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<SEC-DOCUMENT>0000825324-10-000015.txt : 20100816
<SEC-HEADER>0000825324-10-000015.hdr.sgml : 20100816
<ACCEPTANCE-DATETIME>20100816152338
ACCESSION NUMBER:		0000825324-10-000015
CONFORMED SUBMISSION TYPE:	10-Q
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20100630
FILED AS OF DATE:		20100816
DATE AS OF CHANGE:		20100816

FILER:

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

	FILING VALUES:
		FORM TYPE:		10-Q
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-18590
		FILM NUMBER:		101019313

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

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

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	PARAMOUNT VENTURES INC
		DATE OF NAME CHANGE:	19900205
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>qthird1.htm
<TEXT>
<html>

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



<title>UNITED STATES</title>


</head>

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

<div class=WordSection1>













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

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

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

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

<p>(Mark One)</p>

<p align=center style='text-align:center'>_<u>x_</u>QUARTERLY REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE</p>

<p align=center style='text-align:center'>ACT OF 1934</p>

<p align=center style='text-align:center'>For the quarterly period ended June 30, 2010</p>

<p align=center style='text-align:center'>OR</p>

<p align=center style='text-align:center'>___TRANSITION REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES</p>

<p align=center style='text-align:center'>EXCHANGE ACT OF 1934</p>

<p align=center style='text-align:center'>Commission File Number: 0-18590</p>

<p align=center style='text-align:center'>GOOD TIMES RESTAURANTS, INC.</p>

<p align=center style='text-align:center'>(Exact Name of Registrant as Specified in Its
Charter)</p>



<div align=center>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=516
 style='width:387.0pt'>
 <tr style='height:15.0pt'>
  <td width="47%" style='width:47.0%;padding:.75pt .75pt .75pt .75pt;
  height:15.0pt'>
  <p align=center style='text-align:center'>&nbsp;NEVADA &nbsp;</p>
  </td>
  <td width="3%" style='width:3.0%;padding:.75pt .75pt .75pt .75pt;height:15.0pt'>

  </td>
  <td width="50%" style='width:50.0%;padding:.75pt .75pt .75pt .75pt;
  height:15.0pt'>
  <p align=center style='text-align:center'>&nbsp;84-1133368</p>
  </td>
 </tr>
 <tr style='height:30.75pt'>
  <td width="47%" style='width:47.0%;padding:.75pt .75pt .75pt .75pt;
  height:30.75pt'>
  <p align=center style='text-align:center'>(State or Other Jurisdiction of &nbsp;</p>
  <p align=center style='text-align:center'>Incorporation or Organization)</p>
  </td>
  <td width="3%" style='width:3.0%;padding:.75pt .75pt .75pt .75pt;height:30.75pt'>

  </td>
  <td width="50%" valign=top style='width:50.0%;padding:.75pt .75pt .75pt .75pt;
  height:30.75pt'>
  <p align=center style='text-align:center'>&nbsp;&nbsp; (I.R.S. Employer
  Identification Number)</p>
  </td>
 </tr>
</table>

</div>

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

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

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

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

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

<p>Yes &nbsp;&nbsp;&nbsp;&nbsp; <u>x</u> No &nbsp;&nbsp;&nbsp; _</p>



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

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

</div>



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










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



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=546
 style='width:409.5pt'>
 <tr style='height:15.0pt'>
  <td width="41%" style='width:41.0%;padding:.75pt .75pt .75pt .75pt;
  height:15.0pt'>
  <p align=right style='text-align:right'>Large accelerated filer __</p>
  </td>
  <td width="19%" style='width:19.0%;padding:.75pt .75pt .75pt .75pt;
  height:15.0pt'>

  </td>
  <td width="41%" style='width:41.0%;padding:.75pt .75pt .75pt .75pt;
  height:15.0pt'>
  <p>Accelerated
  filer&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; __</p>
  </td>
 </tr>
 <tr style='height:16.5pt'>
  <td width="41%" style='width:41.0%;padding:.75pt .75pt .75pt .75pt;
  height:16.5pt'>
  <p align=right style='text-align:right'>Non-accelerated filer __</p>
  </td>
  <td width="19%" style='width:19.0%;padding:.75pt .75pt .75pt .75pt;
  height:16.5pt'>

  </td>
  <td width="41%" style='width:41.0%;padding:.75pt .75pt .75pt .75pt;
  height:16.5pt'>
  <p>Smaller
  reporting company&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>x</u></p>
  </td>
 </tr>
</table>



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

<p>Yes &nbsp;&nbsp;&nbsp;&nbsp; __ No  <u>x</u></p>

<p>As of August
16, 2010, there were 3,898,559 shares of the Registrant's common stock, par
value $0.001 per share, issued and outstanding.<a name=pgbrk></a></p>

<p><a name=ftr></a><a name=glftr></a><a name=pn></a><a name=hdr></a><a
name=glhdr></a><b>Form 10-Q</b></p>

<p><b>Quarter Ended June 30,
2010</b></p>



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

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

</div>



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










<p><b>&nbsp;</b></p>

<div align=center>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=619
 style='width:464.25pt'>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p><b><u>INDEX</u></b></p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><b><u>PAGE</u></b></p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p><b>PART I - FINANCIAL
  INFORMATION</b></p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Item 1.</p>
  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Financial Statements</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Condensed Consolidated
  Balance Sheets -</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>June 30, 2010 (unaudited)
  and September 30, 2009 (unaudited)</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>3
  - 4</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Condensed Consolidated
  Statements of Operations (unaudited) </p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>For the three and nine
  months ended June 30, 2010 and 2009</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>5</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Condensed Consolidated
  Statements of Cash Flow (unaudited) </p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>For the three and nine
  months ended June 30, 2010 and 2009</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>6</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Notes to Condensed
  Consolidated Financial Statements</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>7
  - 14</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Item 2.</p>
  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Management's Discussion and
  Analysis of Financial Condition and Results of Operations</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>14
  - 23</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Item 3.</p>
  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Quantitative and
  Qualitative Disclosures About Market Risk</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>23</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Item 4T.</p>
  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Controls and Procedures</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>23</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p><b>PART II - OTHER
  INFORMATION</b></p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p><a name="OLE_LINK3">Item 1.</a></p>
  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Legal Proceedings</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>23</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'></td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Item 1A.</p>
  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Risk Factors</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>23</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Item 2.</p>
  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Unregistered Sales of
  Equity Securities and Use of Proceeds</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>23</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Item 3.</p>
  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Defaults Upon Senior
  Securities</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>23</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Item 4.</p>
  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Submission of Matters to a
  Vote of Security Holders</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>24</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Item 5.</p>
  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Other Information.</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>24</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Item 6.</p>
  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Exhibits </p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>24</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p><b>SIGNATURES</b></p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>24</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p><b>CERTIFICATIONS</b></p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>Exhibit
  31.1</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>Exhibit
  31.2</p>
  </td>
 </tr>
 <tr>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="73%" valign=top style='width:73.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>Exhibit
  32.1</p>
  </td>
 </tr>
</table>

</div>

<p align=center style='text-align:center'><b>PART
I - FINANCIAL INFORMATION</b></p>

<p><b>ITEM 1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; FINANCIAL
STATEMENTS</b></p>

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

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

<p align=center style='text-align:center'><b>(Unaudited)</b></p>

<p align=center style='text-align:center'><b>ASSETS</b></p>



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

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

</div>



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










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

<div align=center>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=595
 style='width:446.25pt'>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='margin-left:.5in;text-align:center'>June 30,</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>September
  30,</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='margin-left:.5in;text-align:center'><u>2010</u></p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='margin-left:.5in;text-align:center'><u>2009</u></p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>CURRENT ASSETS:</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash and cash
  equivalents</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>$522,000</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>$815,000</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Receivables,
  net of allowance for doubtful</p>
  <p style='margin-left:.5in'>accounts
  of $0</p>
  </td>
  <td width="20%" valign=bottom style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>191,000</p>
  </td>
  <td width="20%" valign=bottom style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>122,000</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Prepaid
  expenses and other</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>66,000</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>32,000</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inventories</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>211,000</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>220,000</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Notes
  receivable</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'><u>3,000</u></p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>36,000</u></p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total current
  assets</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>993,000</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>1,225,000</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>PROPERTY AND EQUIPMENT, at
  cost:</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Land and
  building</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>6,607,000</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>6,596,000</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Leasehold
  improvements</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>3,891,000</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>4,107,000</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Fixtures and
  equipment</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>8,265,000</u></p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>8,438,000</u></p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>18,763,000</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>19,141,000</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Less
  accumulated depreciation and amortization</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(12,637,000)</u></p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(11,853,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>6,126,000</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>7,288,000</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Assets held for
  sale</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>1,595,000</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>1,595,000</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>OTHER ASSETS:</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Notes
  receivable, net of current portion</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>100,000</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>82,000</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits and
  other assets</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'><u>114,000</u></p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>64,000</u></p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'><u>214,000</u></p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>146,000</u></p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>TOTAL ASSETS</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>$8,928,000</u></p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>$10,254,000</u></p>
  </td>
 </tr>
</table>

</div>

<p align=center style='text-align:center'><b>LIABILITIES
AND STOCKHOLDERS' EQUITY</b></p>



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

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

</div>



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










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

<div align=center>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=607
 style='width:455.25pt'>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>CURRENT LIABILITIES:</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p style='margin-left:.5in'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Current
  maturities of long-term debt, net of discounts of $61,000 and $35,000
  respectively</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>$1,310,000</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>$1,027,000</p>
  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accounts
  payable</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>701,000</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>355,000</p>
  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deferred income</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>118,000</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>113,000</p>
  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Liabilities
  related to discontinued operations</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>20,000</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>-</p>
  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Other accrued
  liabilities</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>1,222,000</u></p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>930,000</u></p>
  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total current
  liabilities</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>3,371,000</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>2,425,000</p>
  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>LONG-TERM LIABILITIES:</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p style='margin-left:.5in'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Debt,
  net of current portion and net of discounts of $40,000 and $0, respectively</p>
  </td>
  <td width="20%" valign=bottom style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>2,418,000</p>
  </td>
  <td width="21%" valign=bottom style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>2,478,000</p>
  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Liabilities
  related to discontinued operations</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>128,000</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>-</p>
  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deferred
  liabilities</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>842,000</u></p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>973,000</u></p>
  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total long-term
  liabilities</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>3,388,000</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>3,451,000</p>
  </td>
 </tr>
</table>

</div>

<p align=center style='text-align:center'><a name="OLE_LINK2"></a><b>GOOD TIMES RESTAURANTS INC. AND
SUBSIDIARIES</b></p>

<p align=center style='text-align:center'><b>CONDENSED
CONSOLIDATED BALANCE SHEETS (Continued)</b></p>

<p align=center style='text-align:center'><b>(Unaudited)</b></p>





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

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

</div>



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












<div align=center>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=629
 style='width:471.75pt'>
 <tr style='height:12.75pt'>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt;
  height:12.75pt'></td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt;
  height:12.75pt'>
  <p align=center style='margin-left:.5in;text-align:center'>June 30,</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt;
  height:12.75pt'>
  <p align=right style='margin-left:.5in;text-align:right'>September 30,</p>
  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='margin-left:.5in;text-align:center'><u>2010</u></p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='margin-left:.5in;text-align:center'><u>2009</u></p>
  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>STOCKHOLDERS' EQUITY:</p>
  </td>
  <td width="21%" style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Non-controlling interest</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>278,000</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>428,000</p>
  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Preferred stock, $.01 par
  value;</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p style='margin-left:.5in'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5,000,000
  shares authorized, none issued</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; and outstanding
  as of September 30, 2009 and</p>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; June 30, 2010</p>
  </td>
  <td width="21%" valign=bottom style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>-</p>
  </td>
  <td width="20%" valign=bottom style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>-</p>
  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Common stock, $.001 par
  value; 50,000,000 shares</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Authorized,
  3,898,559 shares issued and</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; outstanding as
  of September 30, 2009 and</p>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; June 30, 2010</p>
  </td>
  <td width="21%" valign=bottom style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>4,000</p>
  </td>
  <td width="20%" valign=bottom style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>4,000</p>
  </td>
 </tr>
 <tr style='height:3.75pt'>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt;
  height:3.75pt'></td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt;
  height:3.75pt'></td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt;
  height:3.75pt'></td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Capital contributed in
  excess of par value</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>18,095,000</p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>17,751,000</p>
  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Accumulated deficit</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'><u>(16,208,000)</u></p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'><u>(13,805,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total
  stockholders' equity</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'><u>2,169,000</u></p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'><u>4,378,000</u></p>
  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="59%" valign=top style='width:59.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>TOTAL LIABILITIES AND
  STOCKHOLDERS' EQUITY</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'><u>$8,928,000</u></p>
  </td>
  <td width="20%" valign=top style='width:20.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'><u>$10,254,000</u></p>
  </td>
 </tr>
</table>

</div>

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

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

<p align=center style='text-align:center'><b>(Unaudited)</b></p>



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

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

</div>



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










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

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=912
 style='width:9.5in'>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="25%" colspan=3 valign=top style='width:25.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>Three Months Ended</b></p>
  <p align=center style='text-align:center'><b>June 30,</b></p>
  </td>
  <td width="24%" colspan=3 style='width:24.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='margin-left:.5in;text-align:center'><b>Nine Months Ended</b></p>
  <p align=center style='margin-left:.5in;text-align:center'><b>June 30,</b></p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b><u>2010</u></b></p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='margin-left:.5in;text-align:center'><b><u>2009</u></b></p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='margin-left:.5in;text-align:center'><b><u>2010</u></b></p>
  </td>
  <td width="2%" valign=top style='width:2.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="14%" valign=top style='width:14.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b><u>2009</u></b></p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>NET
  REVENUES:</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Restaurant
  sales, net</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>$5,438,000</p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>$5,891,000</p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>$14,751,000</p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>$16,265,000</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Franchise
  revenues</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>127,000</u></p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>138,000</u></p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>351,000</u></p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>412,000</u></p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Total
  revenues</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>5,565,000</p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>6,029,000</p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>15,102,000</p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>16,677,000</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>RESTAURANT
  OPERATING COSTS:</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr style='height:6.75pt'>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt;
  height:6.75pt'>
  <p>Food and
  packaging costs</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt;
  height:6.75pt'>
  <p align=right style='text-align:right'>1,956,000</p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt;
  height:6.75pt'>
  <p align=right style='text-align:right'>2,011,000</p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt;
  height:6.75pt'>
  <p align=right style='text-align:right'>5,139,000</p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt;
  height:6.75pt'>
  <p align=right style='text-align:right'>5,477,000</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Payroll
  and other employee benefit costs</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>1,905,000</p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>1,955,000</p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>5,438,000</p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>5,751,000</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Occupancy
  and other operating costs</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>1,127,000</p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>1,147,000</p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>3,389,000</p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>3,365,000</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Accretion
  of deferred rent</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(126,000)</p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>-</p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(126,000)</p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>-</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Opening
  costs</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>-</p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>-</p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>-</p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>15,000</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Depreciation
  and amortization</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>245,000</u></p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>294,000</u></p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>717,000</u></p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>876,000</u></p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Total
  restaurant operating costs</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>5,107,000</p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>5,407,000</p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>14,557,000</p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>15,484,000</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>General
  and administrative costs</p>
  </td>
  <td width="9%" style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>361,000</p>
  </td>
  <td width="12%" style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>346,000</p>
  </td>
  <td width="13%" colspan=2 style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>1,096,000</p>
  </td>
  <td width="16%" colspan=2 style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>1,238,000</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Advertising
  costs</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>312,000</p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>334,000</p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>862,000</p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>934,000</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Franchise
  costs</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>30,000</p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>35,000</p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>95,000</p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>108,000</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>(Gain)
  loss on sale of restaurant building and equipment</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>55,000</u></p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(7,000)</u></p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>40,000</u></p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(22,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=bottom style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>LOSS FROM
  OPERATIONS</p>
  </td>
  <td width="9%" valign=bottom style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(300,000)</p>
  </td>
  <td width="12%" valign=bottom style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(86,000)</p>
  </td>
  <td width="13%" colspan=2 valign=bottom style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(1,548,000)</p>
  </td>
  <td width="16%" colspan=2 valign=bottom style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(1,065,000)</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>OTHER
  INCOME AND (EXPENSES):</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Unrealized
  income (loss) on interest rate swap</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(7,000)</p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>29,000</p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>3,000</p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(87,000)</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Interest
  income (expense), net</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(200,000)</u></p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(78,000)</u></p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(440,000)</u></p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(183,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Total
  other income and (expenses)</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(207,000)</u></p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(49,000)</u></p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(437,000)</u></p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(270,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>LOSS FROM
  CONTINUING OPERATIONS</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($507,000)</u></p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($135,000)</u></p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($1,985,000)</u></p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($1,335,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Loss from
  discontinued operations</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(126,000)</u></p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(42,000)</u></p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(597,000)</u></p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(153,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>NET LOSS</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($633,000)</u></p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($177,000)</u></p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($2,582,000)</u></p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($1,488,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Income (expense) from
  non-controlling interest</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>68,000</p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(3,000)</p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>179,000</p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>61,000</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>NET LOSS
  APPLICABLE TO COMMON SHAREHOLDERS</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($565,000)</u></p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($180,000)</u></p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($2,403,000)</u></p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($1,427,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Net loss
  per share - basic and diluted</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p style='margin-left:.5in'>Continuing
  operations</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; .13)</u></p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; .03)</u></p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; .51)</u></p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; .34)</u></p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p style='margin-left:.5in'>Discontinued
  operations</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; .03)</u></p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; .01)</u></p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; .15)</u></p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; .04)</u></p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Net loss
  applicable to common shareholders</p>
  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; .14)</u></p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; .05)</u></p>
  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; .62)</u></p>
  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>($&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; .37)</u></p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="9%" valign=top style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="13%" colspan=2 valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" colspan=2 valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>WEIGHTED
  AVERAGE COMMON SHARES AND EQUIVALENTS</p>
  <p>USED IN
  PER SHARE CALCULATION: BASIC AND DILUTED</p>
  </td>
  <td width="9%" valign=bottom style='width:9.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>3,898,559</p>
  </td>
  <td width="12%" valign=bottom style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>3,898,559</p>
  </td>
  <td width="13%" colspan=2 valign=bottom style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>3,898,559</p>
  </td>
  <td width="16%" colspan=2 valign=bottom style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>3,898,559</p>
  </td>
 </tr>
 <tr height=0>
  <td width=465 style='border:none'></td>
  <td width=82 style='border:none'></td>
  <td width=109 style='border:none'></td>
  <td width=36 style='border:none'></td>
  <td width=82 style='border:none'></td>
  <td width=18 style='border:none'></td>
  <td width=119 style='border:none'></td>
 </tr>
</table>

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

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

<p align=center style='text-align:center'><b>(Unaudited)</b></p>



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

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

</div>



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










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

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=726
 style='width:544.5pt'>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="34%" colspan=2 valign=top style='width:34.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>For the Nine Months Ended</p>
  <p align=center style='text-align:center'>June 30,</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>CASH FLOWS
  FROM OPERATING ACTIVITIES:</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><u>2010</u></p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><u>2009</u></p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net
  loss </p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>($2,582,000)</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>($1,488,000)</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss
  from discontinued operations </p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(597,000)</u></p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(153,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net
  loss from continuing operations</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(1,985,000)</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(1,335,000)</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Adjustments
  to reconcile net loss to net cash</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;used
  in operating activities:</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Depreciation
  and amortization</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>717,000</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>876,000</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Amortization
  of debt issuance costs</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>204,000</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>7,000</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Stock
  based compensation expense</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>66,000</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>58,000</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Unrealized
  loss (gain) on interest rate swap</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(3,000)</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>87,000</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accretion
  of deferred rent</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(125,000)</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>-</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Recognition
  of deferred (gain) on sale of restaurant building</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(22,000)</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(22,000)</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loss
  on sale of restaurants</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>62,000</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>-</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Changes
  in operating assets and liabilities:</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Increase)
  decrease in:</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Receivables
  and other</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(62,000)</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>-</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Inventories</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>-</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>20,000</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposits
  and other</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(80,000)</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>-</p>
  </td>
 </tr>
 <tr style='height:3.75pt'>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt;
  height:3.75pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (Decrease)
  increase in:</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt;
  height:3.75pt'></td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt;
  height:3.75pt'></td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accounts
  payable</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>346,000</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(263,000)</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Accrued
  liabilities and deferred income</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>318,000</u></p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(164,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net
  cash used in operating activities from continuing operations</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(564,000)</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(736,000)</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net
  cash used in operating activities from discontinued operations</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(144,000)</u></p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(85,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;Net
  cash used in operating activities</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(708,000)</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(821,000)</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>CASH FLOWS
  USED IN INVESTING ACTIVITIES</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Proceeds
  from the sale of restaurants</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>100,000</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>-</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Payments
  for the purchase of property and equipment</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(54,000)</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(277,000)</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Loans
  made to franchisees and to others</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>-</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(31,000)</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Payments
  received on loans to franchisees and to others</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>15,000</u></p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>26,000</u></p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net
  cash provided by (used in) investing activities</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>61,000</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(282,000)</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>CASH FLOWS
  FROM FINANCING ACTIVITIES:</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Principal
  payments on notes payable, and long-term debt</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(105,000)</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(91,000)</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Borrowings
  on notes payable and long-term debt</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>400,000</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>185,000</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net
  Proceeds (repayments) on revolving lines of credit</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>-</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>320,000</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Distributions,
  net of contributions paid to non-controlling interests</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>59,000</u></p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>(54,000)</u></p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net
  cash provided by financing activities</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>354,000</u></p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>360,000</u></p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>NET CHANGE
  IN CASH AND CASH EQUIVALENTS</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(293,000)</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(743,000)</p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>CASH AND
  CASH EQUIVALENTS, beginning of period</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>$815,000</u></p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>$1,414,000</u></p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>CASH AND
  CASH EQUIVALENTS, end of period</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>$522,000</u></p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>$671,000</u></p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>SUPPLEMENTAL
  DISCLOSURES OF CASH FLOW INFORMATION:</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Cash
  paid for interest</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>$219,000</u></p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>$207,000</u></p>
  </td>
 </tr>
 <tr>
  <td width="66%" valign=top style='width:66.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Non-cash
  fair value of warrants and beneficial conversion feature issued</p>
  <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; with
  debt</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>$277,000</u></p>
  </td>
  <td width="18%" style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>$42,000</u></p>
  </td>
 </tr>
</table>

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

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

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

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

<p align=center style='text-align:center'><b>(Unaudited)</b></p>

<p class=MsoFooter><b>Note 1.
Basis of Presentation</b></p>

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<p><b>&nbsp;</b></p>

<p>In the opinion of management,
the accompanying unaudited condensed consolidated financial statements contain
all of the normal recurring adjustments necessary to present fairly the
financial position of the Company as of June 30, 2010, the results of its
operations and its cash flows for the three and nine month periods ended June
30, 2010. Operating results for the three and nine month periods ended June 30,
2010 are not necessarily indicative of the results that may be expected for the
year ending September 30, 2010. The condensed consolidated balance sheet as of
September 30, 2009 is derived from the audited financial statements, but does
not include all disclosures required by generally accepted accounting
principles. As a result, these financial statements should be read in
conjunction with the Company's Form 10-K for the fiscal year ended September
30, 2009.</p>

<p>Effective October 1, 2009, we
adopted new accounting standards relating to non-controlling interests in
consolidated financial statements. The new accounting guidance established
accounting and reporting standards that require non-controlling interests to be
reported as a component of equity, changes in a parent's ownership interest
while the parent retains its controlling interest to be accounted for as equity
transactions, and any retained non-controlling equity investment upon the
deconsolidation of a subsidiary to be initially measured at fair value. The
adoption of this new accounting guidance primarily resulted in moving the
presentation of non-controlling interest to the &quot;Stockholders'
Equity&quot; section of our condensed consolidated balance sheet.</p>



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<p><b>Note 2. Liquidity</b></p>

<p>As of June 30, 2010, we had a
working capital deficit of $2,378,000 due primarily to the following: 1) the
entire note payable to Wells Fargo Bank, N.A. of $755,000 is shown as a current
liability due to certain loan covenant defaults that existed as of June 30,
2010; 2) an $85,000 current liability related to the unrealized loss on our
interest rate swap, as described in Note 10 below; 3) a current liability of
approximately $430,000 related to 2009 accrued property taxes which will be
paid out of cash generated from operations through the end of fiscal 2010; 4) a
$185,000 bridge loan that was due July 15, 2010 on which we are continuing to
make monthly payments of interest only; and 5) a $400,000 bridge loan with a
maturity date of December 31, 2010. We anticipate both of the bridge loans
being paid out of the proceeds from a larger recapitalization event.</p>

<p>For the nine months ended
June 30, 2010 we used approximately $708,000 for operating activities. If we
are unable to raise additional operating capital during the remainder of fiscal
2010 we may not be able to satisfy our liabilities as they come due and we may
be required to sell additional assets on terms which may not be as favorable as
they otherwise would be.</p>

<p><b>Note 3. Recent
Developments</b></p>

<p><i>Sale and Closing of
Restaurants</i></p>

<p>In March 2010 we closed one
company-owned dual branded restaurant in Commerce City, Colorado and entered
into a long-term sublease with a third party. In June 2010 we closed one
underperforming co-developed restaurant in Denver, Colorado and we are currently
negotiating a contract to sell the restaurant and terminate the ground lease.
See Note 5. below - Discontinued Operations.</p>

<p>On June 1, 2010 we sold our
interest in one co-developed restaurant in Denver, Colorado to a new franchisee
owner operator. The sale resulted in net cash proceeds of $100,000 and a loss
on the sale of $64,000.</p>

<p><i>New Loan Agreement</i></p>

<p>As reported on Form 8k dated
February 3, 2010, the Company entered into a loan agreement with W Capital,
John T. MacDonald and Golden Bridge, LLC (collectively &quot;the Lender&quot;),
pursuant to which the Lender made a loan of $200,000, with up to an additional
$200,000 loan available through April 30, 2010 (the &quot;Loan&quot;), to be
used for restaurant marketing and other working capital uses of the Company. At
June 30, 2010 the entire $400,000 had been advanced to the Company. </p>



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<p>The Loan is evidenced by a
Convertible Secured Promissory Note dated February 1, 2010 (the
&quot;Note&quot;) made by the Company and shall bear interest at a rate of 12%
per annum on the unpaid principal balance through August 1, 2010. The maturity
date for payment of all principal and interest on the Note is December 31,
2010. However, if and to the extent that any portion of the Note is still
outstanding after August 1, 2010, the interest rate will increase to 14% per
annum from and after August 1, 2010 until the maturity date. All interest
accrues through the maturity date. The Loan Agreement contains customary event
of default provisions and a cross-default provision with respect to the loan
agreement for the Wells Fargo Bank and PFGI II, LLC loans in the event of
payment default on either of those loans. Upon the occurrence and continuance
of an event of default, the Lender may declare all or part of the unpaid
principal and accrued and unpaid interest on the Loan due and payable. Any
amounts not paid to the Lender when due will bear interest from the due date
until paid at a rate of 16% per annum.</p>

<p>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 GTDT's restaurants that were not
previously pledged as collateral under the Wells Fargo Bank or PFGI II, LLC
borrowings. The Note is convertible into shares of common stock of the Company
(the &quot;Conversion Shares&quot;) 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, provided however that
the conversion price shall not be below $.75 per share nor above $1.08 per share
(the &quot;Conversion Price&quot;).</p>

<p>In connection with the Loan,
the Company issued warrants dated February 1, 2010 (the &quot;Warrants&quot;)
to the Lender which provides that the Lender may at any time from February 1,
2010 until two years from the date of repayment or conversion of the Loan
purchase up to an aggregate of 50,000 shares of the Company's common stock (the
&quot;Warrant Shares&quot;) at an exercise price that is equal to the
Conversion Price calculation above. If the Loan is not repaid prior to August 1,
2010, the Company will issue warrants for the purchase of 50,000 additional
shares of the Company's common stock upon the same terms as the initial
Warrants. The number of Warrant Shares 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.</p>

<p>Effective April 1, 2010 and
as reported on Form 8k the Company entered into a First Amendment to Loan Agreement
(the &quot;First Amendment&quot;) which amends that certain Loan Agreement,
dated February 1, 2010 (the &quot;Loan Agreement&quot;). As a result of
regulatory concerns, the effect of the First Amendment was to replace Golden
Bridge as a Lender Party under the Loan Agreement with W Capital and McDonald
on the same terms and conditions that applied to Golden Bridge. </p>

<p>Pursuant to the First
Amendment, the Secured Convertible Promissory Note, dated February 1, 2010,
issued by the Company and GTDT to Golden Bridge, W Capital and McDonald, was
cancelled in its entirety. The Company issued a new Secured Convertible
Promissory Note (the &quot;New Note&quot;) to W Capital and McDonald dated
April 1, 2010. </p>



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<p>The fair value of the
warrants of $38,000 will be accredited to interest over the term of the loan.
The intrinsic value of the embedded beneficial conversion feature of $161,000
will be accredited to interest over the term of the loan.</p>

<p><i>PFGI II LLC Amended Loan
Agreement</i></p>

<p>Effective January 2, 2010 and
as reported on Form 8k, the Company entered into an agreement to amend its loan
with PFGI II LLC. 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
also issued in January 2010 112,612 warrants exercisable at $1.11. The fair
value of the warrants of $79,000 will be accredited to interest over the term
of the loan.</p>

<p><i>Special Committee
Formation</i></p>

<p>On August 14, 2009 and as
reported on our Form 10k for the period ending September 30, 2009, we announced
that our Board of Directors has formed a Special Committee comprised of
directors Richard Stark, Alan Teran and Geoff Bailey to explore and evaluate
strategic alternatives aimed at enhancing shareholder value and explore
alternatives to reduce the cost burdens of being a publicly held entity. The
Company has hired Mastodon Ventures, Inc. to provide strategic advisory
services and explore other strategic alternatives intended to further the
long-term&nbsp;business prospects of the Company and provide incremental value
to its shareholders. </p>

<p>There can be no assurance
regarding the timing of or whether the Board will elect to pursue any of the
strategic alternatives it may consider, or that any such alternatives will
result in changes to the Company's plans or will be consummated and there is no
certainty that any&nbsp;strategic alternative will involve a transaction for
shareholders at a share price&nbsp;equal to&nbsp;or above the
current&nbsp;trading&nbsp;price of the Company's shares, bearing in mind that
the trading market for the Company's shares is relatively inactive and that the
Company has&nbsp;realized losses from operations during recent
periods.&nbsp;&nbsp;The Company does not intend to provide updates or make any
further comment until the outcome of the process is determined or until there
are significant developments. We anticipate that we will extend the agreement
with Mastodon Ventures, Inc. beyond the initial six month engagement period.</p>

<p><b>Note 4. Debt Covenant
Compliance</b></p>



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<p>As reported on the form 8-K
filed on January 23, 2009, we are in default of certain technical loan
covenants on our note payable to Wells Fargo Bank, N.A. (&quot;the Bank&quot;).
Therefore all amounts owing under this facility are reflected as current in the
accompanying Condensed Consolidated Balance Sheet as of June 30, 2010. We have
never been in payment default on the note. On February 9, 2009 we received a
Reservation of Rights letter from the Bank formally notifying us of the default
of the Earnings Before Interest Taxes and Depreciation (&quot;EBITDA&quot;)
Coverage Ratio of not less than 1.5 to 1.0 and the Tangible Net Worth of not
less than $5,000,000 as set forth in the Credit Agreement for the period ending
December 31, 2008. The letter serves as notice that notwithstanding the
foregoing events of default, the Bank is reserving all of its rights and
remedies under the Credit Agreement and related agreements.</p>

<p>The Bank is not accelerating
the Loan at this time and is continuing to accept regularly scheduled payments
of principal and interest under the Loan, however the acceptance of payments
under the Loan does not constitute a modification of the Credit Agreement or a
waiver of any of the covenants or of the Bank's rights or remedies under the
Credit Agreement, including the right to accelerate the loan in the future
after the giving of notice. We will continue to work with the Bank on a
Required Corrective Action for compliance with existing or modified loan
covenants. There can be no assurance that the Bank will agree to modify or
waive any of the loan covenants or waive any of its rights or remedies under
the Credit Agreement and we would require additional financing to repay the
loan balance. The loan is secured by security agreements in the equipment of
four restaurants.</p>

<p><b>Note 5. Discontinued
Operations</b></p>

<p>During the six months ended
June 30, 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>Following is a summary of the
costs from discontinued operations for the current and prior year periods:</p>

<div align=center>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=576
 style='width:6.0in'>
 <tr style='height:12.0pt'>
  <td width="32%" valign=bottom style='width:32.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>

  </td>
  <td width="32%" valign=bottom style='width:32.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>Three
  Months Ended</p>
  </td>
  <td width="4%" valign=top style='width:4.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'></td>
  <td width="33%" valign=bottom style='width:33.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>Nine
  Months Ended</p>
  </td>
 </tr>
 <tr style='height:12.0pt'>
  <td width="32%" valign=bottom style='width:32.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>

  </td>
  <td width="32%" valign=bottom style='width:32.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>June
  30,</p>
  </td>
  <td width="4%" valign=top style='width:4.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'></td>
  <td width="33%" valign=bottom style='width:33.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>June
  30,</p>
  </td>
 </tr>
</table>

</div>



<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=606
 style='width:454.5pt'>
 <tr style='height:14.25pt'>
  <td width="36%" valign=top style='width:36.0%;padding:.75pt .75pt .75pt .75pt;
  height:14.25pt'>

  </td>
  <td width="16%" valign=top style='width:16.0%;padding:.75pt .75pt .75pt .75pt;
  height:14.25pt'>
  <p align=center style='text-align:center'><u>2010</u></p>
  </td>
  <td width="13%" valign=top style='width:13.0%;padding:.75pt .75pt .75pt .75pt;
  height:14.25pt'>
  <p align=center style='text-align:center'><u>2009</u></p>
  </td>
  <td width="3%" valign=top style='width:3.0%;padding:.75pt .75pt .75pt .75pt;
  height:14.25pt'></td>
  <td width="18%" valign=top style='width:18.0%;padding:.75pt .75pt .75pt .75pt;
  height:14.25pt'>
  <p align=center style='text-align:center'><u>2010</u></p>
  </td>
  <td width="15%" valign=top style='width:15.0%;padding:.75pt .75pt .75pt .75pt;
  height:14.25pt'>
  <p align=center style='text-align:center'><u>2009</u></p>
  </td>
 </tr>
 <tr style='height:12.0pt'>
  <td width="36%" valign=top style='width:36.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p>Results of operations</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>$31,000</p>
  </td>
  <td width="13%" valign=top style='width:13.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>$42,000</p>
  </td>
  <td width="3%" valign=top style='width:3.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'></td>
  <td width="18%" valign=top style='width:18.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>$166,000</p>
  </td>
  <td width="15%" valign=top style='width:15.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>$153,000</p>
  </td>
 </tr>
 <tr style='height:12.0pt'>
  <td width="36%" valign=top style='width:36.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p>Future lease obligations,
  fair value</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>49,000</p>
  </td>
  <td width="13%" valign=top style='width:13.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>-</p>
  </td>
  <td width="3%" valign=top style='width:3.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'></td>
  <td width="18%" valign=top style='width:18.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>168,000</p>
  </td>
  <td width="15%" valign=top style='width:15.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>-</p>
  </td>
 </tr>
 <tr style='height:12.0pt'>
  <td width="36%" valign=top style='width:36.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p>Asset impairment charges
  and other costs</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>46,000</p>
  </td>
  <td width="13%" valign=top style='width:13.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>-</p>
  </td>
  <td width="3%" valign=top style='width:3.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'></td>
  <td width="18%" valign=top style='width:18.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>263,000</p>
  </td>
  <td width="15%" valign=top style='width:15.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>-</p>
  </td>
 </tr>
 <tr style='height:12.0pt'>
  <td width="36%" valign=top style='width:36.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p>Loss&nbsp;from discontinued
  operations</p>
  </td>
  <td width="16%" valign=top style='width:16.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>$126,000</p>
  </td>
  <td width="13%" valign=top style='width:13.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>$42,000</p>
  </td>
  <td width="3%" valign=top style='width:3.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'></td>
  <td width="18%" valign=top style='width:18.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>$597,000</p>
  </td>
  <td width="15%" valign=top style='width:15.0%;padding:.75pt .75pt .75pt .75pt;
  height:12.0pt'>
  <p align=center style='text-align:center'>$153,000</p>
  </td>
 </tr>
</table>

<p><b>&nbsp;</b></p>



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<p><b>With respect to the closed
locations, we have continuing lease obligations of $1,111,000. We have
subleased the Commerce City location for $642,000. We anticipate we can
sublease the Denver location within six months and we have recorded an
estimated liability of $35,000. To the extent that we are not successful in our
efforts to sublease the Denver location within this estimated time period
additional losses may be recorded in future periods.</b></p>

<p><b>Note 6. Stock-Based
Compensation</b></p>

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

<p>Our net loss for the nine
months ended June 30, 2010 and June 30, 2009 includes $66,000 and $58,000,
respectively, of compensation costs related to our stock-based compensation
arrangements.</p>

<p>During the nine months ended
June 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>In addition to the exercise
and grant date prices of the awards, certain weighted average assumptions that
were used to estimate the fair value of stock option grants are listed in the
following table:</p>

<div align=center>

<table class=MsoNormalTable border=1 cellspacing=1 cellpadding=0 width=588
 style='width:441.0pt;border:outset black 1.0pt'>
 <tr>
  <td width="29%" valign=top style='width:29.0%;border:inset black 1.0pt;
  padding:.75pt .75pt .75pt .75pt'>

  </td>
  <td width="33%" valign=top style='width:33.0%;border:inset black 1.0pt;
  padding:.75pt .75pt .75pt .75pt'>
  <p align=center style='text-align:center'><b>Incentive
  Stock Options</b></p>
  </td>
  <td width="39%" valign=top style='width:39.0%;border:inset black 1.0pt;
  padding:.75pt .75pt .75pt .75pt'>
  <p align=center style='text-align:center'><b>Non-Statutory
  Stock Options</b></p>
  </td>
 </tr>
 <tr>
  <td width="29%" valign=top style='width:29.0%;border:inset black 1.0pt;
  background:silver;padding:.75pt .75pt .75pt .75pt'>
  <p>Expected term (years)</p>
  </td>
  <td width="33%" valign=top style='width:33.0%;border:inset black 1.0pt;
  background:silver;padding:.75pt .75pt .75pt .75pt'>
  <p align=center style='text-align:center'><b>6.5&nbsp;</b></p>
  </td>
  <td width="39%" valign=top style='width:39.0%;border:inset black 1.0pt;
  background:silver;padding:.75pt .75pt .75pt .75pt'>
  <p align=center style='text-align:center'>6.7&nbsp;</p>
  </td>
 </tr>
 <tr>
  <td width="29%" valign=top style='width:29.0%;border:inset black 1.0pt;
  background:white;padding:.75pt .75pt .75pt .75pt'>
  <p>Expected volatility</p>
  </td>
  <td width="33%" valign=top style='width:33.0%;border:inset black 1.0pt;
  background:white;padding:.75pt .75pt .75pt .75pt'>
  <p align=center style='text-align:center'><b>82.4%</b></p>
  </td>
  <td width="39%" valign=top style='width:39.0%;border:inset black 1.0pt;
  background:white;padding:.75pt .75pt .75pt .75pt'>
  <p align=center style='text-align:center'>81.9%</p>
  </td>
 </tr>
 <tr>
  <td width="29%" valign=top style='width:29.0%;border:inset black 1.0pt;
  background:silver;padding:.75pt .75pt .75pt .75pt'>
  <p>Risk-free interest rate</p>
  </td>
  <td width="33%" valign=top style='width:33.0%;border:inset black 1.0pt;
  background:silver;padding:.75pt .75pt .75pt .75pt'>
  <p align=center style='text-align:center'><b>2.84%</b></p>
  </td>
  <td width="39%" valign=top style='width:39.0%;border:inset black 1.0pt;
  background:silver;padding:.75pt .75pt .75pt .75pt'>
  <p align=center style='text-align:center'>2.90%</p>
  </td>
 </tr>
 <tr>
  <td width="29%" valign=top style='width:29.0%;border:inset black 1.0pt;
  background:white;padding:.75pt .75pt .75pt .75pt'>
  <p>Expected dividends</p>
  </td>
  <td width="33%" valign=top style='width:33.0%;border:inset black 1.0pt;
  background:white;padding:.75pt .75pt .75pt .75pt'>
  <p align=center style='text-align:center'><b>0</b></p>
  </td>
  <td width="39%" valign=top style='width:39.0%;border:inset black 1.0pt;
  background:white;padding:.75pt .75pt .75pt .75pt'>
  <p align=center style='text-align:center'>0</p>
  </td>
 </tr>
</table>

</div>

<p>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>



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<p>SFAS 123(R) requires the cash
flows resulting from the tax benefits for tax deductions in excess of the
compensation expense recorded for those options (excess tax benefits) to be
classified as financing cash flows. These excess tax benefits were $0 for the
three and nine month periods ended June 30, 2010.</p>

<p>A summary of stock option
activity under our share-based compensation plan for the nine months ended June
30, 2010 is presented in the following table:</p>

<div align=center>

<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=651
 style='width:488.25pt'>
 <tr>
  <td width="29%" valign=top style='width:29.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'><a
  name="OLE_LINK1"></a></td>
  <td width="13%" valign=bottom style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b><u>Options</u></b></p>
  </td>
  <td width="19%" valign=bottom style='width:19.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>Weighted
  Average <u>Exercise Price</u></b></p>
  </td>
  <td width="23%" valign=bottom style='width:23.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>Weighted
  Average Remaining Contractual</b></p>
  <p align=center style='text-align:center'><b><u>Life (Yrs.)</u></b></p>
  </td>
  <td width="15%" valign=bottom style='width:15.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>Aggregate
  Intrinsic <u>Value</u></b></p>
  </td>
 </tr>
 <tr>
  <td width="29%" valign=top style='width:29.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Outstanding-beg of year</p>
  </td>
  <td width="13%" valign=top style='width:13.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>379,231</p>
  </td>
  <td width="19%" valign=top style='width:19.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>$3.55</p>
  </td>
  <td width="23%" valign=top style='width:23.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="15%" valign=top style='width:15.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="29%" valign=top style='width:29.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Granted</p>
  </td>
  <td width="13%" valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>42,606</p>
  </td>
  <td width="19%" valign=top style='width:19.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>$1.15</p>
  </td>
  <td width="23%" valign=top style='width:23.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="15%" valign=top style='width:15.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="29%" valign=top style='width:29.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Exercised</p>
  </td>
  <td width="13%" valign=top style='width:13.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>-</p>
  </td>
  <td width="19%" valign=top style='width:19.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="23%" valign=top style='width:23.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="15%" valign=top style='width:15.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="29%" valign=top style='width:29.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Forfeited </p>
  </td>
  <td width="13%" valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>&nbsp;
  -</p>
  </td>
  <td width="19%" valign=top style='width:19.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="23%" valign=top style='width:23.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="15%" valign=top style='width:15.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="29%" valign=top style='width:29.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Expired</p>
  </td>
  <td width="13%" valign=top style='width:13.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>&nbsp;<u>(24,431)</u></p>
  </td>
  <td width="19%" valign=top style='width:19.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><a name="OLE_LINK4"><u>$3.</u></a><u>12</u></p>
  </td>
  <td width="23%" valign=top style='width:23.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="15%" valign=top style='width:15.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="29%" valign=top style='width:29.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Outstanding Jun 30, 2010</p>
  </td>
  <td width="13%" valign=top style='width:13.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>397,406</u></p>
  </td>
  <td width="19%" valign=top style='width:19.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>$3.32</u></p>
  </td>
  <td width="23%" valign=top style='width:23.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><u>5.6</u></p>
  </td>
  <td width="15%" valign=top style='width:15.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><u>$0</u></p>
  </td>
 </tr>
 <tr>
  <td width="29%" valign=top style='width:29.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Exercisable Jun 30, 2010</p>
  </td>
  <td width="13%" valign=top style='width:13.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>274,510</u></p>
  </td>
  <td width="19%" valign=top style='width:19.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><u>$3.77</u></p>
  </td>
  <td width="23%" valign=top style='width:23.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><u>4.4</u></p>
  </td>
  <td width="15%" valign=top style='width:15.0%;background:silver;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><u>$0</u></p>
  </td>
 </tr>
</table>

</div>

<p>As of June 30, 2010, the
total remaining unrecognized compensation cost related to unvested stock-based
arrangements was $73,000 and is expected to be recognized over a period of 2.33
years. </p>

<p>There were no stock options
exercised during the nine months ended June 30, 2010.</p>

<p><b>Note 7. Comprehensive
Income (Loss)</b></p>

<p>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>In May 2007, the Company
entered into an interest rate swap agreement, designated as a cash flow hedge,
which hedges the Company's exposure to interest rate fluctuations on the
Company's floating rate $1,100,000 term loan. The contract requires monthly
settlements of the difference between the amounts to be received and paid under
the agreement, the amount of which is recognized in current earnings as
interest expense.</p>



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<p>As of December 31, 2008 and
continuing through June 30, 2010 we are in default of certain technical
covenants on the underlying term loan (see note 3 above) and we have therefore
recognized an unrealized gain of $3,000 for the nine months ended June 30, 2010
in the accompanying Condensed Consolidated Statement of Operations. As long as
the underlying loan is in covenant default we will adjust the unrealized gain
or loss through the statement of operations as non-cash income or expense.</p>

<p><b>Note 8. Contingent
Liabilities</b></p>

<p>We remain contingently liable
on various land leases underlying restaurants that were previously sold to
franchisees. 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. 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><b>Note 9. Related Party
Transactions</b></p>

<p>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 to the Company. Eric Reinhard, Ron
Goodson, David Grissen, Richard Stark, and Alan Teran, who are all members of
the Company's Board of Directors and stockholders of the Company, are the sole
members of Golden Bridge. Eric Reinhard is the sole manager of Golden Bridge.
The Company's and GTDT's obtaining
of the Loan from Golden Bridge and related transactions were 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;&nbsp; See Item
2, <i>Financing Transactions</i> below for the terms of the loan.&nbsp; Amounts
due to related parties that are included in notes payable are $185,000 at June
30, 2010 and 2009.</p>

<p><b>Note 10. Assets Held for
Sale</b></p>

<p>We have classified $1,595,000
as assets held for sale in the accompanying condensed consolidated balance
sheet. These costs are related to a site in Firestone, Colorado which has been
fully developed. The proceeds of a sale leaseback transaction, if consummated,
are required to be used for the reduction of the line of credit payable to PFGI
II, LLC. The effect on our operating cash flow is not material as the interest
expense on the line of credit is approximately equal to the proposed rental
rate on a sale leaseback transaction.</p>

<p><b>Note 11. Impairment of
Long-Lived Assets</b></p>



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<p>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>An analysis was performed on
a restaurant by restaurant basis at June 30, 2010. Assumptions used in
preparing expected cash flows were as follows: </p>

<ul type=disc>
 <ul type=circle>
  <li class=MsoNormal>Sales
      projections are as follows: Fiscal 2010 sales are projected to be down
      3-5% with respect to fiscal 2009, for fiscal years 2011 to 2024 we have
      used annual increases of 2% to 3%. We believe the 2% to 3% increase in
      the years beyond 2010 is a reasonable expectation of growth and that it
      would be unreasonable to expect less 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% per year.</li>
  <li class=MsoNormal>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>Our other
      fixed restaurant operating costs are projected to increase 1.5% to 2% per
      year.</li>
  <li class=MsoNormal>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>Salvage
      value has been estimated on a restaurant by restaurant basis considering
      each restaurant's particular equipment package and building size.</li>
 </ul>
</ul>

<p>Given the results of our
impairment analysis at June 30, 2010 we did not record any impairment as their
projected undiscounted cash flows show recoverability of their asset values.</p>

<p>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. 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>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>



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<p>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>To date we have not written
down any assets due to impairment, however 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><b>Note 12. Fair Value
Measurements</b></p>

<p>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.</p>

<p>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>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>

<p>Level 1: Quoted market prices
in active markets for identical assets and liabilities.</p>

<p>Level 2: Observable inputs
other than defined in Level 1, such as quoted prices for similar assets or
liabilities; quoted prices in markets that are not active; or other inputs that
are observable or can be corroborated by observable market data for substantially
the full term of the assets or liabilities.</p>

<p>Level 3: Unobservable inputs
that are not corroborated by observable market data.</p>

<p>The following table
summarizes financial assets and liabilities that are measured at fair value on
a recurring basis as of June 30, 2010:</p>



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<p style='margin-left:2.0in'>Level
2</p>

<p style='margin-left:2.0in'>Interest
Rate Swap liability  $85,000</p>

<p><b>Note 13. Income Taxes</b></p>

<p>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. We believe it is more likely than not that the
recorded deferred tax assets will be realized.</p>

<p>Although the Company has not
incurred interest and penalties associated with unrecognized tax benefits;
future interest and penalties associated with unrecognized tax benefits, if
any, will be recognized in income tax expense in the Consolidated Statements of
Operations and the corresponding liability in&nbsp;income taxes payable or
income taxes receivable, net on the Consolidated Balance Sheets.</p>

<p>The Company is currently not
undergoing any examinations by any taxing jurisdictions, with the tax years for
the Fiscal Years Ending September 30, 2005 through 2009 remaining open to
examination.</p>

<p><b>Note 14. Non-controlling
Interests</b></p>

<p>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><b>Note 15. Subsequent Events</b></p>



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<p>The Company adopted the
provisions of FASB ASC 855, Subsequent Events, effective October&nbsp;1,
2009.&nbsp;&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. Subsequent events have
been evaluated through the date our interim financial statements were issued
with the filing of this Quarterly Report on Form 10-Q.</p>

<p><b>Note 16. Recent Accounting
Pronouncements</b></p>

<p>In January&nbsp;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&nbsp;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>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 June 30, 2010. The adoption of FASB ASC 105 did not
impact the Company's financial position or results of operations.</p>

<p>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 will
require 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>



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<p>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. This accounting
pronouncement was effective for our fiscal year beginning October 1, 2009. 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><b>Note 17. Stock
Transactions</b></p>

<p>None.</p>

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

<p><b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; AND RESULTS OF
OPERATIONS</b></p>

<p><b><u>General</u></b></p>

<p>This Form 10-Q contains or
incorporates by reference forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended and the disclosure of
risk factors in the Company's form 10-K for the fiscal year ended September 30,
2009. Also, documents subsequently filed by us with the SEC and incorporated
herein by reference may contain forward-looking statements. We caution
investors that any forward-looking statements made by us are not guarantees of
future performance and actual results could differ materially from those in the
forward-looking statements as a result of various factors, including but not
limited to the following:</p>

<ol start=1 type=I>
 <li class=MsoNormal>We compete
     with numerous well established competitors who have substantially greater
     financial resources and longer operating histories than we do. Competitors
     have increasingly offered selected food items and combination meals,
     including hamburgers, at discounted prices, and continued discounting by
     competitors may adversely affect revenues and profitability of Company
     restaurants.</li>
 <li class=MsoNormal>We may be
     negatively impacted if we continue to experience consistent same store
     sales declines. Same store sales comparisons will be dependent, among
     other things, on the success of our advertising and promotion of new and
     existing menu items. No assurances can be given that such advertising and
     promotions will in fact be successful.</li>
</ol>

<p>We may also be negatively
impacted by other factors common to the restaurant industry such as: changes in
consumer tastes away from red meat and fried foods; increases in the cost of
food, paper, labor, health care, workers' compensation or energy; inadequate number
of hourly paid employees; and/or decreases in the availability of affordable
capital resources. We caution the reader that such risk factors are not
exhaustive, particularly with respect to future filings.</p>



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<p><i>Restaurant Locations</i></p>

<p>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. Seven of these
restaurants are &quot;dual brand&quot;, operated pursuant to a Dual Brand Test
Agreement with Taco John's International, of which there is one in North
Dakota, two in Wyoming, and four in Colorado.</p>

<table class=MsoNormalTable border=1 cellpadding=0 width=720 style='width:7.5in'>
 <tr>
  <td width="37%" valign=top style='width:37.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="7%" valign=bottom style='width:7.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>Total</b></p>
  </td>
  <td width="14%" valign=bottom style='width:14.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>Denver, CO</b></p>
  <p align=center style='text-align:center'><b>Greater Metro</b></p>
  </td>
  <td width="11%" valign=bottom style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>Colorado</b></p>
  <p align=center style='text-align:center'><b>Other</b></p>
  </td>
  <td width="8%" valign=bottom style='width:8.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>Idaho</b></p>
  </td>
  <td width="12%" valign=bottom style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>Wyoming</b></p>
  </td>
  <td width="11%" valign=bottom style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>North Dakota</b></p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign=top style='width:37.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Good Times co-owned &amp;
  co-developed</p>
  </td>
  <td width="7%" valign=top style='width:7.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>25</p>
  </td>
  <td width="14%" valign=top style='width:14.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>22</p>
  </td>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>3</p>
  </td>
  <td width="8%" valign=top style='width:8.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="37%" valign=top style='width:37.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Good Times franchised</p>
  </td>
  <td width="7%" valign=top style='width:7.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>17</p>
  </td>
  <td width="14%" valign=top style='width:14.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>14</p>
  </td>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>2</p>
  </td>
  <td width="8%" valign=top style='width:8.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>1</p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="37%" valign=top style='width:37.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Dual brand co-owned</p>
  </td>
  <td width="7%" valign=top style='width:7.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>2</p>
  </td>
  <td width="14%" valign=top style='width:14.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>2</p>
  </td>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="8%" valign=top style='width:8.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="37%" valign=top style='width:37.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Dual brand franchised</p>
  </td>
  <td width="7%" valign=top style='width:7.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>5</p>
  </td>
  <td width="14%" valign=top style='width:14.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>2</p>
  </td>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="8%" valign=top style='width:8.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>2</p>
  </td>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>1</p>
  </td>
 </tr>
 <tr>
  <td width="37%" valign=top style='width:37.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><b>Total</b></p>
  </td>
  <td width="7%" valign=top style='width:7.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>49</b></p>
  </td>
  <td width="14%" valign=top style='width:14.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>40</b></p>
  </td>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>5</b></p>
  </td>
  <td width="8%" valign=top style='width:8.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>1</b></p>
  </td>
  <td width="12%" valign=top style='width:12.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>2</b></p>
  </td>
  <td width="11%" valign=top style='width:11.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>1</b></p>
  </td>
 </tr>
</table>



<table class=MsoNormalTable border=1 cellpadding=0 width=433 style='width:324.75pt'>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>


  </td>
  <td width="49%" colspan=2 valign=top style='width:49.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>As
  of June 30</b></p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="25%" valign=top style='width:25.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>2009</b></p>
  </td>
  <td width="25%" valign=top style='width:25.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>2010</b></p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Company-owned restaurants</p>
  </td>
  <td width="25%" valign=top style='width:25.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>21</p>
  </td>
  <td width="25%" valign=top style='width:25.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>20</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Co-developed restaurants</p>
  </td>
  <td width="25%" valign=top style='width:25.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>9</p>
  </td>
  <td width="25%" valign=top style='width:25.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>7</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Franchise operated
  restaurants</p>
  </td>
  <td width="25%" valign=top style='width:25.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>22</p>
  </td>
  <td width="25%" valign=top style='width:25.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>22</p>
  </td>
 </tr>
 <tr>
  <td width="51%" valign=top style='width:51.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'><b>Total
  restaurants</b></p>
  </td>
  <td width="25%" valign=top style='width:25.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>52</b></p>
  </td>
  <td width="25%" valign=top style='width:25.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'><b>49</b></p>
  </td>
 </tr>
</table>

<p><i>&nbsp;</i></p>



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<p><i>Fiscal 2009:</i> In October 2008 we opened one new
company-owned restaurant in Firestone, Colorado. In December 2008 a Wyoming
franchisee terminated their Good Times franchise agreement in the dual brand
concept and has stopped selling Good Times products in one location. Also in
December 2008 a franchisee opened a new dual brand restaurant in Sheridan,
Wyoming.</p>

<p><i>Fiscal 2010:</i> In October 2009 a franchisee
operating a Good Times restaurant in Thornton, Colorado terminated their
franchise agreement and closed the restaurant. In March 2010 we closed one
company-owned dual branded restaurant in Commerce City, Colorado and in June
2010 we closed one co-developed Good Times restaurant in Denver, Co (see Note
5. above - Discontinued Operations). Additionally in June 2010 we sold one co-developed
restaurant in Denver, Co to a new franchisee operator. We anticipate that we
may close up to three low volume franchised restaurants in fiscal 2010. </p>

<p>The following presents
certain historical financial information of our operations. This financial
information includes results for the three and nine months ended June 30, 2010
and results for the three and nine months ended June 30, 2009.</p>

<p><b><u>Results of Operations</u></b></p>

<p><i>Net Revenues</i></p>

<p>Net revenues for the three
months ended June 30, 2010 decreased $464,000 (7.7%) to $5,565,000 from
$6,029,000 for the three months ended June 30, 2009. Same store restaurant
sales decreased $315,000 (6.3%) during the three months ended June 30, 2010 for
the restaurants that were open for the full three month periods ending June 30,
2010 and June 30, 2009. Restaurants are included in same store sales after they
have been open a full fifteen months and only Good Times restaurants are
included with dual branded restaurants excluded. Restaurant sales decreased
$94,000 due to one co-developed store sold to a franchisee in June 2010.
Restaurant sales decreased $36,000 due to two company-owned dual branded
restaurants not included in same store sales. Restaurant sales decreased $8,000
due to one non-traditional company-owned restaurant not included in same store
sales.</p>

<p>Net revenues for the nine
months ended June 30, 2010 decreased $1,575,000 (9.4%) to $15,102,000 from
$16,677,000 for the nine months ended June 30, 2009. Same store restaurant
sales decreased $1,237,000 (9.0%) during the nine months ended June 30, 2010
for the restaurants that were open for the full nine month periods ending June
30, 2010 and June 30, 2009. Restaurants are included in same store sales after
they have been open a full fifteen months and only Good Times restaurants are
included with dual branded restaurants excluded. Restaurant sales decreased
$136,000 due to one co-developed store sold to a franchisee in June 2010.
Restaurant sales decreased $61,000 due to two company-owned dual branded
restaurants not included in same store sales. Restaurant sales decreased
$80,000 due to one non-traditional company-owned restaurant not included in
same store sales.</p>



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<p>Our first, second and third
quarter same store restaurant sales declines of 11.4%, 9.4% and 6.3%,
respectively, reflect the adverse impact the macroeconomic environment is
having on consumers' discretionary spending and the proliferation of heavy
promotion of $1 value menus and discounting by competitors. In addition adverse
weather conditions in October and December 2009, and February and May 2010 had
a negative effect on our restaurant sales. October 2009 in Colorado was the
second coldest and fifth snowiest October on record and a late month snow storm
caused the closure of our restaurants for most of one day. We have experienced
some moderation of our same store sales declines since mid May 2010. June and
July 2010 same store sales were down 1.8% and 1.6%, respectvely.</p>

<p>Our outlook for fiscal 2010
remains cautious as the economic pressures may continue to impact consumer
spending and we anticipate that we will continue to face increased competitive
pricing pressure.</p>

<p>While we are implementing
several broad product and brand initiatives during fiscal 2010 to improve our
core value proposition, we are not planning to implement a broader $1 menu and
our sales may be adversely affected during the economic recession.</p>

<p>Franchise revenues decreased
$11,000 to $127,000 from $138,000 for the three months ended June 30, 2009
primarily due to a decrease in franchise royalties. Same store Good Times
franchise restaurant sales decreased 8% during the three months ended June 30,
2010 for the franchise restaurants that were open for the full periods ending
June 30, 2010 and June 30, 2009. Dual branded franchise restaurant sales decreased
16.6% during the three months ended June 30, 2010, compared to the same prior
year period.</p>

<p>Franchise revenues decreased
$61,000 to $351,000 from $412,000 for the nine months ended June 30, 2010
primarily due to a decrease in franchise royalties. Same store Good Times
franchise restaurant sales decreased 10.7% during the nine months ended June
30, 2010 for the franchise restaurants that were open for the full periods
ending June 30, 2010 and June 30, 2009. Dual branded franchise restaurant sales
decreased 19.4% during the nine months ended June 30, 2010, compared to the
same prior year period.</p>

<p><i>Restaurant Operating Costs</i></p>

<p>Restaurant operating costs as
a percent of restaurant sales were 93.9% during the three months ended June 30,
2010 compared to 91.8% in the same prior year period and were 98.7% during nine
month period ended June 30, 2010 compared to 95.2% in the same prior year
period.</p>

<p>The changes in
restaurant-level costs are explained as follows:</p>



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<table class=MsoNormalTable border=0 cellspacing=0 cellpadding=0 width=685
 style='width:513.75pt'>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>Three
  Months Ended</p>
  <p align=center style='text-align:center'><u>June
  30, 2010</u></p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=center style='text-align:center'>Nine
  Months Ended</p>
  <p align=center style='text-align:center'><u>June
  30, 2010</u></p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  <p>Restaurant-level costs for
  the period ended June 30, 2009</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>91.8%</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>95.2%</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Increase in food and
  packaging costs</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>1.8%</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>1.1%</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Increase in payroll and
  other employee benefit costs</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>1.9%</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>1.5%</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Increase in occupancy and
  other operating costs</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>1.2%</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>2.3%</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Decrease in depreciation
  and amortization</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(.5%)</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(.5%)</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Decrease in opening costs
  and deferred rent</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='margin-left:.5in;text-align:right'>(2.3%)</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>(.9%)</p>
  </td>
 </tr>
 <tr>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>Restaurant-level costs for
  the period ended June 30, 2010</p>
  </td>
  <td width="21%" valign=top style='width:21.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>93.9%</p>
  </td>
  <td width="18%" valign=top style='width:18.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p align=right style='text-align:right'>98.7%</p>
  </td>
 </tr>
</table>

<p><i>Food and Packaging Costs</i></p>

<p>For the three months ended
June 30, 2010 our food and paper costs, decreased $55,000 to $1,956,000 (36% of
restaurant sales) from $2,011,000 (34.1% of restaurant sales) compared to the
same prior year period.</p>

<p>For the nine months ended
June 30, 2010 our food and paper costs, decreased $338,000 to $5,139,000 (34.8%
of restaurant sales) from $5,477,000 (33.7% of restaurant sales) compared to
the same prior year period.</p>

<p>During fiscal 2009 we
experienced a moderation in our food and packaging costs when our weighted food
and packaging costs increased approximately 2%. We took cumulative weighted
menu price increases during fiscal 2009 of approximately 2.6%.</p>

<p>During the nine months ended
June 30, 2010 we experienced an increase in our weighted average food and
packaging costs of 6.2%, including significant increases in beef, bacon and
soda syrup. We anticipate continued upward pressure on our commodity costs for
the balance of fiscal 2010. We implemented an approximately 3.8% weighted average
menu price increase in May 2010, however the effect of the menu price increase
to our restaurant sales was partially offset by the implementation of price
promotions. We are implementing additional price, portion and purchasing
initiatives and anticipate a reduction of 1.5% to 2% in our food and packaging
costs as a percentage of restaurant sales by September 2010. </p>

<p><i>Payroll and Other Employee
Benefit Costs</i></p>

<p>For the three months ended
June 30, 2010 our payroll and other employee benefit costs decreased $50,000 to
$1,905,000 (35% of restaurant sales) from $1,955,000 (33.2% of restaurant
sales) compared to the same prior year period.</p>



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<p>For the nine months ended June
30, 2010 our payroll and other employee benefit costs decreased $313,000 to
$5,438,000 (36.9% of restaurant sales) from $5,751,000 (35.4% of restaurant
sales) compared to the same prior year period.</p>

<p>The increase in payroll and
other employee benefit expenses as a percent of restaurant sales for the three
and nine month periods ended June 30, 2010 is primarily the result of lower
restaurant sales. Because payroll costs are semi-variable in nature they
increase as a percentage of restaurant sales when there is a decrease in
restaurant sales. </p>

<p>In July 2010 we eliminated
approximately $80,000 of annual payroll costs through salary reductions and
salary eliminations. </p>

<p><i>Occupancy and Other
Operating Costs</i></p>

<p>For the three months ended
June 30, 2010 our occupancy and other operating costs decreased $20,000 to
$1,127,000 (20.7% of restaurant sales) from $1,147,000 (19.5% of restaurant
sales) compared to the same prior year period.</p>

<p>For the nine months ended
June 30, 2010 our occupancy and other operating costs increased $24,000 to
$3,389,000 (23% of restaurant sales) from $3,365,000 (20.7% of restaurant
sales) compared to the same prior year period.</p>

<p>For the three month period
ended June 30, 2010 we experienced increases in utility costs and repairs and
maintenance costs compared to the same prior year period, however these
increases were offset by decreases in all other operating costs. During the
quarter ending June 30, 2010 we successfully negotiated the reduction of base
rents at four company-owned restaurants. The reductions will result in total
savings of approximately $96,000 per year. We are negotiating rent reductions
on additional restaurants.</p>

<p>For the nine month period
ended June 30, 2010 we experienced increases in utility costs, repairs and
maintenance costs, and property taxes compared to the same prior year period,
however these increases were partially offset by decreases in all other
operating costs. Occupancy and other operating costs may increase as a percent
of sales as new company-owned restaurants are developed due to higher rent
associated with sale-leaseback operating leases, as well as higher property
taxes at those locations.</p>

<p><i>Opening Costs</i></p>

<p>For the three months ended
June 30, 2010 and June 30, 2009 our new store opening costs <a name="OLE_LINK9">were
$0.</a> For the nine months ended June 30, 2010 our new store opening costs
were $0 compared to $15,000 in the same prior year period. The prior year costs
are related to a new company-owned restaurant that opened in October 2008.</p>

<p><i>Depreciation and
Amortization</i></p>



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<p>For the three months ended
June 30, 2010, our depreciation and amortization decreased $49,000 to $245,000
(4.5% of restaurant sales) from $294,000 (5% of restaurant sales) compared to
the same prior year period.</p>

<p>For the nine months ended
June 30, 2010, our depreciation and amortization decreased $159,000 to $717,000
(4.9% of restaurant sales) from $876,000 (5.4% of restaurant sales) compared to
the same prior year period.</p>

<p>The decrease in depreciation
and amortization for the three and nine month periods ended June 30, 2010 is
primarily due to declining depreciation expense in our aging company-owned and
co-developed restaurants.</p>

<p><i>General and Administrative
Costs</i></p>

<p>For the three months ended
June 30, 2010, general and administrative costs increased $15,000 to $361,000
(6.5% of total revenues) from $346,000 (5.7% of total revenues) for the same
prior year period.</p>

<p>The increase in general and
administrative costs for the three months ended June 30, 2010 compared to the
same prior year period is primarily attributable to increases in professional
services of $13,000, vacant land costs of $8,000 and increase in other
miscellaneous expenses offset by decreases in payroll and employee benefit
costs of $19,000.</p>

<p>For the nine months ended
June 30, 2010, general and administrative costs decreased $141,000 to
$1,096,000 (7.3% of total revenues) from $1,238,000 (7.4% of total revenues)
for the same prior year period. </p>

<p>The decrease in general and
administrative costs for the nine months ended June 30, 2010 compared to the
same prior year period is primarily attributable to decreases in: 1) payroll
and employee benefit costs of $106,000, 2) training and recruiting expenses of
$16,000 and 3) professional services of $38,000; offset by a decrease in
miscellaneous income related to the elimination by the state and local taxing
authorities of sales tax collection fees.</p>

<p>In July 2010 we implemented
additional salary reductions which will result in annual savings in payroll and
employee benefit costs of approximately $89,000. </p>

<p><i>Advertising Costs</i></p>

<p>For the three months ended
June 30, 2010 advertising costs decreased $22,000 to $312,000 (5.7% of
restaurant sales) from $334,000 (5.7% of restaurant sales) for the same prior
year period.</p>



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<p>For the nine months ended
June 30, 2010 advertising costs decreased $72,000 to $862,000 (5.8% of
restaurant sales) from $934,000 (5.7% of restaurant sales) for the same prior
year period.</p>

<p>The decrease in advertising
costs for the three and nine month periods is primarily due to the decrease in
restaurant sales, as contributions are made to the advertising materials fund
and regional advertising cooperative based on a percentage of sales. In
addition, for the nine month period ended June 30, 2010 $9,000 of payroll and
employee benefit costs have been eliminated in the current period due to the
retirement of our Vice President of Marketing in November 2008. We currently
have no plans to fill the position in the immediate future.</p>

<p><i>Franchise Costs</i></p>

<p>For the three months ended
June 30, 2010, franchise costs decreased $5,000 to $30,000 (.5% of total
revenues) from $35,000 (.6% of total revenues) for the same prior year period.</p>

<p>For the nine months ended
June 30, 2010, franchise costs decreased $13,000 to $95,000 (.6% of total
revenues) from $108,000 (.6% of total revenues) for the same prior year period.
The decrease in franchise costs for the nine month period is primarily
attributable to a reduction in franchise opening support costs compared to the
same prior year period.</p>

<p><i>Loss on Sale of Assets</i></p>

<p>For the three months ended
June 30, 2010, our loss on the sale of assets increased $62,000 to $55,000 from
a gain of $7,000 for the same prior year period. The current three month period
ending June 30, 2010 includes a loss of $64,000 related to a co-developed
restaurant sold to a franchisee in June 2010.</p>

<p>For the nine months ended
June 30, 2010, our loss on the sale of assets increased $63,000 to $40,000 from
a gain of $23,000 for the same prior year period, the increase is attributable
to the $64,000 loss related to a co-developed restaurant sold to a franchisee
in June 2010.</p>

<p><i>Loss from Operations</i></p>

<p>We had a loss from operations
of ($300,000) in the three months ended June 30, 2010 compared to a loss from
operations of ($86,000) for the same prior year period.</p>

<p>We had a loss from operations
of ($1,548,000) in the nine months ended June 30, 2010 compared to a loss from
operations of ($1,065,000) for the same prior year period.</p>



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<p>The increase in loss from
operations for the three and nine month periods 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 Sales of
Assets&quot; sections of Item 2 above.</p>

<p><i>Loss from Continuing
Operations</i></p>

<p>The net loss from continuing
operations was ($507,000) for the three months ended June 30, 2010 compared to
a net loss from continuing operations of ($135,000) for the same prior year
period. The change from the three month period ended June 30, 2009 to June 30,
2010 was attributable to the increase in loss from operations for the three
months ended June 30, 2010, as well as: 1) an increase in net interest expense
of $122,000 compared to the same prior year period; and 2) a decrease in the
unrealized gain related to our interest rate swap liability of $36,000 compared
to the same prior year period. Net interest expense for the three months ended
June 30, 2010 includes non-cash amortization of debt issuance costs of $114,000
related to: 1) the extension of the PFGI II loan in January, 2010; 2) the loan
agreement with W Capital and John T. MacDonald entered into in February 2010;
and 3) the loan agreement with Golden Bridge LLC entered into in April, 2009.
(See &quot;Note 3. Recent Developments&quot; of Item 1 above).</p>

<p>The net loss from continuing
operations was ($1,985,000) for the nine months ended June 30, 2010 compared to
a net loss from continuing operations of ($1,335,000) for the same prior year
period. The change from the nine month period ended June 30, 2009 to June 30,
2010 was attributable to the increase in loss from operations for the nine
months ended June 30, 2010, as well as: 1) an increase in net interest expense
of $257,000 compared to the same prior year period; and 2) an increase in the
unrealized gain related to our interest rate swap liability of $90,000 compared
to the same prior year period. Net interest expense for the nine months ended
June 30, 2010 includes non-cash amortization of debt issuance costs of $204,000
related to: 1) the extension of the PFGI II loan in January, 2010; 2) the loan
agreement with W Capital and John T. MacDonald entered into in February 2010;
and 3) the loan agreement with Golden Bridge LLC entered into in April, 2009.
(See &quot;Note 3. Recent Developments&quot; of Item 1 above)</p>

<p><i>Loss from Discontinued
Operations</i></p>

<p>The loss from discontinued
operations for the three and nine month periods ended June 30, 2010 and 2009
include results attributable to our Commerce City, Colorado dual-branded
restaurant that was closed in March 2010 and our Denver, Colorado co-developed
restaurant that was closed in June 2010. The three and nine month periods ended
June 30, 2010 include the results of operations, the fair value of all future
lease obligations and an impairment charge to write down the fixed assets to
book value. The three and nine month periods ended June 30, 2009 represent the
results of operations.</p>

<p><b><u>Liquidity and Capital
Resources</u></b></p>

<p><i>Cash and Working Capital</i></p>



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<p>As of June 30, 2010, we had
$522,000 in cash and cash equivalents on hand. We currently plan to use the
cash balance and any cash generated from operations for our working capital
needs in fiscal 2010. In February, 2010 we secured a short term loan of
$400,000 to be used as working capital (see &quot;Financing Transactions&quot;
below). Additionally, we may contemplate the sale or sublease of selected
underperforming restaurants in fiscal 2010 </p>

<p>As of June 30, 2010, we had a
working capital deficit of $2,378,000 due primarily to the following: 1) the
entire note payable to Wells Fargo Bank, N.A. of $755,000 shown as a current
liability due to certain loan covenant defaults that existed as of June 30,
2010; 2) an $85,000 current liability related to the unrealized loss on our
interest rate swap, as described in Note 10 of the Notes to the Condensed
Consolidated Financial Statements above; 3) a current liability of
approximately $430,000 related to 2009 accrued property taxes which will be
paid out of cash generated from operations through the end of fiscal 2010; 4) a
$185,000 bridge loan that was due July 15, 2010 on which we are continuing to make
monthly payments of interest only; and 5) a $400,000 bridge loan with a
maturity date of December 31, 2010. We anticipate both of the bridge loans
being paid out of the proceeds from a larger recapitalization event. </p>

<p>We are not in payment default
under the Wells Fargo Bank, N.A. note and anticipate remaining current on all
principal and interest payments in fiscal 2010, subject to our successfully
raising additional operating capital. We have received a Forbearance and
Reservation of Rights letter from Wells Fargo Bank stating that they are
accepting current principal and interest payments and are not currently
accelerating the note, subject to agreeing to an acceptable Required Corrective
Action for the covenant defaults. It is unlikely that we will have an
acceptable Required Corrective Action until our Earnings Before Interest Taxes
and Depreciation (&quot;EBITDA&quot;) improves. If Wells Fargo were to
accelerate the note payable, we would need additional financing and we do not
currently have a source for such financing. </p>

<p>Due to the classification of
the entire Wells Fargo note payable as a current liability and the right of
Wells Fargo to accelerate the required payment of the note, we do not show the
ability to fully satisfy our liabilities in the normal course of business
without raising additional capital. It is our objective to acquire additional
operating capital through debt and equity offerings and the possible sale of
existing restaurants with such funds to be used for the repayment of the Wells
Fargo note and to increase our working capital. We believe we will be
successful in raising sufficient additional operating capital and in
restructuring our debt obligations; however there can be no assurance that we
will be successful in raising such additional funds particularly if we are
unable to reverse our current negative same store sales trends. If we are
unable to raise additional operating capital during the remainder of fiscal
2010 we may not be able to satisfy our liabilities as they come due.</p>



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<p>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 on December 31, 2012. As a result, the majority
of the PFGI II, LLC loan is shown as a long term liability as of June 30, 2010.
We are under contract to sell one of the pieces of land we own collateralizing
the PFGI II, LLC loan and anticipate net proceeds of approximately $850,000,
which will go toward the reduction of the PFGI II, LLC loan. We will continue
to market the other land and building we own that collateralizes the PFGI II,
LLC loan for a sale and leaseback as conditions in the sale leaseback market
improve and plan to use the net proceeds to reduce the loan.</p>

<p><i>Financing Activities</i></p>

<p>Wells Fargo Note Payable</p>

<p>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. We simultaneously entered
into an interest rate swap transaction with Wells Fargo Bank for the full
$1,100,000 with a fixed interest rate of 7.77% for the full eight year term
coinciding with the note payable (see note 5 above). As discussed above we are
in default of certain loan covenants as of June 30, 2010 on this Wells Fargo
note, however we are not currently, and have never been, in payment default
under the note.</p>

<p>PFGI II LLC Promissory Note</p>

<p>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 and
again on December 14, 2009 extending the maturity to December 31, 2012. 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. The promissory note now constitutes a term loan with monthly
payments of principal and interest. 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 $2,488,000 at June 30,
2010. Of the $2,488,000 outstanding balance, approximately $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 held for sale in the sale-leaseback market. The remaining
balance is related to the purchase, entitlement and other development fees on a
parcel of land in Aurora, Colorado that will be sold as described above.</p>



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<p>In connection with the PFGI
II, LLC amendment in December, 2009, the Company issued a three-year warrant
dated January 2, 2010 (the &quot;Warrant&quot;) to PFGI II, LLC which provides
that PFGI II, LLC may at any time from January 2, 2010 until January 2, 2013
purchase up to 112,613 shares of the Company's common stock (the &quot;Warrant
Shares&quot;) at an exercise price of $1.11 per share. The number of Warrant
Shares 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 was derived through the
application of the Black-Scholes option pricing model. The fair value of the
Warrant issued was determined to be $82,000 using 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 $82,000 was charged to the
note discount and credited to Additional Paid in Capital. The note discount
will be amortized over thirty-six months and charged to interest expense.
Amortization of the debt discount included in interest expense for the three
and nine months ended June 30, 2010 was $7,000 and $13,000, respectively.</p>

<p>Golden Bridge Loan Agreement</p>

<p>On April 20, 2009 as reported
on form 8-K, Good Times Restaurants Inc. (the &quot;Company&quot;) and Good
Times Drive Thru Inc. (&quot;GTDT&quot;), a wholly owned subsidiary of 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. Eric Reinhard, Ron Goodson, David Grissen, Richard
Stark, and Alan Teran, who are all members of the Company's Board of Directors
and stockholders of the Company, are the sole members of Golden Bridge. Eric
Reinhard is the sole manager of Golden Bridge. The Company's and GTDT's
obtaining of the Golden Bridge Loan and related transactions with Golden Bridge
were 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.</p>

<p>The Golden Bridge Loan is
evidenced by a promissory note dated April 20, 2009 (the &quot;Golden Bridge
Note&quot;) made by the Company and GTDT, as co-makers, and bears interest at a
rate of 10% per annum on the unpaid principal balance. The Golden Bridge Note
provides for monthly interest payments and was due and payable in full on July
10, 2010. We have a letter agreement with Golden Bridge to continue with
interest only payments until we complete a larger recapitalization event or
through December 31, 2010. The commitment fee for the Golden Bridge Loan was
$3,700. The Golden Bridge Loan Agreement contains customary event of default
provisions and a cross-default provision with respect to the loan agreement for
the PFGI II, LLC loan (as described above).</p>



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<p>The Golden Bridge Loan
Agreement and Note are subject to the terms of an Intercreditor Agreement dated
April 20, 2009 (the &quot;Intercreditor Agreement&quot;), among the Company,
GTDT, Golden Bridge and PFGI II, LLC (&quot;PFGI&quot;). Under the
Intercreditor Agreement, PFGI and Golden Bridge agreed that, upon any payments
of principal or interest on the Golden Bridge Loan or the PFGI Loan by GTDT,
PFGI and Golden Bridge shall each be entitled to its pro rata share of such
payments in the amount of 93.1% for PFGI and 6.9% for Golden Bridge. The
Intercreditor Agreement also provides that GTDT and the Company may prepay the
Golden Bridge Loan in whole or in part with the prior consent of PFGI, and that
any other indebtedness of the Company or GTDT to PFGI or Golden Bridge shall be
subordinate in payment and lien priority to the Golden Bridge Loan and the PFGI
Loan to the extent of the proceeds of the collateral. Under the Intercreditor
Agreement, all money received from any foreclosure on the collateral securing
the PFGI Loan shall be applied to PFGI and Golden Bridge for their expenses
related to such event and then on a pari passu basis to PFGI and Golden Bridge
in accordance with their respective pro rata shares.</p>

<p>Prior to the closing of the
Golden Bridge Loan, borrowings under the PFGI Loan were secured by GTDT's
leasehold estates and business assets with respect to certain of GTDT's
restaurants located in Boulder, Adams, Jefferson and Larimer counties in
Colorado and first deeds of trust on real property in Arapahoe and Weld
counties in Colorado developed under the PFGI Loan.</p>

<p>In connection with the Golden
Bridge Loan, the Company issued a three-year warrant dated April 20, 2009 (the
&quot;Warrant&quot;) 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 (the &quot;Warrant Shares&quot;) at an exercise
price of $1.15 per share. The number of Warrant Shares 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 was derived through the application of the Black-Scholes option pricing
model. The fair value of the Warrant issued 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. Amortization of the debt discount included in interest
expense for the three and nine months ended June 30, 2010 was $8,000 and
$25,000, respectively.</p>

<p>W. Capital and John T.
MacDonald Loan Agreement</p>

<p>On February 2, 2010, as
reported on form 8-K, the Company entered into a loan agreement with W Capital,
John T. MacDonald and Golden Bridge, LLC (collectively &quot;the Lender&quot;),
pursuant to which the Lender made a loan of $200,000, with up to an additional
$200,000 loan available through April 30, 2010 to be used for restaurant
marketing and other working capital uses. At June 30, 2010 the entire $400,000
had been advanced to the Company. The loan agreement was amended on April 1,
2010, as reported on form 8-K. (See &quot;Note 2 - Recent Developments&quot;
above)</p>



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<p>The Loan is evidenced by a
Convertible Secured Promissory Note dated February 1, 2010 (the
&quot;Note&quot;) made by the Company and shall bear interest at a rate of 12%
per annum on the unpaid principal balance through August 1, 2010. The maturity
date for payment of all principal and interest on the Note is December 31,
2010. However, if and to the extent that any portion of the Note is still
outstanding after August 1, 2010, the interest rate will increase to 14% per
annum from and after August 1, 2010 until the maturity date. All interest
accrues through the maturity date. The Loan Agreement contains customary event
of default provisions and a cross-default provision with respect to the loan
agreement for the Wells Fargo Bank and PFGI II, LLC loans in the event of
payment default on either of those loans. Upon the occurrence and continuance
of an event of default, the Lender may declare all or part of the unpaid
principal and accrued and unpaid interest on the Loan due and payable. Any
amounts not paid to the Lender when due will bear interest from the due date
until paid at a rate of 16% per annum. The repayment of the 2009 Golden Bridge
Loan and the February 2, 2010 Loan will require additional equity or debt
capital. As described above in Note 2 - Recent Developments, the Company has
hired Mastodon Ventures to seek strategic alternatives and sources of capital.
There can be no assurance that we will be successful in raising such capital
which would require us to renegotiate the repayment terms of these short term
loans.</p>

<p>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 GTDT's restaurants that were not
previously pledged as collateral under the Wells Fargo Bank or PFGI II, LLC
borrowings. The Note is convertible into shares of common stock of the Company
(the &quot;Conversion Shares&quot;) 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, provided however that the
conversion price shall not be below $.75 per share nor above $1.08 per share
(the &quot;Conversion Price&quot;).</p>

<p>In accordance with FASB ASC
470-20, Debt with Conversion and Other Options, the intrinsic value of the
embedded beneficial conversion feature was determined to be $161,000. The value
of $161,000 was charged to note discounts and credited to Additional Paid in
Capital. The value will be amortized over six months and charged to interest
expense. Amortization of the beneficial conversion feature included in interest
expense for the three and nine months ended June 30, 2010 was $80,000 and
$134,000, respectively.</p>



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<p>In connection with the Loan,
the Company issued warrants dated February 1, 2010 (the &quot;Warrants&quot;)
to the Lender which provides that the Lender may at any time from February 1,
2010 until two years from the date of repayment or conversion of the Loan
purchase up to an aggregate of 50,000 shares of the Company's common stock (the
&quot;Warrant Shares&quot;) at an exercise price that is equal to the
Conversion Price calculation above. If the Loan is not repaid prior to August
1, 2010, the Company will issue warrants for the purchase of 50,000 additional
shares of the Company's common stock upon the same terms as the initial
Warrants. The number of Warrant Shares 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 Warrants was derived
through the application of the Black-Scholes option pricing model. The fair
value of the Warrants issued 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 will be amortized over six months and charged to interest
expense. Amortization of the debt discount included in interest expense for the
three and nine months ended June 30, 2010 was $19,000 and $32,000,
respectively.</p>

<p>Additional commitments for
the development of new restaurants in fiscal 2010 and beyond 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><i>Capital Expenditures</i></p>

<p>We do not have any plans for
any significant capital expenditures for the balance of fiscal 2010, other than
normal recurring capital expenditures for existing restaurants. Additional
commitments for the development of new restaurants in fiscal 2010 and beyond
will depend on the Company's sales trends, cash generated from operations and
our access to additional capital.</p>

<p><i>Cash Flows</i></p>

<p>Net cash used in operating
activities was $708,000 for the nine months ended June 30, 2010. The net cash
used in operating activities for the nine months ended June 30, 2010 was the
result of a net loss of ($2,582,000) as well as cash and non-cash reconciling
items totaling $1,874,000 (comprised of depreciation and amortization of
$921,000, stock based compensation expense of $66,000, non-cash discontinued
operations costs of $453,000 an accounts payable increase of $346,000 and a net
decrease in other operating assets and liabilities of $88,000).</p>

<p>Net cash used in operating
activities was $821,000 for the nine months ended June 30, 2009. The net cash
used in operating activities for the nine months ended June 30, 2009 was the
result of a net loss of ($1,488,000) as well as cash and non-cash reconciling
items totaling $667,000 (comprised of depreciation and amortization of
$944,000, an unrealized loss of $87,000 related to our interest rate swap
liability, an accounts payable decrease of $263,000 and a net increase in other
operating assets and liabilities of $101,000).</p>

<p>Net cash provided by
investing activities for the nine months ended June 30, 2010 was $61,000 which
reflects proceeds from the sale of restaurants of $100,000, payments of $54,000
for miscellaneous restaurant related capital expenditures and $15,000 in
principal payments received on loans to franchisees.</p>

<p>Net cash used in investing
activities for the nine months ended June 30, 2009 was $282,000 which reflects
payments of $277,000 for the purchase of property and equipment (including
$217,000 for new store development and $60,000 for miscellaneous restaurant and
corporate office related capital expenditures), $31,000 in loans made to
franchisees and $26,000 in principal payments received on loans to franchisees.</p>



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<p>Net cash provided by
financing activities for the nine months ended June 30, 2010 was $354,000,
which includes principal payments on notes payable and long term debt of
$105,000, borrowings on notes payable of $400,000 and receivables from
non-controlling interests of $59,000.</p>

<p>Net cash provided by
financing activities for the nine months ended June 30, 2009 was $360,000,
which includes principal payments on notes payable and long term debt of
$91,000; borrowings on notes payable of $185,000; an advance on our revolving
line of credit of $320,000; and distributions to minority interests in
partnerships of $54,000.</p>

<p><i>Contingencies</i></p>

<p>We remain contingently liable
on various land leases underlying restaurants that were previously sold to
franchisees. 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. 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
effect on our future operating results.</p>

<p><b><u>Impact of Inflation</u></b></p>

<p>During fiscal 2009 we
experienced a moderation in our food and packaging costs when our weighted food
and packaging costs increased approximately 2%. During fiscal 2010 we have
experienced an increase in our weighted average food and packaging costs of
6.2%, including significant increases in beef, bacon and soda syrup. We
anticipate continued upward pressure on our commodity costs for the balance of
fiscal 2010. State increases in the minimum wage resulted in a cumulative
increase in our average hourly wage of $.90 per employee hour from fiscal 2007
through fiscal 2009. We took moderate price increases during fiscal 2009 and
plan for additional moderate price increases in fiscal 2010, which may or may
not be sufficient to recover increased commodity costs or increases in other operating
expenses.</p>

<p><b><u>Seasonality</u></b></p>

<p>Revenues of the Company are
subject to seasonal fluctuation based primarily on weather conditions adversely
affecting restaurant sales in December, January, February and March.</p>

<p><b>ITEM 3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; QUANTITATIVE
AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK</b></p>

<p style='margin-left:.5in'>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Not
required.</p>

<p><b>ITEM 4T.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; CONTROLS
AND PROCEDURES</b></p>



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<p><b>Conclusion Regarding the
Effectiveness of Disclosure Controls and Procedures </b></p>

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

<p><b>Changes in Internal
Control over Financial Reporting</b></p>

<p>There have been no
significant changes in the Company's internal control over financial reporting
that occurred during the Company's fiscal quarter ended June&nbsp;30, 2010 that
have materially affected, or are reasonably likely to materially affect, the
Company's internal control over financial reporting.</p>

<p align=center style='text-align:center'><b>PART
II - OTHER INFORMATION</b></p>

<p style='margin-left:1.5in'><b>ITEM
1.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; LEGAL PROCEEDINGS</b></p>

<p>Good Times Restaurants is
subject to legal proceedings which are incidental to its business. These legal
proceedings are not expected to have a material impact on the Company.</p>

<p><b>ITEM 1A. RISK FACTORS</b></p>

<p style='margin-left:.5in'>Not
required.</p>

<p style='margin-left:1.5in'><b>ITEM
2.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS</b></p>

<p style='margin-left:1.0in'>None.</p>

<p style='margin-left:1.5in'><b>ITEM
3.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; DEFAULTS UPON SENIOR SECURITIES</b></p>

<p>We are in default of certain
technical loan covenants as of June&nbsp;30, 2010 on our $755,000 note payable
to Wells Fargo Bank, N.A. (&quot;the Bank&quot;). We have never been in payment
default on the note. On February 9, 2009 we received a Reservation of Rights
letter from the Bank formally notifying us of the default of the Earnings
Before Interest Taxes and Depreciation (&quot;EBITDA&quot;) Coverage Ratio of
not less than 1.5 to 1.0 and the Tangible Net Worth of not less than $5,000,000
as set forth in the Credit Agreement for the period ending December 31, 2008.
The letter serves as notice that notwithstanding the foregoing events of
default, the Bank is reserving all of its rights and remedies under the Credit
Agreement and related agreements. The Bank is not now accelerating the Loan and
is willing to continue to accept regularly scheduled payments of principal and
interest under the Loan.</p>



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<p><b>ITEM 4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; SUBMISSION
OF MATTERS TO A VOTE OF SECURITY HOLDERS</b></p>

<p style='margin-left:1.0in'>None.</p>

<p style='margin-left:1.5in'><b>ITEM
5.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; OTHER INFORMATION</b></p>

<p style='margin-left:1.0in'>None.</p>

<p style='margin-left:1.0in'><b>&nbsp;</b></p>

<p style='margin-left:1.5in'><b>ITEM
6.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; EXHIBITS</b></p>

<p style='margin-left:1.0in'>(a)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Exhibits.
The following exhibits are furnished as part of this report:</p>

<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <u>Exhibit No.</u>&nbsp;&nbsp;&nbsp; <u>Description</u></p>

<p style='margin-left:1.0in'>*31.1&nbsp;&nbsp; Certification
of Chief Executive Officer pursuant to 18 U.S.C. Section 1350</p>

<p style='margin-left:1.0in'>*31.2&nbsp;&nbsp; Certification
of Controller pursuant to 18 U.S.C. Section 1350</p>

<p style='margin-left:1.0in'>*32.1&nbsp;&nbsp; Certification
of Chief Executive Officer and Controller pursuant to Section 906</p>

<p>*filed herewith</p>

<p><b>SIGNATURES</b></p>

<p>In accordance with the
requirements of the Exchange Act, the registrant caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.</p>



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  <td width="39%" valign=top style='width:39.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p><b>GOOD TIMES RESTAURANTS
  INC.</b></p>
  </td>
 </tr>
 <tr>
  <td width="39%" valign=top style='width:39.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p>DATE: August 16, 2010</p>
  </td>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="39%" valign=top style='width:39.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p style='margin-left:.5in'><u>/s/
  Boyd E. Hoback</u></p>
  </td>
 </tr>
 <tr>
  <td width="39%" valign=top style='width:39.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p style='margin-left:.5in'>Boyd
  E. Hoback</p>
  <p style='margin-left:.5in'>President
  and Chief Executive Officer</p>
  </td>
 </tr>
 <tr>
  <td width="39%" valign=top style='width:39.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
 </tr>
 <tr>
  <td width="39%" valign=top style='width:39.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p style='margin-left:.5in'><u>/s/
  Susan M. Knutson</u></p>
  </td>
 </tr>
 <tr>
  <td width="39%" valign=top style='width:39.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>

  </td>
  <td width="61%" valign=top style='width:61.0%;padding:5.25pt 5.25pt 5.25pt 5.25pt'>
  <p style='margin-left:.5in'>Susan
  M. Knutson</p>
  <p style='margin-left:.5in'>Controller</p>
  </td>
 </tr>
</table>



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