Act, which governs such
matters as minimum wages, overtime, and other working conditions.&nbsp; In addition,
we are subject to the Americans With Disabilities Act, which requires
restaurants and other facilities open to the public to provide for access and
use of facilities by the handicapped.&nbsp; Management believes that we are in
compliance with the Americans With Disabilities Act.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>We
are also subject to federal and state laws regulating franchise operations,
which vary from registration and disclosure requirements in the offer and sale
of franchises to the application of statutory standards regulating franchise
relationships.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Available
Information:</b>
Our Internet website address is www.goodtimesburgers.com.&nbsp; We make available
free of charge through our website's investor relations information section our
annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on
Form 8-K, and any amendments to those reports filed with or furnished to the
SEC under applicable securities laws as soon as reasonably practical after we
electronically file such material with, or furnish it to, the SEC.&nbsp; Our website
information is not part of or incorporated by reference into this Annual Report
on Form 10-K.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Special
Note About Forward-Looking Statements:</b>&nbsp; From time to time the Company makes
oral and written statements that reflect the Company's current expectations
regarding future results of operations, economic performance, financial
condition and achievements of the Company.&nbsp; We try, whenever possible, to
identify these forward-looking statements by using words such as
&quot;anticipate,&quot; &quot;assume,&quot; &quot;believe,&quot;
&quot;estimate,&quot; &quot;expect,&quot; &quot;intend,&quot; &quot;plan,&quot;
&quot;project,&quot; &quot;may,&quot; &quot;will,&quot; &quot;would,&quot; and
similar expressions&nbsp; Certain forward-looking statements are included in this
Form 10-K, principally in the sections captioned &quot;Description of
Business,&quot; and &quot;Management's Discussion and Analysis of Financial
Condition and Results of Operations.&quot;&nbsp; Forward-looking statements are
related to, among other things:</p>



<p class=Style63CxSpFirst style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
business objectives and strategic
plans;</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
operating strategies;</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
our ability to open and operate
additional restaurants profitably and the timing of such openings;</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
restaurant and franchise
acquisitions;</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
anticipated price increases;</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
expected future revenues and
earnings, comparable and non-comparable restaurant sales, results of
operations, and future restaurant growth (both company-owned and franchised);</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
estimated costs of opening and
operating new restaurants, including general and administrative, marketing,
franchise development and restaurant operating costs;</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
anticipated selling, general and
administrative expenses and restaurant operating costs, including commodity
prices, labor and energy costs; </p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
future capital expenditures;</p>

<p class=Style63CxSpMiddle style='margin-left:1.0in;text-align:justify;
text-indent:-.25in'>o&nbsp;&nbsp;&nbsp; our expectation that we will have adequate cash from
operations and credit facility borrowings to meet all future debt service,
capital expenditure and working capital requirements in fiscal year 2011;</p>

<p class=Style63CxSpMiddle style='margin-left:1.0in;text-align:justify;
text-indent:-.25in'>o&nbsp;&nbsp;&nbsp; the sufficiency of the supply of commodities and labor
pool to carry on our business;</p>

<p class=Style63CxSpMiddle style='margin-left:1.0in;text-align:justify;
text-indent:-.25in'>o&nbsp;&nbsp;&nbsp; success of advertising and marketing activities;</p>

<p class=Style63CxSpMiddle style='margin-left:1.0in;text-align:justify;
text-indent:-.25in'>o&nbsp;&nbsp;&nbsp; the absence of any material adverse impact arising out
of any current litigation in which we are involved;</p>

<p class=Style63CxSpMiddle style='margin-left:1.0in;text-align:justify;
text-indent:-.25in'>o&nbsp;&nbsp;&nbsp; impact of the adoption of new accounting standards and
our financial and accounting systems and analysis programs;</p>

<p class=Style63CxSpMiddle style='margin-left:1.0in;text-align:justify;
text-indent:-.25in'>o&nbsp;&nbsp;&nbsp; expectations regarding competition and our competitive
advantages;</p>

<p class=Style63CxSpMiddle style='margin-left:1.0in;text-align:justify;
text-indent:-.25in'>o&nbsp;&nbsp;&nbsp; impact of our trademarks, service marks, and other
proprietary rights; and</p>

<p class=Style63CxSpLast style='margin-left:1.0in;text-align:justify;
text-indent:-.25in'>o&nbsp;&nbsp;&nbsp; effectiveness of our internal control over financial
reporting.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Although
we believe that the expectations reflected in our forward-looking statements are
based on reasonable assumptions, such expectations may prove to be materially
incorrect due to known and unknown risks and uncertainties.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
some cases, information regarding certain important factors that could cause
actual results to differ materially from any forward-looking statements appears
together with such statement.&nbsp; In addition, the factors described under
Critical Accounting Policies and Estimates in Part II, Item 7, and Risk Factors
in Part I, Item 1A, as well as other possible factors not listed, could cause
actual results to differ materially from those expressed in forward-looking
statements, including,</p>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>without
limitation, the following: concentration of restaurants in certain markets and
lack of market awareness in new markets; changes in disposable income; consumer
spending trends and habits; increased competition in the quick service
restaurant market; costs and availability of food and beverage inventory; our
ability to attract qualified managers, employees, and franchisees; changes in
the availability of capital or credit facility borrowings; costs and other
effects of legal claims by employees, franchisees, customers, vendors,
stockholders and others, including settlement of those claims; effectiveness of
management strategies and decisions; weather conditions and related events in
regions where our restaurants are operated; and changes in accounting standards
policies and practices or related interpretations by auditors or regulatory
entities.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>All
forward-looking statements speak only as of the date made.&nbsp; All subsequent
written and oral forward-looking statements attributable to us, or persons
acting on our behalf, are expressly qualified in their entirety by the
cautionary statements.&nbsp; Except as required by law, we undertake no obligation
to update any forward-looking statement to reflect events or circumstances
after the date on which it is made or to reflect the occurrence of anticipated
or unanticipated events or circumstances.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>ITEM
1A.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; RISK FACTORS</b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>You
should consider carefully the following risk factors before making an
investment decision with respect to Good Times Restaurants' securities. You are
cautioned that the risk factors discussed below are not exhaustive.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>We
have accumulated losses.</b> We have incurred losses in every fiscal year since
inception except 1999, 2002, 2006 and 2007.&nbsp; As of September 30, 2010 we had an
accumulated deficit of $16,737,000.&nbsp; We cannot assure you that we will not have
a loss for the current fiscal year ending September 30, 2011.&nbsp; As of September
30, 2010, we had a working capital deficit of $1,869,000.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>We
must sustain same store sales increases.</b>&nbsp; We must sustain same store sales
increases in existing restaurants to sustain profitability and we experienced
declines in our same store sales in fiscal 2008, fiscal 2009 and the first ten
months of fiscal 2010.&nbsp; Sales increases will depend in part on the success of
our advertising and promotion of new and existing menu items and consumer
acceptance.&nbsp; We cannot assure that our advertising and promotional efforts will
in fact be successful.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>New
restaurants, when and if opened, may not be profitable, if at all, for several
months.</b>&nbsp;
We anticipate that our new restaurants, when and if opened, will generally take
several months to reach normalized operating levels due to inefficiencies
typically associated with new restaurants, including lack of market awareness,
the need to hire and train a sufficient number of employees, operating costs,
which are often materially greater during the first several months of operation
than thereafter, pre-opening costs and other factors.&nbsp; In addition, restaurants
opened in new markets may open at lower average weekly sales volumes than
restaurants opened in existing markets, and may have higher restaurant-level
operating expense ratios than in existing markets.&nbsp; Sales at restaurants opened
in new markets may take longer to reach average annual company-owned restaurant
sales, if at all, thereby affecting the profitability of these restaurants.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Our
operations are susceptible to the cost of and changes in food availability
which could adversely affect our operating results.</b>&nbsp; Our profitability
depends in part on our ability to anticipate and react to changes in food
costs.&nbsp; Various factors beyond our control, including adverse weather
conditions, governmental regulation, production, availability, recalls of food
products and seasonality may affect our food costs or cause a disruption in our
supply chain.&nbsp; We enter into annual contracts with our beef and chicken
suppliers.&nbsp; Our contracts for chicken are fixed price contracts.&nbsp; Our contracts
for beef are generally based on current market prices plus a processing fee.&nbsp;
Changes in the price or availability of chicken or beef could materially
adversely affect our profitability.&nbsp; We cannot predict whether we will be able
to anticipate and react to changing food costs by adjusting our purchasing
practices and menu prices, and a failure to do so could adversely affect our
operating results.&nbsp; In addition, because we provide a &quot;value-priced&quot;
product, we may not be able to pass along price increases to our guests.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>The
macroeconomic recession could affect our operating results.</b>&nbsp; The current
state of the economy and decreased consumer spending have adversely affected
our sales over the last eighteen months and may continue to cause material negative
sales trends.&nbsp; A continued shift in consumer purchases toward $1 value menus in
our competitive segment and a proliferation of heavy discounting by our major
competitors may also continue to negatively affect our sales and operating
results.</p>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Price
increases may impact guest visits.</b>&nbsp; We may make price increases on
selected menu items in order to offset increased operating expenses we believe
will be recurring.&nbsp; Although we have not experienced significant consumer
resistance to our past price increases, we cannot provide assurance that this
or other future price increases will not deter guests from visiting our
restaurants or affect their purchasing decisions.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>The
hamburger restaurant market is highly competitive.</b> The hamburger
restaurant market is highly competitive.&nbsp; Our competitors include many
recognized national and regional fast-food hamburger restaurant chains such as
McDonald's, Burger King, Wendy's, Carl's Jr., Sonic, Jack in the Box and
Culver's.&nbsp; We also compete with small regional and local hamburger and other
fast-food restaurants, many of which feature drive-through service.&nbsp; Most of
our competitors have greater financial resources, marketing programs and name
recognition.&nbsp; All of the major hamburger chains have increasingly offered
selected food items and combination meals at discounted prices and have
recently intensified their promotions of value priced meals.&nbsp; Continued
discounting by competitors may adversely affect the revenues and profitability
of our restaurants.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Sites
may be difficult to acquire.</b> Location of our restaurants in
high-traffic and readily accessible areas is an important factor for our
success.&nbsp; Drive-through restaurants require sites with specific characteristics
and there are a limited number of suitable sites available in our geographic
markets.&nbsp; Since suitable locations are in great demand, in the future we may
not be able to obtain optimal sites at a reasonable cost.&nbsp; In addition, we
cannot assure you that the sites we do obtain will be successful.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>We
will require additional financing.</b> In order to fully develop the Denver
and Colorado Springs/Pueblo markets and to expand into markets outside of
Colorado, we will require additional financing.&nbsp; We cannot assure you that we
will be able to access sufficient capital to adequately finance our operations
and our planned developments or that additional financing will be available on
reasonable terms.&nbsp; The current economic recession and status of the capital
markets may adversely affect our ability to acquire additional debt or equity
financing for working capital, new restaurant development, or refinancing of
existing funding agreements.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>If
our franchisees cannot develop or finance new restaurants, build them on
suitable sites or open them on schedule, our growth and success may be impeded.</b>&nbsp; Under our
current form of area development agreement, some franchisees must develop a
predetermined number of restaurants according to a schedule that lasts for the
term of their development agreement.&nbsp; Franchisees may not have access to the
financial or management resources that they need to open the restaurants
required by their development schedules, or may be unable to find suitable
sites on which to develop them.&nbsp; Franchisees may not be able to negotiate
acceptable lease or purchase terms for the sites, obtain the necessary permits
and government approvals or meet construction schedules.&nbsp; From time to time in
the past, we have agreed to extend or modify development schedules and we may
do so in the future.&nbsp; Any of these problems could slow our growth and reduce
our franchise revenues.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Additionally,
our franchisees depend upon financing from banks and other financial
institutions in order to construct and open new restaurants.&nbsp; Difficulty in
obtaining adequate financing would adversely affect the number and rate of new
restaurant openings by our franchisees and adversely affect our future
franchise revenues.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Our
franchisees could take actions that could harm our business.</b>&nbsp; Franchisees
are independent contractors and are not our employees.&nbsp; We provide training and
support to franchisees; however, franchisees operate their restaurants as
independent businesses.&nbsp; Consequently, the quality of franchised restaurant
operations may be diminished by any number of factors beyond our control.&nbsp;
Moreover, franchisees may not successfully operate restaurants in a manner
consistent with our standards and requirements, or may not hire and train
qualified managers and other restaurant personnel.&nbsp; Our image and reputation,
and the image and reputation of other franchisees, may suffer materially, and
system-wide sales could significantly decline, if our franchisees do not
operate successfully.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>We
depend on key management employees.</b> We believe our current operations and
future success depend largely on the continued services of our management
employees, in particular Boyd E. Hoback, our president and chief executive
officer, and Scott Lefever, our vice president of operations.&nbsp; Although we have
entered into an employment agreement with Mr. Hoback, he may voluntarily
terminate his employment with us at any time.&nbsp; In addition, we do not maintain
key-person insurance on Messrs. Hoback's or Lefever's life.&nbsp; The loss of
Messrs. Hoback's or Lefever's services, or other key management personnel,
could have a material adverse effect on our financial condition and results of
operations.</p>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Labor
shortages could slow our growth or harm our business.</b> Our success
depends in part upon our ability to attract, motivate and retain a sufficient
number of qualified, high-energy employees.&nbsp; Qualified individuals needed to
fill these positions are in short supply in some areas.&nbsp; The inability to
recruit and retain these individuals may delay the planned openings of new
restaurants or result in high employee turnover in existing restaurants, which
could harm our business.&nbsp; Additionally, competition for qualified employees
could require us to pay higher wages to attract sufficient employees, which
could result in higher labor costs.&nbsp; Most of our employees are paid on an
hourly basis.&nbsp; The employees are paid in accordance with applicable minimum
wage regulations.&nbsp; Accordingly, any increase in the minimum wage, whether state
or federal, could have a material adverse impact on our business.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Nevada
law and our articles of incorporation and bylaws have provisions that
discourage corporate takeovers and could prevent stockholders from realizing a
premium on their investment.</b> We are subject to anti-takeover laws
for Nevada corporations.&nbsp; These anti-takeover laws prevent a Nevada corporation
from engaging in a business combination with any stockholder, including all
affiliates and associates of the stockholder, who owns 10% or more of the
corporation's outstanding voting stock, for three years following the date that
the stockholder acquired 10% or more of the corporation's voting stock, unless
specified conditions are met.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Our
articles of incorporation and our bylaws contain a number of provisions that
may deter or impede takeovers or changes of control or management.&nbsp; These
provisions:</p>



<p class=Style63CxSpFirst style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
authorize our Board of Directors
to establish one or more series of preferred stock, the terms of which can be
determined by the Board of Directors at the time of issuance;</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
do not allow for cumulative voting
in the election of directors unless required by applicable law.&nbsp; Under
cumulative voting, a minority stockholder holding a sufficient percentage of a
class of shares may be able to ensure the election of one or more directors;</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
state that special meetings of our
stockholders may be called only by the chairman of the board, the president or
any two directors, and must be called by the president upon the written request
of the holders of ten percent of the outstanding shares of capital stock
entitled to vote at such special meeting; and</p>

<p class=Style63CxSpLast style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
provide that the authorized number
of directors is currently set at seven.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>These
provisions, alone or in combination with each other, may discourage
transactions involving actual or potential changes of control, including
transactions that otherwise could involve payment of a premium over prevailing
market prices to stockholders for their common stock.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>We
have a controlling stockholder.</b>&nbsp; As a result of the SII Investment
Transaction, SII beneficially owns approximately 51.4% of our outstanding
common stock.&nbsp; In addition, SII has the right, for so long as it owns more than
50% of our outstanding common stock, to designate a majority of our Board of
Directors.&nbsp; SII therefore has the ability to alter the strategic direction
and/or capital structure of the Company.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Future
changes in financial accounting standards may cause adverse unexpected
operating results and affect our reported results of operations.</b>&nbsp; Changes in
accounting standards can have a significant effect on our reported results and
may affect our reporting of transactions completed before the change is
effective.&nbsp; As an example, in 2006, we adopted the change that requires us to record
compensation expense in the statement of operations for employee stock options
using the fair value method.&nbsp; See Note 1 to our Consolidated Financial
Statements for further discussion.&nbsp; New pronouncements and varying
interpretations of pronouncements have occurred and may occur in the future.&nbsp;
Changes to existing rules or differing interpretations with respect to our
current practices may adversely affect our reported financial results.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Our
NASDAQ Listing Is Important. </b>Our Common Stock is currently listed for
trading on the NASDAQ Capital Market.&nbsp; The NASDAQ maintenance rules require,
among other things, that our common stock price remains above $1.00 per share
and that we have minimum stockholders' equity of $2.5 million.&nbsp; During fiscal
2010, the Company received notices of non-compliance with both the minimum bid
price and minimum stockholders' equity continued listing requirements.&nbsp; The
completion of the SII Investment Transaction has helped the Company to regain
compliance with the minimum stockholders' equity requirement.&nbsp; In addition, our
Board of Directors, with the prior approval of our stockholders, has approved a
one-for-three reverse stock split to take effect on December 31, 2010, which
will allow us to regain compliance with the minimum bid price requirement.&nbsp; </p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>We
are subject to extensive government regulation that may adversely hinder or
impact our ability to govern various aspects of our business including our
ability to expand and develop our restaurants.</b>&nbsp; The restaurant
industry is subject to various federal, state and local government regulations,
including those relating to the sale of food.&nbsp; While in</p>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>the
past we have been able to obtain and maintain the necessary governmental
licenses, permits and approvals, our failure to maintain these licenses,
permits and approvals, including food licenses, could adversely affect our
operating results.&nbsp; Difficulties or failures in obtaining the required licenses
and approvals could delay or result in our decision to cancel the opening of
new restaurants.&nbsp; Local authorities may suspend or deny renewal of our food
licenses if they determine that our conduct does not meet applicable standards
or if there are changes in regulations.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Various
federal and state labor laws govern our relationship with our employees and
affect operating costs.&nbsp; These laws govern minimum wage requirements, such as
those to be imposed by recently enacted legislation in Colorado, overtime pay,
meal and rest breaks, unemployment tax rates, workers' compensation rates,
citizenship or residency requirements, child labor regulations and sales
taxes.&nbsp; Additional government-imposed increases in minimum wages, overtime pay,
paid leaves of absence and mandated health benefits may increase our operating
costs.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
federal Americans with Disabilities Act prohibits discrimination on the basis
of disability in public accommodations and employment.&nbsp; Although our
restaurants are designed to be accessible to the disabled, we could be required
to make modifications to our restaurants to provide service to, or make
reasonable accommodations for, disabled persons.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>We
are also subject to federal and state laws that regulate the offer and sale of
franchises and aspects of the licensor-licensee relationship.&nbsp; Many state
franchise laws impose restrictions on the franchise agreement, including
limitations on non-competition provisions and the termination or non-renewal of
a franchise.&nbsp; Some states require that franchise materials be registered before
franchises can be offered or sold in the state.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Compliance
with changing regulation of corporate governance and public disclosure may
result in additional expenses.</b>&nbsp; Keeping abreast of, and in compliance
with, changing laws, regulations and standards relating to corporate governance
and public disclosure, including the Sarbanes-Oxley Act of 2002, new SEC
regulations and The NASDAQ&nbsp; Market rules, has required an increased amount of
management attention and expense.&nbsp; We remain committed to maintaining high
standards of corporate governance and public disclosure.&nbsp; As a result, we
intend to invest all reasonably necessary resources to comply with evolving
standards, and this investment has resulted in and will continue to result in
increased general and administrative expenses and a diversion of management time
and attention from revenue-generating activities to compliance activities.&nbsp; </p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Risks
related to internal controls.</b>&nbsp; Public companies in the United States
are required to review their internal controls as set forth in the
Sarbanes-Oxley Act of 2002.&nbsp; It should be noted that any system of controls,
however well designed and operated, can provide only reasonable, and not
absolute, assurance that the objectives of the system are met.&nbsp; In addition,
the design of any control system is based in part upon certain assumptions
about the likelihood of future events.&nbsp; Because of these and other inherent
limitations of control systems, there can be no assurance that any design will
succeed in achieving its stated goals under all potential future conditions,
regardless of how remote.&nbsp; If the internal controls put in place by us are not
adequate or in conformity with the requirements of the Sarbanes-Oxley Act of
2002, and the rules and regulations promulgated by the Securities and Exchange
Commission, we may be forced to restate our financial statements and take other
actions which will take significant financial and managerial resources, as well
as be subject to fines and other government enforcement actions.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Health
concerns relating to the consumption of beef, chicken or other food products
could affect consumer preferences and could negatively impact our results of
operations.</b>&nbsp;
Like other restaurant chains, consumer preferences could be affected by health
concerns about the avian influenza, also known as bird flu, or the consumption
of beef, the key ingredient in many of our menu items, or negative publicity
concerning food quality, illness and injury generally, such as negative
publicity concerning E. coli, &quot;mad cow&quot; or &quot;foot-and-mouth&quot;
disease, publication of government or industry findings concerning food
products served by us, or other health concerns or operating issues stemming
from one restaurant or a limited number of restaurants.&nbsp; This negative
publicity may adversely affect demand for our food and could result in a
decrease in guest traffic to our restaurants.&nbsp; If we react to the negative
publicity by changing our concept or our menu we may lose guests who do not
prefer the new concept or menu, and may not be able to attract a sufficient new
guest base to produce the revenue needed to make our restaurants profitable.&nbsp;
In addition, we may have different or additional competitors for our intended
guests as a result of a concept change and may not be able to compete
successfully against those competitors.&nbsp; A decrease in guest traffic to our
restaurants as a result of these health concerns or negative publicity or as a
result of a change in our menu or concept could materially harm our business.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>ITEM
1B.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; UNRESOLVED STAFF COMMENTS</b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Not
applicable.</p>

<p class=MsoFooter align=right style='text-align:right'>13</p>



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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>ITEM
2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; PROPERTIES</b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>We
currently lease approximately 3,700 square feet of space for our executive
offices in Golden, Colorado for approximately $55,000 per year under a lease
agreement which expired in September 2009. We are currently leasing the space
on a month to month basis. The space is leased from The Bailey Company, a
significant stockholder in the Company, at their corporate headquarters.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>As
of December 15, 2010, Good Times has an ownership interest in twenty-seven Good
Times units, all of which are located in Colorado.&nbsp; Seven of these restaurants
are held in a joint venture limited partnership of which Good Times is the general
partner.&nbsp; Good Times has a 50% interest in six of the partnership restaurants
and a 78% interest in one restaurant. In June 2010 we sold our 51% interest in
one restaurant that was held in a joint venture limited partnership to our
limited partner, and the restaurant is now operated under a franchise
agreement. There are twenty Good Times units that are wholly owned by Good
Times.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Most
of our existing Good Times restaurants are a combination of free-standing
structures containing approximately 880 to 1,000 square feet for the double
drive thru format and approximately 2,400 square feet for our prototype
building with a 70 seat dining room.&nbsp; In addition, we have several restaurants
that are conversions from other concepts in various sizes ranging from 1,700
square feet to 3,500 square feet.&nbsp; The buildings are situated on lots of
approximately 18,000 to 50,000 square feet.&nbsp; Certain restaurants serve as
collateral for the underlying debt financing arrangements as discussed in the
Notes to Consolidated Financial Statements included in this report.&nbsp; We intend
to acquire new sites both through ground leases and purchase agreements
supported by mortgage and leasehold financing arrangements and through
sale-leaseback agreements.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>All
of the restaurants are regularly maintained by our repair and maintenance staff
as well as by outside contractors, when necessary.&nbsp; We believe that all of our
properties are in good condition and that there will be a need for periodic
capital expenditures to maintain the operational and aesthetic integrity of our
properties for the foreseeable future, including recurring maintenance and
periodic capital improvements.&nbsp; All of our properties are covered up to
replacement cost under our property and casualty insurance policies and in the
opinion of management are adequately covered by insurance.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>ITEM
3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; LEGAL PROCEEDINGS</b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>We
are not involved in any material legal proceedings.&nbsp; We are subject, from time
to time, to various lawsuits in the normal course of business.&nbsp; These lawsuits
are not expected to have a material impact.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>ITEM
4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (REMOVED AND RESERVED)</b></p>

<p class=MsoFooter align=right style='text-align:right'>14</p>



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<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>PART II</b></p>



<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:1.0in;margin-bottom:.0001pt;text-indent:-1.0in;line-height:normal'><b>ITEM 5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; MARKET
FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES.</b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Shares
of our Common Stock are listed for trading on the NASDAQ Capital Market under
the symbol &quot;GTIM&quot;.&nbsp; The following table presents the quarterly high and low bid
prices for our Common Stock as reported by the NASDAQ Capital Market for each
quarter within the last two fiscal years.&nbsp; The quotations reflect interdealer
prices, without retail mark-ups, mark-downs or commissions and may not
represent actual transactions.</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='margin-left:41.4pt;border-collapse:collapse'>
 <tr>
  <td width=135 valign=top style='width:101.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b><u>&nbsp;</u></b></p>
  </td>
  <td width=123 colspan=2 valign=top style='width:92.05pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>2009</b></p>
  </td>
  <td width=30 valign=top style='width:22.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=138 valign=top style='width:103.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b><u>&nbsp;</u></b></p>
  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>2010</b></p>
  </td>
 </tr>
 <tr>
  <td width=135 valign=top style='width:101.45pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>QUARTER
  ENDED</b></p>
  </td>
  <td width=63 valign=top style='width:47.05pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>HIGH</b></p>
  </td>
  <td width=60 valign=top style='width:45.0pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>LOW</b></p>
  </td>
  <td width=30 valign=top style='width:22.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>&nbsp;</b></p>
  </td>
  <td width=138 valign=top style='width:103.5pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>QUARTER
  ENDED</b></p>
  </td>
  <td width=60 valign=top style='width:45.0pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>HIGH</b></p>
  </td>
  <td width=48 valign=top style='width:.5in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>LOW</b></p>
  </td>
 </tr>
 <tr>
  <td width=135 valign=top style='width:101.45pt;border:none;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=63 valign=top style='width:47.05pt;border:none;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=60 valign=top style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=30 valign=top style='width:22.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=138 valign=top style='width:103.5pt;border:none;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=60 valign=top style='width:45.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=48 valign=top style='width:.5in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=135 valign=top style='width:101.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>December
  31, 2008</p>
  </td>
  <td width=63 valign=top style='width:47.05pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$2.95</p>
  </td>
  <td width=60 valign=top style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$0.76</p>
  </td>
  <td width=30 valign=top style='width:22.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=138 valign=top style='width:103.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>December
  31, 2009</p>
  </td>
  <td width=60 valign=top style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$1.37</p>
  </td>
  <td width=48 valign=top style='width:.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$1.05</p>
  </td>
 </tr>
 <tr>
  <td width=135 valign=top style='width:101.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>March
  31, 2009</p>
  </td>
  <td width=63 valign=top style='width:47.05pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$1.57</p>
  </td>
  <td width=60 valign=top style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$0.75</p>
  </td>
  <td width=30 valign=top style='width:22.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=138 valign=top style='width:103.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>March
  31, 2010</p>
  </td>
  <td width=60 valign=top style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$1.32</p>
  </td>
  <td width=48 valign=top style='width:.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$1.03</p>
  </td>
 </tr>
 <tr>
  <td width=135 valign=top style='width:101.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>June
  30, 2009</p>
  </td>
  <td width=63 valign=top style='width:47.05pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$2.50</p>
  </td>
  <td width=60 valign=top style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$1.00</p>
  </td>
  <td width=30 valign=top style='width:22.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=138 valign=top style='width:103.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>June
  30, 2010</p>
  </td>
  <td width=60 valign=top style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$1.25</p>
  </td>
  <td width=48 valign=top style='width:.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$0.92</p>
  </td>
 </tr>
 <tr>
  <td width=135 valign=top style='width:101.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>September
  30, 2009</p>
  </td>
  <td width=63 valign=top style='width:47.05pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$1.65</p>
  </td>
  <td width=60 valign=top style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$1.08</p>
  </td>
  <td width=30 valign=top style='width:22.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=138 valign=top style='width:103.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>September
  30, 2010</p>
  </td>
  <td width=60 valign=top style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$1.01</p>
  </td>
  <td width=48 valign=top style='width:.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$0.30</p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>As
of December 15, 2010 there were approximately 225 holders of record of Common
Stock.&nbsp; However, management estimates that there are not fewer than 1,390
beneficial owners of our Common Stock.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Dividend
Policy</b>:
We have never paid dividends on our Common Stock and do not anticipate paying
dividends in the foreseeable future. &nbsp;In addition, we have obtained financing
under loan agreements that restrict the payment of dividends. &nbsp;Our ability to
pay future dividends will necessarily depend on our earnings and financial
condition. &nbsp;However, since restaurant development is capital intensive, we
currently intend to retain any earnings for that purpose.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Recent
Sales of Unregistered Securities</b>:</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Bridge
Financing Note and Warrant</u></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>During
the fiscal year the Company issued a Secured Convertible Promissory Note in the
amount of up to $400,000 to certain lenders in a bridge financing transaction,
together with warrants to purchase up to 100,000 shares of the Company's Common
Stock.&nbsp; The bridge lenders initially included Golden Bridge, W Capital and
McDonald; however, as of April 1, 2010, the bridge loan agreement was amended
to remove Golden Bridge as a lender, replacing it with additional loans from W
Capital and McDonald on the same terms, and the note and warrants were adjusted
accordingly.&nbsp; The note was convertible into shares of Common Stock at any time
prior to repayment at a conversion price of 25% less than the average price of
the Company's common stock during the 20 days prior to the conversion date, but
not below $0.75 per share nor above $1.08 per share.&nbsp; However, the aggregate
principal amount owing to W Capital and McDonald was paid out of the proceeds
of the SII Investment Transaction.&nbsp; In addition, and with the agreement of the
lenders, the accrued interest on such loans through December 13, 2010 of
$39,715 was converted into an aggregate of 79,430 shares of our Common Stock at
a conversion price of $0.50 per share.&nbsp; The warrants remain outstanding and
exercisable at any time prior to December 13, 2013 at an exercise price of 25%
less than the average price of our Common Stock during the 20 days prior to
exercise, but at not less than $0.75 per share nor more than $1.08 per share.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Company relied on the exemption from registration requirements of the
Securities Act set forth in Section 4(2) thereof and the rules and regulations
promulgated there under for the issuance of the note and the warrants in the
bridge financing and for the issuance of shares of Common Stock upon conversion
of accrued interest under the note.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>SII
Investment Transaction</u></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>As
previously disclosed in the Company's current report on Form 8-K filed on
November 3, 2010, the Company entered into the Purchase Agreement with SII on
October 29, 2010, pursuant to which the Company agreed to sell, and SII agreed
to purchase, 4,200,000 Shares at a purchase price of $0.50 per share, or an
aggregate of $2,100,000.&nbsp; The Purchase Agreement was amended on December 13,
2010 to clarify the scope of SII's director designation rights following the
Closing.&nbsp; On December 13, 2010, the Company and SII completed the issuance and
sale of the Shares to the SII.&nbsp; The Company received gross proceeds of
$2,100,000, which will be used to pay off the interim working capital loans,
reduce the Company's current liabilities and provide working capital for fiscal
2011 and beyond pursuant to its business strategy.</p>

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



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

<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:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Shares sold to SII were not registered under the Securities Act or state
securities laws, and may not be resold in the United States in the absence of
an effective registration statement filed with the SEC or an available
exemption from the applicable federal and state registration requirements.&nbsp; In
the Purchase Agreement, SII represented to the Company that: (a) it is an
accredited investor, as such term is defined in Rule 501 of Regulation D
promulgated under the Securities Act; (b) it acquired the Shares as principal
for its own account for investment purposes only and not with a view to or for
distributing or reselling the Shares or any part thereof; and (c) it is
knowledgeable, sophisticated and experience in making, and qualified to make,
decisions with respect to investments in securities representing an investment
decision similar to that involved in the purchase of the Shares.&nbsp; The Company
has relied on the exemption from the registration requirements of the
Securities Act set forth in Section 4(2) thereof and the rules and regulations
promulgated there under for the purposes of the SII Investment Transaction.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Disclosure
with Respect to the Company's Equity Compensation Plans</b>: We maintain
the 2008 Omnibus Equity Incentive Compensation Plan, pursuant to which we may
grant equity awards to eligible persons, and have outstanding stock options
granted under our 2001Good Times Restaurants Stock Option Plan, 1992 Incentive
Stock Option Plan and 1992 Non-Statutory Stock Option Plan.&nbsp; For additional
information, see Note 13, Stockholders' Equity, in the Notes to the
Consolidated Financial Statements included in this report. The following table
gives information about equity awards under our plans as of September 30, 2010.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>Equity
Compensation Plan Information</b></p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=618
 style='margin-left:.2in;border-collapse:collapse'>
 <tr>
  <td width=168 valign=top style='width:1.75in;padding:0in 5.4pt 0in 5.4pt'><br clear=all
  style='page-break-before:always'>


  </td>
  <td width=138 valign=top style='width:103.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>(a)</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-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>(b)</p>
  </td>
  <td width=186 valign=top style='width:139.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>(c)</p>
  </td>
 </tr>
 <tr>
  <td width=168 valign=bottom style='width:1.75in;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>Plan
  category</b></p>
  </td>
  <td width=138 valign=bottom style='width:103.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>Number of securities to be issued upon
  exercise of outstanding options, warrants &amp; rights</b></p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>Weighted-average exercise price of
  outstanding options, warrants &amp; rights</b></p>
  </td>
  <td width=186 valign=bottom style='width:139.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>Number of securities remaining
  available for future issuance under equity compensation plans (excluding
  securities reflected in column (a))</b></p>
  </td>
 </tr>
 <tr>
  <td width=168 valign=top style='width:1.75in;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Equity
  compensation plans approved by security holders-options</p>
  </td>
  <td width=138 valign=bottom style='width:103.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:30.6pt;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>390,086</p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>$3.30</p>
  </td>
  <td width=186 valign=bottom style='width:139.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>161,986</p>
  </td>
 </tr>
 <tr>
  <td width=168 valign=top style='width:1.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Total</p>
  </td>
  <td width=138 valign=bottom style='width:103.5pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:30.6pt;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>390,086</p>
  </td>
  <td width=126 valign=bottom style='width:94.5pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>$3.30</p>
  </td>
  <td width=186 valign=bottom style='width:139.5pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>161,986</p>
  </td>
 </tr>
</table>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>&nbsp;</b></p>

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



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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

</div>



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










<p class=MsoNormal><b>ITEM 6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; SELECTED
FINANCIAL DATA.</b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
selected financial data on the following pages are derived from our historical
financial statements and is qualified in its entirety by such financial
statements which are included in Item 8 hereof.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
following presents certain historical financial information of the Company.&nbsp;
This financial information includes the combined operations of the Company and
its subsidiary for the fiscal years ended September 30, 2006 to 2010. Certain prior
year balances have been reclassified to conform to the current year's
presentation.&nbsp; Such reclassifications had no effect on the net income or loss.</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=720
 style='margin-left:-17.1pt;border-collapse:collapse'>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:.25in;margin-bottom:.0001pt;text-indent:-.25in;line-height:normal'><b>&nbsp;</b></p>
  </td>
  <td width=474 colspan=10 style='width:355.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>_______________________________ September
  30,________________________________ </b></p>
  </td>
  <td style='border:none;padding:0in 0in 0in 0in' width=6><p class='MsoNormal'>&nbsp;</td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'><b>Operating
  Data:</b></p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.7pt;
  margin-bottom:6.0pt;margin-left:17.3pt;text-align:center;line-height:normal'><b>2010</b></p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.7pt;
  margin-bottom:6.0pt;margin-left:26.3pt;text-align:center;line-height:normal'><b>2009</b></p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.7pt;
  margin-bottom:6.0pt;margin-left:21.8pt;text-align:center;line-height:normal'><b>2008</b></p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.7pt;
  margin-bottom:6.0pt;margin-left:21.8pt;text-align:center;line-height:normal'><b>2007</b></p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.7pt;
  margin-bottom:6.0pt;margin-left:17.3pt;text-align:center;line-height:normal'><b>2006</b></p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>Restaurant
  sales</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>20,390,000&nbsp;</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>22,079,000&nbsp;</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>25,244,000&nbsp;</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>24,215,000&nbsp;</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 colspan=2 style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>20,329,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>Franchise
  fees and royalties</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>473,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>536,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>638,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>740,000&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>606,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total
  Net Revenues</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>20,863,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>22,615,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>25,882,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>24,955,000&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>20,935,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>Restaurant
  Operating Costs:</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=3 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Food
  and packaging costs</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>7,181,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>7,423,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>8,002,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>7,589,000&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>6,338,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Payroll
  and other employee benefit costs</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>7,359,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>7,663,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>8,780,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>8,063,000&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>6,584,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Occupancy
  and other operating costs</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,331,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,529,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,881,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,393,000&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,797,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; New
  store pre-opening costs</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>15,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>38,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>118,000&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>182,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Depreciation
  and amortization</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>943,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,172,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,283,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,223,000&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>997,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total
  restaurant operating costs</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>19,814,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>20,802,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>22,984,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>21,386,000&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>17,898,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>

  </td>
  <td width=96 colspan=3 style='width:1.0in;padding:0in .7pt 0in .7pt'>

  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Selling,
  General &amp; Administrative costs</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,638,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,814,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,567,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,226,000&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,752,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Franchise
  costs</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>124,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>161,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>312,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>160,000&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>166,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss
  (Gain) on restaurant assets</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>199,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(28,000)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(35,000)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(17,000)</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(57,000)</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>Income&nbsp;
  (Loss) from Operations</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($1,912,000)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($1,134,000)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($946,000)</p>
  </td>
  <td width=16 style='width:12.0pt;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 style='width:60.0pt;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>200,000&nbsp;</p>
  </td>
  <td width=16 style='width:12.0pt;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 colspan=2 style='width:60.0pt;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>176,000&nbsp;</p>
  </td>
 </tr>
 <tr style='height:17.5pt'>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt;height:17.5pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>Other
  Income and (expenses)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:17.5pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:17.5pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:17.5pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:17.5pt'>

  </td>
  <td width=96 colspan=3 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:17.5pt'>

  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Unrealized
  gain (loss) on interest rate swap</p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(87,000)</p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
  <td width=96 colspan=3 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Interest
  income (expense), net</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(598,000)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(261,000)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(13,000)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>40,000&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>87,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total
  other income (expense)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(595,000)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(348,000)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(13,000)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>40,000&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>87,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>

  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>

  </td>
  <td width=80 style='width:60.0pt;padding:0in .7pt 0in .7pt'>

  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>

  </td>
  <td width=80 colspan=2 style='width:60.0pt;padding:0in .7pt 0in .7pt'>

  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>Net
  Income (Loss) from continuing operations</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($2,507,000)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($1,482,000)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($959,000)</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>240,000&nbsp;</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 colspan=2 style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>263,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss
  from discontinued operations</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>590,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>218,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>Net
  Income&nbsp; (Loss)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($3,097,000)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($1,700,000)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($959,000)</p>
  </td>
  <td width=16 style='width:12.0pt;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 style='width:60.0pt;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>240,000&nbsp;</p>
  </td>
  <td width=16 style='width:12.0pt;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 colspan=2 style='width:60.0pt;border:none;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>263,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Income
  (Expense) from non-controlling interest</p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>165,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>54,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(113,000)</p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(211,000)</p>
  </td>
  <td width=96 colspan=3 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(246,000)</p>
  </td>
 </tr>
 <tr style='height:.2in'>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt;height:.2in'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Income
  tax expense</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt;height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt;height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt;height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt;height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .7pt 0in .7pt;height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
 </tr>
 <tr style='height:.3in'>
  <td width=240 valign=bottom style='width:2.5in;padding:0in 5.4pt 0in 5.4pt;
  height:.3in'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>Net
  Income (Loss) available to Common Shareholders</p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;border:none;
  padding:0in .7pt 0in .7pt;height:.3in'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($2,932,000)</p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;border:none;
  padding:0in .7pt 0in .7pt;height:.3in'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($1,646,000)</p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;border:none;
  padding:0in .7pt 0in .7pt;height:.3in'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($1,076,000)</p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;border:none;padding:0in .7pt 0in .7pt;
  height:.3in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 valign=bottom style='width:60.0pt;border:none;padding:0in .7pt 0in .7pt;
  height:.3in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>29,000&nbsp;</p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;border:none;padding:0in .7pt 0in .7pt;
  height:.3in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 colspan=2 valign=bottom style='width:60.0pt;border:none;
  padding:0in .7pt 0in .7pt;height:.3in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>17,000&nbsp;</p>
  </td>
 </tr>
 <tr style='height:.3in'>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt;height:.3in'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>Basic
  and Diluted Earnings (Loss) Per Share</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt;
  height:.3in'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($ .75)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt;
  height:.3in'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($ .42)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt;
  height:.3in'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($.28)</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt;height:.3in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 style='width:60.0pt;padding:0in .7pt 0in .7pt;height:.3in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>.01&nbsp;</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt;height:.3in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 colspan=2 style='width:60.0pt;padding:0in .7pt 0in .7pt;
  height:.3in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>.01&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=3 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'><b>Balance
  Sheet Data:</b></p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=3 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>Working
  Capital (Deficit)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($1,869,000)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($1,200,000)</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($2,082,000)</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>532,000&nbsp;</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 colspan=2 style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,547,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>Total
  assets</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>8,318,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>10,254,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>11,920,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>11,544,000&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>10,693,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>Non-controlling
  interest in partnerships</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>274,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>428,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>584,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>751,000&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>795,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>Long-term
  debt</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,005,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,478,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>846,000&nbsp;</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>970,000&nbsp;</p>
  </td>
  <td width=96 colspan=3 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,293,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=240 style='width:2.5in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:13.5pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
  normal'>Stockholders'
  equity</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,694,000&nbsp;</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,378,000&nbsp;</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>5,993,000&nbsp;</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>7,084,000&nbsp;</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 colspan=2 style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>6,877,000&nbsp;</p>
  </td>
 </tr>
 <tr height=0>
  <td width=240 style='border:none'></td>
  <td width=16 style='border:none'></td>
  <td width=80 style='border:none'></td>
  <td width=16 style='border:none'></td>
  <td width=80 style='border:none'></td>
  <td width=16 style='border:none'></td>
  <td width=80 style='border:none'></td>
  <td width=16 style='border:none'></td>
  <td width=80 style='border:none'></td>
  <td width=16 style='border:none'></td>
  <td width=74 style='border:none'></td>
  <td width=6 style='border:none'></td>
 </tr>
</table>



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



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

<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:0in;margin-bottom:.0001pt;line-height:
normal'><b>&nbsp;</b></p>

<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:1.0in;margin-bottom:.0001pt;text-indent:-1.0in;line-height:normal'><b>ITEM 7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS</b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b><u>Results of Operations</u></b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Net
Revenues: Net revenues for fiscal 2010 decreased $1,752,000 (7.7%) to $20,863,000
from $22,615,000 for fiscal 2009.&nbsp; Same store restaurant sales decreased $1,146,000
(6.1%) during fiscal 2010. Restaurants are included in same store sales after
they have been open a full fifteen months and only Good Times restaurants are
included while dual branded restaurants are excluded.&nbsp; Restaurant sales
decreased $77,000 due to one non-traditional company-owned restaurant not
included in same store sales and decreased $94,000 due to two dual branded company-owned
restaurants. Restaurant sales decreased $372,000 due to one co-developed
restaurant sold to a franchisee in June 2010. Net revenues decreased $63,000 in
fiscal 2010 due to a decrease in franchise royalties of $66,000 offset by an increase
in franchise fees of $3,000.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Our
same store restaurant sales decline of 6.1% reflects the adverse impact the
macroeconomic environment has had on consumers' discretionary spending, the
heavy promotion of $1 value menus and discounting by competitors and the
proliferation of fast casual hamburger themed restaurants in Colorado.&nbsp; We had
shown same store sales growth in sixteen consecutive quarters leading into the
third quarter of fiscal 2008 but then experienced declines through May of 2010,
when the declines moderated significantly and then sales growth trends turned
positive in August 2010 and have remained positive through the date of this
report.&nbsp; Our outlook for fiscal 2011 is more optimistic based on the last six
months' sales trends, however our sales trends are influenced by many factors
and the macroeconomic environment remains challenging for smaller restaurant
chains.&nbsp; Our average transaction has increased in August through November 2010
compared to 2009 and we are continuing to manage our marketing communications
to balance growth in customer traffic and their average expenditure.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Average
restaurant sales for company-owned and co-developed restaurants (including
double drive thru restaurants and restaurants with dining rooms but excluding
dual brand restaurants) for fiscal 2009 and 2010 were as follows:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='margin-left:18.9pt;border-collapse:collapse'>
 <tr style='height:8.65pt'>
  <td width=155 valign=top style='width:116.1pt;padding:0in 5.4pt 0in 5.4pt;
  height:8.65pt'>

  </td>
  <td width=108 valign=top style='width:81.0pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt;height:8.65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>Fiscal
  2010</b></p>
  </td>
  <td width=108 valign=top style='width:81.0pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt;height:8.65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>Fiscal
  2009</b></p>
  </td>
 </tr>
 <tr style='height:8.55pt'>
  <td width=155 valign=top style='width:116.1pt;padding:0in 5.4pt 0in 5.4pt;
  height:8.55pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Company
  operated</p>
  </td>
  <td width=108 valign=top style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:8.55pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal'>$734,000</p>
  </td>
  <td width=108 valign=top style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:8.55pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:4.5pt;margin-bottom:.0001pt;line-height:normal'>$783,000</p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>For
factors which may affect future results of operations, please refer to the
section entitled &quot;Current Fiscal Year Initiatives&quot; in Item 1 on pages 4 - 5 of
this report and a related discussion of planned product and system changes
discussed in the section entitled &quot;Concept and Business Strategy&quot; in Item 1 on
pages 2 - 4 of this report.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Restaurant
Operating Costs:</b>
Restaurant operating costs as a percent of restaurant sales were 97.2% for fiscal
2010 compared to 94.2% in fiscal 2009.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>The
changes in restaurant-level costs are explained as follows:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=438
 style='margin-left:18.9pt;border-collapse:collapse'>
 <tr>
  <td width=354 valign=top style='width:265.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Restaurant-level
  costs for the period ended September 30, 2009</p>
  </td>
  <td width=84 valign=top style='width:63.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>94.2%</p>
  </td>
 </tr>
 <tr>
  <td width=354 valign=top style='width:265.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Increase
  in food and packaging costs</p>
  </td>
  <td width=84 valign=top style='width:63.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1.6%</p>
  </td>
 </tr>
 <tr>
  <td width=354 valign=top style='width:265.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Increase
  in payroll and other employee benefit costs</p>
  </td>
  <td width=84 valign=top style='width:63.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1.4%</p>
  </td>
 </tr>
 <tr>
  <td width=354 valign=top style='width:265.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Increase
  in occupancy and other operating costs</p>
  </td>
  <td width=84 valign=top style='width:63.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>&nbsp;
  .8%</p>
  </td>
 </tr>
 <tr>
  <td width=354 valign=top style='width:265.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Decrease
  in pre-open costs</p>
  </td>
  <td width=84 valign=top style='width:63.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(.1%)</p>
  </td>
 </tr>
 <tr>
  <td width=354 valign=top style='width:265.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Decrease
  in depreciation and amortization costs</p>
  </td>
  <td width=84 valign=top style='width:63.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(.7%)</p>
  </td>
 </tr>
 <tr>
  <td width=354 valign=top style='width:265.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Restaurant-level
  costs for the period ended September 30, 2010</p>
  </td>
  <td width=84 valign=top style='width:63.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>97.2%</p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Food
and Packaging Costs:</b>
Food and packaging costs for fiscal 2010 decreased $242,000 from $7,423,000 (33.6%
of restaurant sales) in fiscal 2009 to $7,181,000 (35.2% of restaurant sales).
In fiscal 2009 we saw a moderation in food and packaging cost increases. We
experienced dramatic increases in commodity costs including beef, bacon, soft
drinks and dairy costs in fiscal 2010.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
fiscal 2009 and 2010 our weighted food and packaging costs increased
approximately 2% and 11%, respectively.&nbsp; The cumulative weighted menu price
increases taken during fiscal 2009 and fiscal 2010 were approximately 2.2% and
1.7%, respectively.&nbsp; Most of the 2010 menu price increases were taken in the
last four months of fiscal 2010 aggregating a 7.1% cumulative increase. The
introduction of the $2.89 Craver combo meals in May 2010 negatively impacted
our cost of sales by an estimated 1% of restaurant sales. We anticipate limited
price increases in fiscal 2011 with continued cost pressure on several core
commodities, however we anticipate our food and packaging costs as a percentage
of sales will decrease in fiscal 2011 from a combination of price increases,
product sales mix changes and recipe modifications.</p>

<p class=MsoFooter align=right style='text-align:right'>18</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Payroll
and Other Employee Benefit Costs:</b> For fiscal 2010, payroll and other
employee benefit costs decreased $304,000 from $7,663,000 (34.7% of restaurant
sales) in fiscal 2009 to $7,359,000 (36.1% of restaurant sales).</p>



<p class=MsoBodyText style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;text-indent:0in'>The decrease in payroll
and other employee benefit costs for fiscal 2010 is primarily due to a decrease
in restaurant sales. Payroll and benefit costs are semi-variable and therefore
increase or decrease as sales fluctuate and increased as a percentage of sales
in fiscal 2010.&nbsp; &nbsp;Additionally, in July 2010 we eliminated approximately
$80,000 of annual payroll costs through salary reductions and salary
eliminations. &nbsp;&nbsp;The three dual branded restaurants also have a higher labor
cost as a percent of sales than Good Times single brand restaurants.&nbsp;&nbsp; We
anticipate payroll and other employee benefit costs will decrease as a
percentage of sales in fiscal 2011 due to the operating leverage on increasing
sales.</p>



<p class=MsoNormal style='margin-bottom:6.0pt;text-align:justify;line-height:
normal'><b>Occupancy
and Other Costs:</b>
For fiscal 2010, occupancy and other costs decreased $198,000 from $4,529,000 (20.5%
of restaurant sales) in fiscal 2009 to $4,331,000 (21.3% of restaurant sales).&nbsp;
The $198,000 decrease in occupancy and other costs is primarily attributable
to:</p>

<p class=Style63CxSpFirst style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Decrease in building rent of $40,000
due to negotiated rent reductions at several locations.</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Decrease in our accretion for
deferred rent of $168,000 due to negotiated rent reductions at several
locations.</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Decrease of $89,000 in various
other restaurant operating costs due to decreased restaurant sales and planned
expense reductions.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
decreases above were offset by the following cost increases:</p>



<p class=Style63CxSpFirst style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Increase in property taxes of $12,000
related to valuation increases at existing restaurants.</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Increase in restaurant repairs of
$36,000 primarily due to the aging of our restaurants.</p>

<p class=Style63CxSpLast style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Increase in utility costs of $62,000
related to utility rate increases and increased usage related to the
implementation of our fresh cut fry product.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Occupancy
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 increased property taxes on those locations, however occupancy costs
will decrease as same store sales increase.&nbsp;&nbsp; We are pursuing additional rent
concessions and lease restructuring with several of our landlords and
anticipate additional reductions to our occupancy costs in fiscal 2011, however
we are unable to estimate the amount of those reductions.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>New
Store Pre-opening Costs:</b> For fiscal 2010, new store pre-opening costs
decreased $15,000 from $15,000 in fiscal 2009 to $0.&nbsp; New store pre-opening
costs in fiscal 2009 were related to one new company-owned restaurant that
opened in October 2008. </p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Depreciation
and Amortization Costs:</b> For fiscal 2010, depreciation and amortization
costs decreased $229,000 from $1,172,000 in fiscal 2009 to $943,000.&nbsp;
Depreciation costs decreased due to declining depreciation expense in our aging
company-owned and joint-venture restaurants.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Selling,
General and Administrative Costs:</b> For fiscal 2010, selling, general and
administrative costs decreased $176,000 from $2,814,000 (12.7% of restaurant
sales) in fiscal 2009 to $2,638,000 (12.9% of restaurant sales).&nbsp; The decrease
in selling, general and administrative costs are partially attributable to
decreased advertising costs, which decreased to $1,156,000 (5.7% of restaurant
sales) for fiscal 2010 from $1,246,000 (5.6% of restaurant sales) for fiscal
2009, and a decrease in general and administrative costs, which decreased to
$1,482,000 (7.3% of restaurant sales) for fiscal 2010 from $1,568,000 (7.1% of restaurant
sales) for fiscal 2009 as explained below.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
decrease in advertising costs is 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.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>We
anticipate that fiscal 2011 advertising expense will decrease from fiscal 2010
and will consist primarily of radio advertising and on-site and
point-of-purchase merchandising totaling approximately 4% of restaurant sales.&nbsp;
We anticipate that general and administrative expenses will be relatively
stable, with the exception of reinstating certain salaries that were reduced in
fiscal 2009 and 2010.</p>

<p class=MsoFooter align=right style='text-align:right'>19</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
$86,000 decrease in general and administrative expenses in fiscal 2010 is
primarily attributable to:</p>



<p class=Style63CxSpFirst style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Reductions in payroll and employee
benefit costs of $147,000.</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Reductions in training and
recruiting expenses of $9,000.</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Reduction in professional services
of $47,000.</p>

<p class=Style63CxSpLast style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Net reductions in various other
fixed expenses of $8,000.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
decreases above were offset by the following cost increases and additional
costs:</p>



<p class=Style63CxSpFirst style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
A decrease of $22,000 in
miscellaneous income related to the elimination by the state and local taxing
authorities of sales tax collection fees.</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Expense of $85,000 to write off an
uncollectable franchise note receivable.</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Increase in vacant land costs of
$18,000.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Franchise
Costs:</b>
For fiscal 2010 franchise costs decreased $37,000 from $161,000 (.7% of total
revenues) in fiscal 2009 to $124,000 (.6% of total revenues).</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
decrease in franchise costs is primarily attributable to a reduction in legal
fees and reductions in various other costs compared to the prior year. In
fiscal 2009 we wrote off $20,000 in legal costs related to the Good Times/Taco
John's Dual Brand franchise agreement.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Loss
(Gain) on Restaurant Assets:</b> For fiscal 2010 the loss on restaurant
assets increased $227,000 to a $199,000 loss from a $28,000 gain in fiscal 2009.&nbsp;
The $227,000 loss on restaurant assets in fiscal 2010 is primarily related to a
$163,000 write down to fair market value of a piece of&nbsp; land that was sold on
December 3, 2010.&nbsp; Additionally we recognized a $64,000 loss related to a
co-developed restaurant sold to a franchisee in June 2010.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Income
(Loss) from Operations:</b> The loss from operations was $1,912,000 in fiscal
2010 compared to a loss from operations of $1,134,000 in fiscal 2009. The
increase in loss from operations for the fiscal year is due primarily to the
decrease in net revenues offset by other matters discussed in the
&quot;Restaurant Operating Costs&quot;, &quot;General and Administrative
Costs&quot;, &quot;Franchise Costs&quot; and &quot;Loss on Restaurant Assets&quot; sections above.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Loss
from Continuing Operations:</b> The loss from continuing operations was $2,507,000
for fiscal 2010 compared to a loss of $1,482,000 in fiscal 2009.&nbsp; The change
from fiscal 2009 to fiscal 2010 was primarily attributable to the matters
discussed in the &quot;Net Revenues&quot;, &quot;Food and Packaging
Costs&quot;, &quot;Selling, General and Administrative Costs&quot; and
&quot;Franchise Costs&quot; sections of Item 6, as well as 1) an increase in
net interest expense of $337,000 compared to the same prior year period; and 2)
a reduction in the unrealized loss related to our interest rate swap liability
of $90,000 in fiscal 2010 compared to fiscal 2009.&nbsp; Net interest expense for fiscal
2010 includes non-cash amortization of debt issuance costs of $259,000 related
to: 1) warrants related to the extension of the PFGI II loan in January, 2010;
2) beneficial conversion rights and warrants related to the loan agreement with
W Capital and John T. MacDonald entered into in February 2010; and 3) warrants
related to the loan agreement with Golden Bridge LLC entered into in April,
2009. (See &quot;Financing&quot; below).&nbsp;&nbsp; We anticipate that interest expense will be
reduced significantly in fiscal 2011 due to the pay off of the W Capital,
MacDonald and Golden Bridge loans and the reduction of the PFGI II loan
discussed below.</p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>&nbsp;</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Loss
from Discontinued Operations: </b>The loss from discontinued operations
for fiscal 2010 and 2009 includes results attributable to our Commerce City,
Colorado dual-branded restaurant that was closed in March 2010 and one Denver,
Colorado co-developed restaurant that was closed in June 2010. The fiscal 2010 costs
of $590,000 includes the results of operations of $153,000, the fair value of
all future lease obligations of $143,000 and impairment charges to write down
the fixed assets to book value and other costs of $294,000. The fiscal 2009
costs of $218,000 represent the results of operations related to the two closed
restaurants.</p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>&nbsp;</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Income
from Non-controlling Interests: </b>For fiscal 2010 the income from non-controlling
interests increased $111,000 to $165,000 from $54,000 in fiscal 2009. The
non-controlling interests represents the limited partner's share of income or
loss in the co-developed restaurants. The $111,000 increase was attributable to
the decreased profitability of the co-developed restaurants.&nbsp;&nbsp; We anticipate
that income from non-controlling interests will decrease as the limited
partner's share of income improves.</p>

<p class=MsoFooter align=right style='text-align:right'>20</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b><u>Liquidity and Capital Resources</u></b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Cash
and Working Capital:</b>
As of September 30, 2010, we had $429,000 in cash and cash equivalents on
hand.&nbsp; We currently plan to use the cash balance, any cash generated from
operations and net proceeds received in December 2010 from the SII Investment
Transaction described below to reduce our accounts payable, accrued liabilities
and short term notes payable and for our working capital needs.&nbsp; We believe
that we will have sufficient capital to meet our working capital, long term
debt obligations and recurring capital expenditure needs in fiscal 2011 and
beyond. &nbsp;Additionally, we may sell or sublease select underperforming company
operated restaurants if we believe the realizable asset value is greater than
the long term cash flow value or if the asset does not fit our longer term
distribution and location of restaurants.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>As
of September 30, 2010, we had a working capital deficit of $1,869,000 substantially
due to notes payable of $585,000 which are due on December 31, 2010 and accrued
property taxes for 2009 of approximately $200,000 which are currently due.&nbsp;
Additionally, we have recorded an $84,000 current liability related to the
unrealized loss on our interest rate swap, as described in Note 5 of the Notes
to Consolidated Financial Statements in Item 8. Net proceeds of approximately
$1,820,000 received on December, 13 2010 from the SII Investment Transaction
discussed in Item 1 were used to reduce our accounts payable, accrued
liabilities and short term notes payable and for our working capital needs in
fiscal 2011.
After the completion of the SII Investment Transaction on December 13, 2010,
our working capital deficit decreased to approximately $45,000.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
December, 2009 we entered into an agreement to extend the maturity of the PFGI
II, LLC loan of $2,500,000 to December 31, 2012 and modified the terms of the
loan to include a 25 year amortization period with a balloon payment for the
remaining principal balance on December 31, 2012.&nbsp; As a result, the majority of
the PFGI II LLC loan is shown as a long term liability as of September 30, 2010.
&nbsp;On December 3, 2010 we sold the vacant land that was partially collateralizing
the PFGI II loan and used the net proceeds of $812,000 to reduce the loan.&nbsp;&nbsp; We
anticipate selling the land and building for an operating restaurant we own
that collateralizes the remaining PFGI II loan in a sale leaseback transaction and
using the proceeds to reduce the loan.&nbsp; If that transpires and the PFGI II loan
is paid in full, the additional collateral under the PFGI II loan will be
released.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b><u>Financing:</u></b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b><u>&nbsp;</u></b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i><u>Wells Fargo Bank N.A.</u></i></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>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.&nbsp; As previously reported, we
were in default of certain financial loan covenants and had been operating
under a forbearance and reservation of rights agreement with Wells Fargo.&nbsp;&nbsp; As
previously disclosed in the Company's current report on Form 8-K filed December
17, 2010, we entered into a new Credit and Loan Agreement that modified the
loan covenants and provided additional collateral to Wells Fargo. &nbsp;The loan
covenants were modified to require minimum Tangible Net Worth of $2,500,000,
Total Liabilities Divided by Tangible Net Worth not greater than 3.0 to 1.0 and
an EBITDA Coverage Ratio not less than 0.9 to 1.0 as of the end of the first
fiscal quarter of 2012, not less than 1.2 to 1.0 as of the end of the second
fiscal quarter of 2012 and not less than 1.5 to 1.0 thereafter.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i><u>PFGI II, LLC</u></i></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
July 2008, we entered into a $2,500,000 promissory note with an unrelated third
party (PFGI II, LLC) and amended that note on April 20, 2009 extending the
maturity to July 10, 2010. Effective January 2, 2010, the Company entered into
an agreement to amend its loan with PFGI II LLC.&nbsp; The maturity date was
extended to December 31, 2012, the interest rate was increased to 8.65% and
monthly payments of principal and interest are payable beginning January 31,
2010, based upon a 25 year amortization prior to maturity. In connection with
the agreement, the Company issued a three-year warrant dated January 2, 2010 to
PFGI II, LLC which provides that PFGI II, LLC may at any time from January 2,
2010 until December 31, 2012 purchase up to 112,612 shares of the Company's
common stock at an exercise price of $1.11 per share. The number of shares purchasable
upon exercise of the warrant and the exercise price are subject to customary
anti-dilution adjustments upon the occurrence of any stock dividends, stock
splits, reverse stock splits, recapitalizations, reclassifications, stock
combinations or similar events. The fair value of the warrant issued to PFGI
II, LLC was determined to be $79,000 with the following assumptions; 1) risk
free interest rate of 1.7%, 2) an expected life of 3 years, and 3) an expected
dividend yield of zero. The fair value of $79,000 was charged to the note
discount and credited to Additional Paid in Capital. The note discount will be amortized
over the term of thirty six months and charged to interest expense.</p>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
promissory note originally constituted a revolving line-of-credit for the
development of new restaurants which was advanced and repaid on a monthly basis
from time to time.&nbsp; The promissory note now constitutes a term loan with
monthly payments of principal and interest.&nbsp; The loan is secured by separate
leasehold deeds of trust and security agreements related to six company-owned restaurants
and first deeds of trust on two real properties funded by the line of credit.
The total outstanding balance on the promissory note was $2,481,000 at September
30, 2010.&nbsp; Of the $2,481,000 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 was sold on December 3, 2010 reducing the loan by $812,000 in net proceeds
from the sale.</p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>&nbsp;</u></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i><u>Golden Bridge, LLC</u></i></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>On
April 20, 2009 as reported on Form 8-K, the Company entered into a loan
agreement with Golden Bridge, LLC (&quot;Golden Bridge&quot;), pursuant to which Golden
Bridge made a loan of $185,000 (the &quot;Golden Bridge Loan&quot;) to GTDT to be used
for restaurant marketing and other working capital costs.&nbsp; Eric Reinhard, Ron
Goodson, David Grissen, Richard Stark, and Alan Teran, who were all members of
the Company's Board of Directors at the time of the transaction and
stockholders of the Company, are the sole members of Golden Bridge.&nbsp; Subsequent
to the fiscal year end, the loan was repaid in full on December 13, 2010 from
the proceeds of the SII Investment Transaction (see &quot;SII Investment
Transaction&quot; below).</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Golden Bridge Loan was evidenced by a promissory note dated April 20, 2009 made
by the Company and GTDT, as co-makers, and bearing interest at a rate of 10%
per annum on the unpaid principal balance.&nbsp; The note provided for monthly
interest payments and was to mature and be due and payable in full on December
31, 2010.&nbsp; The commitment fee for the Golden Bridge Loan was $3,700.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
connection with the Golden Bridge Loan, the Company issued a three-year warrant
dated April 20, 2009 to Golden Bridge which provides that Golden Bridge may at
any time from April 20, 2009 until April 20, 2012 purchase up to 92,500 shares
of the Company's common stock at an exercise price of $1.15 per share.&nbsp; The
number of shares purchasable upon exercise of the warrant and the exercise
price are subject to customary anti-dilution adjustments upon the occurrence of
any stock dividends, stock splits, reverse stock splits, recapitalizations,
reclassifications, stock combinations or similar events. The fair value of the
warrant issued to Golden Bridge was determined to be $42,000 with the following
assumptions: 1) risk free interest rate of 1.27%, 2) an expected life of 3
years, and 3) an expected dividend yield of zero. The fair value of $42,000 was
charged to the note discount and credited to Additional Paid in Capital. The
note discount will be amortized over fourteen months and charged to interest
expense.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i><u>W. Capital and John T. McDonald</u></i></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>On
February 1, 2010, the Company entered into a loan agreement with W Capital,
Inc. (&quot;W Capital&quot;), John T. McDonald (&quot;McDonald&quot;) and Golden Bridge, pursuant
to which the lenders made loans totaling $200,000, with up to an additional
$200,000 available through April 30, 2010, to be used for restaurant marketing
and other working capital uses of GTDT.&nbsp; As set forth below, the loan agreement
was subsequently amended as of April 1, 2010 to remove Golden Bridge as a
lender and to replace it with additional loans from W Capital and McDonald.&nbsp; At
September 30, 2010 the entire $400,000 had been advanced to the Company
pursuant to the loan agreement (the &quot;Bridge Loans&quot;). &nbsp;On December 13, 2010, the
outstanding principal amount of the Bridge Loans was paid in full from the
proceeds of the SII Investment Transaction, and accrued interest on the Bridge
Loans was converted into 79,430 shares of Common Stock.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Bridge Loans were evidenced by a Secured Convertible Promissory Note dated April
1, 2010 made by the Company and bearing interest at a rate of 12% per annum on
the unpaid principal balance through August 1, 2010 and at a rate of 14% per
annum from and after August 1, 2010 until the maturity date of December 31,
2010.&nbsp; The note provided that the outstanding principal balance and accrued
interest would be convertible into shares of Common Stock of the Company at any
time prior to repayment at a conversion price of 25% less than the average
price of the Company's common stock during the 20 days prior to the conversion
date, but not below $0.75 per share nor above $1.08 per share.&nbsp; However, in
connection with the SII Investment Transaction, W Capital and McDonald agreed
to convert the accrued interest payable on the Bridge Loans into shares of
Common Stock at a conversion price of $0.50 per share and entered into an
agreement with the Company to amend the conversion provisions of the note
accordingly.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
connection with the Bridge Loans, the Company issued warrants dated February 1,
2010 to W Capital and McDonald which provide that the lenders may at any time from
February 1, 2010 until two years from the date of repayment or conversion of
the Bridge Loans purchase up to an aggregate of 50,000 shares of the Company's Common
Stock at an exercise price of 25% less than the average price of the Company's
common stock during the 20 days prior to the exercise</p>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>date,
provided, however, that the exercise price shall not be below $0.75 per share
nor above $1.08 per share.&nbsp; Pursuant to the terms of the loan agreement,
because the Bridge Loans were not repaid prior to August 1, 2010, the Company
issued warrants to W Capital and McDonald for the purchase of 50,000 additional
shares of the Company's Common Stock upon the same terms as the initial warrants.&nbsp;
The number of shares purchasable upon exercise of the warrants issued to W
Capital and McDonald and the exercise price are subject to customary
anti-dilution adjustments upon the occurrence of any stock dividends, stock
splits, reverse stock splits, recapitalizations, reclassifications, stock
combinations or similar events.&nbsp; Following the repayment and conversion of the
Bridge Loans on December 13, 2010, the warrants will expire on December 12,
2012.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
fair value of the warrants issued February 1, 2010 was determined to be $38,000
with the following assumptions: 1) risk free interest rate of 1.41%, 2) an
expected life of 2.5 years, and 3) an expected dividend yield of zero. The fair
value of $38,000 was charged to the note discount and credited to Additional
Paid in Capital. The note discount was amortized over the term of seven months
and charged to interest expense.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
intrinsic value of the embedded beneficial conversion feature of the Bridge
Loans was determined to be $161,000. The intrinsic value of $161,000 was
charged to the note discount and credited to Additional Paid in Capital. The
note discount was amortized over the term of seven months and charged to
interest expense.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
fair value of the warrants issued August 1, 2010 was determined to be $36,000
with the following assumptions: 1) risk free interest rate of .70%, 2) an
expected life of 2.4 years, and 3) an expected dividend yield of zero. The fair
value of $36,000 was charged to the note discount and credited to Additional
Paid in Capital. The note discount will be amortized over the term of five
months and charged to interest expense.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Additional
commitments for the development of new restaurants in fiscal 2011 will depend
on the Company's sales trends, cash generated from operations and our access to
capital including in the sale-leaseback markets.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i><u>SII Investment Transaction</u></i></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>On
October 29, 2010, the Company and SII entered into the Purchase Agreement,
pursuant to which the Company agreed to sell, and SII agreed to purchase,
4,200,000 Shares of Common Stock at a purchase price of $0.50 per share, or an
aggregate purchase price of $2,100,000.&nbsp; The Purchase Agreement was amended on
December 13, 2010.&nbsp; On December 13, 2010, the Company and SII completed the SII
Investment Transaction through the issuance and sale of the Shares to SII.&nbsp; On
December 13, 2010, the Company and SII also entered into a Registration Rights
Agreement, pursuant to which the Company granted SII certain registration
rights with respect to resale of the Shares.&nbsp; As a result of the completion of
the SII Investment Transaction, SII became the beneficial owner of
approximately 51.4 percent of the Company's outstanding Common Stock.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Purchase Agreement provides for so long as SII holds more than 50 percent of
our outstanding common stock, (i) our Board of Directors shall consist of seven
members, and (ii) SII will have the right to designate four members of our
Board.&nbsp; In addition, the Purchase Agreement provides that for a period of three
years following the Closing, as long as SII continues to own at least 80
percent of the Shares, SII will have a right of first refusal to purchase
additional securities which are offered and sold by the Company for the purpose
of maintaining its percentage interest in the Company.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
proceeds from the SII Investment Transaction were used to pay approximately
$280,000 of expenses related to the transaction, repay $585,000 in short term
loans, reduce accrued liabilities by $200,000,&nbsp; reduce accounts payable by
approximately $150,000 and the balance going to increase the Company's working
capital.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Cash
Flows:</b>
Net cash used in operating activities was $737,000 for fiscal 2010 compared to
cash provided by operating activities of $595,000 in fiscal 2009.&nbsp; The increase
in net cash used in operating activities from continuing operations for fiscal
2010 was the result of a net loss from continuing operations of $2,507,000 and
non-cash reconciling items totaling $1,910,000 (comprised principally of
depreciation and amortization of $943,000, amortization of debt issuance costs
of $259,000, $88,000 of stock option compensation expense, a $166,000 increase
in accrued liabilities related to property taxes, a $361,000 increase in our
trade accounts payable and net increases in operating assets and liabilities
totaling $93,000). In addition, net cash used in operating activities from
discontinued operations for fiscal 2010 was $140,000 compared to $128,000 for
fiscal 2009.</p>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Net
cash provided by investing activities in fiscal 2010 was $54,000 compared to net
cash used of $284,000 in fiscal 2009.&nbsp; The fiscal 2010 activity reflects
payments for the purchase of property and equipment of $61,000, payments
received on loans to franchisees of $15,000 and proceeds from the sales of
fixed assets of $100,000.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Net
cash provided by financing activities in fiscal 2010 was $297,000 compared to $280,000
in fiscal 2009.&nbsp; The fiscal 2010 activity includes principal payments on notes
payable and long term debt of $144,000, borrowings on notes payable of $400,000
and receivables from non-controlling interests in partnerships of $41,000.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Contingencies
and Off-Balance Sheet Arrangements:</b> 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 we have not been notified nor are we aware of any
leases in default under which we are contingently liable, however there can be
no assurance that there will not be in the future, which could have a material
adverse effect on our future operating results.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Critical
Accounting Policies and Estimates:&nbsp; </b>We follow accounting standards set by
the Financial Accounting Standards Board, commonly referred to as the &quot;FASB.&quot;
The FASB sets generally accepted accounting principles (GAAP) that we follow to
ensure we consistently report our financial condition, results of operations,
and cash flows. Over the years, the FASB and other designated GAAP-setting
bodies, have issued standards in the form of FASB Statements, Interpretations,
FASB Staff Positions, EITF consensuses, AICPA Statements of Position, etc.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
FASB recognized the complexity of its standard-setting process and embarked on
a revised process in 2004 that culminated in the release on July 1, 2009, of
the FASB Accounting Standards Codification,&trade; sometimes referred to as the
Codification or ASC. To the Company, this means instead of following the Statements,
Interpretations, Staff Positions, etc., we will follow the guidance in Topics
as defined in the ASC. The Codification does not change how the Company
accounts for its transactions or the nature of related disclosures made.
However, when referring to guidance issued by the FASB, the Company refers to
topics in the ASC rather than Statements, etc. The above change was made
effective by the FASB for periods ending on or after September 15, 2009. We
have updated references to GAAP in this Annual Report on Form 10-K to reflect
the guidance in the Codification.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Notes
Receivable:</b>
We evaluate the collectability of our note receivables from franchisees
annually.&nbsp; The aggregate notes receivable on the consolidated balance sheet at
September 30, 2010 were $19,000.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Discontinued
Operations: </b>Discontinued
operations are presented in accordance with FASB ASC 205-20, Presentation of
Financial Statements. During fiscal 2010 we closed two locations, one
dual-branded restaurant in Commerce City, Colorado in March 2010 and one
co-developed restaurant in Denver, Colorado in June 2010. The loss from
discontinued operations includes both the current and historical results of
operations, the fair value of all future lease obligations and an impairment
charge to write down the fixed assets to book value. Fixed assets of $1,164,000
and $1,164,000 of associated accumulated depreciation related to discontinued
operations are included in the property and equipment of our condensed
consolidated balance sheet. Current and long-term liabilities related to
discontinued operations relate to the future estimated lease obligations.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>With
respect to the closed locations, we have continuing lease obligations of
$786,000. We have subleased the Commerce City location for $618,000. We have
terminated the lease on the Denver location effective February 1, 2011. We have
recorded an estimated liability of $143,000 related to these locations.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Non-controlling
Interests:</b>
The Company adopted the provisions of FASB ASC 810, Consolidation, effective
October 1, 2009. FASB ASC 810 requires non-controlling interests, previously
called minority interests, to be presented as a separate item in the equity
section of the consolidated balance sheet. It also requires the amount of
consolidated net income or loss attributable to non-controlling interests to be
clearly presented on the face of the consolidated income statement.
Additionally, Topic 810 clarifies that changes in a parent's ownership interest
in a subsidiary that do not result in deconsolidation are equity transactions,
and that deconsolidation of a subsidiary requires gain or loss recognition in
net income based on the fair value on the deconsolidation date. Topic 810 was
applied prospectively with the exception of presentation and disclosure
requirements, which were applied retrospectively for all periods presented, and
did not significantly change the presentation of our consolidated financial
statements.</p>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>&nbsp;</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Impairment
of Long-Lived Assets:</b>
We review our long-lived assets for impairment in accordance with the guidance
of FASB ASC 360-10, Property, Plant, and Equipment, including land, property
and equipment whenever events or changes in circumstances indicate that the
carrying amount of an asset may not be recoverable. Recoverability of assets to
be held and used is measured by a comparison of the capitalized costs of the
assets to the future undiscounted net cash flows expected to be generated by
the assets and the expected cash flows are based on recent historical cash
flows at the restaurant level (the lowest level that cash flows can be
determined).</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>An
analysis was performed on a restaurant by restaurant basis at September 30, 2010.&nbsp;
Assumptions used in preparing expected cash flows were as follows:</p>



<ul style='margin-top:0in' type=disc>
 <li class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
     justify;line-height:normal'>Sales projections are as follows: Fiscal 2011
     sales are projected to increase 3% to 5% with respect to fiscal 2010, for
     fiscal years 2012 to 2024 we have used annual increases of 2% to 3%. We
     believe the 2% to 3% increase in the years beyond 2011 is a reasonable
     expectation of growth and that it would be unreasonable to expect no
     growth in our sales. These increases include menu price increases in
     addition to any real growth. Historically our weighted menu prices have
     increased 1.5% to 6%.</li>
</ul>

<p class=Style63CxSpFirst style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our variable and semi-variable
restaurant operating costs are projected to increase proportionately with the
sales increases as well as increasing an additional 1.5% per year consistent
with inflation.</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Our other fixed restaurant
operating costs are projected to increase 1.5% to 2% per year.</p>

<p class=Style63CxSpMiddle style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Food and packaging costs are
projected to remain flat in relation to our current fiscal 2010 food and
packaging costs as a percentage of sales.</p>

<p class=Style63CxSpLast style='text-align:justify;text-indent:-.25in'>&#149;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Salvage value has been estimated
on a restaurant by restaurant basis considering each restaurant's particular
equipment package and building size.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Given
the results of our impairment analysis at September 30, 2010 there are no
restaurants which have potential impairment as their projected undiscounted
cash flows show recoverability of their asset values.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Our
impairment analysis included a sensitivity analysis with regard to the cash
flow projections that determine the recoverability of each restaurant's assets.
The results indicate that even with a 20% decline in our projected cash flows
we would still not have any potential impairment issues.&nbsp; We have experienced
higher than normal food and packaging costs as a percentage of restaurant sales
in recent years and we do not believe these costs will remain at these levels
in future years. However for purposes of our cash flow projections in the asset
impairment analysis we have assumed our food and packaging costs will remain at
these higher levels.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Each
time we conduct an impairment analysis in the future we will compare actual
results to our projections and assumptions, and to the extent our actual
results do not meet expectations, we will revise our assumptions and this could
result in impairment charges being recognized.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>All
of the judgments and assumptions made in preparing the cash flow projections
are consistent with our other financial statement calculations and disclosures.
The assumptions used in the cash flow projections are consistent with other
forward-looking information prepared by the Company, such as those used for
internal budgets, discussions with third parties, and/or reporting to
management or the Board of Directors.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
fiscal 2010 we closed two company-operated restaurants resulting in total
charges of $396,000. &nbsp;Projecting the cash flows for the impairment analysis
involves significant estimates with regard to the performance of each
restaurant, and it is reasonably possible that the estimates of cash flows may
change in the near term resulting in the need to write down operating assets to
fair value. If the assets are determined to be impaired, the amount of impairment
recognized is the amount by which the carrying amount of the assets exceeds
their fair value. Fair value would be determined using forecasted cash flows
discounted using an estimated average cost of capital and the impairment charge
would be recognized in income from operations.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Income
Taxes:</b>
We account for income taxes in accordance with FASB ASC 740, Income Taxes. FASB
ASC 740 prescribes the use of the liability method whereby deferred tax asset
and liability account balances are determined based on differences between the
financial reporting and tax bases of assets and liabilities and are measured
using the enacted tax rates and laws that will be in effect when the
differences are expected to reverse. The Company provides a valuation
allowance, if necessary, to reduce deferred tax assets to their estimated
realizable value. The deferred tax assets are reviewed periodically for
recoverability, and valuation allowances are adjusted as necessary.&nbsp; We believe
it is more likely than not that the recorded deferred tax assets will be
realized.</p>

<p class=MsoFooter align=right style='text-align:right'>25</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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</div>



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












<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Variable
Interest Entities:</b>
We analyze any potential Variable Interest or Special-Purpose Entities in
accordance with the guidance of FASB ASC 810-10, Consolidation of Variable
Interest and Special-Purpose Entities. Once an entity is determined to be a
Variable Interest Entity (VIE), the party with the controlling financial
interest, the primary beneficiary, is required to consolidate it.&nbsp; We have two
franchisees with notes payable to the Company and after analysis we have
determined that, while these franchisees are VIE's as defined by FASB ASC
810-10, we are not the primary beneficiary of the entities, and therefore they
are not required to be consolidated.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Fair
Value of Financial Instruments:</b> We adopted the provisions of FASB ASC
820, Fair Value Measurements and Disclosures, effective October 1, 2008. FASB
ASC 820 defines fair value, establishes a framework for measuring fair value
under GAAP and enhances disclosure about fair value measurements. The adoption
of this guidance did not have a material impact on either our financial position
or results of operations.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>New
Accounting Pronouncements</b>: In January 2010, the FASB issued an update
regarding guidance over the disclosure requirements of fair value
measurements.&nbsp; This update adds new requirements for disclosure about
transfers into and out of Levels One and Two and also adds additional
disclosure requirements about purchases, sales, issuances, and settlements
relating to Level Three measurements.&nbsp; The guidance is effective for
reporting periods beginning after December 15, 2009 for the disclosure
requirements around Levels One and Two measurements, and is effective for
reporting periods beginning after December&nbsp;15, 2010 for the disclosure
requirements around Level Three.&nbsp; This new guidance currently has no
impact on the fair value disclosures of the Company, as there have been no
transfers out of Levels One or Two.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
June 2009, the FASB issued FASB ASC 105, Generally Accepted Accounting
Principles, which establishes the FASB Accounting Standards Codification as the
sole source of authoritative generally accepted accounting principles. Pursuant
to the provisions of FASB ASC 105, the Company has updated references to GAAP
in its financial statements issued for the period ended September 30, 2010. The
adoption of FASB ASC 105 did not impact the Company's financial position or
results of operations.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
June 2008, the FASB issued FASB ASC 815-40, Derivatives and Hedging, that
provides guidance on how to determine if certain instruments (or embedded
features) are considered indexed to a company's own stock, including
instruments similar to warrants to purchase the company's stock. FASB ASC
815-40 requires companies to use a two-step approach to evaluate an
instrument's contingent exercise provisions and settlement provisions in determining
whether the instrument is considered to be indexed to its own stock and
therefore exempt from the application of FASB ASC 815. Although FASB ASC 815-40
was effective for our fiscal year beginning October 1, 2009, any outstanding
instrument at the date of adoption requires a retrospective application of the
accounting through a cumulative effect adjustment to retained earnings upon
adoption. The adoption of FASB ASC 815-40 did not impact the Company's
financial position or results of operations. The requirements of FASB ASC
815-40 will only impact future derivative or hedging transactions into which we
may enter.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
December 2007, the FASB issued FASB ASC 805, Business Combinations, which
establishes principles and requirements for how an acquiring entity in a
business combination recognizes and measures the assets acquired and
liabilities assumed in the transaction; establishes the acquisition-date fair
value as the measurement objective for all assets acquired and liabilities
assumed; and sets the disclosure requirements regarding the information needed
to evaluate and understand the nature and financial effect of the business
combination.&nbsp; This accounting pronouncement was effective for our fiscal year
beginning October 1, 2009.&nbsp; The adoption of this guidance did not have any
impact on the Company's financial position or results of operations. The
requirements of FASB ASC 805 will only impact future business combination
transactions into which we may enter.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Subsequent
Events:</b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Subsequent
events have been evaluated through the date the consolidated financial
statements were available to be issued.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Pre-approval
of non-audit services: On October 25, 2010, the Audit Committee of the Board of
Directors of Good Times Restaurants Inc. approved in advance certain non-audit
services to be performed by Hein &amp; Associates, Good Times' independent
auditor.&nbsp; These non-audit services are to consist primarily of corporate income
tax compliance services.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Completion
of SII Investment Transaction and Related Events:&nbsp; On December 13, 2010, the
Company completed the SII Investment Transaction pursuant to which the Company
issued 4,200,000 Shares to SII and received gross proceeds of $2,100,000, some
of which were used to repay the Company's interim working capital loans from Golden
Bridge, W Capital and McDonald, accompanied by the conversion of accrued
interest on the W Capital and McDonald loans into</p>



<p class=MsoFooter align=right style='text-align:right'>26</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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</div>



<br
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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>79,430
shares of Common Stock.&nbsp; In addition, the SII Investment Transaction also
allowed the Company to renegotiate the terms and covenants of its loan with
Wells Fargo and to regain compliance of certain financial loan covenants that
had previously been in default. See Financing Activities under the Liquidity
and Capital Resources section above for further details regarding the SII
Investment Transaction and related events.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>See
the &quot;Financing&quot; section above for discussion of the partial pay-down of the
PFGI II loan in December 2010.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>ITEM
7A.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; QUANTITIATIVE AND QUALITIATIVE DISCLOSURES ABOUT MARKET RISK.</b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Not
applicable.</p>



<p class=MsoFooter align=right style='text-align:right'>27</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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

</div>



</div>

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


<div class=WordSection3>









<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>ITEM
8&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>&nbsp;</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>&nbsp;</b></p>

<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>INDEX TO FINANCIAL STATEMENTS</b></p>





<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
  <td width=589 valign=top style='width:441.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=87 valign=top style='width:65.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:12.6pt;margin-bottom:.0001pt;line-height:normal'><u>PAGE</u></p>
  </td>
 </tr>
 <tr>
  <td width=589 valign=top style='width:441.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=87 valign=top style='width:65.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=589 valign=top style='width:441.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Report
  of Independent Registered Public Accounting Firm</p>
  </td>
  <td width=87 valign=top style='width:65.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.65pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>F-2</p>
  </td>
 </tr>
 <tr>
  <td width=589 valign=top style='width:441.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=87 valign=top style='width:65.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=589 valign=top style='width:441.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Consolidated
  Balance Sheets - September 30, 2010 and 2009</p>
  </td>
  <td width=87 valign=top style='width:65.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.65pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>F-3</p>
  </td>
 </tr>
 <tr>
  <td width=589 valign=top style='width:441.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=87 valign=top style='width:65.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=589 valign=top style='width:441.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Consolidated
  Statements of Operations - For the Years Ended September 30, 2010 and 2009</p>
  </td>
  <td width=87 valign=top style='width:65.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.65pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>F-4</p>
  </td>
 </tr>
 <tr>
  <td width=589 valign=top style='width:441.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=87 valign=top style='width:65.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=589 valign=top style='width:441.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Consolidated
  Statements of Stockholders' Equity and Comprehensive Loss - For the Period
  from</p>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;October
  1, 2008 through September 30, 2010</p>
  </td>
  <td width=87 valign=top style='width:65.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.65pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>F-5</p>
  </td>
 </tr>
 <tr>
  <td width=589 valign=top style='width:441.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=87 valign=top style='width:65.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=589 valign=top style='width:441.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Consolidated
  Statements of Cash Flows - For the Years Ended September 30, 2010 and 2009</p>
  </td>
  <td width=87 valign=top style='width:65.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.65pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>F-6</p>
  </td>
 </tr>
 <tr>
  <td width=589 valign=top style='width:441.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=87 valign=top style='width:65.45pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=589 valign=top style='width:441.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Notes
  to Consolidated Financial Statements</p>
  </td>
  <td width=87 valign=top style='width:65.45pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.65pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>F7
  - F20</p>
  </td>
 </tr>
</table>



<p class=MsoFooter align=right style='text-align:right'>F-1</p>

<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

<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:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM</p>









<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>To
the Stockholders and</p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>Board
of Directors</p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>Good
Times Restaurants, Inc.</p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>Golden,
Colorado</p>







<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>We have audited the accompanying consolidated balance sheets of
Good Times Restaurants, Inc. and subsidiary as of September 30, 2010 and 2009,
and the related consolidated statements of operations, stockholders' equity and
comprehensive loss, and cash flows for the years then ended.&nbsp; These financial
statements are the responsibility of the Company's management.&nbsp; Our
responsibility is to express an opinion on these financial statements based on
our audits.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>We conducted our audits in accordance with the standards of the
Public Company Accounting Oversight Board (United States).&nbsp; Those standards
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatement.&nbsp; The
Company is not required to have, nor were we engaged to perform an audit of its
internal control over financial reporting.&nbsp; Our audit included consideration of
internal control over financial reporting as a basis for designing audit
procedures that are appropriate in the circumstances, but not for the purpose
of expressing an opinion on the effectiveness of the Company's internal control
over financial reporting.&nbsp; Accordingly, we express no such opinion.&nbsp; An audit
also includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation.&nbsp; We believe that our audits provide a
reasonable basis for our opinion.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In our opinion, the consolidated financial statements referred to
above present fairly, in all material respects, the financial position of Good
Times Restaurants, Inc. and subsidiary as of September 30, 2010 and 2009, and
the results of their operations and their cash flows for the years then ended
in conformity with U.S. generally accepted accounting principles.</p>









<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>HEIN &amp; ASSOCIATES LLP </p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>Denver,
Colorado</p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>December
19, 2010</p>



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

<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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

</div>



</div>

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


<div class=WordSection4>









<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>GOOD TIMES RESTAURANTS INC. AND
SUBSIDIARY</b></p>

<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>CONSOLIDATED BALANCE SHEETS</b></p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=637
 style='border-collapse:collapse'>
 <tr>
  <td style='border:none;padding:0in 0in 0in 0in' width=415><p class='MsoNormal'>&nbsp;</td>
  <td width=222 colspan=5 valign=top style='width:166.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:.3in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'><b>September
  30,</b></p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:20.2pt;margin-bottom:.0001pt;text-align:center;
  line-height:normal'><b><u>2010</u></b></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>&nbsp;</b></p>
  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:.3in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'><b><u>2009</u></b></p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>ASSETS</u></p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;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=108 colspan=2 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>CURRENT ASSETS:</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;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=108 colspan=2 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash
  and cash equivalents</p>
  </td>
  <td width=16 valign=top style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 valign=top style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>429,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=16 valign=top style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=92 valign=top style='width:69.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>815,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Receivables,
  net of allowance for doubtful accounts of $0</p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>157,000&nbsp;</p>
  </td>
  <td width=18 valign=bottom style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=bottom style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>122,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Prepaid
  expenses and other</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>38,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>32,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inventories</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>201,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>220,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Notes
  receivable</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>9,000&nbsp;</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>36,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total
  current assets</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>834,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,225,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>PROPERTY AND EQUIPMENT</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;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=108 colspan=2 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Land
  and building</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>5,653,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>6,596,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Leasehold
  improvements</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,821,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,107,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fixtures
  and equipment</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>8,229,000&nbsp;</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>8,438,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>17,703,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>19,141,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Less
  accumulated depreciation and amortization</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(12,828,000)</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(11,853,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,875,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>7,288,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;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=108 colspan=2 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Assets
  held for sale</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,445,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,595,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>OTHER ASSETS:</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;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=108 colspan=2 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Notes
  receivable, net of current portion</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>10,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>82,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits
  and other assets</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>154,000&nbsp;</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>64,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>164,000&nbsp;</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>146,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=415 valign=top style='width:311.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>TOTAL ASSETS</p>
  </td>
  <td width=16 valign=top style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 valign=top style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>8,318,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=16 valign=top style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=92 valign=top style='width:69.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>10,254,000&nbsp;</p>
  </td>
 </tr>
</table>



<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><u>LIABILITIES AND STOCKHOLDERS' EQUITY</u></p>

<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><u>&nbsp;</u></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=636
 style='margin-left:.9pt;border-collapse:collapse'>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>CURRENT LIABILITIES:</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;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=108 colspan=2 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:.55in;margin-bottom:.0001pt;text-indent:-.55in;line-height:normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current
  maturities of long-term debt, net of discount of $48,000 and $27,000,
  respectively</p>
  </td>
  <td width=16 valign=top style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 valign=top style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>702,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=16 valign=top style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=92 valign=top style='width:69.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,027,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accounts
  payable</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>716,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>355,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deferred
  income</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>89,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>113,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Liabilities
  related to discontinued operations</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>20,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other
  accrued liabilities</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>1,176,000&nbsp;</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>930,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total
  current liabilities</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,703,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,425,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>LONG-TERM LIABILITIES:</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;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=108 colspan=2 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:.55in;margin-bottom:.0001pt;text-indent:-.55in;line-height:normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt,
  net of current portion and net of discount of $33,000 and $0, respectively</p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,005,000&nbsp;</p>
  </td>
  <td width=18 valign=bottom style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=bottom style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,478,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Liabilities
  related to discontinued operations</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>123,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deferred
  liabilities</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>793,000&nbsp;</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>973,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total
  long-term liabilities</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,921,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,451,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>

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

  </td>
  <td width=108 colspan=2 style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>COMMITMENTS AND CONTINGENCIES (Notes 5 and 7)</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;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=108 colspan=2 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;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=108 colspan=2 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>STOCKHOLDERS' EQUITY:</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;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=108 colspan=2 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Non-controlling
  interest in Partnerships</p>
  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>274,000&nbsp;</p>
  </td>
  <td width=18 style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>428,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Preferred
  stock, $.01 par value;</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;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=108 colspan=2 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5,000,000
  shares authorized, none issued</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;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=108 colspan=2 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; and
  outstanding as of September 30, 2009 and 2010</p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=bottom style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Common
  stock, $.001 par value; 50,000,000 shares</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;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=108 colspan=2 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Authorized,
  3,898,559 shares issued and</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;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=108 colspan=2 valign=top style='width:81.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; outstanding
  as of September 30, 2009 and 2010</p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,000&nbsp;</p>
  </td>
  <td width=18 valign=bottom style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=bottom style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Capital
  contributed in excess of par value</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>18,153,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>17,751,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accumulated
  deficit</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(16,737,000)</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(13,805,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total
  stockholders' equity</p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>1,694,000&nbsp;</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 colspan=2 valign=top style='width:81.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>4,378,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=414 valign=top style='width:310.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>TOTAL
  LIABILITIES AND STOCKHOLDERS' EQUITY</p>
  </td>
  <td width=16 valign=top style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 valign=top style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>8,318,000&nbsp;</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=16 valign=top style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=92 valign=top style='width:69.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>10,254,000&nbsp;</u></p>
  </td>
 </tr>
</table>



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

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

<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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

</div>



</div>

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


<div class=WordSection5>









<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>GOOD TIMES RESTAURANTS INC. AND
SUBSIDIARY</b></p>

<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>CONSOLIDATED STATEMENTS OF OPERATIONS</b></p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=618
 style='margin-left:-7.5pt;border-collapse:collapse'>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=210 colspan=5 valign=top style='width:157.5pt;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:21.0pt;margin-bottom:.0001pt;text-align:center;
  line-height:normal'><b>For the Years Ended</b></p>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:25.5pt;margin-bottom:.0001pt;text-align:center;
  line-height:normal'><b>September 30,</b></p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=102 colspan=2 valign=top style='width:76.5pt;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:21.0pt;margin-bottom:.0001pt;text-align:center;
  line-height:normal'><b><u>2010</u></b></p>
  </td>
  <td width=12 valign=top style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>&nbsp;</b></p>
  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:21.0pt;margin-bottom:.0001pt;text-align:center;
  line-height:normal'><b><u>2009</u></b></p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>NET REVENUES:</p>
  </td>
  <td width=102 colspan=2 style='width:76.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Restaurant
  sales</p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=86 valign=bottom style='width:64.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>20,390,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 valign=bottom style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>22,079,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Area
  development and franchise fees</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>16,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>13,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Franchise
  royalties </p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>457,000&nbsp;</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>523,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Total
  net revenues</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>20,863,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>22,615,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>RESTAURANT OPERATING COSTS:</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Food
  and packaging costs</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>7,181,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>7,423,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Payroll
  and other employee benefit costs</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>7,359,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>7,663,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Restaurant
  occupancy costs</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,528,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,486,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Accretion
  of deferred rent</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(167,000)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Other
  restaurant operating costs</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>970,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,042,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>New
  store pre-opening costs</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>15,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Depreciation
  and amortization</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>943,000&nbsp;</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>1,172,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Total
  restaurant operating costs</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>19,814,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>20,802,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>General
  and administrative costs</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,482,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,568,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Advertising
  costs</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,156,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,246,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Franchise
  costs</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>124,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>161,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Loss
  (Gain) on restaurant assets</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>199,000&nbsp;</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(28,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Loss From Operations</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(1,912,000)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(1,134,000)</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Other Income (Expenses):</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Interest
  income</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>16,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Interest
  expense</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(599,000)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(277,000)</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Unrealized
  income (loss) on interest rate swap</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>3,000&nbsp;</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(87,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Total
  other expenses, net</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(595,000)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(348,000)</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>LOSS FROM CONTINUING OPERATIONS</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>($2,507,000)</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>($1,482,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Loss
  from discontinued operations</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(590,000)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(218,000)</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>NET LOSS</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>($3,097,000)</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>($1,700,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Loss
  from non-controlling interests</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>165,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>54,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>NET LOSS APPLICABLE TO COMMON STOCKHOLDERS</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>($2,932,000)</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>($1,646,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>BASIC AND DILUTED LOSS PER SHARE:</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Continuing
  operations</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($.64)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($.38)</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Discontinued
  operations</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($.15)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($.06)</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Net
  loss applicable to common stockholders</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($.75)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>($.42)</p>
  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>WEIGHTED AVERAGE COMMON SHARES OUTSTANDING</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=408 valign=top style='width:4.25in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Basic
  and Diluted</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,898,559&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,898,559&nbsp;</p>
  </td>
 </tr>
 <tr height=0>
  <td width=408 style='border:none'></td>
  <td width=16 style='border:none'></td>
  <td width=86 style='border:none'></td>
  <td width=12 style='border:none'></td>
  <td width=16 style='border:none'></td>
  <td width=80 style='border:none'></td>
 </tr>
</table>

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

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

<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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

</div>



</div>

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


<div class=WordSection6>









<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>GOOD TIMES RESTAURANTS INC. AND SUBSIDIARY</b></p>

<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>CONSOLIDATED STATEMENTS OF STOCKHOLDERS'
EQUITY AND COMPREHENSIVE LOSS</b></p>

<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>FOR THE PERIOD FROM OCTOBER 1, 2008
THROUGH SEPTEMBER 30, 2010</b></p>

<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>&nbsp;</b></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=912
 style='margin-left:-35.5pt;border-collapse:collapse'>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=114 colspan=3 valign=bottom style='width:85.5pt;border:none;
  border-bottom:solid windowtext 1.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Preferred Stock</p>
  </td>
  <td width=114 colspan=3 valign=bottom style='width:85.5pt;border:none;
  border-bottom:solid windowtext 1.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Common Stock</p>
  </td>
  <td width=40 colspan=2 valign=top style='width:30.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=458 colspan=13 valign=bottom style='width:343.5pt;padding:0in .5pt 0in .5pt'>

  </td>
 </tr>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=54 valign=bottom style='width:40.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Issued</p>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Shares</p>
  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;border-top:solid windowtext 1.0pt;
  border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
  padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Par</p>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Value</p>
  </td>
  <td width=60 valign=bottom style='width:45.0pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Issued</p>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Shares</p>
  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;border:none;
  border-bottom:solid windowtext 1.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Par</p>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Value</p>
  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;border:none;
  border-bottom:solid windowtext 1.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Capital Contributed in Excess of Par
  Value</p>
  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;border:none;
  border-bottom:solid windowtext 1.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Non-controlling interest in
  Partnerships</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;border:none;
  border-bottom:solid windowtext 1.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Accumulated Deficit</p>
  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;border:none;
  border-bottom:solid windowtext 1.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Accumulated Other Comprehensive Loss</p>
  </td>
  <td width=96 valign=bottom style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Comprehensive Income (Loss)</p>
  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;border:none;
  border-bottom:solid windowtext 1.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Total</p>
  </td>
 </tr>
 <tr style='height:1.0pt'>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=54 valign=bottom style='width:40.5pt;border:none;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;border:none;
  padding:0in .5pt 0in .5pt;height:1.0pt'>

  </td>
  <td width=60 valign=bottom style='width:45.0pt;border:none;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;border:none;
  padding:0in .5pt 0in .5pt;height:1.0pt'>

  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;border:none;
  padding:0in .5pt 0in .5pt;height:1.0pt'>

  </td>
  <td width=66 colspan=3 valign=top style='width:49.5pt;border:none;padding:
  0in .5pt 0in .5pt;height:1.0pt'>

  </td>
  <td width=90 colspan=2 valign=top style='width:67.5pt;border:none;padding:
  0in .5pt 0in .5pt;height:1.0pt'>

  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;border:none;
  padding:0in .5pt 0in .5pt;height:1.0pt'>

  </td>
  <td width=96 valign=top style='width:1.0in;border:none;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;border:none;
  padding:0in .5pt 0in .5pt;height:1.0pt'>

  </td>
 </tr>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>BALANCES, October 1, 2008</p>
  </td>
  <td width=54 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  -&nbsp;</u></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$</p>
  </td>
  <td width=44 valign=bottom style='width:33.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  0&nbsp;</u></p>
  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:3.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>3,898,559</u></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=38 valign=bottom style='width:28.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>4,000&nbsp;</u></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=68 colspan=2 valign=bottom style='width:51.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>17,632,000&nbsp;</u></p>
  </td>
  <td width=18 colspan=2 valign=bottom style='width:13.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:.7pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;line-height:normal'>&nbsp;$</p>
  </td>
  <td width=48 valign=bottom style='width:.5in;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>584,000&nbsp;</u></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=74 valign=bottom style='width:55.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>(12,159,000)</p>
  </td>
  <td width=22 valign=bottom style='width:16.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=62 valign=bottom style='width:46.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>(68,000)</u></p>
  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=18 colspan=2 valign=bottom style='width:13.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>5,993,000&nbsp;</u></p>
  </td>
 </tr>
 <tr style='height:1.0pt'>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=54 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
 </tr>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Stock
  option compensation cost</p>
  </td>
  <td width=54 valign=top style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>77,000&nbsp;</p>
  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>77,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Value
  of warrants issued with debt</p>
  </td>
  <td width=54 valign=top style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>42,000&nbsp;</p>
  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>42,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Non-controlling
  interest in Partnerships</p>
  </td>
  <td width=54 valign=top style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>(156,000)</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(156,000)</p>
  </td>
 </tr>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><a name="_Hlk184521674">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net Loss</a></p>
  </td>
  <td width=54 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>(1,646,000)</p>
  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>(1,646,000)</u></p>
  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(1,646,000)</p>
  </td>
 </tr>
 <tr style='height:1.0pt'>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deferred
  hedging losses</p>
  </td>
  <td width=54 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>68,000&nbsp;</p>
  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>68,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Comprehensive
  loss</p>
  </td>
  <td width=54 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></p>
  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:3.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></p>
  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></p>
  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></p>
  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></p>
  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></p>
  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></p>
  </td>
 </tr>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=54 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;padding:0in .5pt 0in .5pt'>

  </td>
 </tr>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>BALANCES, September&nbsp;30, 2009</p>
  </td>
  <td width=54 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  -&nbsp;</u></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u>$</p>
  </td>
  <td width=44 valign=bottom style='width:33.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  0&nbsp;</u></p>
  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:3.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>3,898,559</u></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=38 valign=bottom style='width:28.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>4,000&nbsp;</u></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=68 colspan=2 valign=bottom style='width:51.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>17,751,000&nbsp;</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>428,000&nbsp;</u></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=74 valign=bottom style='width:55.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>(13,805,000)</p>
  </td>
  <td width=22 valign=bottom style='width:16.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=62 valign=bottom style='width:46.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  0&nbsp;</u></p>
  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=62 colspan=3 valign=bottom style='width:46.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>4,378,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=54 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;padding:0in .5pt 0in .5pt'>

  </td>
 </tr>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Stock
  option compensation cost</p>
  </td>
  <td width=54 valign=top style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>88,000&nbsp;</p>
  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>88,000&nbsp;&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Value
  of warrants issued with debt</p>
  </td>
  <td width=54 valign=top style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>153,000&nbsp;</p>
  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>153,000&nbsp;&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Value
  of beneficial conversion feature</p>
  </td>
  <td width=54 valign=top style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>161,000&nbsp;</p>
  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>161,000&nbsp;&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Non-controlling
  interest in Partnerships</p>
  </td>
  <td width=54 valign=top style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>(154,000)</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(154,000)</p>
  </td>
 </tr>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Net
  Loss and comprehensive loss</p>
  </td>
  <td width=54 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>(2,932,000)</p>
  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>(2,932,000)</u></p>
  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(2,932,000)</p>
  </td>
 </tr>
 <tr>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Deferred
  hedging losses</p>
  </td>
  <td width=54 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=60 colspan=2 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></p>
  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:3.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></p>
  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></p>
  </td>
  <td width=84 colspan=3 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></p>
  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </u></p>
  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;
  </u></p>
  </td>
  <td width=78 colspan=4 valign=bottom style='width:58.5pt;padding:0in .5pt 0in .5pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  0&nbsp;&nbsp;</u></p>
  </td>
 </tr>
 <tr style='height:1.0pt'>
  <td width=186 valign=top style='width:139.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>BALANCES, September&nbsp;30, 2010</p>
  </td>
  <td width=54 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  -&nbsp;</u></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=44 valign=bottom style='width:33.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  0&nbsp;</u></p>
  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:3.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>3,898,559</u></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=38 valign=bottom style='width:28.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>4,000&nbsp;</u></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=68 colspan=2 valign=bottom style='width:51.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>18,153,000&nbsp;</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>274,000&nbsp;</u></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=74 valign=bottom style='width:55.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>(16,737,000)</p>
  </td>
  <td width=22 valign=bottom style='width:16.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=62 valign=bottom style='width:46.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  0&nbsp;</u></p>
  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:4.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=22 colspan=3 valign=bottom style='width:16.5pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>

  </td>
  <td width=56 valign=bottom style='width:42.0pt;padding:0in .5pt 0in .5pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>1,694,000&nbsp;</u></p>
  </td>
 </tr>
 <tr height=0>
  <td width=186 style='border:none'></td>
  <td width=54 style='border:none'></td>
  <td width=16 style='border:none'></td>
  <td width=44 style='border:none'></td>
  <td width=60 style='border:none'></td>
  <td width=16 style='border:none'></td>
  <td width=38 style='border:none'></td>
  <td width=16 style='border:none'></td>
  <td width=24 style='border:none'></td>
  <td width=44 style='border:none'></td>
  <td width=12 style='border:none'></td>
  <td width=6 style='border:none'></td>
  <td width=48 style='border:none'></td>
  <td width=16 style='border:none'></td>
  <td width=74 style='border:none'></td>
  <td width=22 style='border:none'></td>
  <td width=62 style='border:none'></td>
  <td width=96 style='border:none'></td>
  <td width=16 style='border:none'></td>
  <td width=2 style='border:none'></td>
  <td width=4 style='border:none'></td>
  <td width=56 style='border:none'></td>
 </tr>
</table>

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

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

<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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

</div>



</div>

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


<div class=WordSection7>









<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>GOOD TIMES RESTAURANTS INC. AND
SUBSIDIARY</b></p>

<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>CONSOLIDATED STATEMENTS OF CASH FLOWS</b></p>

<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>&nbsp;</b></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=678
 style='margin-left:-12.0pt;border-collapse:collapse'>

  <tr style='height:24.75pt'>
   <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt;
   height:24.75pt'>

   </td>
   <td width=198 colspan=5 valign=top style='width:148.5pt;padding:0in 1.5pt 0in 1.5pt;
   height:24.75pt'>
   <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
   margin-bottom:0in;margin-left:7.5pt;margin-bottom:.0001pt;text-align:center;
   line-height:normal'><b>FOR
   THE YEARS ENDED</b></p>
   <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
   margin-bottom:0in;margin-left:21.0pt;margin-bottom:.0001pt;text-align:center;
   line-height:normal'><b>September
   30,</b></p>
   </td>
  </tr>
  <tr>
   <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>

   </td>
   <td width=90 colspan=2 valign=top style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt'>
   <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
   margin-bottom:0in;margin-left:21.0pt;margin-bottom:.0001pt;text-align:center;
   line-height:normal'><b><u>2010</u></b></p>
   </td>
   <td width=12 valign=top style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

   </td>
   <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>
   <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
   margin-bottom:0in;margin-left:12.0pt;margin-bottom:.0001pt;text-align:center;
   line-height:normal'><b><u>2009</u></b></p>
   </td>
  </tr>

 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Cash Flows from Operating Activities:</p>
  </td>
  <td width=90 colspan=2 style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=top style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Net Loss</p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=74 valign=bottom style='width:55.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(3,097,000)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 valign=bottom style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(1,700,000)</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Loss from discontinued operations</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(590,000)</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(218,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Net loss from continuing operations</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(2,507,000)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(1,482,000)</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Adjustments
  to reconcile net income (loss) to net cash provided by
  operating&nbsp;activities:</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Depreciation and amortization</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>943,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,172,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Amortization of debt issuance costs</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>259,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>15,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Accretion of deferred rent</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(167,000)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Write off of note receivable</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>85,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Loss (gain) on disposal of property, restaurants and equipment</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>199,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(28,000)</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Stock option compensation cost</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>88,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>77,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Unrealized loss (income) on interest rate swap agreement</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(3,000)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>87,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Changes
  in operating assets and liabilities:</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  (Increase) decrease in:</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Receivables</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>22,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>38,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Inventories</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>10,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>20,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Prepaid expenses and other</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(6,000)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>47,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Deposits and other assets</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(47,000)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>16,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  (Decrease) increase in:</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Accounts payable</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>361,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(273,000)</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Accrued and other liabilities</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>166,000&nbsp;</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(157,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Net
  cash used in operating activities from continuing operations</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(597,000)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(467,000)</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Net
  cash used in operating activities from discontinued operations</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(140,000)</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(128,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  Net cash used in operating activities</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(737,000)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(595,000)</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Cash Flows From Investing Activities:</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Payments for the purchase of property and equipment </p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(61,000)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(284,000)</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;
  &nbsp;&nbsp;Proceeds from the sale of assets</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>100,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
 </tr>
 <tr style='height:10.35pt'>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt;
  height:10.35pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;
  &nbsp;&nbsp;Loans made to franchisees and to others</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt;
  height:10.35pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt;
  height:10.35pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt;
  height:10.35pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(31,000)</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;
  &nbsp;&nbsp;Payments received on loans to franchisees and to others</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>15,000&nbsp;</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>31,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Net
  cash provided by (used in) investing activities</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>54,000&nbsp;</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(284,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;Cash Flows From Financing Activities:</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Principal payments on notes payable, capital leases, and long-term debt</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(144,000)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(123,000)</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Borrowings on notes payable and long-term debt</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>400,000&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>185,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Net proceeds on line-of-credit</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-&nbsp;</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>320,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;
  Receivable (distributions) from minority interest partner</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>41,000&nbsp;</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(102,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Net
  cash provided by financing activities</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>297,000&nbsp;</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>280,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Net Change in Cash and Cash Equivalents</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(386,000)</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(599,000)</p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Cash and Cash Equivalents, beginning of
  year</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>815,000&nbsp;</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>1,414,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Cash and Cash Equivalents, end of year</p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=74 valign=bottom style='width:55.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>429,000&nbsp;</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 valign=bottom style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>815,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Supplemental Disclosures of Cash Flow Information:</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><a name="_Hlk216664756">Cash paid for interest</a></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=74 valign=bottom style='width:55.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>282,000&nbsp;</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 valign=bottom style='width:60.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>299,000&nbsp;</u></p>
  </td>
 </tr>
 <tr style='height:11.25pt'>
  <td width=480 valign=top style='width:5.0in;padding:0in 1.5pt 0in 1.5pt;
  height:11.25pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Non-cash
  fair value of warrants and beneficial conversion feature</p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .7pt 0in .7pt;
  height:11.25pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=74 valign=bottom style='width:55.5pt;padding:0in .7pt 0in .7pt;
  height:11.25pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>313,000&nbsp;</u></p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in 1.5pt 0in 1.5pt;
  height:11.25pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .7pt 0in .7pt;
  height:11.25pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=80 valign=bottom style='width:60.0pt;padding:0in .7pt 0in .7pt;
  height:11.25pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>42,000&nbsp;</u></p>
  </td>
 </tr>
</table>





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

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

<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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

</div>



</div>

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


<div class=WordSection8>









<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>Notes to
Consolidated Financial statements</b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u> Organization and Summary of
Significant Accounting Policies</u>:</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Organization</u> - Good Times
Restaurants Inc. (Good Times or the Company) is a Nevada corporation. The
Company operates through its wholly owned subsidiary Good Times Drive Thru Inc.
(Drive Thru).</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Drive
Thru commenced operations in 1986 and, as of September&nbsp;30, 2010, operates twenty
seven&nbsp;company-owned and joint venture drive-thru fast food hamburger
restaurants.&nbsp; The Company's restaurants are located in Colorado. In addition,
Drive Thru has twenty-two franchises, eighteen operating in Colorado, two in
Wyoming, one in Idaho and one in North Dakota, and is offering franchises for
development of additional Drive Thru restaurants.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>We
follow accounting standards set by the Financial Accounting Standards Board,
commonly referred to as the &quot;FASB&quot;. The FASB sets generally accepted accounting
principles (GAAP) that we follow to ensure we consistently report our financial
condition, results of operations and cash flows. References to GAAP issued by
the FASB in these footnotes are to the <i>FASB Accounting Standards
Codification&trade;, </i>sometimes referred to as the Codification or ASC. The FASB
finalized the Codification effective for periods ending on or after September
15, 2009. For further discussion of the Codification see &quot;FASB Codification
Discussion&quot; in Management's Discussion and Analysis of Financial Condition and
Results of Operations (commonly referred to as MD&amp;A) elsewhere in this
report.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Principles
of Consolidation</u>
- - The consolidated financial statements include the accounts of Good Times, its
subsidiary and one limited partnership, in which the Company exercises control
as general partner. In June 2010 the Company sold its interest in one limited
partnership to the limited partner and then entered into a franchise agreement
with the limited partner who now operates the restaurant as a franchisee. &nbsp;The
Company owns an approximate 51% interest in the remaining partnership, is the
sole general partner and receives a management fee prior to any distributions
to the limited partners.&nbsp; Because the Company owns an approximate 51% interest
in the partnership and exercises complete management control over all decisions
for the partnership, except for certain veto rights, the financial statements
of the partnership are consolidated into the Company's financial statements.&nbsp;
The equity interest of the unrelated limited partner is shown on the
accompanying consolidated balance sheet in the stockholders' equity section as a
non-controlling interest, and the limited partner's share of the net income or
loss in the partnership is shown as non-controlling interest income or expense
in the accompanying consolidated statement of operations. All inter-company
accounts and transactions are eliminated.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Accounting
Estimates</u>
- - The preparation of consolidated financial statements in conformity with U.S.
Generally Accepted Accounting Principles requires management to make estimates
and assumptions that affect the amounts reported in these consolidated
financial statements and the accompanying notes.&nbsp; Actual results could differ
from those estimates.</p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>&nbsp;</u></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Reclassification</u> - Certain prior
year balances have been reclassified to conform to the current year's
presentation.&nbsp; Such reclassifications had no effect on the net income or loss.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Cash
and Cash Equivalents</u>
- - The Company considers all highly liquid debt instruments purchased with an
initial maturity of three months or less to be cash equivalents.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Accounts
Receivable</u>
- - Accounts receivable include uncollateralized receivables from our franchisees
and our advertising fund, due in the normal course of business, generally
requiring payment within thirty days of the invoice date. On a periodic basis
the Company monitors all accounts for delinquency and provides for estimated
losses of uncollectible accounts. Currently and historically there have been no
allowances for unrecoverable accounts receivable.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Inventories</u> - Inventories
are stated at the lower of cost or market, determined by the first-in first-out
method, and consist of restaurant food items and related packaging supplies.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Property
and Equipment</u>
- - Depreciation is recognized using the straight-line method over the estimated
useful lives of the assets or the lives of the related leases, if shorter, as
follows:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='margin-left:18.9pt;border-collapse:collapse'>
 <tr>
  <td width=179 valign=top style='width:134.1pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Buildings</p>
  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>15
  years</p>
  </td>
 </tr>
 <tr>
  <td width=179 valign=top style='width:134.1pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Leasehold
  improvements</p>
  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>7-15
  years</p>
  </td>
 </tr>
 <tr>
  <td width=179 valign=top style='width:134.1pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Fixtures
  and equipment</p>
  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>3-8
  years</p>
  </td>
 </tr>
</table>



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



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

<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:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Maintenance
and repairs are charged to expense as incurred, and expenditures for major
improvements are capitalized.&nbsp; When assets are retired, or otherwise disposed
of, the property accounts are relieved of costs and accumulated depreciation
with any resulting gain or loss credited or charged to income.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>We
have classified $2,445,000 as assets held for sale in the accompanying
consolidated balance sheet. These costs are related to two sites, one in
Firestone, Colorado which has been fully developed and one in Aurora, Colorado that
was sold to a third party in December 2010 (see Note 2 below).&nbsp; The proceeds of
the sale leaseback transaction and the land sale, when consummated, are
required to be used for the reduction of the line of note payable to PFGI II, LLC.
The effect on our operating cash flow is not material as the interest expense
on the note payable is approximately equal to the proposed rental rate on a
sale and leaseback transaction. </p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Impairment
of Long-Lived Assets</u>
- - We review our long-lived assets for impairment in accordance with the
guidance of FASB ASC 360-10, Property, Plant, and Equipment, including land,
property and equipment whenever events or changes in circumstances indicate
that the carrying amount of an asset may not be recoverable. Recoverability of
assets to be held and used is measured by a comparison of the capitalized costs
of the assets to the future undiscounted net cash flows expected to be
generated by the assets and the expected cash flows are based on recent
historical cash flows at the restaurant level (the lowest level that cash flows
can be determined).</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>An
analysis was performed on a restaurant by restaurant basis at September 30, 2010.
Assumptions used in preparing expected cash flows were as follows:</p>



<ul style='margin-top:0in' type=disc>
 <li class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
     justify;line-height:normal'>Sales projections are as follows: Fiscal 2011
     sales are projected to increase 3% to 5% with respect to fiscal 2010, for
     fiscal years 2012 to 2024 we have used annual increases of 2% to 3%. We
     believe the 2% to 3% increase in the years beyond 2011 is a reasonable
     expectation of growth and that it would be unreasonable to expect no
     growth in our sales. These increases include menu price increases in
     addition to any real growth. Historically our weighted menu prices have
     increased 1.5% to 6%.</li>
 <li class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
     justify;line-height:normal'>Our variable and semi-variable restaurant
     operating costs are projected to increase proportionately with the sales
     increases as well as increasing an additional 1.5% per year consistent
     with inflation.</li>
 <li class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
     justify;line-height:normal'>Our other fixed restaurant operating costs are
     projected to increase 1.5% to 2% per year.</li>
 <li class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
     justify;line-height:normal'>Food and packaging costs are projected to
     remain flat in relation to our current fiscal 2010 food and packaging
     costs as a percentage of sales. </li>
 <li class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
     justify;line-height:normal'>Salvage value has been estimated on a
     restaurant by restaurant basis considering each restaurant's particular equipment
     package and building size.</li>
</ul>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Given
the results of our impairment analysis at September 30, 2010 there are no
restaurants which are impaired as their projected undiscounted cash flows show
recoverability of their asset values.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Our
impairment analysis included a sensitivity analysis with regard to the cash
flow projections that determine the recoverability of each restaurant's assets.
The results indicate that even with a 15% decline in our projected cash flows
we would still not have any potential impairment issues.&nbsp; However if we elect
to sublease, close or otherwise exit a restaurant location impairment could be
required. We have experienced higher than normal food and packaging costs as a
percentage of restaurant sales in recent years and we do not believe these
costs will remain at these levels in future years. However for purposes of our
cash flow projections in the asset impairment analysis we have assumed our food
and packaging costs will remain at these higher levels.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Each
time we conduct an impairment analysis in the future we will compare actual
results to our projections and assumptions, and to the extent our actual
results do not meet expectations, we will revise our assumptions and this could
result in impairment charges being recognized.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>All
of the judgments and assumptions made in preparing the cash flow projections
are consistent with our other financial statement calculations and disclosures.
The assumptions used in the cash flow projections are consistent with other
forward-looking information prepared by the company, such as those used for
internal budgets, discussions with third parties, and/or reporting to
management or the board of directors.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
fiscal 2010 we closed two company operated restaurants resulting in total
charges of $396,000. Projecting the cash flows for the impairment analysis
involves significant estimates with regard to the performance of each
restaurant, and it is reasonably possible that the estimates of cash flows may
change in the near term resulting in the need to write down</p>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>operating
assets to fair value. If the assets are determined to be impaired, the amount
of impairment recognized is the amount by which the carrying amount of the
assets exceeds their fair value. Fair value would be determined using forecasted
cash flows discounted using an estimated average cost of capital and the
impairment charge would be recognized in income from operations.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Sales
of Restaurants and Restaurant Equity Interests</u> - Sales of
restaurants or non-controlling equity interests in restaurants developed by the
Company are recorded under either the full accrual method or the installment
method of accounting.&nbsp; Under the full accrual method, a gain is not recognized
until the collectability of the sales price is reasonably assured and the
earnings process is virtually complete without further contingencies.&nbsp; When a
sale does not meet the requirements for income recognition, the related gain is
deferred until those requirements are met.&nbsp; Under the installment method, the
gain is incrementally recognized as principal payments on the related notes
receivable are collected.&nbsp; The Company's accounting policy, with regards to the
sale of restaurants, is in accordance with the guidance of FASB ASC 360-10,
Property, Plant, and Equipment.&nbsp; If the initial payment is less than the
percentages set forth, use of the installment method is required.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Company's accounting for the sale of restaurants is also in accordance with
FASB ASC 810-20, Consolidation of Variable Interest and Special-Purpose
Entities, because the risks and other incidents of ownership have been
transferred to the buyer.&nbsp; Specifically, a) no continuing involvement by the
Company exists in restaurants that are sold, b) sales contracts and related
income recognition are not dependant on the future successful operations of the
sold restaurants, and c) the Company is not involved as a guarantor on the
purchasers' debts.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Deferred
Liabilities</u>
- - Rent expense is reflected on a straight-line basis over the term of the lease
for all leases containing step-ups in base rent.&nbsp; An obligation representing
future payments (which totaled $384,000 as of September&nbsp;30, 2010) is
reflected in the accompanying consolidated balance sheet as a deferred
liability.&nbsp; Also included in the $916,000 deferred and other liability balance
is a $391,000 deferred gain on the sale of the building and improvements of two
Company-owned restaurants in two separate sale leaseback transactions.&nbsp; The
building and improvements were subsequently leased back from the third party
purchasers. The gains will be recognized in future periods in proportion to the
rents paid on the fifteen and twenty year leases.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Opening
Costs</u>
- - Opening costs are expensed as incurred.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Advertising</u> - The Company
incurs advertising expenses in connection with the marketing of its restaurant
operations.&nbsp; Advertising costs are expensed when the related advertising
begins.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Franchise
and Area Development Fees</u> - Individual franchise fee revenue is deferred when
received and is recognized as income when the Company has substantially
performed all of its obligations under the franchise agreement and the
franchisee has commenced operations.&nbsp; The Company's commitments and obligations
pursuant to the franchise agreements consist of a) development assistance;
including site selection, building specifications and equipment purchasing and
b) operating assistance; including training of personnel and preparation and
distribution of manuals and operating materials.&nbsp; All of these obligations are
effectively complete upon the opening of the restaurant at which time the
franchise fee and the portion of any development fee allocable to that
restaurant is recognized.&nbsp; There are no additional material commitments or
obligations.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Company has not recognized any franchise fees that have not been collected.&nbsp;
The Company segregates initial franchise fees from other franchise revenue in
the statement of operations.&nbsp; Revenues and costs related to company-owned
restaurants are segregated from revenues and costs related to franchised
restaurants in the statement of operations.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Continuing
royalties from franchisees, which are a percentage of the gross sales of
franchised operations, are recognized as income when earned.&nbsp; Franchise
development expenses, which consist primarily of legal costs and restaurant
opening expenses associated with developing and opening franchise restaurants,
are expensed against the related franchise fee income.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Accounting
for Notes Receivable</u>
- - The Company's notes receivables are all due from Good Times franchisees, or
franchise advertising cooperatives. All of the notes receivable are
collateralized by real estate or equipment and certain of the notes are
personally guaranteed by the franchisees. The notes are all term notes with
interest accruing at market rates. The Company reviews the notes from time to
time to access collectability. The Company has determined that all notes
receivable at September 30, 2010 are collectable and allowances for write-downs
are not necessary.</p>

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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Operating
Partner Program</u>
- - Operating Partners in a restaurant share in future increases of their
restaurant's cash flows above an established baseline, which is based on the
preceding twelve months' cash flow after full allocation of advertising and
capital expenses.&nbsp; This program is designed to figuratively put Operating
Partners in the shoes of an owner so that a portion of their compensation is
derived solely from the improvement in the financial performance of their
respective restaurants.&nbsp; The portion of cash flow increases allocable to the
Operating Partners are expensed as incurred on a quarterly basis, with a
cumulative adjustment made for any months where cash flows fall below the
established baselines. Compensation under this program is expensed to
restaurant operations as incurred.&nbsp; No other long term benefits accrue or vest
to the Operating Partners in this program.&nbsp; Operating Partners are employees at
will and are subject to termination from this program if certain operating,
customer service and financial objectives are not met.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Income
Taxes</u>
- - We account for income taxes in accordance with FASB ASC 740, Income Taxes.
FASB ASC 740 prescribes the use of the liability method whereby deferred tax
asset and liability account balances are determined based on differences
between the financial reporting and tax bases of assets and liabilities and are
measured using the enacted tax rates and laws that will be in effect when the
differences are expected to reverse. The Company provides a valuation
allowance, if necessary, to reduce deferred tax assets to their estimated
realizable value.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Net
Income (Loss) Per Common Share</u> - The income (loss) per share is
presented in accordance with the guidance of FASB ASC 260-10, Earnings per Share
(EPS).&nbsp; Basic EPS is calculated by dividing the income (loss) available to
common stockholders by the weighted average number of common shares outstanding
for the period.&nbsp; Diluted EPS reflects the potential dilution that could occur
if securities or other contracts to issue common stock were exercised or
converted into common stock. Options for 906 and 9,953 shares of common stock
were not included in computing diluted EPS for 2010 and 2009, respectively, because
their effects were anti-dilutive.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Financial
Instruments and Concentrations of Credit Risk</u> - Credit risk represents the
accounting loss that would be recognized at the reporting date if
counterparties failed completely to perform as contracted.&nbsp; Concentrations of
credit risk (whether on or off balance sheet) that arise from financial
instruments exist for groups of customers or counterparties when they have
similar economic characteristics that would cause their ability to meet
contractual obligations to be similarly effected by changes in economic or
other conditions.&nbsp; Financial instruments with off-balance-sheet risk to the
Company include lease liabilities whereby the Company is contingently liable as
a guarantor of certain leases that were assigned to third parties in connection
with various sales of restaurants to franchisees (see Note 7).</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Financial
instruments potentially subjecting the Company to concentrations of credit risk
consist principally of receivables.&nbsp; At September 30, 2010, notes receivable
totaled $19,000 and is due from two entities.&nbsp; Additionally, the Company has
other current receivables totaling $157,000, which includes $68,000 of
franchise receivables.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Company purchases 100% of its restaurant food and paper from one vendor. The
Company believes a sufficient number of other suppliers exist from which food
and paper could be purchased to prevent any long-term, adverse consequences. </p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Company operates in one industry segment, restaurants.&nbsp; A geographic
concentration exists because the Company's customers are generally located in
the State of Colorado.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Comprehensive
Income (Loss</u>)
- - 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-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>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. In fiscal
2008 The Company recorded the fair value of these contracts in the balance
sheet, with the offset to other comprehensive loss. In fiscal 2009 and fiscal
2010 the fair value has been recognized in current earnings due to the
technical covenant defaults that exist with the underlying Wells Fargo Bank
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. See Note 5 for additional
information.</p>

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



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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Stock-Based
Compensation</u>
- - Stock-based compensation is presented in accordance with the guidance of FASB
ASC 718-10-30, Compensation - Stock Compensation. Under
the provisions of FASB ASC 718, stock-based compensation is measured at the
grant date, based on the calculated fair value of the award, and is recognized
as an expense over the requisite employee service period (generally the vesting
period of the grant). See Note 13 for additional information.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Variable
Interest Entities</u>
- - FASB ASC 810-20, Consolidation of Variable Interest and Special-Purpose
Entities, can require consolidation of &quot;variable interest entities&quot; (VIEs).&nbsp;
Once an entity is determined to be a VIE, the party with the controlling
financial interest, the primary beneficiary, is required to consolidate it.&nbsp;
The Company has two franchisees with notes payable to the Company.&nbsp; These
franchisees are VIE's as defined by FASB ASC 810-20, however, the Company is
not the primary beneficiary of these entities.&nbsp; Therefore they are not required
to be consolidated under the guidance of FASB ASC 810-20.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Fair
Value of Financial Instruments </u>- The Company adopted the provisions of
FASB ASC 820, Fair Value Measurements and Disclosures, effective October 1,
2008. FASB ASC 820 defines fair value, establishes a framework for measuring
fair value under generally accepted accounting principles and enhances
disclosures about fair value measurements. See Note 12 for additional
information.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Fair
value is defined as the price that would be received to sell an asset or paid
to transfer a liability in an orderly transaction between market participants
at the measurement date. Valuation techniques used to measure fair value, as
required by Topic 820 of the FASB ASC, must maximize the use of observable
inputs and minimize the use of unobservable inputs.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>FASB
ASC 820 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
FASB ASC 820 are as follows:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='margin-left:.45in;border-collapse:collapse'>
 <tr>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Level
  1:</p>
  </td>
  <td width=562 valign=top style='width:5.85in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Quoted
  market prices in active markets for identical assets and liabilities.</p>
  </td>
 </tr>
 <tr>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=562 valign=top style='width:5.85in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Level
  2:</p>
  </td>
  <td width=562 valign=top style='width:5.85in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>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>
  </td>
 </tr>
 <tr>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=562 valign=top style='width:5.85in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=72 valign=top style='width:.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Level
  3</p>
  </td>
  <td width=562 valign=top style='width:5.85in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Unobservable
  inputs that are not corroborated by observable market data.</p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Non-controlling
Interests</u></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Company adopted the provisions of FASB <a name="jump_exp_1"></a>ASC <a
name="jump_exp_2"></a>810, Consolidation, effective October&nbsp;1, 2009. FASB
ASC 810 requires non-controlling interests, previously called minority
interests, to be presented as a separate item in the equity section of the
consolidated balance sheet. It also requires the amount of consolidated net
income or loss attributable to non-controlling interests to be clearly
presented on the face of the consolidated income statement. Additionally, Topic
810 clarifies that changes in a parent's ownership interest in a subsidiary
that do not result in deconsolidation are equity transactions, and that
deconsolidation of a subsidiary requires gain or loss recognition in net income
based on the fair value on the deconsolidation date. Topic 810 was applied
prospectively with the exception of presentation and disclosure requirements,
which were applied retrospectively for all periods presented, and did not
significantly change the presentation of our consolidated financial statements.</p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>&nbsp;</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Subsequent
Events</u></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Company adopted the provisions of FASB ASC 855, Subsequent Events, effective
October 1, 2009.&nbsp; FASB ASC 855 establishes the accounting for, and disclosure
of, material events that occur after the balance sheet date but before the
financial statements are issued.&nbsp;&nbsp;In general, these events will be
recognized if the condition existed at the date of the balance sheet, but will
not be recognized if the condition did not exist at the balance sheet
date.&nbsp;&nbsp;Disclosure is required for non-recognized events if required
to keep the financial statements from being misleading.</p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>&nbsp;</u></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Recent
Accounting Pronouncements</u> <a name="OLE_LINK2">-</a> In
January 2010, the FASB issued an update regarding guidance over the disclosure
requirements of fair value measurements. This update adds new requirements for
disclosure about transfers into and out of Levels One and Two and also adds
additional disclosure requirements about purchases, sales, issuances, and
settlements relating to Level Three measurements.&nbsp; The guidance is
effective for reporting periods beginning after December 15, 2009</p>



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



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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>for
the disclosure requirements around Levels One and Two measurements, and is
effective for reporting periods beginning after December&nbsp;15, 2010 for the
disclosure requirements around Level Three.&nbsp; This new guidance currently
has no impact on the fair value disclosures of the Company, as there have been
no transfers out of Levels One or Two.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
June 2009, the FASB issued FASB ASC 105, Generally Accepted Accounting
Principles, which establishes the FASB Accounting Standards Codification as the
sole source of authoritative generally accepted accounting principles. Pursuant
to the provisions of FASB ASC 105, the Company has updated references to GAAP
in its financial statements issued for the period ended September 30, 2010. The
adoption of FASB ASC 105 did not impact the Company's financial position or
results of operations.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
June 2008, the FASB issued FASB ASC 815-40, Derivatives and Hedging, that
provides guidance on how to determine if certain instruments (or embedded
features) are considered indexed to a company's own stock, including
instruments similar to warrants to purchase the company's stock. FASB ASC
815-40 requires companies to use a two-step approach to evaluate an
instrument's contingent exercise provisions and settlement provisions in
determining whether the instrument is considered to be indexed to its own stock
and therefore exempt from the application of FASB ASC 815. Although FASB ASC
815-40 was effective for our fiscal year beginning October 1, 2009, any
outstanding instrument at the date of adoption requires a retrospective
application of the accounting through a cumulative effect adjustment to
retained earnings upon adoption. The adoption of FASB ASC 815-40 did not impact
the Company's financial position or results of operations. The requirements of
FASB ASC 815-40 will only impact future derivative or hedging transactions into
which we may enter.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
December 2007, the FASB issued FASB ASC 805, Business Combinations, which
establishes principles and requirements for how an acquiring entity in a
business combination recognizes and measures the assets acquired and
liabilities assumed in the transaction; establishes the acquisition-date fair
value as the measurement objective for all assets acquired and liabilities
assumed; and sets the disclosure requirements regarding the information needed
to evaluate and understand the nature and financial effect of the business
combination.&nbsp; This accounting pronouncement was effective for our fiscal year
beginning October 1, 2009.&nbsp; The adoption of this guidance did not have any impact
on the Company's financial position or results of operations. The requirements
of FASB ASC 805 will only impact future business combination transactions into
which we may enter.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Liquidity:</u> </p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>As
of September 30, 2010, we had $429,000 in cash and cash equivalents on hand.&nbsp;
We currently plan to use the cash balance, any cash generated from operations
and net proceeds of approximately $1,820,000 received on December, 13 2010 from
the SII Investment Transaction discussed in Note 15 to reduce our accounts payable,
accrued liabilities and short term notes payable and for our working capital
needs in fiscal 2011. In December 2010 we also renegotiated the covenants and
collateral of our bank loan with Wells Fargo whereby we are currently in
compliance with all covenants. We believe that we will have sufficient capital
to meet our working capital, long term debt obligations and recurring capital
expenditure needs in fiscal 2011.&nbsp; &nbsp;&nbsp;Additionally, we may sell or sublease
select underperforming company operated restaurants if we believe the
realizable asset value is greater than the long term cash flow value or if the
asset does not fit our longer term distribution and location of restaurants.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>As
of September 30, 2010, we had a working capital deficit of $1,869,000 substantially
due to notes payable of $585,000 which are due on December 31, 2010 and accrued
property taxes for 2009 of approximately $200,000 which are currently due.&nbsp; Net
proceeds of approximately $1,820,000 received on December, 13 2010 from the SII
Investment Transaction discussed in Note 15 were used to reduce our accounts
payable, accrued liabilities and short term notes payable and for our working
capital needs in fiscal 2011. Additionally, we have recorded an $84,000 current
liability related to the unrealized loss on our interest rate swap, as
described in Note 4 below.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
December, 2009 we entered into an agreement to extend the maturity of the PFGI
II, LLC loan to December 31, 2012 and modified the terms of the loan to include
a 25 year amortization period with a balloon payment for the remaining
principal balance on December 31, 2012.&nbsp; As a result, the majority of the PFGI
II LLC loan is shown as a long term liability as of September 30, 2010. &nbsp;&nbsp;On
December 3, 2010 we sold the vacant land that was partially collateralizing the
PFGI II loan and used the net proceeds of $812,000 to reduce the loan.&nbsp;&nbsp; We
anticipate selling the land and building underlying an operating restaurant we
own that collateralizes the remaining PFGI II loan in a sale leaseback
transaction and using the proceeds to reduce the loan.&nbsp; If that transpires and
the PFGI II loan is paid in full, the additional collateral under the PFGI II
loan will be released.</p>

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



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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>DISCONTINUED
OPERATIONS</u></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>&nbsp;</u></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Discontinued
operations are presented in accordance with FASB ASC 205-20, Presentation of
Financial Statements. During fiscal 2010 we closed two locations: one
dual-branded restaurant in Commerce City, Colorado in March 2010 and one
co-developed restaurant in Denver, Colorado in June 2010. The loss from
discontinued operations includes both the current and historical results of
operations, the fair value of all future lease obligations and an impairment
charge to write down the fixed assets to book value. Fixed assets of $1,164,000
and $1,164,000 of associated accumulated depreciation related to discontinued
operations are included in the property and equipment of our condensed
consolidated balance sheet. Current and long-term liabilities related to
discontinued operations relate to the future estimated lease obligations.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Following
is a summary of the costs from discontinued operations for the current and
prior year periods:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=492
 style='width:369.0pt;margin-left:59.4pt;border-collapse:collapse'>
 <tr>
  <td width=288 valign=top style='width:3.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=204 colspan=2 valign=bottom style='width:153.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Twelve Months Ended</p>
  </td>
 </tr>
 <tr>
  <td width=288 valign=top style='width:3.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=204 colspan=2 valign=bottom style='width:153.0pt;border:none;
  border-bottom:solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>September 30,</p>
  </td>
 </tr>
 <tr>
  <td width=288 valign=top style='width:3.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 valign=bottom style='width:81.0pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>2010</p>
  </td>
  <td width=96 valign=bottom style='width:1.0in;border-top:solid windowtext 1.0pt;
  border-left:none;border-bottom:solid windowtext 1.0pt;border-right:none;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>2009</p>
  </td>
 </tr>
 <tr>
  <td width=288 valign=top style='width:3.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Results
  of operations</p>
  </td>
  <td width=108 valign=bottom style='width:81.0pt;border:none;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:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>$153,000</p>
  </td>
  <td width=96 valign=bottom style='width:1.0in;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:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>$218,000</p>
  </td>
 </tr>
 <tr>
  <td width=288 valign=top style='width:3.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Future
  lease obligations, fair value</p>
  </td>
  <td width=108 valign=bottom style='width:81.0pt;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:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>143,000</p>
  </td>
  <td width=96 valign=bottom style='width:1.0in;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:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr>
  <td width=288 valign=top style='width:3.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Asset
  impairment charges and other costs</p>
  </td>
  <td width=108 valign=bottom style='width:81.0pt;border:none;border-bottom:
  solid windowtext 1.0pt;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:-14.9pt;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>294,000</p>
  </td>
  <td width=96 valign=bottom style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  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:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr>
  <td width=288 valign=top style='width:3.0in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=108 valign=bottom style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=96 valign=bottom style='width:1.0in;border:none;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=288 valign=top style='width:3.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Loss
  from discontinued operations</p>
  </td>
  <td width=108 valign=bottom style='width:81.0pt;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:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>$590,000</p>
  </td>
  <td width=96 valign=bottom style='width:1.0in;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:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>$218,000</p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>With
respect to the closed locations, we have continuing lease obligations of
$786,000. We have subleased the Commerce City location for $618,000. We have
terminated the lease on the Denver location effective February 1, 2011. We have
recorded an estimated liability of $143,000 related to these locations.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Notes Receivable</u>:</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>Notes
receivable consists of the following as of September 30, 2010:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=684
 style='border-collapse:collapse'>
 <tr style='height:9.0pt'>
  <td width=582 valign=top style='width:436.75pt;padding:0in 0in 0in 0in;
  height:9.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Notes
  receivable from franchisees related to restaurant equipment; 6.0% to 10%
  interest per annum; monthly payments of principal and interest are due in the
  amount of approximately $1,100; final payment due in 2012; collateralized by
  all fixtures and equipment of the related restaurants.</p>
  </td>
  <td width=102 colspan=2 valign=bottom style='width:76.25pt;padding:0in .7pt 0in .7pt;
  height:9.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>19,000&nbsp;</p>
  </td>
 </tr>
 <tr style='height:9.0pt'>
  <td width=582 valign=top style='width:436.75pt;padding:0in 0in 0in 0in;
  height:9.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Less
  current portion</p>
  </td>
  <td width=102 colspan=2 style='width:76.25pt;padding:0in .7pt 0in .7pt;
  height:9.0pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(9,000)</u></p>
  </td>
 </tr>
 <tr style='height:9.0pt'>
  <td width=582 valign=top style='width:436.75pt;padding:0in 0in 0in 0in;
  height:9.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Notes
  receivable, net of current portion</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt;height:9.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=86 style='width:64.25pt;padding:0in .7pt 0in .7pt;height:9.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>10,000&nbsp;</u></p>
  </td>
 </tr>
</table>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><u>&nbsp;</u></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Debt</u>:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=690
 style='border-collapse:collapse'>
 <tr>
  <td width=582 valign=top style='width:436.75pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Note
  payable with PFGI II, LLC with monthly of principal and interest (8.65%, with
  a 25 year amortization) and a balloon payment of all unpaid principal due on
  December 31, 2012.&nbsp; The loan is secured by two Real Property Deeds of Trust,
  four Leasehold Deeds of Trust and <a name="OLE_LINK4">Security Agreements</a>
  and Assignment of Rents and Fixture Filings and two Security Agreements and
  Assignment of Rents and Fixture Filings related to those six corporate
  restaurants.&nbsp; The promissory note constitutes a line of credit which may be
  repaid but not re-advanced, at any time. </p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=92 valign=bottom style='width:68.75pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,481,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=582 valign=top style='width:436.75pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=108 colspan=2 valign=bottom style='width:80.75pt;padding:0in 0in 0in 0in'>

  </td>
 </tr>
 <tr>
  <td width=582 valign=top style='width:436.75pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Note
  payable with Wells Fargo Bank, NA with payments of principal and interest
  (prime rate less .5%) due monthly and the final payment due in April 2015.&nbsp;
  The loan is secured by four Security Agreements related to the furniture,
  fixtures and equipment of the four corporate restaurants. This loan is
  classified as current based on covenant violations as discussed below.</p>
  </td>
  <td width=108 colspan=2 valign=bottom style='width:80.75pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>722,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=582 valign=top style='width:436.75pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=108 colspan=2 valign=bottom style='width:80.75pt;padding:0in 0in 0in 0in'>

  </td>
 </tr>
 <tr>
  <td width=582 valign=top style='width:436.75pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Related
  Party note payable with Golden Bridge, LLC with payments of interest (10%)
  due monthly with all unpaid principal due December 31, 2010. The promissory
  note is subject to the terms of an Intercreditor Agreement between the
  Company, Golden Bridge, LLC and PFG1 II, LLC, and the deeds of trust and
  security agreements described in such Intercreditor Agreement. See note 8
  below for further explanation.</p>
  </td>
  <td width=108 colspan=2 valign=bottom style='width:80.75pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>185,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=582 valign=top style='width:436.75pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=108 colspan=2 valign=top style='width:80.75pt;padding:0in 0in 0in 0in'>

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



<p class=MsoFooter align=right style='text-align:right'>F-13</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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

</div>



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












<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=690
 style='border-collapse:collapse'>
 <tr>
  <td width=582 valign=top style='width:436.75pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Note
  payable with W. Capital and John T. McDonald with interest accruing monthly (12%
  from February, 2010 to July, 2010 and 14% from August, 2010 to maturity) with
  all unpaid principal due December 31, 2010. The Loan Agreement and the Note
  are subject to the terms of a Leasehold Deed of Trust Agreement and Security
  Agreement with respect to certain of Good Times Drive Thru's restaurants that
  were not previously pledged as collateral under the Wells Fargo Bank or PFGI
  II, LLC borrowings.
  See note 8 below for further explanation.</p>
  </td>
  <td width=108 colspan=2 valign=bottom style='width:80.75pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>400,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=582 valign=top style='width:436.75pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=108 colspan=2 valign=bottom style='width:80.75pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=582 valign=top style='width:436.75pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Unamortized
  note discount related to warrants issued in connection with the above notes payable
  with PFGI II, LLC and W. Capital and John T. McDonald</p>
  </td>
  <td width=108 colspan=2 valign=bottom style='width:80.75pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp;&nbsp;&nbsp; (81,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=582 valign=top style='width:436.75pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=108 colspan=2 style='width:80.75pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,707,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=582 valign=top style='width:436.75pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Less
  current portion</p>
  </td>
  <td width=108 colspan=2 style='width:80.75pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp; (702,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=582 valign=top style='width:436.75pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Long
  term portion</p>
  </td>
  <td width=16 style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=92 style='width:68.75pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>3,005,000&nbsp;</u></p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
conjunction with the Wells Fargo Bank term loan, the Company entered into a
variable to fixed interest rate swap agreement with Wells Fargo Bank effective
May 9, 2007, with a notional amount of $1,100,000, a pay rate of 7.77% and a
receive rate based on the bank prime rate less .50%. The swap agreement has an
eight-year term and has the effect of normalizing the effective interest rate
at 7.77%. As of September 30, 2010, the fair value of the contract was a loss
of $84,000. The unrealized loss has been recorded in interest expense.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>As
of September 30, 2010, principal payments on debt become due as follows:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=300
 style='margin-left:22.75pt;border-collapse:collapse'>
 <tr>
  <td width=210 valign=top style='width:157.25pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Years Ending</p>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>September 30,</p>
  </td>
  <td width=90 colspan=2 valign=top style='width:67.5pt;padding:0in 0in 0in 0in'>

  </td>
 </tr>
 <tr>
  <td width=210 valign=top style='width:157.25pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=90 colspan=2 valign=top style='width:67.5pt;padding:0in 0in 0in 0in'>

  </td>
 </tr>
 <tr>
  <td width=210 valign=top style='width:157.25pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>2011</p>
  </td>
  <td width=16 valign=top style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=74 valign=top style='width:55.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>702,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=210 valign=top style='width:157.25pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>2012</p>
  </td>
  <td width=90 colspan=2 valign=top style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>152,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=210 valign=top style='width:157.25pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>2013</p>
  </td>
  <td width=90 colspan=2 valign=top style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,565,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=210 valign=top style='width:157.25pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>2014</p>
  </td>
  <td width=90 colspan=2 valign=top style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>169,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=210 valign=top style='width:157.25pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>2015</p>
  </td>
  <td width=90 colspan=2 valign=top style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;
  119,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=210 valign=top style='width:157.25pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=16 valign=top style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=74 valign=top style='width:55.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>3,707,000&nbsp;</u></p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
connection with the Wells Fargo Bank loan, the Company had agreed to certain
covenants, which include minimum tangible net worth, a total liabilities to
tangible net worth ratio and a fixed charge coverage ratio, as defined in the
agreement. As stated above in Note 2 as of September 30, 2010, the Company was
not in compliance with its loan covenants, but in December 2010 negotiated an
amended loan agreement and is now in compliance with all covenants and the
majority of the loan is therefore classified as a long-term liability.</p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><u>&nbsp;</u></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Other Accrued Liabilities</u>:</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>Other
accrued liabilities consist of the following at September 30, 2010:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=300
 style='margin-left:22.75pt;border-collapse:collapse'>
 <tr>
  <td width=210 valign=top style='width:157.5pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Wages
  and other employee benefits</p>
  </td>
  <td width=16 valign=top style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=74 valign=top style='width:55.4pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>244,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=210 valign=top style='width:157.5pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Taxes,
  other than income tax</p>
  </td>
  <td width=90 colspan=2 valign=top style='width:67.4pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>702,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=210 valign=top style='width:157.5pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Other</p>
  </td>
  <td width=90 colspan=2 valign=top style='width:67.4pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>230,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=210 valign=top style='width:157.5pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=90 colspan=2 valign=top style='width:67.4pt;padding:0in 0in 0in 0in'>

  </td>
 </tr>
 <tr>
  <td width=210 valign=top style='width:157.5pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=16 valign=top style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=74 valign=top style='width:55.4pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>1,176,000&nbsp;</u></p>
  </td>
 </tr>
</table>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><u>&nbsp;</u></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>7.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Commitments and Contingencies</u>:</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Company's office space, and the land and buildings related to the Drive Thru
restaurant facilities are classified as operating leases and expire over the
next 14 years. Some leases contain escalation clauses over the lives of the
leases. Most of the leases contain one to three five-year renewal options at
the end of the initial term. Certain leases include provisions for additional
contingent rent payments if sales volumes exceed specified levels. The Company
paid no material contingent rentals during fiscal 2010 and 2009.</p>

<p class=MsoFooter align=right style='text-align:right'>F-14</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

<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:0in;margin-bottom:.0001pt;line-height:
normal'>Following
is a summary of operating lease activities:</p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>&nbsp;</b></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=312
 style='margin-left:22.75pt;border-collapse:collapse'>
 <tr>
  <td width=156 valign=top style='width:117.0pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=156 colspan=2 valign=top style='width:117.0pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Year Ended September 30,</p>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><u>2010</u></p>
  </td>
 </tr>
 <tr>
  <td width=156 valign=top style='width:117.0pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=156 colspan=2 valign=top style='width:117.0pt;padding:0in 0in 0in 0in'>

  </td>
 </tr>
 <tr>
  <td width=156 valign=top style='width:117.0pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Minimum
  rentals</p>
  </td>
  <td width=16 valign=top style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=140 valign=top style='width:105.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:35.3pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,322,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=156 valign=top style='width:117.0pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Less
  sublease rentals</p>
  </td>
  <td width=156 colspan=2 valign=top style='width:117.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:35.3pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;(322,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=156 valign=top style='width:117.0pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=156 colspan=2 valign=top style='width:117.0pt;padding:0in 0in 0in 0in'>

  </td>
 </tr>
 <tr>
  <td width=156 valign=top style='width:117.0pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Net
  rent paid</p>
  </td>
  <td width=16 valign=top style='width:12.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=140 valign=top style='width:105.0pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:35.3pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>2,000,000&nbsp;</u></p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>As
of September&nbsp;30, 2010, future minimum rental commitments required under
the Company's operating leases that have initial or remaining non-cancellable
lease terms in excess of one year are as follows:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=264
 style='margin-left:18.95pt;border-collapse:collapse'>

  <tr>
   <td width=180 valign=top style='width:135.0pt;padding:0in .95pt 0in .95pt'>
   <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;
   line-height:normal'>Years
   Ending September 30,</p>
   </td>
   <td width=84 colspan=2 valign=top style='width:63.0pt;padding:0in .95pt 0in .95pt'>

   </td>
  </tr>

 <tr>
  <td width=180 valign=top style='width:135.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2011</p>
  </td>
  <td width=16 valign=top style='width:12.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=68 valign=top style='width:51.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,081,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=180 valign=top style='width:135.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2012</p>
  </td>
  <td width=84 colspan=2 valign=top style='width:63.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,122,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=180 valign=top style='width:135.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2013</p>
  </td>
  <td width=84 colspan=2 valign=top style='width:63.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,128,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=180 valign=top style='width:135.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2014</p>
  </td>
  <td width=84 colspan=2 valign=top style='width:63.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,923,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=180 valign=top style='width:135.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 2015</p>
  </td>
  <td width=84 colspan=2 valign=top style='width:63.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,551,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=180 valign=top style='width:135.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Thereafter</p>
  </td>
  <td width=84 colspan=2 valign=top style='width:63.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;
  8,221,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=180 valign=top style='width:135.0pt;padding:0in .95pt 0in .95pt'>

  </td>
  <td width=84 colspan=2 valign=top style='width:63.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>18,026,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=180 valign=top style='width:135.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Less
  sublease rentals</p>
  </td>
  <td width=84 colspan=2 valign=top style='width:63.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(2,965,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=180 valign=top style='width:135.0pt;padding:0in .95pt 0in .95pt'>

  </td>
  <td width=84 colspan=2 valign=top style='width:63.0pt;padding:0in .95pt 0in .95pt'>

  </td>
 </tr>
 <tr>
  <td width=180 valign=top style='width:135.0pt;padding:0in .95pt 0in .95pt'>

  </td>
  <td width=16 valign=top style='width:12.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=68 valign=top style='width:51.0pt;padding:0in .95pt 0in .95pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>15,061,000&nbsp;</u></p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Company is contingently liable on several ground leases that have been
subleased or assigned to franchisees. The subleased and assigned leases expire
between 2011 and 2024. Currently we have not been notified nor are we aware of
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=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>8.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Financing Transactions</u>:</p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b><u>&nbsp;</u></b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i><u>Wells Fargo Bank N.A.</u></i></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>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.&nbsp; As previously reported, we
were in default of certain financial loan covenants and had been operating
under a forbearance and reservation of rights agreement with Wells Fargo.&nbsp;&nbsp; As
previously disclosed in the Company's current report on Form 8-K filed December
17, 2010, we entered into a new Credit and Loan Agreement that modified the
loan covenants and provided additional collateral to Wells Fargo. &nbsp;The loan
covenants were modified to require minimum Tangible Net Worth of $2,500,000,
Total Liabilities Divided by Tangible Net Worth not greater than 3.0 to 1.0 and
an EBITDA Coverage Ratio not less than 0.9 to 1.0 as of the end of the first
fiscal quarter of 2012, not less than 1.2 to 1.0 as of the end of the second
fiscal quarter of 2012 and not less than 1.5 to 1.0 thereafter.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i><u>PFGI II, LLC</u></i></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
July 2008, we entered into a $2,500,000 promissory note with an unrelated third
party (PFGI II, LLC) and amended that note on April 20, 2009 extending the
maturity to July 10, 2010. Effective January 2, 2010, the Company entered into
an agreement to amend its loan with PFGI II LLC.&nbsp; The maturity date was
extended to December 31, 2012, the interest rate was increased to 8.65% and
monthly payments of principal and interest are payable beginning January 31,
2010, based upon a 25 year amortization prior to maturity. In connection with
the agreement, the Company issued a three-year warrant dated January 2, 2010 to
PFGI II, LLC which provides that PFGI II, LLC may at any time from January 2,
2010 until December 31, 2012 purchase up to 112,612 shares of the Company's
common stock at an exercise price of $1.11 per share. The number of shares purchasable
upon exercise of the warrant and the exercise price are subject to customary
anti-dilution adjustments upon the occurrence of any stock dividends, stock
splits, reverse stock splits, recapitalizations, reclassifications, stock
combinations or similar events. The fair value of the warrant issued to PFGI
II, LLC was determined to be $79,000 with the following assumptions; 1) risk
free interest rate of 1.7%, 2) an expected life of 3 years, and 3) an expected
dividend yield of zero. The fair value of $79,000 was charged to the note
discount and credited to Additional Paid in Capital. The note discount will be amortized
over the term of thirty six months and charged to interest expense.</p>

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



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

<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:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
promissory note originally constituted a revolving line-of-credit for the
development of new restaurants which was advanced and repaid on a monthly basis
from time to time.&nbsp; The promissory note now constitutes a term loan with
monthly payments of principal and interest.&nbsp; The loan is secured by separate
leasehold deeds of trust and security agreements related to six company-owned restaurants
and first deeds of trust on two real properties funded by the line of credit.
The total outstanding balance on the promissory note was $2,481,000 at September
30, 2010.&nbsp; Of the $2,481,000 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 was sold on December 3, 2010 reducing the loan by $812,000 in net proceeds
from the sale.</p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><u>&nbsp;</u></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i><u>Golden Bridge, LLC</u></i></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>On
April 20, 2009 as reported on Form 8-K, the Company entered into a loan
agreement with Golden Bridge, LLC (&quot;Golden Bridge&quot;), pursuant to which Golden
Bridge made a loan of $185,000 (the &quot;Golden Bridge Loan&quot;) to GTDT to be used
for restaurant marketing and other working capital costs.&nbsp; Eric Reinhard, Ron
Goodson, David Grissen, Richard Stark, and Alan Teran, who were all members of
the Company's Board of Directors at the time of the transaction and
stockholders of the Company, are the sole members of Golden Bridge.&nbsp; Subsequent
to the fiscal year end, the loan was repaid in full on December 13, 2010 from
the proceeds of the SII Investment Transaction (see &quot;SII Investment
Transaction&quot; below).</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Golden Bridge Loan was evidenced by a promissory note dated April 20, 2009 made
by the Company and GTDT, as co-makers, and bearing interest at a rate of 10%
per annum on the unpaid principal balance.&nbsp; The note provided for monthly
interest payments and was to mature and be due and payable in full on December
31, 2010.&nbsp; The commitment fee for the Golden Bridge Loan was $3,700.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
connection with the Golden Bridge Loan, the Company issued a three-year warrant
dated April 20, 2009 to Golden Bridge which provides that Golden Bridge may at
any time from April 20, 2009 until April 20, 2012 purchase up to 92,500 shares
of the Company's common stock at an exercise price of $1.15 per share.&nbsp; The
number of shares purchasable upon exercise of the warrant and the exercise
price are subject to customary anti-dilution adjustments upon the occurrence of
any stock dividends, stock splits, reverse stock splits, recapitalizations,
reclassifications, stock combinations or similar events. The fair value of the
warrant issued to Golden Bridge was determined to be $42,000 with the following
assumptions: 1) risk free interest rate of 1.27%, 2) an expected life of 3
years, and 3) an expected dividend yield of zero. The fair value of $42,000 was
charged to the note discount and credited to Additional Paid in Capital. The
note discount will be amortized over fourteen months and charged to interest
expense.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i><u>W. Capital and John T. McDonald</u></i></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>On
February 1, 2010, the Company entered into a loan agreement with W Capital,
Inc. (&quot;W Capital&quot;), John T. McDonald (&quot;McDonald&quot;) and Golden Bridge, pursuant
to which the lenders made loans totaling $200,000, with up to an additional
$200,000 available through April 30, 2010, to be used for restaurant marketing
and other working capital uses of GTDT.&nbsp; As set forth below, the loan agreement
was subsequently amended as of April 1, 2010 to remove Golden Bridge as a
lender and to replace it with additional loans from W Capital and McDonald.&nbsp; At
September 30, 2010 the entire $400,000 had been advanced to the Company
pursuant to the loan agreement (the &quot;Bridge Loans&quot;). &nbsp;On December 13, 2010, the
outstanding principal amount of the Bridge Loans was paid in full from the
proceeds of the SII Investment Transaction, and accrued interest on the Bridge
Loans was converted into 79,430 shares of Common Stock.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Bridge Loans were evidenced by a Secured Convertible Promissory Note dated April
1, 2010 made by the Company and bearing interest at a rate of 12% per annum on
the unpaid principal balance through August 1, 2010 and at a rate of 14% per
annum from and after August 1, 2010 until the maturity date of December 31,
2010.&nbsp; The note provided that the outstanding principal balance and accrued
interest would be convertible into shares of Common Stock of the Company at any
time prior to repayment at a conversion price of 25% less than the average
price of the Company's common stock during the 20 days prior to the conversion
date, but not below $0.75 per share nor above $1.08 per share.&nbsp; However, in
connection with the SII Investment Transaction, W Capital and McDonald agreed
to convert the accrued interest payable on the Bridge Loans into shares of
Common Stock at a conversion price of $0.50 per share and entered into an
agreement with the Company to amend the conversion provisions of the note
accordingly.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>In
connection with the Bridge Loans, the Company issued warrants dated February 1,
2010 to W Capital and McDonald which provide that the lenders may at any time from
February 1, 2010 until two years from the date of repayment or</p>

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



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

<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:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>conversion
of the Bridge Loans purchase up to an aggregate of 50,000 shares of the
Company's Common Stock at an exercise price of 25% less than the average price
of the Company's common stock during the 20 days prior to the exercise date, provided,
however, that the exercise price shall not be below $0.75 per share nor above
$1.08 per share.&nbsp; Pursuant to the terms of the loan agreement, because the
Bridge Loans were not repaid prior to August 1, 2010, the Company issued
warrants to W Capital and McDonald for the purchase of 50,000 additional shares
of the Company's Common Stock upon the same terms as the initial warrants.&nbsp; The
number of shares purchasable upon exercise of the warrants issued to W Capital
and McDonald and the exercise price are subject to customary anti-dilution
adjustments upon the occurrence of any stock dividends, stock splits, reverse
stock splits, recapitalizations, reclassifications, stock combinations or
similar events.&nbsp; Following the repayment and conversion of the Bridge Loans on
December 13, 2010, the warrants will expire on December 12, 2012.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
fair value of the warrants issued February 1, 2010 was determined to be $38,000
with the following assumptions: 1) risk free interest rate of 1.41%, 2) an
expected life of 2.5 years, and 3) an expected dividend yield of zero. The fair
value of $38,000 was charged to the note discount and credited to Additional
Paid in Capital. The note discount was amortized over the term of seven months
and charged to interest expense.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
intrinsic value of the embedded beneficial conversion feature of the Bridge
Loans was determined to be $161,000. The intrinsic value of $161,000 was
charged to the note discount and credited to Additional Paid in Capital. The
note discount was amortized over the term of seven months and charged to
interest expense.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
fair value of the warrants issued August 1, 2010 was determined to be $36,000
with the following assumptions: 1) risk free interest rate of .70%, 2) an
expected life of 2.4 years, and 3) an expected dividend yield of zero. The fair
value of $36,000 was charged to the note discount and credited to Additional
Paid in Capital. The note discount is being amortized over the term of five
months and charged to interest expense.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Managed Limited Partnerships</u>:</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Drive
Thru is currently the general partner of one limited partnership that was
formed to develop Drive Thru restaurants and Drive Thru sold their limited
partner interest in one restaurant in June 2010. Limited partner contributions
have been used to construct new restaurants.&nbsp; Drive Thru, as a general partner,
generally receives an allocation of approximately 51% of the profit and losses
and a fee for its management services.&nbsp; The equity interest of the unrelated
limited partner is shown on the accompanying consolidated balance sheet in the
stockholders equity section as a non-controlling interest, and the limited
partner's share of the net income or loss in the partnership is shown as
non-controlling interest income or expense in the accompanying consolidated
statement of operations. </p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Income Taxes</u>:</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Deferred
tax assets (liabilities) are comprised of the following at September 30:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=595
 style='border-collapse:collapse'>
 <tr>
  <td width=228 valign=top style='width:171.0pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=169 colspan=6 valign=top style='width:126.65pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>2010</b></p>
  </td>
  <td width=198 colspan=9 valign=top style='width:148.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>2009</b></p>
  </td>
 </tr>
 <tr>
  <td width=228 valign=top style='width:171.0pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=67 colspan=2 valign=top style='width:50.15pt;border:none;
  border-bottom:solid windowtext 1.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Current</p>
  </td>
  <td width=13 valign=top style='width:9.65pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .65pt 0in .65pt'>

  </td>
  <td width=89 colspan=3 valign=top style='width:66.85pt;border:none;
  border-bottom:solid windowtext 1.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Long Term</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=66 colspan=3 valign=top style='width:49.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Current</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .65pt 0in .65pt'>

  </td>
  <td width=6 valign=top style='width:4.5pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in .65pt 0in .65pt'>

  </td>
  <td width=84 colspan=2 valign=top style='width:63.0pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Long Term</p>
  </td>
 </tr>
 <tr>
  <td width=228 valign=top style='width:171.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Deferred
  assets (liabilities):</p>
  </td>
  <td width=67 colspan=2 valign=top style='width:50.15pt;border:none;
  padding:0in .65pt 0in .65pt'>

  </td>
  <td width=13 valign=top style='width:9.65pt;border:none;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=89 colspan=3 valign=top style='width:66.85pt;border:none;
  padding:0in .65pt 0in .65pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=66 colspan=3 valign=top style='width:49.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=84 colspan=2 valign=top style='width:63.0pt;padding:0in .65pt 0in .65pt'>

  </td>
 </tr>
 <tr style='height:.1in'>
  <td width=228 valign=top style='width:171.0pt;padding:0in .65pt 0in .65pt;
  height:.1in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Tax
  effect of net operating loss carry-forward</p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .65pt 0in .65pt;
  height:.1in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=51 valign=bottom style='width:38.15pt;padding:0in .65pt 0in .65pt;
  height:.1in'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>-</p>
  </td>
  <td width=13 valign=top style='width:9.65pt;padding:0in .65pt 0in .65pt;
  height:.1in'>

  </td>
  <td width=18 valign=bottom style='width:13.5pt;padding:0in .65pt 0in .65pt;
  height:.1in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=71 colspan=2 valign=bottom style='width:53.35pt;padding:0in .65pt 0in .65pt;
  height:.1in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,047,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt;
  height:.1in'>

  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt;
  height:.1in'>

  </td>
  <td width=54 colspan=2 valign=bottom style='width:40.5pt;padding:0in .65pt 0in .65pt;
  height:.1in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=12 valign=bottom style='width:9.0pt;padding:0in .65pt 0in .65pt;
  height:.1in'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>-</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt;
  height:.1in'>

  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt;
  height:.1in'>

  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .65pt 0in .65pt;
  height:.1in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=68 valign=bottom style='width:51.0pt;padding:0in .65pt 0in .65pt;
  height:.1in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,292,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=228 valign=top style='width:171.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Partnership
  basis difference</p>
  </td>
  <td width=67 colspan=2 valign=bottom style='width:50.15pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>-</p>
  </td>
  <td width=13 valign=top style='width:9.65pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=89 colspan=3 valign=bottom style='width:66.85pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>173,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>-</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>143,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=228 valign=top style='width:171.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Deferred
  revenue</p>
  </td>
  <td width=67 colspan=2 valign=bottom style='width:50.15pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>-</p>
  </td>
  <td width=13 valign=top style='width:9.65pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=89 colspan=3 valign=bottom style='width:66.85pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>160,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>-</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>172,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=228 valign=top style='width:171.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Property
  and equipment basis differences</p>
  </td>
  <td width=67 colspan=2 valign=bottom style='width:50.15pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>-</p>
  </td>
  <td width=13 valign=top style='width:9.65pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=89 colspan=3 valign=bottom style='width:66.85pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>286,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>-</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>117,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=228 valign=top style='width:171.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Other
  accrued liability difference</p>
  </td>
  <td width=67 colspan=2 valign=bottom style='width:50.15pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>90,000&nbsp;</u></p>
  </td>
  <td width=13 valign=top style='width:9.65pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=89 colspan=3 valign=bottom style='width:66.85pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;
  41,000&nbsp;</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>48,000&nbsp;</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;
  36,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=228 valign=top style='width:171.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Net
  deferred tax assets</p>
  </td>
  <td width=67 colspan=2 valign=bottom style='width:50.15pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>90,000&nbsp;</p>
  </td>
  <td width=13 valign=top style='width:9.65pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=89 colspan=3 valign=bottom style='width:66.85pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,707,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>48,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,760,000&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width=228 valign=top style='width:171.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Less
  valuation allowance*</p>
  </td>
  <td width=67 colspan=2 valign=bottom style='width:50.15pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(90,000)</u></p>
  </td>
  <td width=13 valign=top style='width:9.65pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=89 colspan=3 valign=bottom style='width:66.85pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(3,707,000)</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(48,000)</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>(2,760,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width=228 valign=top style='width:171.0pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=67 colspan=2 valign=bottom style='width:50.15pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=13 valign=top style='width:9.65pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=89 colspan=3 valign=bottom style='width:66.85pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=66 colspan=3 valign=bottom style='width:49.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=84 colspan=2 valign=bottom style='width:63.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=228 valign=top style='width:171.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Net
  deferred tax assets</p>
  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=51 valign=bottom style='width:38.15pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; -</u></p>
  </td>
  <td width=13 valign=top style='width:9.65pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=29 colspan=2 valign=bottom style='width:21.85pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=60 valign=bottom style='width:45.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  -</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=18 valign=bottom style='width:13.5pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=48 colspan=2 valign=bottom style='width:.5in;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:-27.65pt;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  -</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=6 valign=top style='width:4.5pt;padding:0in .65pt 0in .65pt'>

  </td>
  <td width=16 valign=bottom style='width:12.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=68 valign=bottom style='width:51.0pt;padding:0in .65pt 0in .65pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; -</u></p>
  </td>
 </tr>
 <tr height=0>
  <td width=228 style='border:none'></td>
  <td width=16 style='border:none'></td>
  <td width=51 style='border:none'></td>
  <td width=13 style='border:none'></td>
  <td width=18 style='border:none'></td>
  <td width=11 style='border:none'></td>
  <td width=60 style='border:none'></td>
  <td width=18 style='border:none'></td>
  <td width=6 style='border:none'></td>
  <td width=18 style='border:none'></td>
  <td width=36 style='border:none'></td>
  <td width=12 style='border:none'></td>
  <td width=18 style='border:none'></td>
  <td width=6 style='border:none'></td>
  <td width=16 style='border:none'></td>
  <td width=68 style='border:none'></td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>*&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The
valuation allowance increased by $989,000 during the year ended September 30,
2010.</p>

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



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

<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:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Company has net operating loss carry-forwards of approximately $7,997,000 for
income tax purposes which expire from 2011 through 2030.&nbsp;
The use of these net operating loss carry-forwards may be restricted due to
changes in ownership.</p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Total
income tax expense for the years ended 2010 and 2009 differed from the amounts
computed by applying the U.S. Federal statutory tax rates to pre-tax income as
follows:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=642
 style='border-collapse:collapse'>
 <tr>
  <td width=420 valign=top style='width:315.0pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=108 colspan=3 valign=top style='width:81.0pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:31.5pt;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>2010</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:22.5pt;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>2009</p>
  </td>
 </tr>
 <tr>
  <td width=420 valign=top style='width:315.0pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=108 colspan=3 valign=top style='width:81.0pt;padding:0in 0in 0in 0in'>

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

  </td>
  <td width=96 colspan=2 valign=top style='width:1.0in;padding:0in 0in 0in 0in'>

  </td>
 </tr>
 <tr>
  <td width=420 valign=top style='width:315.0pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Total
  expense (benefit) computed by applying the U.S. Statutory rate (35%)</p>
  </td>
  <td width=18 valign=bottom style='width:13.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=90 colspan=2 valign=bottom style='width:67.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(1,026,000)</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=18 valign=bottom style='width:13.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=78 valign=bottom style='width:58.5pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(576,000)</p>
  </td>
 </tr>
 <tr style='height:11.2pt'>
  <td width=420 valign=bottom style='width:315.0pt;padding:0in 0in 0in 0in;
  height:11.2pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>State
  income tax, net of federal tax benefit</p>
  </td>
  <td width=108 colspan=3 valign=bottom style='width:81.0pt;padding:0in .7pt 0in .7pt;
  height:11.2pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(88,000)</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 0in 0in 0in;
  height:11.2pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt;
  height:11.2pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'>(50,000)</p>
  </td>
 </tr>
 <tr style='height:13.0pt'>
  <td width=420 valign=bottom style='width:315.0pt;padding:0in 0in 0in 0in;
  height:13.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Effect
  of change in valuation allowance</p>
  </td>
  <td width=108 colspan=3 valign=bottom style='width:81.0pt;padding:0in .7pt 0in .7pt;
  height:13.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>989,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 0in 0in 0in;
  height:13.0pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt;
  height:13.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>552,000&nbsp;</p>
  </td>
 </tr>
 <tr style='height:13.0pt'>
  <td width=420 valign=bottom style='width:315.0pt;padding:0in 0in 0in 0in;
  height:13.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Permanent
  differences</p>
  </td>
  <td width=108 colspan=3 valign=bottom style='width:81.0pt;padding:0in .7pt 0in .7pt;
  height:13.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>30,000&nbsp;</p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 0in 0in 0in;
  height:13.0pt'>

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt;
  height:13.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>68,000&nbsp;</p>
  </td>
 </tr>
 <tr style='height:13.0pt'>
  <td width=420 valign=bottom style='width:315.0pt;padding:0in 0in 0in 0in;
  height:13.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Other</p>
  </td>
  <td width=108 colspan=3 valign=bottom style='width:81.0pt;padding:0in .7pt 0in .7pt;
  height:13.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;
  95,000&nbsp;</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 0in 0in 0in;
  height:13.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;</u></p>
  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in .7pt 0in .7pt;
  height:13.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><u>&nbsp;&nbsp;&nbsp;
  6,000&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=420 valign=bottom style='width:315.0pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=108 colspan=3 valign=bottom style='width:81.0pt;padding:0in 0in 0in 0in'>

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

  </td>
  <td width=96 colspan=2 valign=bottom style='width:1.0in;padding:0in 0in 0in 0in'>

  </td>
 </tr>
 <tr>
  <td width=420 valign=bottom style='width:315.0pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Provision
  for income taxes</p>
  </td>
  <td width=40 colspan=2 valign=bottom style='width:30.25pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=68 valign=bottom style='width:50.75pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-</u></p>
  </td>
  <td width=18 valign=top style='width:13.5pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=18 valign=bottom style='width:13.75pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>&nbsp;$</p>
  </td>
  <td width=78 valign=bottom style='width:58.25pt;padding:0in .7pt 0in .7pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal'><u>&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;-</u></p>
  </td>
 </tr>
 <tr height=0>
  <td width=420 style='border:none'></td>
  <td width=18 style='border:none'></td>
  <td width=22 style='border:none'></td>
  <td width=68 style='border:none'></td>
  <td width=18 style='border:none'></td>
  <td width=18 style='border:none'></td>
  <td width=78 style='border:none'></td>
 </tr>
</table>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><u>&nbsp;</u></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Related Parties</u>:</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Erie County Investment Company (owner of 99% of The Bailey Company) is a
substantial holder of our common stock and has certain contractual rights to
elect members of the Company's Board of Directors under the Series B
Convertible Preferred Stock Agreements entered into in February, 2005.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Company leases office space from The Bailey Company under a lease agreement
which expired in September 2010 and is currently leasing the space on a month
to month basis.&nbsp; Rent paid to them in fiscal 2010 and 2009 for office space was
$55,000 and $55,000, respectively.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Bailey Company is also the owner of one franchised Good Times Drive Thru
restaurant which is located in Loveland, Colorado and was the owner of one
franchised restaurant in Thornton, Colorado which was closed in October 2009.
The Bailey Company has entered into two franchise and management agreements
with us. Franchise royalties and management fees paid under those agreements
totaled approximately $50,000 and $78,000 for the fiscal years ending September
30, 2010 and 2009, respectively. Amounts due from The Bailey Company related to
these agreements at September 30, 2010 and 2009 were $12,000 and $18,000,
respectively.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Total
interest and commitment fees paid to Golden Bridge, LLC under their agreement were
approximately $18,000 and $12,000 for the fiscal years ending September 30, 2010
and 2009, respectively. See Note 8 above for the terms of the loan.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>FAIR
VALUE OF FINANCIAL INSTRUMENTS:</u></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
following table summarizes financial assets and liabilities that are measured
at fair value on a recurring basis as of September 30, 2010:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='margin-left:23.4pt;border-collapse:collapse'>
 <tr>
  <td width=180 valign=top style='width:135.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>Level
  2</u></p>
  </td>
  <td width=78 valign=top style='width:58.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
 </tr>
 <tr>
  <td width=180 valign=top style='width:135.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Interest
  Rate Swap liability</p>
  </td>
  <td width=78 valign=top style='width:58.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$84,000</p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>13.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Stockholders' Equity</u>:</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Preferred
Stock</u>
- - The Company has the authority to issue 5,000,000 shares of preferred stock.&nbsp;
The Board of Directors has the authority to issue such preferred shares in
series and determine the rights and preferences of the shares as may be
determined by the Board of Directors.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Common
Stock Dividend Restrictions</u> - As long as at least two-thirds of the shares of
common stock into which the Series B Preferred Stock was converted remains held
by the former holders of such converted Series B Preferred Stock, without the
written consent or affirmative vote of the holders of three-quarters of the
then outstanding votes of the shares of the Series B Preferred Stock and the
shares of the common stock, the Company cannot institute any payment of cash
dividends or other distributions on any shares of common stock.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><u>Stock
Option Plans</u>
- - The Company has an Omnibus Equity Incentive Compensation Plan (the &quot;2008&nbsp;
Plan&quot;), approved by shareholders in fiscal 2008, which is the successor equity
compensation plan to the Company's 2001 Stock Option Plan (the &quot;2001&nbsp; Plan&quot;).&nbsp;
As of September 30, 2010, 161,986 shares were available for future grants of
nonqualified stock options, incentive stock options, stock appreciation rights,
restricted stock, restricted stock units, performance shares, performance units
and stock-based awards.</p>

<p class=MsoFooter align=right style='text-align:right'>F-18</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

<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:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
2008 Plan serves as the successor to our 2001 Plan, as amended (the
&quot;Predecessor Plan&quot;), and no further awards shall be made under the Predecessor
Plan from and after the effective date of the 2008 Plan.&nbsp; All outstanding
awards under the Predecessor Plan immediately prior to the effective date of
the 2008 Plan shall be incorporated into the 2008 Plan and shall accordingly be
treated as awards under the 2008 Plan.&nbsp; However, each such award shall continue
to be governed solely by the terms and conditions of the instrument evidencing
such grant or issuance, and, except as otherwise expressly provided in the 2008
Plan or by the Committee that administers the 2008 Plan, no provision of the
2008 Plan shall affect or otherwise modify the rights or obligations of holders
of such incorporated awards.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Following
the guidance of FASB ASC 718-10-30, Compensation - Stock Compensation,
stock-based compensation is measured at the grant date, based on the calculated
fair value of the award, and is recognized as an expense over the requisite
employee service period (generally the vesting period of the grant).</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>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 fiscal 2010. 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=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Net
income for the fiscal years ended September 30, 2010 and 2009 includes $88,000
and $77,000, respectively, of compensation costs related to our stock-based
compensation arrangements.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>During
the fiscal year ended September 30, 2010, we granted 12,000 non-statutory stock
options and 30,606 incentive stock options both with exercise prices of $1.15.
The per share weighted average fair value was $.85 for the non-statutory stock
option grants and $.84 for the incentive stock option grants.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>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>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=522
 style='margin-left:22.75pt;border-collapse:collapse'>
 <tr>
  <td width=192 valign=top style='width:143.75pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=150 valign=top style='width:112.75pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Incentive Stock Options</p>
  </td>
  <td width=12 valign=top style='width:9.0pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=168 valign=top style='width:1.75in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Non-Statutory Stock Options</p>
  </td>
 </tr>
 <tr>
  <td width=192 valign=top style='width:143.75pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Expected
  term (years)</p>
  </td>
  <td width=150 valign=top style='width:112.75pt;border:none;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:58.75pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>6.5</p>
  </td>
  <td width=12 valign=top style='width:9.0pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=168 valign=top style='width:1.75in;border:none;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:58.75pt;
  margin-bottom:0in;margin-left:4.5pt;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>6.7</p>
  </td>
 </tr>
 <tr>
  <td width=192 valign=top style='width:143.75pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Expected
  volatility</p>
  </td>
  <td width=150 valign=top style='width:112.75pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:49.5pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>82.4%</p>
  </td>
  <td width=12 valign=top style='width:9.0pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=168 valign=top style='width:1.75in;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:49.0pt;
  margin-bottom:0in;margin-left:4.5pt;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>81.9%</p>
  </td>
 </tr>
 <tr>
  <td width=192 valign=top style='width:143.75pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Risk-free
  interest rate</p>
  </td>
  <td width=150 valign=top style='width:112.75pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:49.5pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2.84%</p>
  </td>
  <td width=12 valign=top style='width:9.0pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=168 valign=top style='width:1.75in;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:49.0pt;
  margin-bottom:0in;margin-left:4.5pt;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2.90%</p>
  </td>
 </tr>
 <tr>
  <td width=192 valign=top style='width:143.75pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Expected
  dividends</p>
  </td>
  <td width=150 valign=top style='width:112.75pt;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:58.75pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>0</p>
  </td>
  <td width=12 valign=top style='width:9.0pt;padding:0in 0in 0in 0in'>

  </td>
  <td width=168 valign=top style='width:1.75in;padding:0in 0in 0in 0in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:54.25pt;
  margin-bottom:0in;margin-left:4.5pt;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>0</p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>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=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>FASB
ASC 718-10-30 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 fiscal years ended September 30, 2010 and 2009.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>A
summary of stock option activity under our share-based compensation plan for
the fiscal year ended September 30, 2010 is presented in the following table:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=606
 style='margin-left:23.4pt;border-collapse:collapse'>
 <tr style='height:.5in'>
  <td width=168 valign=top style='width:1.75in;padding:0in 5.4pt 0in 5.4pt;
  height:.5in'>

  </td>
  <td width=89 valign=bottom style='width:66.6pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:.5in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Options</p>
  </td>
  <td width=109 valign=bottom style='width:81.9pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:.5in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Weighted Average Exercise Price</p>
  </td>
  <td width=138 valign=bottom style='width:103.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:.5in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Weighted Average Remaining Contractual
  Life (Yrs.)</p>
  </td>
  <td width=102 valign=bottom style='width:76.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:.5in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Aggregate Intrinsic Value</p>
  </td>
 </tr>
 <tr>
  <td width=168 valign=bottom style='width:1.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Outstanding-beg
  of year</p>
  </td>
  <td width=89 valign=bottom style='width:66.6pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:11.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>379,231</p>
  </td>
  <td width=109 valign=bottom style='width:81.9pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>$3.55</p>
  </td>
  <td width=138 valign=bottom style='width:103.5pt;border:none;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=bottom style='width:76.5pt;border:none;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=168 valign=bottom style='width:1.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Granted</p>
  </td>
  <td width=89 valign=bottom style='width:66.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:11.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>42,606</p>
  </td>
  <td width=109 valign=bottom style='width:81.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>$1.15</p>
  </td>
  <td width=138 valign=bottom style='width:103.5pt;padding:0in 5.4pt 0in 5.4pt'>

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

  </td>
 </tr>
 <tr>
  <td width=168 valign=bottom style='width:1.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Exercised</p>
  </td>
  <td width=89 valign=bottom style='width:66.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:11.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>0</p>
  </td>
  <td width=109 valign=bottom style='width:81.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=138 valign=bottom style='width:103.5pt;padding:0in 5.4pt 0in 5.4pt'>

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

  </td>
 </tr>
 <tr>
  <td width=168 valign=bottom style='width:1.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Forfeited</p>
  </td>
  <td width=89 valign=bottom style='width:66.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:11.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>(7,320)</p>
  </td>
  <td width=109 valign=bottom style='width:81.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>$4.60</p>
  </td>
  <td width=138 valign=bottom style='width:103.5pt;padding:0in 5.4pt 0in 5.4pt'>

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

  </td>
 </tr>
 <tr>
  <td width=168 valign=bottom style='width:1.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Expired</p>
  </td>
  <td width=89 valign=bottom style='width:66.6pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:11.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>(24,431)</p>
  </td>
  <td width=109 valign=bottom style='width:81.9pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>$3.12</p>
  </td>
  <td width=138 valign=bottom style='width:103.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=102 valign=bottom style='width:76.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=168 valign=bottom style='width:1.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Outstanding
  Sept 30, 2010</p>
  </td>
  <td width=89 valign=bottom style='width:66.6pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:11.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>390,086</p>
  </td>
  <td width=109 valign=bottom style='width:81.9pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>$3.30</p>
  </td>
  <td width=138 valign=bottom style='width:103.5pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>5.4</p>
  </td>
  <td width=102 valign=bottom style='width:76.5pt;border:none;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>$0</p>
  </td>
 </tr>
 <tr>
  <td width=168 valign=bottom style='width:1.75in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=89 valign=bottom style='width:66.6pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=109 valign=bottom style='width:81.9pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=138 valign=bottom style='width:103.5pt;padding:0in 5.4pt 0in 5.4pt'>

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

  </td>
 </tr>
 <tr>
  <td width=168 valign=bottom style='width:1.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Exercisable
  Sept 30, 2010</p>
  </td>
  <td width=89 valign=bottom style='width:66.6pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:11.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>269,060</p>
  </td>
  <td width=109 valign=bottom style='width:81.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>$3.76</p>
  </td>
  <td width=138 valign=bottom style='width:103.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>4.2</p>
  </td>
  <td width=102 valign=bottom style='width:76.5pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>$0</p>
  </td>
 </tr>
</table>



<p class=MsoFooter align=right style='text-align:right'>F-19</p>



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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>As
of September 30, 2010, the total remaining unrecognized compensation cost
related to unvested stock-based arrangements was $51,000 and is expected to be
recognized over a weighted average period of 2.09 years.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
total intrinsic value of stock options exercised during the fiscal year ended
September 30, 2010 was $0.&nbsp; Cash received from stock option exercises for the
fiscal year ended September 30, 2010 was $0.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>14.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Retirement Plan</u>:</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
Company has a 401(k) profit sharing plan (the &quot;Plan&quot;).&nbsp; Eligible employees may
make voluntary contributions to the Plan, which may be matched by the Company,
in an amount equal to 25% of the employee's contribution up to 6% of their
compensation.&nbsp; The amount of employee contributions is limited as specified in
the Plan. The Company may, at its discretion, make additional contributions to
the Plan or change the matching percentage.&nbsp; The Company did not make any
matching contributions in fiscal 2010 or fiscal 2009.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>15.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Subsequent Events</u>:</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Subsequent
events have been evaluated through the date the consolidated financial
statements were available to be issued.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Pre-approval
of non-audit services: On October 25, 2010, the Audit Committee of the Board of
Directors of Good Times Restaurants Inc. approved in advance certain non-audit
services to be performed by Hein &amp; Associates, Good Times' independent
auditor.&nbsp; These non-audit services are to consist primarily of corporate income
tax compliance services.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Completion
of SII Investment Transaction and Related Events:&nbsp; On December 13, 2010, the
Company completed the SII Investment Transaction pursuant to which the Company
issued 4,200,000 Shares to SII and received gross proceeds of $2,100,000, some
of which were used to repay the Company's interim working capital loans from
Golden Bridge, W Capital and McDonald, accompanied by the conversion of accrued
interest on the W Capital and McDonald loans into 79,430 shares of Common
Stock.&nbsp; In addition, the SII Investment Transaction also allowed the Company to
renegotiate the terms and covenants of its loan with Wells Fargo and to regain
compliance of certain financial loan covenants that had previously been in
default. See Financing Activities under the Liquidity and Capital Resources
section above for further details regarding the SII Investment Transaction and
related events.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>See
the &quot;Financing&quot; section above for discussion of the partial pay-down of the
PFGI II loan in December 2010.</p>





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<div class=WordSection9>









<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:1.0in;margin-bottom:.0001pt;text-indent:-1.0in;line-height:normal'><b>ITEM 9.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.</b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>During
the two most recent fiscal years, Good Times Restaurants has not had any
changes in or disagreements with its independent accountants on matters of
accounting or financial disclosure.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>ITEM
9A.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; CONTROLS AND PROCEDURES.</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>&nbsp;</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal;background:white'><b>Conclusion Regarding the Effectiveness
of Disclosure Controls and Procedures: </b>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 Company's fiscal year ended September 30, 2010, 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-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Management's
Report on Internal Control Over Financial Reporting: </b>We are
responsible for establishing and maintaining adequate internal control over
financial reporting (as defined in Rule&nbsp;13a-15(f) and 15d-15(f) under the
Securities and Exchange Act of 1934, as amended). We maintain a system of
internal controls that is designed to provide reasonable assurance in a
cost-effective manner as to the fair and reliable preparation and presentation
of the consolidated financial statements.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Therefore, even those systems determined to be
effective can provide only reasonable assurance with respect to financial
statement preparation and presentation.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>We
conducted an evaluation of the effectiveness of our internal control over
financial reporting as of September 30, 2010. In making this evaluation, our
management used the criteria set forth by the Committee of Sponsoring
Organizations of the Treadway Commission (&quot;COSO&quot;) in Internal
Control-Integrated Framework. This evaluation included a review of the
documentation of controls, evaluation of the design effectiveness of controls
and a conclusion on this evaluation. We have concluded that, as of September
30, 2010, the Company's internal control over financial reporting was effective
based on these criteria.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal;background:white'>This Annual Report does not include an
attestation report of the Company's registered public accounting firm regarding
internal control over financial reporting.&nbsp;&nbsp;Management's report was
not subject to attestation by the Company's registered public accounting firm
pursuant to rules of the SEC that permit the Company to provide only
management's report in this Annual Report.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal;background:white'><b>Changes in Internal Control over
Financial Reporting: </b>There
have been no significant changes in the Company's internal control over
financial reporting that occurred during the Company's fiscal quarter ended
September 30, 2010 that have materially affected, or are reasonably likely to
materially affect, the Company's internal control over financial reporting.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal;background:white'><b>ITEM
9B.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; OTHER INFORMATION</b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>Nothing
to report.</p>

<p class=MsoFooter align=right style='text-align:right'>28</p>



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<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>PART III</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>&nbsp;</b></p>

<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:1.0in;margin-bottom:.0001pt;text-indent:-1.0in;line-height:normal'><b>ITEM 10.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; DIRECTORS,
EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE<a name="_Toc92016743"></a><a
name="_Toc89839951"></a><a name="_Toc89839456">.</a></b></p>

<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:1.0in;margin-bottom:.0001pt;text-align:justify;text-indent:-1.0in;
line-height:normal'><b>&nbsp;</b></p>

<p style='margin:0in;margin-bottom:.0001pt;text-align:justify'><b>Directors:</b>
The directors of Good Times Restaurants are as follows:</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i>Geoffrey
R. Bailey,</i>
age 58, has served as a Good Times director since 1996 and is a member of the Audit
Committee.&nbsp; He is also a director of The Erie County Investment Co., which owns
99% of The Bailey Company.&nbsp; The principal business of The Bailey Company owns
and operating 58 Arby's restaurants as a franchisee, and The Bailey Company has
also been a franchisee and joint venture partner of Good Times Restaurants
since 1987.&nbsp; Mr. Bailey joined The Erie County Investment Co. in 1979.&nbsp; Mr.
Bailey is a graduate of the University of Denver with a Bachelor's Degree in
Business Administration.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i>David
L. Dobbin</i>,
age 49, was appointed as a Good Times director effective upon the closing of
the SII Investment Transaction on December 13, 2010.&nbsp; He was also appointed as
the Chairman of the Board effective as of December 13, 2010.&nbsp; In addition, he currently
serves as Chairman of the Board of Small Island Investments Ltd., the Company's
strategic investor (2010-Present).&nbsp; He also serves as Chairman of the Boards of
Terra Nova Pub Group Ltd., its subsidiaries and affiliates (2007-Present) and
Welaptega Marine Ltd. (2008-Present), a leading supplier of offshore mooring
inspection systems, companies controlled by Mr. Dobbin through Repechage
Investments Limited, an investment company formed under the laws of Canada that
holds investments in the transportation, service, real estate and hospitality
sectors (2001-Present).&nbsp; Previously, Mr. Dobbin served in several capacities
with CHC Helicopter Corporation, an offshore helicopter services provider, and
led Canadian Ocean Resource Associates Inc., a consulting firm specializing in
best practice reviews, institutional support and public/private partnerships.&nbsp;
Mr. Dobbin holds a Bachelor of Commerce from Memorial University of
Newfoundland.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i>Gary
J. Heller</i>,
age 43, was appointed as a Good Times director effective upon the closing of
the SII Investment Transaction on December 13, 2010.&nbsp; He is the chairman of the
Compensation Committee.&nbsp; In addition, he currently serves as Secretary and a
Director of Elephant &amp; Castle Group Inc. (2007-Present), Secretary and a
Manager of Massachusetts Pub Group LLC (2008-Present), and Executive Vice
President of Terra Nova Pub Group Ltd. (2009-Present).&nbsp; Prior to entering the
restaurant industry in 2007, Mr. Heller spent 16 years as an investment banker,
including serving as a Managing Director of FTI Capital Advisors, LLC
(2002-2006) and a Director of Andersen Corporate Finance LLC.&nbsp; Mr. Heller holds
a BA in Economics from the University of Pennsylvania and an MBA in Finance
from New York University.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i>Boyd
E. Hoback</i>,
age 55, has served as a Good Times director since 1992 and is President and
Chief Executive Officer of Good Times Restaurants, a position which he has held
since December 1992, and he has been in the restaurant business since the age
of 16.&nbsp; Mr. Hoback has been a vital part of the development of Good Times to a
52-restaurant chain and has been involved in developing all areas of the
Company.&nbsp; Mr. Hoback is an honors graduate of the University of Colorado in
finance.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i>John
F. Morgan</i>,
age 50, was appointed as a Good Times director effective upon the closing of
the SII Investment Transaction on December 13, 2010.&nbsp; He is a member of the
Audit Committee and the Compensation Committee.&nbsp; In addition, he currently
serves as President, Chief Executive Officer and a Director of Elephant &amp;
Castle Group Inc. and Terra Nova Pub Group Ltd. (2009-Present).&nbsp; He is
President, Chief Executive Officer and a Manager of Massachusetts Pub Group LLC
(2008-Present).&nbsp; Previously Mr. Morgan had been the President of Morgan Capital
Limited, St. John's, Newfoundland, an independent financial services firm
providing taxation and merger and acquisition support services to North
American and international clients (1994-2009).&nbsp; Mr. Morgan holds a Bachelor of
Commerce degree from Memorial University of Newfoundland and Labrador with a
participation in the In Depth Taxation Program and Chartered Business Valuator
Program.&nbsp; He is a Chartered Accountant.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i>Keith
A. Radford</i>,
age 41, was appointed as a Good Times director effective upon the closing of
the SII Investment Transaction on December 13, 2010.&nbsp; He is the chairman of the
Audit Committee.&nbsp; In addition, he currently serves as Chief Financial Officer
of Terra Nova Pub Group Ltd., Elephant &amp; Castle Group Inc. and
Massachusetts Pub Group LLC (2009-Present).&nbsp; Previously Mr. Radford served as a
Director and Vice President of subsidiaries within AKER Solutions, a leading
global provider of engineering and construction services, technology products
and integrated solutions (2002-2008).&nbsp; In addition he has over eight years of
experience in public practice providing auditing, taxation and business
consulting services.&nbsp; Mr. Radford holds a Bachelor of Commerce degree from
Memorial University of Newfoundland and Labrador and is a Chartered Accountant.</p>

<p class=MsoFooter align=right style='text-align:right'>29</p>



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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i>Eric
W. Reinhard</i>,
age 51, has served as a Good Times director since 2005.&nbsp; He resigned as
Chairman of the Board, a position he held since 2005, effective as of December
13, 2010.&nbsp; He is currently a member of the Compensation Committee.&nbsp; Mr.
Reinhard also serves as President of the Pepsi Cola Bottler's Association, a
beverage association management and consulting association and a position he
has held since 2006. Prior to June 2004 he was the General Manager for the
Pepsi Bottling Group's Great West Business Unit.&nbsp; While in this role, Mr.
Reinhard was also a member of the Pepsi Bottling Group's Chairman's Operating
Council, a member of the Food Service Strategic Planning Committee, and a
member of The Dr. Pepper Bottler Marketing Committee.&nbsp;&nbsp; Mr. Reinhard joined
Pepsi Cola in 1984 after four years with The Proctor &amp; Gamble Distributing
Company.&nbsp; Since 1984 he has held several field and headquarters positions
including Vice President/General Manager Pepsi-Lipton Tea partnership (JV),
General Manager Mid-Atlantic business Unit, Area Vice President Retail
Channels, Vice President On-Premise Operations and Area Vice President of
Franchise Operations.&nbsp; Mr. Reinhard holds a BA from Michigan State University
and has completed the Executive Business Program at the University of Michigan.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>There are no family
relationships among the directors.&nbsp; The board has determined that of the
current directors Geoffrey R. Bailey, Eric W. Reinhard, David L. Dobbin, Gary
J. Heller, John F. Morgan and Keith A. Radford are independent directors under
the NASDAQ listing standards.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>Geoffrey R. Bailey was
originally elected to the Board of Directors pursuant to contractual board
representation rights granted to The Bailey Company in connection with its
investment in shares of our Series A Convertible Preferred Stock in 1996.&nbsp; Prior
to December 13, 2010, Mr. Bailey continued to serve on the board pursuant to
contractual board representation rights held by The Bailey Company and its
affiliates (&quot;The Bailey Group&quot;) in connection with our Series B Convertible
Preferred Stock financing in February 2005, whereby The Bailey Group was
entitled to elect three members of our Board of Directors, two of whom must be
independent directors.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>Prior to December 13,
2010, Richard J. Stark and Alan A. Teran were the other two members of our
Board designated by The Bailey Group under these provisions.&nbsp; The other
investors in our Series B Convertible Preferred Stock financing also had board
representation rights whereby they were entitled to elect three members of our
Board.&nbsp; Eric W. Reinhard was originally elected in 2005 and has continued to
serve on our Board pursuant to these provisions.&nbsp; Prior to December 13, 2010,
Ron Goodson and David Grissen were the other two members of our Board
designated by the other Series B investors under these provisions.&nbsp; In
connection with the SII Investment Transaction, Messrs. Stark, Teran, Goodson
and Grissen resigned from our Board effective as of December 13, 2010.&nbsp; In
addition, the Series B Investors agreed to cancel their Board designation
rights under the Series B Convertible Preferred Stock financing documents and
to accept in lieu thereof the designation rights set forth in the Purchase
Agreement with SII.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>The SII Purchase
Agreement provides that so long as SII holds more than 50% of the Company's
outstanding Common Stock, (i) the Board shall consist of seven directors, and
(ii) SII shall have the right to designate four members of the Board.&nbsp; In
addition, the Purchase Agreement provides that SII shall vote its shares in any
election of directors in favor of one person designated by The Bailey Group and
one person designated by Eric W. Reinhard, in addition to SII's four director
designees.&nbsp; If either The Bailey Group or Reinhard ceases to own at least
600,000 shares of the Company's Common Stock (adjusted for any stock splits,
reverse splits or similar capital stock transactions), then the foregoing
designation right will cease, and SII has agreed to vote its shares in any
election of directors in favor of a person, other than an SII designee, who
receives the majority of votes of holders of Common Stock other than the
Investor.&nbsp; Pursuant to the Purchase Agreement, the Series B investors have
agreed to vote their shares in any election of directors in favor of SII's
designees.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>See Item 13 &quot;Certain
relationships and related transactions&quot; for additional discussion of these
provisions.&nbsp; There are no other arrangements or understandings between any
current director and any other person under which that dire<a
name="_Toc92016733">ctor was elected or nominated.</a></p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'><b>Nominee selection
process</b><b>: </b>Our Board of Directors as a whole
acts as the nominating committee for the selection of nominees for election as
directors.&nbsp; We do not have a separate standing nominating committee since we
require that our director nominees be approved as nominees by a majority of our
independent directors.&nbsp; The Board will consider suggestions by stockholders for
possible future nominees for election as directors at the next annual meeting
when the suggestion is delivered in writing to the corporate secretary of Good
Times Restaurants by April 15 of the year immediately preceding the annual
meeting.&nbsp; No request for a recommended nominee was made by the August 15, 2010
deadline by any stockholder or group of stockholders with beneficial ownership
of more than 5% of the Company's common stock as indicated in a Schedule 13D or
13G.</p>

<p class=MsoFooter align=right style='text-align:right'>30</p>



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<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>The Board selects each
nominee, subject to contractual nominee designation and election rights held by
certain stockholders, as discussed below, based on the nominee's skills,
achievements and experience, with the objective that the Board as a whole
should have broad and relevant experience in high policymaking levels in
business and a commitment to representing the long-term interests of the
stockholders.&nbsp; The Board believes that each nominee should have experience in
positions of responsibility and leadership, an understanding of our business
environment and a reputation for integrity.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>The Board evaluates
each potential nominee individually and in the context of the Board as a
whole.&nbsp; The objective is to recommend a group that will effectively contribute
to our long-term success and represent stockholder interests.&nbsp; In determining
whether to recommend a director for re-election, the Board also considers the
director's past attendance at meetings and participation in and contributions
to the activities of the Board.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>When seeking
candidates for director, the Board solicits suggestions from incumbent
directors, management, stockholders or others.&nbsp; The Board does not have a
charter for the nominating process.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>The Company does not
have a formal policy with regard to the consideration of diversity in
identifying director nominees, but the Board strives to nominate directors with
a variety of complementary skills so that, as a group, the Board will possess
the appropriate talent, skills, and expertise to oversee the Company's
business.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'><a name="_Toc92016734"><b>Communication
with the directors</b></a><b>:</b> The Board welcomes questions or
comments about us and our operations.&nbsp; Those interested may contact the Board
as a whole or any one or more specified individual directors by sending a
letter to the intended recipients' attention in care of Good Times Restaurants
Inc., Corporate Secretary, 601 Corporate Circle, Golden, CO 80401.&nbsp; All such
communications other than commercial advertisements will be forwarded to the
appropriate director or directors for review.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'><b>Leadership
Structure:</b>&nbsp; The
Board does not have a policy regarding the separation of the roles of Chief
Executive Officer and Chairman of the Board as the Board believes it is in the
best interests of the Company to make that determination based on the position
and direction of the Company and the membership of the Board.&nbsp; The Board has
determined that separating these roles is in the best interests of the
Company's stockholders at this time.&nbsp; This structure ensures a greater role for
the independent directors in the oversight of the Company and active
participation of the independent directors in setting agendas and establishing
Board priorities and procedures.&nbsp; Further, this structure permits the Chief
Executive Officer to focus on the management of the Company's day-to-day
operations.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'><b>Risk Oversight:</b>&nbsp; Material risks are identified
and prioritized by the Company's management and reported to the Board for
oversight.&nbsp; The Board regularly reviews information regarding the Company's
credit, liquidity and operations, as well as the risks associated with each.&nbsp;
In addition, the Board continually works, with the input of the Company's
executive officers, to assess and analyze the most likely areas of future risk
for the Company.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'><a name="_Toc92016736"></a><a name="_Toc89839945"></a><a
name="_Toc89839450"><b><u>Board
Committees</u></b></a></p>

<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'><b>&nbsp;</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><a name="_Toc92016737"></a><a name="_Toc89839946"></a><a
name="_Toc89839451"><b>Audit
Committee</b></a><b>:</b> The Audit
Committee currently consists of Messrs. Radford, Morgan and Bailey, each of
whom is an independent director under the applicable NASDAQ listing standards.&nbsp;
The Board has determined that Mr. Morgan is an audit committee financial
expert, as that term is defined by the SEC rules.&nbsp; Prior to December 13, 2010,
the Audit Committee consisted of Messrs. Grissen, Teran and Stark, and Mr.
Stark served as the Audit Committee financial expert.&nbsp; As discussed above,
Messrs. Grissen, Teran and Stark resigned as directors in connection with the
SII Investment Transaction, effective as of December 13, 2010.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
function of the Audit Committee relates to oversight of the auditors, the
auditing, accounting and financial reporting processes and the review of the
Company's financial reports and information.&nbsp; In addition, the functions of
this Committee have included, among other things, recommending to the Board the
engagement or discharge of independent auditors, discussing with the auditors
their review of the Company's quarterly results and the results of their audit
and reviewing the Company's internal accounting controls.&nbsp; The Audit Committee
operates pursuant to a written charter adopted by the Board of Directors.&nbsp; A
current copy of the Audit Committee Charter is available on our website at
www.goodtimesburgers.com.&nbsp; The Audit Committee held four meetings during fiscal
2010.</p>



<p class=Style90 style='text-align:justify'><a name="_Toc92016738"></a><a
name="_Toc89839947"></a><a name="_Toc89839452"><b>Compensation Committee</b></a><b>:</b> The
Compensation Committee currently consists of Messrs. Heller, Morgan and
Reinhard,
each of who is an independent director under the applicable NASDAQ listing
standards.&nbsp; Prior
to December 13, 2010, the Compensation Committee consisted of Messrs. Goodson,
Stark and Teran, all of whom resigned as directors in connection</p>

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<p class=Style90 style='text-align:justify'>with the SII Investment Transaction,
effective as of December 13, 2010.&nbsp; The function of this Committee is to
consider and determine all matters relating to the compensation of the
President and Chief Executive Officer and other executive officers, including
matters relating to the employment agreements.&nbsp; The Compensation Committee held
one meeting during fiscal 2010.</p>



<p class=Style90 style='text-align:justify'>The Compensation Committee does not have
a charter. The responsibility of the Compensation Committee is to review and
approve the compensation and other terms of employment of our Chief Executive
Officer and our other executive officers, including all of the executive
officers named in the Summary Compensation Table in Item 11 of Part III of this
Form 10-K (the &quot;Named Executive Officers&quot;).&nbsp; Among its other duties, the
Compensation Committee oversees all significant aspects of the Company's
compensation plans and benefit programs.&nbsp; The Compensation Committee annually
reviews and approves corporate goals and objectives for the Chief Executive
Officer's compensation and evaluates the Chief Executive Officer's performance
in light of those goals and objectives.&nbsp; The Compensation Committee also
recommends to the Board of Directors the compensation and benefits for members
of the Board of Directors.&nbsp; The Compensation Committee has also been appointed
by the Board of Directors to administer our 2008 Omnibus Equity Incentive
Compensation Plan (the &quot;2008 Plan&quot;), which is the successor equity compensation
plan to the Company's 2001 Stock Option Plan (the &quot;2001 Plan&quot;).&nbsp; The
Compensation Committee does not delegate any of its authority to other persons.</p>



<p class=Style90 style='margin-top:0in;margin-right:6.05pt;margin-bottom:0in;
margin-left:.2pt;margin-bottom:.0001pt;text-align:justify'>In carrying out
its duties, the Compensation Committee participates in the design and
implementation and ultimately reviews and approves specific compensation
programs.&nbsp; The Compensation Committee reviews and determines the base salaries
for the Named Executive Officers, and also approves awards to the Named
Executive Officers under the Company's equity compensation plans.</p>



<p class=Style90 style='margin-right:.25pt;text-align:justify'>In determining
the amount and form of compensation for Named Executive Officers other than the
Chief Executive Officer, the Compensation Committee obtains input from the
Chief Executive Officer regarding the duties, responsibilities and performance
of the other executive officers and the results of performance reviews.&nbsp; The
Chief Executive Officer also recommends to the Compensation Committee the base
salary levels for all Named Executive Officers and the award levels for all
Named Executive Officers under the Company's equity compensation programs.&nbsp; No
Named Executive Officer attends any executive session of the Compensation
Committee or is present during final deliberations or determinations of such
Named Executive Officer's compensation.&nbsp; The Chief Executive Officer also
provides input with respect to the amount and form of compensation for the
members of the Board of Directors.</p>



<p class=Style90 style='text-align:justify'>The Compensation Committee has the
authority to directly engage, at the Company's expense, any compensation
consultants or other advisers as it deems necessary to carry out its
responsibilities in determining the amount and form of executive and director
compensation.&nbsp; For fiscal 2010, the Compensation Committee did not use the
services of a compensation consultant or other adviser.&nbsp; However, the
Compensation Committee has reviewed surveys, reports and other market data
against which it has measured the competitiveness of the Company's compensation
programs.&nbsp; In determining the amount and form of executive and director
compensation, the Compensation Committee has reviewed and discussed historical
salary information as well as salaries for similar positions at comparable
companies.</p>



<p class=Style90 style='text-align:justify'><b>Special Committee:</b>&nbsp; On August 14,
2009 as reported on Form 8-K we announced that our Board of Directors had
formed a Special Committee comprised of directors Geoff Bailey, Richard Stark
and Alan Teran to explore and evaluate strategic alternatives aimed at
enhancing shareholder value.&nbsp; The Special Committee actively explored various
strategic alternatives from August 2009 through October 2010, and the Company
completed the SII Investment Transaction on December 13, 2010.&nbsp; With the
completion of the SII Investment Transaction, the Special Committee has been
terminated.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><a name="_Toc92016739"></a><a name="_Toc89839948"></a><a
name="_Toc89839453"><b>Directors'
meetings and attendance</b></a><b>:</b> There were nine meetings of the Board
of Directors held during the last full fiscal year.&nbsp; No member of the Board of
Directors attended fewer than 75% of the board meetings and applicable
committee meetings.&nbsp; Each continuing director attended the 2010 annual meeting
of stockholders.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><a name="_Toc92016740"></a><a name="_Toc89839949"></a><a
name="_Toc89839454"><b>Directors'
compensation</b></a><b>:</b> Each
non-employee director receives $500 for each Board of Directors meeting
attended.&nbsp; Members of the Compensation and Audit Committees generally each
receive $100 per meeting attended.&nbsp; However, where both Compensation and Audit
Committee meetings are held at the same gathering, only $100 is paid to directors
attending both committee meetings.&nbsp; Additionally, for the fiscal year ended September
30, 2010, each non-employee director received a non-statutory stock option to
acquire 2,000 shares of common stock at an exercise price of $1.15.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'><a name="_Toc92016741"></a><a name="_Toc89839950"></a><a
name="_Toc89839455"><b>Audit
Committee Report</b></a><b>:</b> Good Times Restaurant's
management is responsible for the internal controls and financial reporting
process for Good Times Restaurants.&nbsp; The independent accountants for Good Times
Restaurants are responsible</p>

<p class=MsoFooter align=right style='text-align:right'>32</p>



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<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>for performing an
independent audit of the financial statements in accordance with generally
accepted auditing standards and to issue a report on those financial
statements.&nbsp; The Audit Committee's responsibility is to monitor and oversee
these processes.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>In this context, the
Audit Committee met with management and the independent accountants to review
and discuss the Good Times Restaurants financial statements for the fiscal year
ended September 30, 2010.&nbsp; Management represented to the Audit Committee that
the financial statements were prepared in accordance with generally accepted
accounting principles, and the Audit Committee has reviewed and discussed the
financial statements with management and the independent accountants.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>The Audit Committee
has discussed with the independent accountants matters required to be discussed
by Statement on Auditing Standards No. 61, Communication with Audit
Committees.&nbsp; The Audit Committee has also received the written disclosures and
the letter from the independent accountants required by applicable requirements
of the Public Company Accounting Oversight Board regarding the independent
accountants' communications with the Audit Committee concerning independence
and the Audit Committee discussed with the independent accountants that firm's
independence.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Based
on the Audit Committee's review and discussions referred to above, the Audit
Committee recommended to the Board of Directors that the audited financial
statements be included in the Good Times Restaurants Annual Report on Form 10-K
for the fiscal year ended September 30, 2010 for filing with the SEC.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Executive
officers</b><b>:</b> The executive
officers of Good Times Restaurants are as follows:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=624
 style='margin-left:5.4pt;border-collapse:collapse'>
 <tr style='height:11.5pt'>
  <td width=144 valign=top style='width:1.5in;padding:0in 5.4pt 0in 5.4pt;
  height:11.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b><u>Name</u></b></p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt;
  height:11.5pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:-2.55pt;margin-bottom:.0001pt;text-align:center;
  line-height:normal'><b><u>Age</u></b></p>
  </td>
  <td width=138 valign=top style='width:103.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:11.5pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:.05in;margin-bottom:.0001pt;line-height:normal'><b><u>Position</u></b></p>
  </td>
  <td width=222 valign=top style='width:166.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:11.5pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'><b><u>Date
  Began With Company</u></b></p>
  </td>
 </tr>
 <tr style='height:11.5pt'>
  <td width=144 valign=top style='width:1.5in;padding:0in 5.4pt 0in 5.4pt;
  height:11.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Boyd
  E. Hoback</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt;
  height:11.5pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:-2.55pt;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>55</p>
  </td>
  <td width=138 valign=top style='width:103.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:11.5pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:2.85pt;margin-bottom:.0001pt;line-height:normal'>President
  &amp; CEO</p>
  </td>
  <td width=222 valign=top style='width:166.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:11.5pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:12.6pt;margin-bottom:
  0in;margin-left:44.1pt;margin-bottom:.0001pt;line-height:normal'>September 1987</p>
  </td>
 </tr>
 <tr style='height:11.5pt'>
  <td width=144 valign=top style='width:1.5in;padding:0in 5.4pt 0in 5.4pt;
  height:11.5pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Susan
  M. Knutson</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt;
  height:11.5pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:-2.55pt;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>52</p>
  </td>
  <td width=138 valign=top style='width:103.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:11.5pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:2.85pt;margin-bottom:.0001pt;line-height:normal'>Controller</p>
  </td>
  <td width=222 valign=top style='width:166.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:11.5pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:12.6pt;margin-bottom:
  0in;margin-left:44.1pt;margin-bottom:.0001pt;line-height:normal'>September 1987</p>
  </td>
 </tr>
 <tr style='height:11.85pt'>
  <td width=144 valign=top style='width:1.5in;padding:0in 5.4pt 0in 5.4pt;
  height:11.85pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Scott
  G. LeFever</p>
  </td>
  <td width=120 valign=top style='width:1.25in;padding:0in 5.4pt 0in 5.4pt;
  height:11.85pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:0in;
  margin-bottom:0in;margin-left:-2.55pt;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>52</p>
  </td>
  <td width=138 valign=top style='width:103.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:11.85pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:2.85pt;margin-bottom:.0001pt;line-height:normal'>VP of
  Operations</p>
  </td>
  <td width=222 valign=top style='width:166.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:11.85pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:12.6pt;margin-bottom:
  0in;margin-left:44.1pt;margin-bottom:.0001pt;line-height:normal'>September 1987</p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i>Boyd
E. Hoback.</i>&nbsp;
See the description of Mr. Hoback's business experience under &quot;Directors&quot;.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i>Susan
M. Knutson </i>has
been Controller since 1993 with direct responsibility for overseeing the
accounting department, maintaining cash controls, producing budgets, financials
and quarterly and annual reports required to be filed with the Securities and
Exchange Commission, acting as the principal financial officer of the Company,
and preparing all information for the annual audit.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><i>Scott
G. LeFever</i>
has been Vice President of Operations since August 1995, and has been involved
in all phases of operations with direct responsibility for restaurant service
performance, personnel and cost controls.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>Executive officers do
not have fixed terms and serve at the discretion of the Board of Directors.&nbsp;
There are no family relationships among the executive officers or directors.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><a name="_Toc92016744"></a><a name="_Toc89839952"></a><a
name="_Toc89839457"><b>Code
of ethics</b></a>:
Good Times Restaurants has adopted a Code of Business Conduct which applies to
all directors, officers, employees and franchisees of Good Times Restaurants.&nbsp;
The Code of Business Conduct was filed with the SEC as an exhibit to the Annual
Report on Form 10-KSB for the fiscal year ended September 30, 2003.</p>

<p class=MsoFooter align=right style='text-align:right'>33</p>



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<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>ITEM
11.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; EXECUTIVE COMPENSATION</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>&nbsp;</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>Executive Compensation:</b> The following table sets
forth compensation information for 2010 and 2009 with respect to the named
executive officers:</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal;text-autospace:none'><b>Summary Compensation Table for 2010 and 2009:</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal;text-autospace:none'><b>&nbsp;</b></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=674
 style='border-collapse:collapse'>
 <tr style='height:.5in'>
  <td width=104 valign=bottom style='width:78.0pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.5pt 0in 1.5pt;height:.5in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'><b>Name
  and Principal Position</b></p>
  </td>
  <td width=42 valign=bottom style='width:31.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.5pt 0in 1.5pt;height:.5in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'><b>Year</b></p>
  </td>
  <td width=48 valign=bottom style='width:.5in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 1.5pt 0in 1.5pt;height:.5in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'><b>Salary
  $</b></p>
  </td>
  <td width=48 valign=bottom style='width:.5in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 1.5pt 0in 1.5pt;height:.5in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'><b>Bonus
  $</b></p>
  </td>
  <td width=54 valign=bottom style='width:40.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.5pt 0in 1.5pt;height:.5in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'><b>Stock
  Awards $</b></p>
  </td>
  <td width=66 valign=bottom style='width:49.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.5pt 0in 1.5pt;height:.5in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'><b>Option
  Awards $<sup>3</sup></b></p>
  </td>
  <td width=90 valign=bottom style='width:67.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.5pt 0in 1.5pt;height:.5in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'><b>Non-Equity
  Incentive Plan Compensation $</b></p>
  </td>
  <td width=84 valign=bottom style='width:63.0pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.5pt 0in 1.5pt;height:.5in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'><b>Nonqualified
  Deferred Compensation Earnings $</b></p>
  </td>
  <td width=84 valign=bottom style='width:63.0pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.5pt 0in 1.5pt;height:.5in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'><b>All
  Other Compensation $</b></p>
  </td>
  <td width=54 valign=bottom style='width:40.5pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 1.5pt 0in 1.5pt;height:.5in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'><b>Total
  $</b></p>
  </td>
 </tr>
 <tr>
  <td width=104 valign=top style='width:78.0pt;border:none;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=42 valign=top style='width:31.5pt;border:none;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=48 valign=top style='width:.5in;border:none;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=48 valign=top style='width:.5in;border:none;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=54 valign=top style='width:40.5pt;border:none;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=66 valign=top style='width:49.5pt;border:none;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=90 valign=top style='width:67.5pt;border:none;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=84 valign=top style='width:63.0pt;border:none;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=84 valign=top style='width:63.0pt;border:none;padding:0in 1.5pt 0in 1.5pt'>

  </td>
  <td width=54 valign=top style='width:40.5pt;border:none;padding:0in 1.5pt 0in 1.5pt'>

  </td>
 </tr>
 <tr style='height:1.0pt'>
  <td width=104 valign=top style='width:78.0pt;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal;text-autospace:none'>Boyd E. Hoback</p>
  </td>
  <td width=42 valign=top style='width:31.5pt;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal;text-autospace:none'>2010</p>
  </td>
  <td width=48 valign=top style='width:.5in;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal;text-autospace:none'>148,000</p>
  </td>
  <td width=48 valign=top style='width:.5in;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'>_</p>
  </td>
  <td width=54 valign=top style='width:40.5pt;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'>_</p>
  </td>
  <td width=66 valign=top style='width:49.5pt;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:3.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal;text-autospace:none'>29,381</p>
  </td>
  <td width=90 valign=top style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'>_</p>
  </td>
  <td width=84 valign=top style='width:63.0pt;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'>_</p>
  </td>
  <td width=84 valign=top style='width:63.0pt;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:16.5pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal;text-autospace:none'>13,978<sup>1</sup></p>
  </td>
  <td width=54 valign=top style='width:40.5pt;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal;text-autospace:none'>191,359</p>
  </td>
 </tr>
 <tr style='height:1.0pt'>
  <td width=104 style='width:78.0pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal;text-autospace:none'>President and Chief Executive Officer</p>
  </td>
  <td width=42 style='width:31.5pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal;text-autospace:none'>2009</p>
  </td>
  <td width=48 style='width:.5in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal;text-autospace:none'>162,033</p>
  </td>
  <td width=48 style='width:.5in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'>_</p>
  </td>
  <td width=54 style='width:40.5pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'>_</p>
  </td>
  <td width=66 style='width:49.5pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:3.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal;text-autospace:none'>25,118</p>
  </td>
  <td width=90 style='width:67.5pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'>_</p>
  </td>
  <td width=84 style='width:63.0pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'>_</p>
  </td>
  <td width=84 style='width:63.0pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:16.5pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal;text-autospace:none'>16,073<sup>1</sup></p>
  </td>
  <td width=54 style='width:40.5pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal;text-autospace:none'>203,224</p>
  </td>
 </tr>
 <tr style='height:1.0pt'>
  <td width=104 style='width:78.0pt;border:none;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal;text-autospace:none'>Scott G. LeFever</p>
  </td>
  <td width=42 style='width:31.5pt;border:none;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal;text-autospace:none'>2010</p>
  </td>
  <td width=48 style='width:.5in;border:none;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal;text-autospace:none'>90,625</p>
  </td>
  <td width=48 style='width:.5in;border:none;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'>_</p>
  </td>
  <td width=54 style='width:40.5pt;border:none;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'>_</p>
  </td>
  <td width=66 style='width:49.5pt;border:none;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:3.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal;text-autospace:none'>11,645</p>
  </td>
  <td width=90 style='width:67.5pt;border:none;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'>_</p>
  </td>
  <td width=84 style='width:63.0pt;border:none;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'>_</p>
  </td>
  <td width=84 style='width:63.0pt;border:none;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:16.5pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal;text-autospace:none'>10,580<sup>2</sup></p>
  </td>
  <td width=54 style='width:40.5pt;border:none;padding:0in 1.5pt 0in 1.5pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal;text-autospace:none'>112,850</p>
  </td>
 </tr>
 <tr style='height:1.0pt'>
  <td width=104 style='width:78.0pt;padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal;text-autospace:none'>Vice President of Operations</p>
  </td>
  <td width=42 style='width:31.5pt;padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal;text-autospace:none'>2009</p>
  </td>
  <td width=48 style='width:.5in;padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal align=right style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:right;line-height:normal;text-autospace:none'>101,667</p>
  </td>
  <td width=48 style='width:.5in;padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'>_</p>
  </td>
  <td width=54 style='width:40.5pt;padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'>_</p>
  </td>
  <td width=66 style='width:49.5pt;padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:3.0pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal;text-autospace:none'>9,979</p>
  </td>
  <td width=90 style='width:67.5pt;padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'>_</p>
  </td>
  <td width=84 style='width:63.0pt;padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal;text-autospace:none'>_</p>
  </td>
  <td width=84 style='width:63.0pt;padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:16.5pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal;text-autospace:none'>11,477<sup>2</sup></p>
  </td>
  <td width=54 style='width:40.5pt;padding:0in 1.5pt 0in 1.5pt;height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal;text-autospace:none'>123,123</p>
  </td>
 </tr>
</table>

<p class=MsoNormal style='margin-top:0in;margin-right:-13.7pt;margin-bottom:
0in;margin-left:0in;margin-bottom:.0001pt;line-height:normal;text-autospace:
none'><sup>&nbsp;</sup></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=667
 style='width:6.95in;margin-left:9.0pt;border-collapse:collapse'>
 <tr>
  <td width=19 valign=top style='width:.2in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:-13.7pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;line-height:normal;text-autospace:
  none'><sup>1</sup></p>
  </td>
  <td width=648 valign=top style='width:6.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:-.9pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;line-height:
  normal;text-autospace:none'>The amount indicated for Mr. Hoback includes an automobile
  allowance, long-term disability and 401(K) Plan matching contributions.</p>
  </td>
 </tr>
 <tr>
  <td width=19 valign=top style='width:.2in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:-13.7pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;line-height:normal;text-autospace:
  none'><sup>2</sup></p>
  </td>
  <td width=648 valign=top style='width:6.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:-13.7pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;line-height:
  normal;text-autospace:none'>The amount indicated for Mr. LeFever includes an automobile
  allowance, long-term disability, personal expenses and 401(K) Plan matching
  contributions.</p>
  </td>
 </tr>
 <tr>
  <td width=19 valign=top style='width:.2in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:-13.7pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;line-height:normal;text-autospace:
  none'><sup>3</sup></p>
  </td>
  <td width=648 valign=top style='width:6.75in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal;text-autospace:none'>The value of stock option
  awards shown in this column includes all amounts expensed in the Company's
  financial statements in 2009 and 2010 for equity awards in accordance
  with the guidance of FASB ASC 718-10-30, Compensation - Stock Compensation, excluding any estimate for forfeitures.&nbsp; The Company's
  accounting treatment for, and assumptions made in the valuations of, equity
  awards is set forth in Note 1 of the notes to the Company's 2010 consolidated
  financial statements included in the Company's Annual Report on Form 10-K for
  the fiscal year ended September 30, 2010.&nbsp; There were no option awards
  re-priced in 2010.</p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-top:0in;margin-right:-13.7pt;margin-bottom:
0in;margin-left:9.0pt;margin-bottom:.0001pt;line-height:normal;text-autospace:
none'>There were no shares of SARs granted during 2010 or 2009 nor has
there been any nonqualified deferred compensation paid to any named executive
officers during 2010 or 2009.&nbsp; The Company does not have any plans that provide
for specified retirement payments and benefits at, following or in connection
with retirement.</p>



<p class=MsoFooter align=right style='text-align:right'>.34</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal;text-autospace:none'>

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

</div>



</div>

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


<div class=WordSection10>









<p class=MsoNormal style='margin-top:0in;margin-right:-13.7pt;margin-bottom:
0in;margin-left:0in;margin-bottom:.0001pt;line-height:normal;text-autospace:
none'>The
following table sets forth information as of September 30, 2010 on all
unexercised options previously awarded to the named executive officers:</p>



<table class=MsoNormalTable border=1 cellspacing=0 cellpadding=0 width=948
 style='margin-left:-17.1pt;border-collapse:collapse;border:none'>
 <tr style='height:.2in'>
  <td width=948 nowrap colspan=12 style='width:711.0pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>Outstanding
  Equity Awards at 2010 Fiscal Year-End</b></p>
  </td>
 </tr>
 <tr style='height:.2in'>
  <td width=513 nowrap colspan=6 style='width:385.1pt;border:none;border-bottom:
  solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:.2in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>Option Awards</b></p>
  </td>
  <td width=16 valign=top style='width:11.8pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>&nbsp;</b></p>
  </td>
  <td width=419 nowrap colspan=5 style='width:314.1pt;border:none;border-bottom:
  solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:.2in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'><b>Stock Awards</b></p>
  </td>
 </tr>
 <tr style='height:85.0pt'>
  <td width=127 valign=bottom style='width:95.5pt;border:none;border-bottom:
  solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:85.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Name</p>
  </td>
  <td width=90 valign=bottom style='width:67.5pt;border:none;border-bottom:
  solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:85.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Number of Securities Underlying
  Unexercised Options -Exercisable (#)</p>
  </td>
  <td width=102 valign=bottom style='width:76.5pt;border:none;border-bottom:
  solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:85.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Number of Securities Underlying
  Unexercised Options -Unexercisable (#)</p>
  </td>
  <td width=89 valign=bottom style='width:66.5pt;border:none;border-bottom:
  solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:85.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Equity Incentive Plan Awards: Number
  of Securities Underlying Unexercised Unearned Options (#)</p>
  </td>
  <td width=60 valign=bottom style='width:45.0pt;border:none;border-bottom:
  solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:85.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Option Exercise Price $</p>
  </td>
  <td width=72 colspan=3 valign=bottom style='width:.75in;border:none;
  border-bottom:solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:85.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Option Expiration Date</p>
  </td>
  <td width=72 valign=bottom style='width:.75in;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:85.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Number of Shares or Units of Stock
  That Have Not Vested (#)</p>
  </td>
  <td width=78 valign=bottom style='width:58.5pt;border:none;border-bottom:
  solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:85.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Market Value of Shares or Units of
  Stock That Have Not Vested ($)</p>
  </td>
  <td width=108 valign=bottom style='width:81.0pt;border:none;border-bottom:
  solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:85.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Equity Incentive Plan Awards: Number
  of Unearned Shares, Units or Other Rights That Have Not Vested (#)</p>
  </td>
  <td width=150 valign=bottom style='width:112.5pt;border:none;border-bottom:
  solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:85.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Equity Incentive Plan Awards: Market
  or Payout Value of Unearned Shares, Units or Other Rights That Have Not
  Vested ($)</p>
  </td>
 </tr>
 <tr style='height:12.75pt'>
  <td width=127 valign=top style='width:95.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Boyd
  E. Hoback</p>
  </td>
  <td width=90 nowrap style='width:67.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,500</p>
  </td>
  <td width=102 nowrap style='width:76.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=89 nowrap style='width:66.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$1.38</p>
  </td>
  <td width=72 nowrap colspan=3 style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>10/01/10</p>
  </td>
  <td width=72 nowrap style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:2.2pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=78 nowrap style='width:58.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=108 nowrap style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=150 nowrap style='width:112.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr style='height:12.75pt'>
  <td width=127 valign=top style='width:95.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>

  </td>
  <td width=90 nowrap style='width:67.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>50,000</p>
  </td>
  <td width=102 nowrap style='width:76.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=89 nowrap style='width:66.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$1.75</p>
  </td>
  <td width=72 nowrap colspan=3 style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>10/01/11</p>
  </td>
  <td width=72 nowrap style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:2.2pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=78 nowrap style='width:58.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=108 nowrap style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=150 nowrap style='width:112.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr style='height:12.75pt'>
  <td width=127 valign=top style='width:95.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>

  </td>
  <td width=90 nowrap style='width:67.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,750</p>
  </td>
  <td width=102 nowrap style='width:76.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=89 nowrap style='width:66.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$2.70</p>
  </td>
  <td width=72 nowrap colspan=3 style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>10/01/12</p>
  </td>
  <td width=72 nowrap style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:2.2pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=78 nowrap style='width:58.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=108 nowrap style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=150 nowrap style='width:112.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr style='height:12.75pt'>
  <td width=127 valign=top style='width:95.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>

  </td>
  <td width=90 nowrap style='width:67.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,900</p>
  </td>
  <td width=102 nowrap style='width:76.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=89 nowrap style='width:66.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$3.60</p>
  </td>
  <td width=72 nowrap colspan=3 style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>10/01/13</p>
  </td>
  <td width=72 nowrap style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:2.2pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=78 nowrap style='width:58.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=108 nowrap style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=150 nowrap style='width:112.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr style='height:12.75pt'>
  <td width=127 valign=top style='width:95.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>

  </td>
  <td width=90 nowrap style='width:67.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>12,000</p>
  </td>
  <td width=102 nowrap style='width:76.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=89 nowrap style='width:66.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$3.11</p>
  </td>
  <td width=72 nowrap colspan=3 style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>10/01/14</p>
  </td>
  <td width=72 nowrap style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:2.2pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=78 nowrap style='width:58.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=108 nowrap style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=150 nowrap style='width:112.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr style='height:12.75pt'>
  <td width=127 valign=top style='width:95.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>

  </td>
  <td width=90 nowrap style='width:67.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>8,500</p>
  </td>
  <td width=102 nowrap style='width:76.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=89 nowrap style='width:66.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$5.68</p>
  </td>
  <td width=72 nowrap colspan=3 style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>10/01/15</p>
  </td>
  <td width=72 nowrap style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:2.2pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=78 nowrap style='width:58.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=108 nowrap style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=150 nowrap style='width:112.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr style='height:12.75pt'>
  <td width=127 valign=top style='width:95.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>

  </td>
  <td width=90 nowrap style='width:67.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>11,400</p>
  </td>
  <td width=102 nowrap style='width:76.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>7,600
  <sup>(1)</sup></p>
  </td>
  <td width=89 nowrap style='width:66.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$6.38</p>
  </td>
  <td width=72 nowrap colspan=3 style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>11/17/16</p>
  </td>
  <td width=72 nowrap style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:2.2pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=78 nowrap style='width:58.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=108 nowrap style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=150 nowrap style='width:112.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr style='height:12.75pt'>
  <td width=127 nowrap valign=bottom style='width:95.5pt;border:none;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>

  </td>
  <td width=90 nowrap style='width:67.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>0</p>
  </td>
  <td width=102 nowrap style='width:76.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>28,503
  <sup>(2)</sup></p>
  </td>
  <td width=89 nowrap style='width:66.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$1.47</p>
  </td>
  <td width=72 nowrap colspan=3 style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>11/14/18</p>
  </td>
  <td width=72 nowrap style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:2.2pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=78 nowrap style='width:58.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=108 nowrap style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=150 nowrap style='width:112.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr style='height:12.75pt'>
  <td width=127 nowrap valign=bottom style='width:95.5pt;border:none;
  border-bottom:solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>

  </td>
  <td width=90 nowrap style='width:67.5pt;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>0</p>
  </td>
  <td width=102 nowrap style='width:76.5pt;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>13,652
  <sup>(3)</sup></p>
  </td>
  <td width=89 nowrap style='width:66.5pt;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$1.15</p>
  </td>
  <td width=72 nowrap colspan=3 style='width:.75in;border:none;border-bottom:
  solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>11/06/19</p>
  </td>
  <td width=72 nowrap style='width:.75in;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:2.2pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=78 nowrap style='width:58.5pt;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=108 nowrap style='width:81.0pt;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=150 nowrap style='width:112.5pt;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr style='height:12.75pt'>
  <td width=127 valign=bottom style='width:95.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Scott
  G. LeFever</p>
  </td>
  <td width=90 nowrap valign=bottom style='width:67.5pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,260</p>
  </td>
  <td width=102 nowrap valign=bottom style='width:76.5pt;border:none;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-</p>
  </td>
  <td width=89 nowrap valign=bottom style='width:66.5pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap valign=bottom style='width:45.0pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$2.70</p>
  </td>
  <td width=72 nowrap colspan=3 valign=bottom style='width:.75in;border:none;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>10/01/12</p>
  </td>
  <td width=72 nowrap valign=bottom style='width:.75in;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:2.2pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=78 nowrap valign=bottom style='width:58.5pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=108 nowrap valign=bottom style='width:81.0pt;border:none;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=150 nowrap valign=bottom style='width:112.5pt;border:none;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr style='height:12.75pt'>
  <td width=127 valign=bottom style='width:95.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>

  </td>
  <td width=90 nowrap valign=bottom style='width:67.5pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,580</p>
  </td>
  <td width=102 nowrap valign=bottom style='width:76.5pt;border:none;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-</p>
  </td>
  <td width=89 nowrap valign=bottom style='width:66.5pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$3.60</p>
  </td>
  <td width=72 nowrap colspan=3 valign=bottom style='width:.75in;border:none;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>10/01/13</p>
  </td>
  <td width=72 nowrap style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:2.2pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=78 nowrap style='width:58.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=108 nowrap style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=150 nowrap style='width:112.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr style='height:12.75pt'>
  <td width=127 valign=bottom style='width:95.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>

  </td>
  <td width=90 nowrap valign=bottom style='width:67.5pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>5,750</p>
  </td>
  <td width=102 nowrap valign=bottom style='width:76.5pt;border:none;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-</p>
  </td>
  <td width=89 nowrap valign=bottom style='width:66.5pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$3.11</p>
  </td>
  <td width=72 nowrap colspan=3 valign=bottom style='width:.75in;border:none;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>10/01/14</p>
  </td>
  <td width=72 nowrap style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:2.2pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=78 nowrap style='width:58.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=108 nowrap style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=150 nowrap style='width:112.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr style='height:12.75pt'>
  <td width=127 valign=bottom style='width:95.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>

  </td>
  <td width=90 nowrap valign=bottom style='width:67.5pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>5,750</p>
  </td>
  <td width=102 nowrap valign=bottom style='width:76.5pt;border:none;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>-</p>
  </td>
  <td width=89 nowrap valign=bottom style='width:66.5pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$5.68</p>
  </td>
  <td width=72 nowrap colspan=3 valign=bottom style='width:.75in;border:none;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>10/01/15</p>
  </td>
  <td width=72 nowrap style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:2.2pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=78 nowrap style='width:58.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=108 nowrap style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=150 nowrap style='width:112.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr style='height:12.75pt'>
  <td width=127 valign=bottom style='width:95.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>

  </td>
  <td width=90 nowrap valign=bottom style='width:67.5pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,725</p>
  </td>
  <td width=102 nowrap valign=bottom style='width:76.5pt;border:none;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,025<sup>
  (1)</sup></p>
  </td>
  <td width=89 nowrap valign=bottom style='width:66.5pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$6.38</p>
  </td>
  <td width=72 nowrap colspan=3 valign=bottom style='width:.75in;border:none;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>11/17/16</p>
  </td>
  <td width=72 nowrap style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:2.2pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=78 nowrap style='width:58.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=108 nowrap style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=150 nowrap style='width:112.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr style='height:12.75pt'>
  <td width=127 nowrap valign=bottom style='width:95.5pt;border:none;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>

  </td>
  <td width=90 nowrap valign=bottom style='width:67.5pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>0</p>
  </td>
  <td width=102 nowrap valign=bottom style='width:76.5pt;border:none;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>17,007<sup>
  (2)</sup></p>
  </td>
  <td width=89 nowrap valign=bottom style='width:66.5pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$1.47</p>
  </td>
  <td width=72 nowrap colspan=3 valign=bottom style='width:.75in;border:none;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>11/14/18</p>
  </td>
  <td width=72 nowrap style='width:.75in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:2.2pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=78 nowrap style='width:58.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=108 nowrap style='width:81.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=150 nowrap style='width:112.5pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr style='height:12.75pt'>
  <td width=127 nowrap valign=bottom style='width:95.5pt;border:none;
  border-bottom:solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>

  </td>
  <td width=90 nowrap style='width:67.5pt;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>0</p>
  </td>
  <td width=102 nowrap style='width:76.5pt;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:13.6pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,348
  <sup>(3)</sup></p>
  </td>
  <td width=89 nowrap style='width:66.5pt;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>$1.15</p>
  </td>
  <td width=72 nowrap colspan=3 style='width:.75in;border:none;border-bottom:
  solid windowtext 1.5pt;padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>11/06/19</p>
  </td>
  <td width=72 nowrap style='width:.75in;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:2.2pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=78 nowrap style='width:58.5pt;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=108 nowrap style='width:81.0pt;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:8.1pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=150 nowrap style='width:112.5pt;border:none;border-bottom:solid windowtext 1.5pt;
  padding:0in 5.4pt 0in 5.4pt;height:12.75pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
 </tr>
 <tr height=0>
  <td width=127 style='border:none'></td>
  <td width=90 style='border:none'></td>
  <td width=102 style='border:none'></td>
  <td width=89 style='border:none'></td>
  <td width=60 style='border:none'></td>
  <td width=45 style='border:none'></td>
  <td width=16 style='border:none'></td>
  <td width=11 style='border:none'></td>
  <td width=72 style='border:none'></td>
  <td width=78 style='border:none'></td>
  <td width=108 style='border:none'></td>
  <td width=150 style='border:none'></td>
 </tr>
</table>

<p class=MsoNormal style='margin-top:0in;margin-right:-27.0pt;margin-bottom:
0in;margin-left:-9.0pt;margin-bottom:.0001pt;text-indent:-13.5pt;line-height:
normal'><sup>&nbsp;</sup></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='margin-left:-9.0pt;border-collapse:collapse'>
 <tr>
  <td width=19 valign=top style='width:.2in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:-27.0pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;line-height:normal'><sup>1</sup></p>
  </td>
  <td width=898 valign=top style='width:9.35in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:-27.0pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;line-height:normal'>The options
  were granted on November 17, 2006. Assuming continued employment with the
  Company, the shares under the option agreements will become exercisable per a
  vesting schedule which began on November 17, 2007 continuing through November
  17, 2010, whereby options vest per the following schedule: 10% on November
  17, 2007; an additional 20% on November 17, 2008; an additional 30% on
  November 17, 2009; and an additional 40% on November 17, 2010.</p>
  </td>
 </tr>
 <tr>
  <td width=19 valign=top style='width:.2in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:-27.0pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;line-height:normal'><sup>2</sup></p>
  </td>
  <td width=898 valign=top style='width:9.35in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:-27.0pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;line-height:normal'>The options
  were granted on November 14, 2008. Assuming continued employment with the
  Company, the shares under the option agreements will become fully exercisable
  on November 14, 2011.</p>
  </td>
 </tr>
 <tr>
  <td width=19 valign=top style='width:.2in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:-27.0pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;line-height:normal'><sup>3</sup></p>
  </td>
  <td width=898 valign=top style='width:9.35in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:-27.0pt;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;line-height:normal'>The options
  were granted on November 6, 2009. Assuming continued employment with the
  Company, the shares under the option agreements will become fully exercisable
  on November 6, 2012.</p>
  </td>
 </tr>
</table>





<p class=MsoFooter align=right style='text-align:right'>35</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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

</div>



</div>

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


<div class=WordSection11>









<p class=MsoNormal style='margin-top:0in;margin-right:-27.0pt;margin-bottom:
0in;margin-left:0in;margin-bottom:.0001pt;line-height:normal'>The following
table sets forth compensation information for 2010 with respect to directors:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=661
 style='border-collapse:collapse'>
 <tr style='height:15.75pt'>
  <td width=661 nowrap colspan=8 style='width:495.9pt;padding:0in 5.4pt 0in 5.4pt;
  height:15.75pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>Director
  Compensation Table for Fiscal Year 2010</b></p>
  </td>
 </tr>
 <tr style='height:.6in'>
  <td width=121 valign=bottom style='width:90.9pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:.6in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Name</p>
  </td>
  <td width=72 style='width:.75in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt;height:.6in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Fees Earned or Paid in Cash ($)</p>
  </td>
  <td width=60 valign=bottom style='width:45.0pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:.6in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Stock Awards ($)</p>
  </td>
  <td width=60 valign=bottom style='width:45.0pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:.6in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Option Awards ($) <sup>1, 2</sup></p>
  </td>
  <td width=96 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt;height:.6in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Non-Equity Incentive Plan Compensation
  ($)</p>
  </td>
  <td width=96 style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt;height:.6in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Nonqualified Deferred Compensation
  Earnings $</p>
  </td>
  <td width=96 valign=bottom style='width:1.0in;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt;height:.6in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>All Other Compensation $ </p>
  </td>
  <td width=60 valign=bottom style='width:45.0pt;border:none;border-bottom:
  solid windowtext 1.0pt;padding:0in 5.4pt 0in 5.4pt;height:.6in'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>Total $</p>
  </td>
 </tr>
 <tr style='height:1.0pt'>
  <td width=121 valign=bottom style='width:90.9pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Geoffrey
  R. Bailey</p>
  </td>
  <td width=72 nowrap valign=bottom style='width:.75in;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>3,000</p>
  </td>
  <td width=60 nowrap valign=bottom style='width:45.0pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>1,695</p>
  </td>
  <td width=96 nowrap style='width:1.0in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=96 nowrap style='width:1.0in;border:none;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=96 nowrap valign=bottom style='width:1.0in;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap valign=bottom style='width:45.0pt;border:none;padding:
  0in 5.4pt 0in 5.4pt;height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,695</p>
  </td>
 </tr>
 <tr style='height:1.0pt'>
  <td width=121 valign=top style='width:90.9pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Ron
  Goodson <sup>3</sup></p>
  </td>
  <td width=72 nowrap style='width:.75in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>3,000</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>1,695</p>
  </td>
  <td width=96 nowrap style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=96 nowrap style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=96 nowrap valign=bottom style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,695</p>
  </td>
 </tr>
 <tr style='height:1.0pt'>
  <td width=121 nowrap valign=bottom style='width:90.9pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>David
  Grissen <sup>3</sup></p>
  </td>
  <td width=72 nowrap style='width:.75in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>2,000</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>1,695</p>
  </td>
  <td width=96 nowrap style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=96 nowrap style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=96 nowrap valign=bottom style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3,695</p>
  </td>
 </tr>
 <tr style='height:1.0pt'>
  <td width=121 valign=bottom style='width:90.9pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Eric
  W. Reinhard </p>
  </td>
  <td width=72 nowrap valign=bottom style='width:.75in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>3,000</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>1,695</p>
  </td>
  <td width=96 nowrap style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=96 nowrap style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=96 nowrap valign=bottom style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,695</p>
  </td>
 </tr>
 <tr style='height:1.0pt'>
  <td width=121 valign=top style='width:90.9pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Richard
  J. Stark <sup>3</sup></p>
  </td>
  <td width=72 nowrap style='width:.75in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>3,000</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>1,695</p>
  </td>
  <td width=96 nowrap style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=96 nowrap style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=96 nowrap valign=bottom style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,695</p>
  </td>
 </tr>
 <tr style='height:1.0pt'>
  <td width=121 nowrap valign=bottom style='width:90.9pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Alan
  A. Teran <sup>3</sup></p>
  </td>
  <td width=72 nowrap style='width:.75in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>3,000</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>1,695</p>
  </td>
  <td width=96 nowrap style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=96 nowrap style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=96 nowrap valign=bottom style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,695</p>
  </td>
 </tr>
 <tr style='height:1.0pt'>
  <td width=121 nowrap valign=bottom style='width:90.9pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Boyd
  E. Hoback <sup>4</sup></p>
  </td>
  <td width=72 nowrap valign=bottom style='width:.75in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap valign=bottom style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=96 nowrap style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.05in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:center;
  line-height:normal'>-</p>
  </td>
  <td width=96 nowrap style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=96 nowrap valign=bottom style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
  text-align:center;line-height:normal'>-</p>
  </td>
  <td width=60 nowrap style='width:45.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:1.0pt'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:6.7pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>0</p>
  </td>
 </tr>
</table>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><sup>&nbsp;</sup></p>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
  <td width=24 valign=top style='width:17.8pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><sup>1</sup></p>
  </td>
  <td width=637 valign=top style='width:478.1pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>The
  value of stock option awards shown in this column includes all amounts
  expensed in the Company's financial statements in 2010 for equity awards in
  accordance with the guidance of FASB ASC 718-10-30, Compensation - Stock
  Compensation, excluding any estimate for forfeitures.&nbsp; The Company's accounting
  treatment for, and assumptions made in the valuation of equity awards are set
  forth in Note 1 of the notes to the Company's 2010 consolidated financial
  statements included in the Company's Annual Report on Form 10-K for the
  fiscal year ended September 30, 2010.&nbsp; There were no option awards re-priced
  in 2010.</p>
  </td>
 </tr>
 <tr>
  <td width=24 valign=top style='width:17.8pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><sup>&nbsp;2</sup></p>
  </td>
  <td width=637 valign=top style='width:478.1pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>As
  of September 30, 2010, the following directors held options to purchase the
  following number of shares of our common stock:&nbsp; Mr. Bailey 14,000 shares;
  Mr. Goodson 12,000 shares; Mr. Grissen 12,000 shares; Mr. Reinhard 16,500
  shares; Mr. Stark 14,000 shares; Mr. Teran 14,000 shares; and Mr. Hoback
  133,242 shares.</p>
  </td>
 </tr>
 <tr>
  <td width=24 valign=top style='width:17.8pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><sup>3</sup></p>
  </td>
  <td width=637 valign=top style='width:478.1pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Resigned
  as a director effective as of December 13, 2010.</p>
  </td>
 </tr>
 <tr>
  <td width=24 valign=top style='width:17.8pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><sup>4</sup></p>
  </td>
  <td width=637 valign=top style='width:478.1pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Mr.
  Hoback is an employee director and does not receive additional fees for
  service as a member of the Board.</p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>A
description of the standard compensation arrangements (such as fees for
committee service, service as chairman of the board or a committee, and meeting
attendance) is set forth in the section entitled &quot;Directors' Compensation&quot;
above.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Employment
Agreement:</b>&nbsp;
Mr. Hoback entered into an employment agreement with us in October 2001 and the
terms of the agreement were revised effective October 2007 for compliance with
Section 409A of the Internal Revenue Code.&nbsp; The revised agreement provides for
his employment as president and chief executive officer for two years from the
date of the agreement at a minimum salary of $190,000 per year, terminable by
us only for cause.&nbsp; The agreement provides for payment of one year's salary and
benefits in the event that change of ownership control results in a termination
of his employment or termination other than for cause.&nbsp; This agreement renews
automatically unless specifically not renewed by the Board of Directors.&nbsp; Mr.
Hoback's compensation, including salary, expense allowance, bonus and any
equity award, is reviewed and set annually by the Compensation Committee.&nbsp; Mr.
Hoback's bonus, when applicable, is based on the Company's achieving certain
Earnings Before Interest, Taxes, Depreciation and Amortization (&quot;EBITDA&quot;)
targets for the year.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>As
a condition to the closing of the SII Investment Transaction, Mr. Hoback agreed
to waive certain rights under the employment agreement which would otherwise have
accrued to him as a result of the change in ownership control of the Company as
a result of the SII Investment Transaction, including his right to terminate
his employment within one year of the change in control and trigger the
severance payment described above and his right to accelerate the vesting of
stock options upon the change in control.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Other
Employment Arrangements:</b>&nbsp; Mr. LeFever is employed as an &quot;employee at will&quot;
and does not have a written employment agreement.&nbsp; His compensation, including
salary, expense allowance, bonus and any equity awards, is reviewed and
approved by the Compensation Committee annually.&nbsp; He participates in a bonus
program that is based on both the company's level of EBITDA for the year and
achieving certain operating metrics and sales targets.</p>

<p class=MsoFooter align=right style='text-align:right'>36</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

<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:0in;margin-bottom:.0001pt;line-height:
normal'><b>&nbsp;</b></p>

<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:1.0in;margin-bottom:.0001pt;text-indent:-1.0in;line-height:normal'><b>ITEM 12.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS</b></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Ownership
of common stock by principal stockholders and management:</b> The following
table shows the beneficial ownership of shares of Good Times Restaurants common
stock as of December 15, 2010 by each person known by Good Times Restaurants to
be the beneficial owner of more than five percent of the shares of Good Times
Restaurants common stock, each director and each executive officer named in the
Summary Compensation Table, and all directors and executive officers as a
group.&nbsp; The address for the principal stockholders and the Directors and
Officers is 601 Corporate Circle, Golden, CO 80401.</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=654
 style='margin-left:18.9pt;border-collapse:collapse'>
 <tr style='height:.1in'>
  <td width=384 valign=top style='width:288.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:.1in'><b><br
  clear=all style='page-break-before:always'>
  </b>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b><u>Holder</u></b></p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:.1in'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:.3pt;margin-bottom:.0001pt;line-height:normal'><b>Number of
  shares</b></p>
  </td>
  <td width=42 valign=top style='width:31.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:.1in'>
  <p class=MsoNormal style='margin-top:0in;margin-right:.3pt;margin-bottom:
  0in;margin-left:.9pt;margin-bottom:.0001pt;line-height:normal'><b>&nbsp;</b></p>
  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:.1in'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.3pt;
  margin-bottom:0in;margin-left:.9pt;margin-bottom:.0001pt;text-align:center;
  line-height:normal'><b>Percent
  of</b></p>
  </td>
 </tr>
 <tr style='height:.2in'>
  <td width=384 valign=top style='width:288.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b><u>Principal
  stockholders</u></b></p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b><u>beneficially
  owned</u></b></p>
  </td>
  <td width=42 valign=top style='width:31.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-top:0in;margin-right:.3pt;margin-bottom:
  0in;margin-left:.9pt;margin-bottom:.0001pt;line-height:normal'><b><u>&nbsp;</u></b></p>
  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=center style='margin-top:0in;margin-right:.3pt;
  margin-bottom:0in;margin-left:.9pt;margin-bottom:.0001pt;text-align:center;
  line-height:normal'><b><u>class**</u></b></p>
  </td>
 </tr>
 <tr style='height:.2in'>
  <td width=384 valign=top style='width:288.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Small
  Island Investments Ltd</p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,200,000</p>
  </td>
  <td width=42 valign=top style='width:31.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:17.1pt;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>51.36%</p>
  </td>
 </tr>
 <tr style='height:.2in'>
  <td width=384 valign=top style='width:288.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>The
  Bailey Company, LLLP</p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>821,512<sup>1</sup></p>
  </td>
  <td width=42 valign=top style='width:31.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:17.1pt;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>10.05%</p>
  </td>
 </tr>
 <tr style='height:.2in'>
  <td width=384 valign=top style='width:288.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>The
  Erie County Investment Co.</p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1,016,192<sup>1</sup></p>
  </td>
  <td width=42 valign=top style='width:31.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:17.1pt;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>12.43%</p>
  </td>
 </tr>
 <tr style='height:.2in'>
  <td width=384 valign=top style='width:288.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b><u>Directors
  and Officers</u></b></p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><b>&nbsp;</b></p>
  </td>
  <td width=42 valign=top style='width:31.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-top:0in;margin-right:17.1pt;margin-bottom:
  0in;margin-left:.05in;margin-bottom:.0001pt;line-height:normal'><b>&nbsp;</b></p>
  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:17.1pt;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'><b>&nbsp;</b></p>
  </td>
 </tr>
 <tr style='height:.2in'>
  <td width=384 valign=top style='width:288.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>David
  L. Dobbin, Chairman</p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,202,00<sup>2</sup></p>
  </td>
  <td width=42 valign=top style='width:31.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:17.1pt;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>51.37%</p>
  </td>
 </tr>
 <tr style='height:.2in'>
  <td width=384 valign=top style='width:288.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Geoffrey
  R. Bailey, Director</p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>29,300<sup>3</sup></p>
  </td>
  <td width=42 valign=top style='width:31.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:17.1pt;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>*</p>
  </td>
 </tr>
 <tr style='height:.2in'>
  <td width=384 valign=top style='width:288.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Boyd
  E. Hoback, Director, President and Chief Executive Officer</p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>142,142<sup>4</sup></p>
  </td>
  <td width=42 valign=top style='width:31.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:17.1pt;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>1.70%</p>
  </td>
 </tr>
 <tr style='height:.2in'>
  <td width=384 valign=top style='width:288.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Eric
  W. Reinhard, Chairman</p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>316,000<sup>5</sup></p>
  </td>
  <td width=42 valign=top style='width:31.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:17.1pt;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>3.84%</p>
  </td>
 </tr>
 <tr style='height:.2in'>
  <td width=384 valign=top style='width:288.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Scott
  G. LeFever, Vice President, Operations</p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>21,090<sup>6</sup></p>
  </td>
  <td width=42 valign=top style='width:31.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:17.1pt;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>*</p>
  </td>
 </tr>
 <tr style='height:.2in'>
  <td width=384 valign=top style='width:288.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Gary
  H. Heller, Director</p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,000<sup>7</sup></p>
  </td>
  <td width=42 valign=top style='width:31.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:17.1pt;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>*</p>
  </td>
 </tr>
 <tr style='height:.2in'>
  <td width=384 valign=top style='width:288.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>John
  F. Morgan, Director</p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,000<sup>8</sup></p>
  </td>
  <td width=42 valign=top style='width:31.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:17.1pt;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>*</p>
  </td>
 </tr>
 <tr style='height:.2in'>
  <td width=384 valign=top style='width:288.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Keith
  A. Radford, Director</p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:.3in;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>2,000<sup>9</sup></p>
  </td>
  <td width=42 valign=top style='width:31.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:17.1pt;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>*</p>
  </td>
 </tr>
 <tr style='height:.2in'>
  <td width=384 valign=top style='width:288.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>All
  directors and executive officers as a group</p>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>(9
  persons including all those named above)</p>
  </td>
  <td width=132 valign=top style='width:99.0pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:17.3pt;
  margin-bottom:0in;margin-left:0in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>4,735,036<sup>10</sup></p>
  </td>
  <td width=42 valign=top style='width:31.5pt;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>

  </td>
  <td width=96 valign=top style='width:1.0in;padding:0in 5.4pt 0in 5.4pt;
  height:.2in'>
  <p class=MsoNormal align=right style='margin-top:0in;margin-right:17.1pt;
  margin-bottom:0in;margin-left:.05in;margin-bottom:.0001pt;text-align:right;
  line-height:normal'>55.47%</p>
  </td>
 </tr>
</table>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=688
 style='margin-left:5.4pt;border-collapse:collapse'>
 <tr>
  <td width=24 valign=top style='width:.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><sup>1</sup></p>
  </td>
  <td width=664 valign=top style='width:497.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>The
  Bailey Company is 99% owned by The Erie County Investment Co., which should
  be deemed the beneficial owner of Good Times Restaurants common stock held by
  The Bailey Company.&nbsp; The Erie County Investment Co. also owns 194,680 shares
  of Good Times Restaurants common stock in its own name.&nbsp; Geoffrey R. Bailey
  is a director and executive officer of The Erie County Investment Co.&nbsp;
  Geoffrey R. Bailey disclaims beneficial ownership of the shares of Good Times
  Restaurants common stock held by The Bailey Company and The Erie County
  Investment Co.&nbsp; Because of his ownership of only 26% of the voting shares of
  The Erie County Investment Co., Paul T. Bailey disclaims beneficial ownership
  of the shares of Good Times Restaurants common stock held by The Bailey
  Company and The Erie County Investment Co. Paul T. Bailey is the father of
  Geoffrey R. Bailey.</p>
  </td>
 </tr>
 <tr>
  <td width=24 valign=top style='width:.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><sup>2</sup></p>
  </td>
  <td width=664 valign=top style='width:497.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>David
  L. Dobbin owns 100% of Small Island Investments Ltd. Also includes 2,000
  shares underlying presently exercisable stock options.</p>
  </td>
 </tr>
 <tr>
  <td width=24 valign=top style='width:.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><sup>3</sup></p>
  </td>
  <td width=664 valign=top style='width:497.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Includes
  16,000 shares underlying presently exercisable stock options and 2,497
  warrants to purchase stock.</p>
  </td>
 </tr>
 <tr>
  <td width=24 valign=top style='width:.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><sup>4</sup></p>
  </td>
  <td width=664 valign=top style='width:497.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Includes
  97,150 shares underlying presently exercisable stock options and 19,999
  warrants to purchase stock.</p>
  </td>
 </tr>
 <tr>
  <td width=24 valign=top style='width:.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><sup>5</sup></p>
  </td>
  <td width=664 valign=top style='width:497.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Includes
  16,500 shares underlying presently exercisable stock options and 37,500
  warrants to purchase stock</p>
  </td>
 </tr>
 <tr>
  <td width=24 valign=top style='width:.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><sup>6</sup></p>
  </td>
  <td width=664 valign=top style='width:497.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Includes
  21,090 shares underlying presently exercisable stock options</p>
  </td>
 </tr>
 <tr>
  <td width=24 valign=top style='width:.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><sup>7</sup></p>
  </td>
  <td width=664 valign=top style='width:497.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Includes
  2,000 shares underlying presently exercisable stock options</p>
  </td>
 </tr>
 <tr>
  <td width=24 valign=top style='width:.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><sup>8</sup></p>
  </td>
  <td width=664 valign=top style='width:497.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Includes
  2,000 shares underlying presently exercisable stock options</p>
  </td>
 </tr>
 <tr>
  <td width=24 valign=top style='width:.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><sup>9</sup></p>
  </td>
  <td width=664 valign=top style='width:497.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Includes
  2,000 shares underlying presently exercisable stock options</p>
  </td>
 </tr>
 <tr>
  <td width=24 valign=top style='width:.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><sup>10</sup></p>
  </td>
  <td width=664 valign=top style='width:497.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Does
  not include shares held beneficially by The Bailey Company and The Erie
  County Investment Co.&nbsp; If those shares were included, the number of shares
  beneficially held by all directors and executive officers as a group would be
  5,751,228 and the percentage of class would be 67.38%.</p>
  </td>
 </tr>
 <tr>
  <td width=24 valign=top style='width:.25in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:6.0pt;margin-right:0in;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;line-height:normal'>*</p>
  </td>
  <td width=664 valign=top style='width:497.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:6.0pt;margin-right:0in;margin-bottom:
  0in;margin-left:0in;margin-bottom:.0001pt;text-align:justify;line-height:
  normal'>Less
  than one percent.</p>
  </td>
 </tr>
 <tr>
  <td width=24 valign=top style='width:.25in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=664 valign=top style='width:497.9pt;padding:0in 5.4pt 0in 5.4pt'>

  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Under
  SEC rules, beneficial ownership includes shares over which the individual or
  entity has voting or investment power and any shares which the individual or
  entity has the right to acquire within sixty days.</p>
  </td>
 </tr>
</table>

<p class=MsoFooter align=right style='text-align:right'>37</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

<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:0in;margin-bottom:.0001pt'><b>&nbsp;</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>The
information required by this Item concerning securities authorized for issuance
under equity compensation plans is incorporated by reference to the information
provided under the caption &quot;Disclosure with Respect to the Company's
Equity Compensation Plan&quot; in Part II - Item 5 - Market for Common Equity
and Related Stockholder Matters, included in this Form 10-K.</p>



<p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:1.0in;margin-bottom:.0001pt;text-indent:-1.0in;line-height:normal'><b>ITEM 13.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE.</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>&nbsp;</b></p>

<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>In February 2005, we
issued 1,240,000 shares of our Series B Convertible Preferred Stock, including
180,000 shares to The Erie County Investment Co., a substantial holder of our
common stock and member of The Bailey Group.&nbsp; In June 2006, we exercised our
mandatory conversion rights under the terms of the Series B preferred stock to
convert all of those shares into a total of 1,240,000 shares of our common
stock.&nbsp; Under the agreements for the Series B preferred stock financing, prior
to December 13, 2010 The Bailey Group had the right to elect three directors,
provided that two directors meet the NASDAQ independence standards, and the
other investors in the Series B preferred stock financing had the right to
elect three directors.&nbsp; As a condition to the closing of the SII Investment
Transaction, the Series B investors agreed to waive the foregoing director
designation rights, effective as of December 13, 2010.&nbsp; Going forward, the
Series B investors have certain designation rights as set forth in the Purchase Agreement with SII,
which is discussed below.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>The SII Purchase
Agreement provides that so long as SII holds more than 50% of the Company's
outstanding Common Stock, (i) the Board shall consist of seven directors, and
(ii) SII shall have the right to designate four members of the Board.&nbsp; In
addition, a provision
of the Series B preferred stock financing restricts, for as long as the
original investors hold at least two-thirds of the common stock into which the
Series B shares have been converted, our ability to increase the size of the
Board of Directors above seven directors unless we first receive approval from
the holders of at least three-fourths of all outstanding shares of common
stock.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>The SII Purchase
Agreement provides that SII shall vote its shares in any election of directors
in favor of one person designated by The Bailey Group and one person designated
by Eric W. Reinhard, in addition to SII's four director designees.&nbsp; If either
The Bailey Group or Reinhard ceases to own at least 600,000 shares of the
Company's Common Stock (adjusted for any stock splits, reverse splits or
similar capital stock transactions), then the foregoing designation right will
cease, and SII has agreed to vote its shares in any election of directors in
favor of a person, other than an SII designee, who receives the majority of
votes of holders of Common Stock other than SII.&nbsp; Pursuant to the Purchase
Agreement, the Series B investors have agreed to vote their shares in any
election of directors in favor of SII's designees.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Keith
A. Radford, John F. Morgan, Gary J. Heller and David L. Dobbin are the current
directors designated by SII, Geoffrey R. Bailey is the current director
designated by The Bailey Group, and Eric W. Reinhard is the current director
designated by the other Series B investors.&nbsp; David L. Dobbin is a director of
SII, which holds approximately 51.4% of our outstanding Common Stock following
the SII Investment Transaction.&nbsp; Geoffrey R. Bailey is a director of The Erie
County Investment Co., which owns 99% of The Bailey Company.&nbsp; The Bailey
Company and The Erie County Investment Co. are principal stockholders of us.&nbsp;
Geoffrey R. Bailey's father, Paul T. Bailey, is the principal owner of The Erie
County Investment Co.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'>Our
corporate headquarters are located in a building owned by The Bailey Company
and in which The Bailey Company also has its corporate headquarters.&nbsp; We
currently lease our executive office space of approximately 3,693 square feet
from The Bailey Company for approximately $55,000 per year.&nbsp; The lease expired September
30, 2009 and we continue to lease the space on a month to month basis.</p>



<p class=Style74 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>The Bailey Company is
also the owner of one franchised Good Times Drive Thru restaurant which is
located in Loveland, Colorado and was the owner of one franchised restaurant in
Thornton, Colorado which was closed in October 2009. The Bailey Company has
entered into two franchise and management agreements with us.&nbsp; Franchise
royalties and management fees paid under those agreements totaled approximately
$50,000 and $78,000 for the fiscal years ending September 30, 2010 and 2009,
respectively.</p>



<p class=Style79 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>In April 2009 the
Company entered into a loan agreement with Golden Bridge, pursuant to which
Golden Bridge made a loan of $185,000 to the Company.&nbsp; This loan was repaid in
full out of the proceeds received by the Company in the SII Investment
Transaction.&nbsp; Director Eric Reinhard and former directors Ron Goodson, David
Grissen, Richard Stark, and Alan Teran, who are all stockholders of the
Company, are the sole members of Golden Bridge, and Eric Reinhard is the sole
manager of Golden Bridge.&nbsp; The Company's obtaining of the loan from Golden
Bridge and related transactions were</p>

<p class=MsoFooter align=right style='text-align:right'>38</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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

</div>



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












<p class=Style79 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>duly approved in
advance by the Company's Board of Directors by the affirmative vote of members
thereof who did not have an interest in the transaction.&nbsp; Total interest and commitment
fees paid under this agreement were approximately $18,000 and $12,000 for the
fiscal years ending September 30, 2010 and 2009, respectively. The amount due to related parties
under this agreement that is included in notes payable was $185,000 at September
30, 2010. See Note 8 to our Consolidated Financial Statements of Item 8 above
for the terms of the loan.</p>



<p class=Style79 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'><b>Section 16(a)
beneficial ownership reporting compliance:</b> Under Section 16(a) of the Securities Exchange Act
of 1934, directors, executive officers and persons who own more than ten
percent of our Common Stock must disclose their initial beneficial ownership of
the Common Stock and any changes in that ownership in reports which must be
filed with the SEC and Good Times Restaurants. The SEC has designated specific
deadlines for these reports and Good Times Restaurants must identify in this
proxy statement those persons who did not file these reports when due.</p>



<p class=Style79 style='margin-bottom:0in;margin-bottom:.0001pt;text-indent:
0in'>Based solely on a
review of the reports filed with Good Times Restaurants and written
representations received from reporting persons Good Times Restaurants believes
that during the fiscal year ended September 30, 2010 all Section 16(a) filing
requirements for its officers, directors, and more than ten percent
shareholders were complied with on a timely basis.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>ITEM
14.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; PRINCIPAL ACCOUNTANT FEES AND SERVICES</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>&nbsp;</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><a name="_Toc92016773"></a><a name="_Toc89839956"></a><a
name="_Toc89839461"><b>INDEPENDENT
PUBLIC ACCOUNTANTS</b></a><b>:</b> The Board of Directors appointed HEIN
&amp; ASSOCIATES LLP as Good Times Restaurants' independent auditors for the
fiscal year ended September 30, 2009 and fiscal year 2010, and to perform other
accounting services.&nbsp; Representatives of HEIN &amp; ASSOCIATES LLP are expected
to be present at the annual meeting of shareholders, and will have the
opportunity to make a statement if they so desire and to respond to appropriate
shareholder questions.<a name="_Toc92016774"></a><a name="_Toc89839957"></a><a
name="_Toc89839462"></a></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Audit
Fees</b><b>:</b> The aggregate
fees billed for professional services rendered by HEIN &amp; ASSOCIATES LLP for
its audit of the Company's annual financial statements for the fiscal year
ended September 30, 2010, and its reviews of the financial statements included
in the Company's Forms 10-Qs for fiscal year 2010 were $75,910 compared to
$86,236 in fees for the fiscal year ended 2009.<a name="_Toc92016775"></a><a
name="_Toc89839958"></a><a name="_Toc89839463"></a></p>



<p class=MsoEnvelopeAddress style='text-align:justify'><b>Audit Related Fees:</b> There were no aggregate fees billed by HEIN &amp; ASSOCIATES LLP for
assurance and related services that are reasonably related to the performance
of the audit or review of our financial statements and are not reported under
&quot;Audit Fees&quot; for the fiscal years ended September 30, 2010 and September 30,
2009.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Tax
Fees:</b>
The aggregate fees billed by HEIN &amp; ASSOCIATES LLP for the preparation and
review of the Company's tax returns for the fiscal year ended September 30,
2010 were $10,500 compared to $11,350 in fees for the fiscal year ended
September 30, 2009.</p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>All
Other Fees</b><b>:</b> The aggregate
fees billed to Good Times Restaurants for all other services rendered by HEIN
&amp; ASSOCIATES LLP for fiscal year 2010 were $12,214 compared to $12,562 in
fees for the fiscal year ended September 30, 2009.&nbsp; These fees are primarily related
to a 401(k) plan audit<a name="_Toc92016776"></a><a name="_Toc89839959"></a><a
name="_Toc89839464">.</a></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Audit
Committee:</b>
Policy on Pre-Approval Policies of Auditor Services: Under the
provisions of the Audit Committee Charter, all audit services and all permitted
non-audit services (unless subject to a de minimis exception allowed by law)
provided by our independent auditors, as well as fees and other compensation to
be paid to them, must be approved in advance by our Audit Committee.&nbsp; All audit
and other services provided by HEIN &amp; ASSOCIATES LLP during the fiscal year
ended September 30, 2010, and the related fees as discussed above, were
approved in advance in accordance with SEC rules and the provisions of the
Audit Committee Charter.&nbsp; There were no other services or products provided by
HEIN &amp; ASSOCIATES LLP to us or related fees during the fiscal year ended September
30, 2010 except as discussed above.<a name="_Toc92016777"></a><a
name="_Toc89839960"></a><a name="_Toc89839465"></a></p>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
justify;line-height:normal'><b>Auditor
Independence</b><b>:</b> The Audit Committee of the Board of
Directors has considered the effect that the provision of the services
described above under the caption &quot;All Other Fees&quot; may have on the independence
of HEIN &amp; ASSOCIATES LLP.&nbsp; The Audit Committee has determined that
provision of those services is compatible with maintaining the independence of
HEIN &amp; ASSOCIATES LLP as the Company's principal accountants.</p>

<p class=MsoFooter align=right style='text-align:right'>39</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

<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:0in;margin-bottom:.0001pt;line-height:
normal'><b>&nbsp;</b></p>

<p class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'><b>PART IV</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>&nbsp;</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>ITEM
15.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; EXHIBITS, FINANCIAL STATEMENT SCHEDULES</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>&nbsp;</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>The
following exhibits are furnished as part of this report:</p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b><u>Exhibit</u></b></p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'><b><u>Description</u></b></p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b><u>&nbsp;</u></b></p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'><b><u>&nbsp;</u></b></p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>3.1</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Articles
  of Incorporation of the Registrant (previously filed on November 30, 1988 as
  Exhibit 3.1 to the registrant's Registration Statement on Form S-18 (File No.
  33-25810-LA) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>3.2</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Amendment
  to Articles of Incorporation of the Registrant dated January 23, 1990
  (previously filed on January 18, 1990 as Exhibit 3.1 to the registrant's
  Current Report on Form 8-K (File No. 000-18590) and incorporated herein by
  reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>3.3</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Amendment
  to Articles of Incorporation (previously filed as Exhibit 3.5 to the
  registrant's Annual Report on Form 10-KSB for the fiscal year ended September
  30, 1996 and (File No. 000-18590) incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>3.4</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Restated
  Bylaws of Registrant dated November 7, 1997 (previously filed as Exhibit 3.6
  to the registrant's Annual Report on Form 10-KSB for the fiscal year ended
  September 30, 1997 (File No. 000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>3.5</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Restated
  Bylaws of Registrant, amended as of August 14, 2007 (previously filed as
  Exhibit 3/1 to the registrant's current report on Form 8-K dated August 14,
  2007 (File No. 000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>4.1</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Certificate
  of Designations, Preferences, and Rights of Series B Convertible Preference
  Stock of Good Times Restaurants Inc. (previously filed as Exhibit 1 to the
  Amendment No. 6 to Schedule 13D filed by The Erie County Investment Co., The
  Bailey Company, LLLP and Paul T. Bailey (File No. 005-42729) on February 14,
  2005 and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.1</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>1992
  Incentive Stock Option Plan, as amended (previously filed as Exhibit 4.9 to
  the registrant's Annual Report on Form 10-KSB for the fiscal year ended
  September 30, 1998 (File No. 000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.2</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>1992
  Non-Statutory Stock Option Plan, as amended (previously filed as Exhibit 4.10
  to the registrant's Annual Report on Form 10-KSB for the fiscal year ended
  September 30, 1998 (File No. 000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.3</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Employment
  Agreement dated October 3, 2001 between the registrant and Boyd E. Hoback</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.4</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Wells
  Fargo Credit Agreement (previously filed as Exhibit 10.17 to the registrant's
  Annual Report on Form 10-KSB for the fiscal year ended September 30, 2003
  (File No. 000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.5</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Form
  of Option Agreement (previously filed as Exhibit 10.18 to the registrant's
  Annual Report on Form 10-KSB for the fiscal year ended September 30, 2004
  (File No. 000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.6</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Form
  of Option Grant Notice (previously filed as Exhibit 10.19 to the registrant's
  Annual Report on Form 10-KSB for the fiscal year ended September 30, 2004
  (File No. 000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.7</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Cash
  Bonus Plan for Boyd Hoback (previously filed as Exhibit 10.20 to the
  registrant's Annual Report on Form 10-KSB for the fiscal year ended September
  30, 2004 (File No. 000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.8</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Securities
  Purchase Agreements (previously filed on the registrant's Current Report on
  Form 8-K dated January 3, 2005 (File No. 000-18590) and incorporated herein
  by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.9</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Amendment
  to Securities Purchase Agreement (previously filed as Exhibit 10.1 to the
  registrant's Form 8-K Report dated January 27, 2005 (File No. 000-18590) and
  incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.10</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>2001
  Stock Option Plan, as amended (previously filed as Exhibit 99.1 to the
  registrant's Registration Statement on Form S-8 filed on May 23, 2005
  (Registration No. 333-125150) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.11</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Conversion
  of Series B Convertible Preferred Stock (previously filed as Exhibit 99.1 to
  the registrant's Form 8-K Report dated June 8, 2006 (File No. 000-18590) and
  incorporated herein by reference)</p>
  </td>
 </tr>
</table>



<p class=MsoFooter align=right style='text-align:right'>40</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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

</div>



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












<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b><u>Exhibit</u></b></p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'><b><u>Description</u></b></p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.12</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Loan
  Agreement and Promissory Note (previously filed as Exhibit 10.1 and 10.2 to
  the registrant's Form 8-K Report dated August 7, 2006 (File No. 000-18590)
  and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.13</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Acceleration
  of Vesting of Stock Options and Form of Resale Restriction Agreement
  (previously filed as Exhibit 10.1 to the registrant's Form 8-K Report dated
  August 8, 2006 (File No. 000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.14</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Expansion
  of Loan Agreement and Promissory Note (previously filed as Exhibit 10.1 and
  10.2 to the registrant's Form 8-K Report dated March 15, 2007 (File No.
  000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.15</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Loan
  Agreement and Promissory Note (previously filed as Exhibit 10.1 and 10.2 to
  the registrant's Form 8-K Report dated May 7, 2007 (File No. 000-18590) and
  incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.16</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Amendment
  No. 1 to Loan Agreement and Promissory Note (previously filed as Exhibit 10.1
  and 10.2 to the registrant's Form 8-K Report dated May 10, 2007 (File No.
  000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.17</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>2008
  Omnibus Equity Incentive Compensation Plan (previously filed as Exhibit 10.1&nbsp;
  to the registrant's Form 8-K Report dated January 29, 2008 (File No.
  000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.18</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Employment
  Agreement of Boyd E. Hoback (previously filed as Exhibit 10.1 to the
  registrant's Form 8-K Report dated January 29, 2008 (File No. 000-18590) and
  incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.19</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Letter
  Agreement between Good Times Drive Thru Inc. and CEDA Enterprises, Inc.
  (previously filed as Exhibit 10.1 to the registrant's Form 8-K Report dated
  March 12, 2008 (File No. 000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.20</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Letter
  Agreement between Good Times Drive Thru Inc. and CEDA Enterprises, Inc. and
  CEJ Investments, LLC (previously filed as Exhibit 10.2 to the registrant's
  Form 8-K Report dated March 12, 2008 (File No. 000-18590) and incorporated
  herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.21</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Amended
  and Restated Loan Agreement (previously filed as Exhibit 10.1 to the
  registrant's Form 8-K Report dated July 2, 2008 (File No. 000-18590) and
  incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.22</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Promissory
  Note by Good Times Drive Thru Inc. and Good Times Restaurants Inc. payable to
  PFGI II, LLC (previously filed as Exhibit 10.2 to the registrant's Form 8-K
  Report dated July 2, 2008 (File No. 000-18590) and incorporated herein by
  reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.23</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Departure
  of Management Employees, Transfer of Development Rights and Suspension of
  Expansion (previously filed in the registrant's Form 8-K Report dated June
  26, 2008 (File No. 000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.24</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Suspension
  of Development Agreement previously filed as Exhibit 10.41 to the
  registrant's Form 10-KSB Report dated December 26, 2008 (File No. 000-18590)
  and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.25</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Results
  of Operations, Triggering Events and Other Events (previously filed as the
  registrant's Form 8-K Report dated January 20, 2009 (File No. 000-18590) and
  incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.26</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Loan
  Agreement, Promissory Note, Warrant, Intercreditor Agreement and First
  Amendment to Amended and Restated Promissory Note (previously filed as
  Exhibits 4.1, 10.1, 10.2, 10.3 and 10.4 to the registrant's Form 8-K Report dated
  April 20, 2009 (File No. 000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.27</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Agreement
  between Good Times Restaurants Inc. and Mastodon Ventures Inc. (previously
  filed as Exhibit 10.1 to the registrant's Form 8-K Report dated August 14,
  2009 (File No. 000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.28</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Letter
  Agreement between Good Times Restaurants Inc. and PFGI II, LLC dated December
  14, 2009 (previously filed as Exhibit 10.33 to the registration's Annual
  Report on Form 10-K dated December 29, 2009 (File no. 000-18590) and
  incorporated herein by reference) </p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.29</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Promissory
  Note and Warrant dated January 19, 2010 (previously filed as Exhibits 4.1 and
  10.1 to the registrant's Form 8-K Report dated January 21, 2010 (File No.
  000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.30</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Loan
  Agreement, Convertible Secured Promissory Note and Warrants (previously filed
  as Exhibits 4.1, 10.1 and 10.2 to the registrant's Form 8-K Report dated
  February 3, 2010 (File No. 000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.31</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Registration
  Statement (previously filed on the registrant's Registration Statement on
  Form S-3 filed on March 4, 2010 (Registration No. 333-165189) and
  incorporated herein by reference</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.32</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>First
  Amendment to Loan Agreement, Convertible Secured promissory Note and Warrants
  (previously filed as Exhibits 4.1, 10.1 and 10.2 to the registrant's Form 8-K
  Report dated April 6, 2010 (File No. 000-18590) and incorporated herein by
  reference)</p>
  </td>
 </tr>
</table>

<p class=MsoFooter align=right style='text-align:right'>41</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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

</div>



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












<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0
 style='border-collapse:collapse'>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b><u>Exhibit</u></b></p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'><b><u>Description</u></b></p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.33</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Amendment
  No. 1 to Registration Statement (previously filed on the registrant's
  Registration Statement on Form S-3 filed on April 27, 2010 (Registration No.
  333-165189) and incorporated herein by reference</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.34</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Term
  Sheet dated October 3, 2010 between Company and Small Island Investments
  Limited (previously filed as Exhibit 10.1 to the registrant's Form 8-K Report
  dated October 5, 2010 (File No. 000-18590) and incorporated herein by
  reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.35</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Securities
  Purchase Agreement dated October 29, 2010 (previously filed as Exhibit 10.1
  to the registrant's Form 8-K Report dated November 3, 2010 (File No.
  000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.36</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Registration
  Rights Agreement dated December 13, 2010 (previously filed as Exhibit 10.1 to
  the registrant's Form 8-K Report dated December 17, 2010 (File No. 000-18590)
  and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.37</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Loan
  and Credit and Loan Agreement dated as of December 13, 2010 (previously filed
  as Exhibit 10.1 to the registrant's Form 8-K Report dated December 17, 2010
  (File No. 000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.38</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Consent
  and Agreement dated as of December 13, 2010 (previously filed as Exhibit 10.1
  to the registrant's Form 8-K Report dated December 17, 2010 (File No.
  000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>10.39</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Consent
  and Waiver dated as of December 13, 2010 (previously filed as Exhibit 10.1 to
  the registrant's Form 8-K Report dated December 17, 2010 (File No. 000-18590)
  and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>14.1</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Code
  of Ethics (previously filed as Exhibit 14.1 to the registrant's Annual Report
  on Form 10-KSB for the fiscal year ended September 30, 2003 (File No.
  000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>21.1</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>Subsidiaries
  of registrant (previously filed as Exhibit 21.1 to the registrant's Annual
  Report on Form 10-KSB for the fiscal year ended September 30, 1998 (File No.
  000-18590) and incorporated herein by reference)</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>23.1</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>*Consent
  of HEIN &amp; ASSOCIATES LLP</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>31.1</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>*Certification
  of Chief Executive `Officer pursuant to 18 U.S.C. Section 1350</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>31.2</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>*Certification
  of Controller pursuant to 18 U.S.C. Section 1350</p>
  </td>
 </tr>
 <tr>
  <td width=79 valign=top style='width:59.4pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>32.1</p>
  </td>
  <td width=598 valign=top style='width:448.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;text-align:
  justify;line-height:normal'>*Certification
  of Chief Executive Officer and Controller pursuant to 18 U.S.C. Section 1350</p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>*Filed
herewith</p>

<p class=MsoFooter align=right style='text-align:right'>42</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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










<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>SIGNATURES</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'><b>&nbsp;</b></p>

<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>In
accordance with Section 13 or 15(d) 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 width=595
 style='border-collapse:collapse'>
 <tr>
  <td width=307 valign=top style='width:3.2in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>&nbsp;</b></p>
  </td>
  <td width=288 valign=top style='width:3.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><b>GOOD
  TIMES&nbsp; RESTAURANTS INC.</b></p>
  </td>
 </tr>
 <tr style='height:24.9pt'>
  <td width=307 style='width:3.2in;padding:0in 5.4pt 0in 5.4pt;height:24.9pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Date:
  December 23, 2010</p>
  </td>
  <td width=288 valign=bottom style='width:3.0in;padding:0in 5.4pt 0in 5.4pt;
  height:24.9pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><i><u>/s/
  Boyd E. Hoback</u></i></p>
  </td>
 </tr>
 <tr>
  <td width=307 valign=top style='width:3.2in;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=288 valign=top style='width:3.0in;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Boyd
  E. Hoback</p>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>President
  and Chief Executive Officer</p>
  </td>
 </tr>
</table>



<p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
normal'>In
accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated. </p>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=596
 style='border-collapse:collapse'>
 <tr>
  <td width=255 valign=top style='width:191.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><i><u>/s/
  David L. Dobbin</u></i></p>
  </td>
  <td width=52 valign=top style='width:39.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><i><u>&nbsp;</u></i></p>
  </td>
  <td width=289 valign=top style='width:216.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:.55pt;margin-bottom:.0001pt;line-height:normal'><i><u>/s/ Boyd E.
  Hoback</u></i></p>
  </td>
 </tr>
 <tr style='height:37.95pt'>
  <td width=255 valign=top style='width:191.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:37.95pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>David
  L. Dobbin, Chairman</p>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Date:
  December 23, 2010</p>
  </td>
  <td width=52 valign=top style='width:39.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:37.95pt'>

  </td>
  <td width=289 valign=top style='width:216.75pt;padding:0in 5.4pt 0in 5.4pt;
  height:37.95pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:.55pt;margin-bottom:.0001pt;line-height:normal'>Boyd E.
  Hoback, Director </p>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:.55pt;margin-bottom:.0001pt;line-height:normal'>and President
  and CEO</p>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:.55pt;margin-bottom:.0001pt;line-height:normal'>Date: December
  23, 2010 </p>
  </td>
 </tr>
 <tr>
  <td width=255 valign=top style='width:191.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><i>&nbsp;</i></p>
  </td>
  <td width=52 valign=top style='width:39.2pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=289 valign=top style='width:216.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><i>&nbsp;</i></p>
  </td>
 </tr>
 <tr>
  <td width=255 valign=top style='width:191.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><i><u>/s/
  Geoffrey R. Bailey</u></i></p>
  </td>
  <td width=52 valign=top style='width:39.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=289 valign=top style='width:216.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><i><u>/s/
  Susan M. Knutson</u></i></p>
  </td>
 </tr>
 <tr style='height:35.7pt'>
  <td width=255 valign=top style='width:191.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:35.7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Geoffrey
  R. Bailey, Director</p>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Date:
  December 23, 2010 </p>
  </td>
  <td width=52 valign=top style='width:39.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:35.7pt'>

  </td>
  <td width=289 valign=top style='width:216.75pt;padding:0in 5.4pt 0in 5.4pt;
  height:35.7pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Susan
  M. Knutson, Controller and</p>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Principal
  Financial Officer</p>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Date:
  December 23, 2010</p>
  </td>
 </tr>
 <tr>
  <td width=255 valign=top style='width:191.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><i>&nbsp;</i></p>
  </td>
  <td width=52 valign=top style='width:39.2pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=289 valign=top style='width:216.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><i>&nbsp;</i></p>
  </td>
 </tr>
 <tr>
  <td width=255 valign=top style='width:191.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:.55pt;margin-bottom:.0001pt;line-height:normal'><i><u>/s/ Gary J.
  Heller</u></i></p>
  </td>
  <td width=52 valign=top style='width:39.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><u>&nbsp;</u></p>
  </td>
  <td width=289 valign=top style='width:216.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><i><u>/s/
  Keith A. Radford</u></i></p>
  </td>
 </tr>
 <tr style='height:26.4pt'>
  <td width=255 valign=top style='width:191.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:26.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:.55pt;margin-bottom:.0001pt;line-height:normal'>Gary J.
  Heller, Director</p>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:.55pt;margin-bottom:.0001pt;line-height:normal'>Date: December
  23, 2010 </p>
  </td>
  <td width=52 valign=top style='width:39.2pt;padding:0in 5.4pt 0in 5.4pt;
  height:26.4pt'>

  </td>
  <td width=289 valign=top style='width:216.75pt;padding:0in 5.4pt 0in 5.4pt;
  height:26.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Keith
  A. Radford, Director</p>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Date:
  December 23, 2010 </p>
  </td>
 </tr>
 <tr>
  <td width=255 valign=top style='width:191.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><i>&nbsp;</i></p>
  </td>
  <td width=52 valign=top style='width:39.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><i>&nbsp;</i></p>
  </td>
  <td width=289 valign=top style='width:216.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-top:0in;margin-right:0in;margin-bottom:0in;
  margin-left:.55pt;margin-bottom:.0001pt;line-height:normal'><i>&nbsp;</i></p>
  </td>
 </tr>
 <tr>
  <td width=255 valign=top style='width:191.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><i><u>/s/
  John F. Morgan</u></i></p>
  </td>
  <td width=52 valign=top style='width:39.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><i><u>&nbsp;</u></i></p>
  </td>
  <td width=289 valign=top style='width:216.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><i><u>/s/
  Eric W. Reinhard</u></i></p>
  </td>
 </tr>
 <tr>
  <td width=255 valign=top style='width:191.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>John
  F. Morgan, Director</p>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Date:
  December 23, 2010 </p>
  </td>
  <td width=52 valign=top style='width:39.2pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=289 valign=top style='width:216.75pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Eric
  W. Reinhard, Director</p>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'>Date:
  December 23, 2010</p>
  </td>
 </tr>
 <tr>
  <td width=255 valign=top style='width:191.2pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal style='margin-bottom:0in;margin-bottom:.0001pt;line-height:
  normal'><i><u>&nbsp;</u></i></p>
  </td>
  <td width=52 valign=top style='width:39.2pt;padding:0in 5.4pt 0in 5.4pt'>

  </td>
  <td width=289 valign=top style='width:216.75pt;padding:0in 5.4pt 0in 5.4pt'>

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

<p class=MsoFooter align=right style='text-align:right'>43</p>



<div class=MsoNormal align=center style='margin-bottom:0in;margin-bottom:.0001pt;
text-align:center;line-height:normal'>

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

</div>





</div>

</body>

</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.CERT
<SEQUENCE>2
<FILENAME>ex311certceo1.htm
<TEXT>
<html>

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



<title>_</title>


</head>

<body lang=EN-US>

<div class=WordSection1>

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

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









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



<p class=MsoListParagraph style='margin-left:.75in;text-align:justify;
text-indent:-.5in'>1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
I have reviewed this annual report
on Form 10-K of Good Times Restaurants Inc.;</p>



<p class=MsoListParagraph style='margin-left:.75in;text-align:justify;
text-indent:-.5in'>2.&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=MsoListParagraph style='margin-left:.75in;text-align:justify;
text-indent:-.5in'>3.&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:-.25in'>4.&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;&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;&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;&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>

<p class=MsoNormal style='margin-left:1.0in;text-align:justify;text-indent:
- -.5in'>(d)&nbsp;&nbsp;&nbsp;&nbsp;&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:-22.5pt'>5.&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;&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;&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; December 23, 2010</p>



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

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

</div>





</div>

</body>

</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.CERT
<SEQUENCE>3
<FILENAME>ex312certcontroller1.htm
<TEXT>
<html>

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



<title>_</title>


</head>

<body lang=EN-US>

<div class=WordSection1>

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

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









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



<p class=MsoListParagraph style='margin-left:.75in;text-align:justify;
text-indent:-.5in'>1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
I have reviewed this annual report
on Form 10-K of Good Times Restaurants Inc.;</p>



<p class=MsoListParagraph style='margin-left:.75in;text-align:justify;
text-indent:-.5in'>2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&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=MsoListParagraph style='margin-left:.75in;text-align:justify;
text-indent:-.5in'>3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&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=MsoListParagraphCxSpFirst style='margin-left:.75in;text-align:justify;
text-indent:-.5in'>4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&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;&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;&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;&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>

<p class=MsoNormal style='margin-left:1.0in;text-align:justify;text-indent:
- -.5in'>(d)&nbsp;&nbsp;&nbsp;&nbsp;&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=MsoListParagraph style='margin-left:.75in;text-align:justify;
text-indent:-.5in'>5.&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;&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;&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; December 23, 2010</p>



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

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

<p class=MsoFooter>Controller</p>

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

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

</div>





</div>

</body>

</html>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.906 CERT
<SEQUENCE>4
<FILENAME>ex321certceocont1.htm
<TEXT>
<html>

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



<title>_</title>


</head>

<body lang=EN-US>

<div class=WordSection1>

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

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









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

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

<p class=titlec align=center style='margin:0in;margin-bottom:.0001pt;
text-align:center'><b>CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,</b></p>

<p class=titlec align=center style='margin:0in;margin-bottom:.0001pt;
text-align:center'><b>AS ADOPTED PURSUANT TO</b></p>

<p class=titlec align=center style='margin:0in;margin-bottom:.0001pt;
text-align:center'><b>SECTION 906 OF THE
SARBANES-OXLEY ACT OF 2002</b></p>

<p class=titlec align=center style='margin:0in;margin-bottom:.0001pt;
text-align:center'><b>&nbsp;</b></p>



<p class=bodytext5 style='margin:0in;margin-bottom:.0001pt;text-align:justify;
text-indent:.5in'>In connection with the Annual
Report on Form 10K of Good Times Restaurants Inc. (the &quot;Company&quot;) for the
fiscal year ended September 30, 2010 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-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-align:justify;text-indent:-.25in'>(1)&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-top:0in;margin-right:0in;margin-bottom:0in;
margin-left:.75in;margin-bottom:.0001pt;text-align:justify;text-indent:-.25in'>(2)&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=301 valign=top style='width:225.9pt;border:none;border-bottom:solid windowtext 1.0pt;
  padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal><i>/s/ Boyd E. Hoback</i></p>
  </td>
  <td width=48 valign=top style='width:.5in;padding:0in 5.4pt 0in 5.4pt'>
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  <p class=MsoNormal><i>/s/ Susan M. Knutson</i></p>
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  <td width=301 valign=top style='width:225.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Boyd E. Hoback</p>
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  <p class=MsoNormal>Susan M. Knutson</p>
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 </tr>
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  <td width=301 valign=top style='width:225.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>Chief Executive Officer</p>
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  <p class=MsoNormal>Controller (principal
  financial officer)</p>
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  <p class=MsoNormal>December 23, 2010</p>
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  <td width=289 valign=top style='width:216.9pt;padding:0in 5.4pt 0in 5.4pt'>
  <p class=MsoNormal>December 23, 2010</p>
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<DOCUMENT>
<TYPE>EX-99.2M CNSNT SRVCE
<SEQUENCE>5
<FILENAME>heinconsent1.htm
<TEXT>
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<head>
<!-- Document Prepared With E-Services, LLC HTML Software-->
<!-- Copyright 2006 E-Services, LLC.-->
<!-- All rights reserved EDGAR2.com -->



<title>CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</title>


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<p class=MsoNormal align=center style='text-align:center'><b>CONSENT OF
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</b></p>







<p class=MsoNormal style='text-align:justify'>We consent to the incorporation by
reference of our report dated December&nbsp;19, 2010, accompanying the consolidated
financial statements of Good Times Restaurants, Inc., also incorporated by reference
in the Form S-8 Registration Statements with registration numbers 333-60813,
333-98407, and 333-125150 and Form S-3 Registration Statement 333-122890 of
Good Times Restaurants, Inc., and to the use of our name and the statements
with respect to us, as appearing under the heading &quot;Experts&quot; in the
Registration Statements.</p>



<p class=MsoNormal style='text-align:justify'><u>/s/ Hein &amp; Associates LLP</u></p>



<p class=MsoNormal style='text-align:justify'><b><i>HEIN</i></b><i> &amp;
ASSOCIATES LLP</i> </p>



<p class=MsoNormal style='text-align:justify'>Denver, Colorado</p>

<p class=MsoFooter>December 19, 2010</p>

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