UNITED STATES

 SECURITIES AND EXCHANGE COMMISSION

 Washington, D.C. 20549

 FORM 10-K

 (Mark One)

 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For the fiscal year ended September 27, 2025

 or

 TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For the transition period from ____________ to
____________

 Commission File Number 001-06836

 FLANIGAN'S ENTERPRISES, INC.

 (Exact name of registrant as specified in its
charter)

 59-0877638

 (State or Other Jurisdiction of

 (I.R.S. Employer

 Incorporation or Organization)

 Identification Number)

 5059 N.E. 18th Avenue, Fort Lauderdale, Florida

 33334

 (Address of Principal Executive Offices)

 (Zip Code)

 (954) 377-1961

 (Registrant's Telephone Number, Including
Area Code)

 Securities registered pursuant to Section 12(b) of the Act:

 Title of each class

 Trading symbol(s)

 Name of each exchange on which registered

 Common Stock, $0.10 par value

 BDL

 NYSE AMERICAN

 Securities registered pursuant to Section 12(g)
of the Act: None

 Indicate by check mark if the registrant is a
well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No

 Indicate by check mark if the registrant is not
required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No

 Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements
for the past 90 days. Yes No

 Indicate by check mark whether the registrant
has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405
of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes
 No

 Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer,"
"smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

 Large accelerated filer
 Accelerated filer
 Non-accelerated filer

 Smaller reporting company
 Emerging growth company

 If an emerging growth company, indicate by check
mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange Act.

 Indicate by check mark whether the registrant
has filed a report on and attestation to its management's assessment of the effectiveness of its internal control over financial
reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or
issued its annual report.

 If securities are registered pursuant to Section
12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction
of an error to previously issued financial statements.

 Indicate by check mark whether any of those error
corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant's
executive officers during the relevant recovery period pursuant to §240.10D-1(b).

 Indicate by check mark whether the registrant is a shell company (as
defined in Rule 12b-2 of the Act).

 Yes No

 As of March 28, 2025, the last business day of
the registrant's most recently completed second fiscal quarter, the aggregate market value of the voting stock held by non-affiliates
of the registrant was approximately $ 21,031,000 (based on the closing price of the common stock as reported on the NYSE AMERICAN of $24.99
per share).

 As of December 18, 2025 there were 1,858,647 shares of the registrant's
Common Stock, $0.10 par value, outstanding.

 DOCUMENTS INCORPORATED BY REFERENCE

 Information required by Part III (Items 10, 11,
12, 13 and 14) hereof is incorporated by reference to portions of the Registrant's Proxy Statement for the 2026 Annual Meeting
of Shareholders which will be filed with the Securities and Exchange Commission no later than 120 days after the end of the registrant's
fiscal year covered by this report.

 FLANIGAN'S
ENTERPRISES, INC. AND SUBSIDIARIES

 Item 1

 Business

 Item 1A

 Risk
 Factors

 Item 1B

 Unresolved
 Staff Comments

 Item 1C

 Cybersecurity

 Item 2

 Properties

 Item 3

 Legal
 Proceedings

 Item 4

 Mine
 Safety Disclosures

 Item 5

 Market
 for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

 Item 6

 Reserved

 Item 7

 Management's
 Discussion and Analysis of Financial Condition and Results of Operations

 Item 7A

 Quantitative
 and Qualitative Disclosures About Market Risk

 Item 8

 Financial
 Statements and Supplementary Data

 Item 9

 Changes
 in and Disagreements with Accountants on Accounting and Financial Disclosure

 Item 9A

 Controls
 and Procedures

 Item 9B

 Other
 Information

 Item 9C

 Disclosure
 Regarding Foreign Jurisdictions that Prevent Inspections

 Item 10

 Directors, Executive Officers and Corporate Governance

 Item 11

 Executive Compensation

 Item 12

 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 Item 13

 Certain Relationships and Related Transactions, and Director Independence

 Item 14

 Principal Accountant Fees and Services

 Item 15

 Exhibits and Financial Statement Schedules

 Item 16

 Form
 10 – K Summary

 SIGNATURES

 EXHIBIT INDEX

 i

 As used in this Annual Report on Form 10-K,
the terms "we," "us," "our," the "Company" and "Flanigan's" mean Flanigan's
Enterprises, Inc. and its subsidiaries (unless the context indicates a different meaning).

 CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 This annual report, including,
without limitation, statements under the heading "Management's Discussion and Analysis of Financial Condition and Results
of Operations," includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended
("Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended ("Exchange Act"). These
forward-looking statements can be identified by the use of forward-looking terminology, including the words "believes," "estimates,"
"anticipates," "expects," "intends," "plans," "may," "will,"
"potential," "projects," "predicts," "continue," or "should," "could",
"may", "might", "will" and "would" or, in each case, their negative or other variations
or comparable terminology. There can be no assurance that actual results will not materially differ from expectations. Such statements
include, but are not limited to, the general expansion of our business and other statements which are not statements of current or historical
facts.

 The forward-looking statements
contained in this annual report are based on our current expectations and beliefs concerning future developments and their potential
effects on us. Future developments affecting us may not be those that we have anticipated. These forward-looking statements involve a
number of risks, uncertainties (some of which are beyond our control) and other assumptions that may cause actual results or performance
to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include,
but are not limited to, those factors described under the heading "Risk Factors." Should one or more of these risks or uncertainties
materialize, or should any of our assumptions prove incorrect, actual results may vary in material respects from those projected in these
forward-looking statements. We caution readers not to place undue reliance on any forward-looking statements, which speak only as of
the dates on which they are made. We undertake no obligation to update or revise any forward-looking statements, whether as a result
of new information, future events or otherwise, except as may be required under applicable securities laws. These risks and others described
under "Risk Factors" may not be exhaustive.

 By their nature, forward-looking
statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the
future. We caution you that forward-looking statements are not guarantees of future performance and that our actual results of operations,
financial condition and liquidity, and developments in the industry in which we operate may differ materially from those made in or suggested
by the forward-looking statements contained in this annual report. In addition, even if our results of operations, financial condition
and liquidity, and developments in the industry in which we operate are consistent with the forward-looking statements contained in this
annual report, those results or developments may not be indicative of results or developments in subsequent periods.

 ii

 ITEM 1. BUSINESS

 General

Flanigan's Enterprises, Inc., a Florida corporation, together with its subsidiaries ("we", "our", "ours"
and "us" as the context requires), (i) operates 32 units, consisting of restaurants, package liquor stores, combination restaurant/package
liquor stores and a sports bar that we either own or have operational control over and partial ownership in; and (ii) franchises an additional
5 units, consisting of 2 restaurants (one of which we operate) and 3 combination restaurant/package liquor stores. The table below provides
information concerning the type (i.e. restaurant, sports bar, package liquor store or combination restaurant/package liquor store) and
ownership of the units (i.e. whether (i) we own 100% of the unit; (ii) the unit is owned by a limited partnership of which we are the
sole general partner and/or have invested in; or (iii) the unit is franchised by us), as of September 27, 2025 and as compared to September
28, 2024. With the exception of "The Whale's Rib," a restaurant we operate but do not own, and "Brendan's
Sports Pub" a restaurant/bar we own, all of the restaurants operate under our service marks "Flanigan's Seafood Bar
and Grill" or "Flanigan's" and all of the package liquor stores operate under our service marks "Big Daddy's
Liquors" or "Big Daddy's Wine & Liquors".

 TYPES
 OF UNITS

 2025

 2024

 Company Owned:

 Combination package liquor store and restaurant

 Restaurant only, including sports bar

 Package liquor store only

 Company Managed Restaurants Only:

 Limited partnerships

 Unrelated Third Party

 Total Company Owned/Operated Units

 Franchised Units

 (1)

 Notes:

 (1)
 We operate a restaurant
 for one (1) franchisee. This unit is included in the table both as a franchised restaurant,
 as well as a restaurant operated by us.

 History and Development of Our Business

 We were incorporated in Florida
in 1959 and commenced operating as a chain of small cocktail lounges and package liquor stores throughout South Florida. By 1970, we
had established a chain of "Big Daddy's" lounges and package liquor stores between Vero Beach and Homestead, Florida.
From 1970 to 1979, we expanded our package liquor store and lounge operations throughout Florida and opened clubs in five other "Sun
Belt" states. In 1975, we discontinued most of our package store operations in Florida except in the South Florida areas of Miami-Dade,
Broward, Palm Beach and Monroe Counties. In 1982, we expanded our club operations into the Philadelphia, Pennsylvania area as general
partner of several limited partnerships we organized. In March 1985, we began franchising package liquor stores and lounges in the South
Florida area. (See Note 12 to the consolidated financial statements and the discussion of franchised units on pages 3 and 4).

 During our fiscal year 1987,
we began renovating our lounges to provide full restaurant food service, and subsequently renovated and added food service to most of
our lounges. Food sales currently represent approximately 79.67% and bar sales approximately 20.33% of our total restaurant sales.

 Our package liquor stores
emphasize high volume business by providing customers with a wide variety of brand name and private label merchandise at discount prices.
Our restaurants and our sports bar establishment offer alcoholic beverages and food service with abundant portions and reasonable prices,
served in a relaxed, friendly and casual atmosphere.

 We conduct our operations
directly and through a number of limited partnerships and wholly owned subsidiaries, all of which are listed below. Our subsidiaries
and the limited partnerships, (except for the limited partnership, where we are not the general partner, which owns and operates our
franchised restaurant in Fort Lauderdale, Florida) are reported on a consolidated basis.

 Entity

 State
 Of
 Organization

 Percentage
 Owned

 Flanigan's Management Services, Inc.

 CIC Investors #13, Limited Partnership

 CIC Investors #25, Limited Partnership

 —

 CIC Investors #50, Limited Partnership

 CIC Investors #55, Limited Partnership

 CIC Investors #60, Limited Partnership

 CIC Investors #65, Limited Partnership

 CIC Investors #70, Limited Partnership

 CIC Investors #80, Limited Partnership

 CIC Investors #85, Limited Partnership

 CIC Investors #90, Limited Partnership

 Josar Investments, LLC

 Flanigan's Calusa Center, LLC

 Flanigan's Fish Company, LLC

 Package Liquor Store Operations

 Our package liquor stores
emphasize high volume business by providing customers with a wide selection of brand name and private label liquors, beers and wines
while offering competitive pricing by meeting the published sales prices of our competitors. We provide sales training to our package
liquor store personnel. The stores are open for business seven days a week from 9:00-10:00 a.m. to 10:00-11:00 p.m., depending upon demand
and local law. Most of our units have "night windows" with extended evening hours.

 Company-Owned Package
Liquor Stores. As of our fiscal year ended September 27, 2025, we own and operate eleven package liquor stores in the South Florida
area under the name "Big Daddy's Liquors" or "Big Daddy's Wine & Liquors", two of which are jointly
operated with restaurants we own.

 Franchised Package Liquor
Stores. We currently franchise three package liquor stores, all in the South Florida area, all of which are operated under the name
"Big Daddy's Liquors". Of the three franchised package liquor stores, two are jointly operated with our franchisee's
restaurant operations and one is operated in a freestanding building adjacent to the franchisee's restaurant operation. Two of
the three franchised package liquor stores are franchised to members of the family of our Chairman of the Board, officers and/or directors.
We have not entered into a franchise arrangement for either a package liquor store, restaurant or combination package liquor store/restaurant
since 1986 and do not anticipate that we will do so in the foreseeable future.

 Generally, a franchise agreement
with our franchisees for the operation of a package liquor store runs for the balance of the term of the franchisee's lease for
the business premises, extended by the franchisee's continued occupancy of the business premises thereafter, whether by lease or
ownership. In exchange for our providing management and related services to the franchisee and our granting the right to the franchisee
to use our service mark, "Big Daddy's Liquors", franchisees of package liquor stores pay us weekly in arrears, (i)
a royalty equal to approximately 1% of gross sales; plus (ii) an amount for advertising equal to between 1.5% to 3% of gross sales generated
at the stores depending upon our actual advertising costs.

 For accounting purposes,
we do not consolidate the revenue and expenses of our franchisees' operations with our revenue and expenses. Franchise royalties
we receive are recognized as revenue when sales are made by franchisees.

 Restaurant Operations

 Our restaurants provide a
neighborhood casual, standardized dining experience, typical of casual restaurant chains. The interior decor of the restaurants is nautical
with numerous fishing and boating pictures and decorations. The restaurants are designed to permit minor modifications without significant
capital expenditures. However, from time to time we are required to redesign and refurbish the restaurants at significant cost. Drink
prices may vary between locations to meet local conditions. Food prices are substantially standardized for all restaurants. The restaurants'
hours of operation are from 11:00 a.m. to 1:00-5:00 a.m. depending upon demand and local law.

 Company-Owned Restaurants.
As of our fiscal year ended September 27, 2025, we own and operate eleven restaurants all under our service mark "Flanigan's
Seafood Bar and Grill" two of which are jointly operated with package liquor stores we own.

 Franchised Restaurants.
We franchise five restaurants, all of which operate under our service mark "Flanigan's Seafood Bar and Grill", two
of which operate as a restaurant only, two of which operate jointly with a franchisee operated "Big Daddy's Liquors"
package liquor store and one of which operates adjacent to a "Big Daddy's Liquors" package liquor store. Four of the
five franchised restaurants are franchised to members of the family of our Chairman of the Board, officers and/or directors. We have
not entered into a franchise arrangement for either a package liquor store, restaurant or combination package liquor store/restaurant
since 1986 and do not anticipate that we will do so in the foreseeable future.

 Generally, a franchise agreement
with our franchisees for the operation of a restaurant runs for the balance of the term of the franchisee's lease for the business
premises, extended by the franchisee's continued occupancy of the business premises thereafter, whether by lease or ownership.
In exchange for our providing management and related services to the franchisee and our granting the right to the franchisee to use our
service mark, "Flanigan's Seafood Bar and Grill", our franchisees pay us weekly in arrears, (i) a royalty equal to
approximately 3% of gross sales; plus (ii) an amount for advertising equal to between 1.5% to 3% of gross sales from the restaurants
depending upon our actual advertising costs.

 For accounting purposes,
we do not consolidate the revenue and expenses of our franchisees' operations with our revenue and expenses. Franchise royalties
we receive are recognized as revenue when sales are made by franchisees.

 Restaurants Owned by Affiliated Limited Partnerships

 We have invested along with
others (some of whom are affiliated with our officers and directors) in eleven limited partnerships which currently own and operate eleven
South Florida based restaurants under our service marks "Flanigan's Seafood Bar and Grill" or "Flanigan's".
In addition to being a limited partner in these limited partnerships, we are the sole general partner of ten of these limited partnerships
and manage and control the operations of these restaurants except for the restaurant located in Fort Lauderdale, Florida where we only
hold a limited partnership interest.

 Generally, the terms of the
limited partnership agreements provide that until the investors' cash investment in a limited partnership (including any cash invested
by us) is returned in full, (available cash is distributed to the investors pro-rata based on ownership interest), the limited partnership
distributes to the investors annually out of available cash from the operation of the restaurant, as a return of capital, up to 25% of
the cash invested in the limited partnership, with no management fee paid to us. Any available cash in excess of the 25% of the cash
invested in the limited partnership distributed to the investors annually, is paid one-half () to us as a management fee and
one-half () to the investors (including us), pro-rata based on the investors' investment, as a return of capital. Once
all of the investors (including us), have received, in full, amounts equal to their cash invested, an annual management fee becomes payable
to us equal to one-half () of cash available to be distributed, with the other one-half () of available cash distributed
to the investors (including us), as a profit distribution, pro-rata based on the investors' investment. As of September 27, 2025,
all limited partnerships, with the exception of the limited partnership which owns the restaurant in Sunrise, Florida (Store #85), which
opened for business in March 2022 and the limited partnership which owns the restaurant in Miramar, Florida (Store #25), which opened
for business in April 2023, have returned all cash invested and we receive an annual management fee equal to one-half () of the
cash available for distribution by the limited partnership.

 In addition to receipt of
distributable amounts from the limited partnerships, we receive a fee equal to 3% of gross sales for use of our service marks "Flanigan's
Seafood Bar and Grill" or "Flanigan's", which use is authorized while we act as general partner only. This 3%
fee is "earned" when sales are made by the limited partnerships and is paid weekly, in arrears. Whether we will have any
additional restaurants in the future will be dependent, among other things, on market conditions and our ability to raise capital. We
anticipate that we will continue to form limited partnerships to raise funds to own and operate restaurants under our service marks "Flanigan's
Seafood Bar and Grill" or "Flanigan's" using the same or substantially similar financial arrangements.

 Below is information on the
eleven limited partnerships which own and operate "Flanigan's Seafood Bar and Grill" or "Flanigan's"
restaurants:

 Surfside, Florida

and a 46% limited partner in this limited partnership which has owned and operated a restaurant in Surfside, Florida under our "Flanigan's
Seafood Bar and Grill" service mark since March 6, 1998. 33.3% of the limited partnership interest is owned by persons who are
either our officers, directors or their family members. This limited partnership has returned to its investors all of their initial cash
invested and we receive an annual management fee equal to one-half () of the cash available for distribution by this limited
partnership. This entity is consolidated in the accompanying consolidated financial statements.

 Kendall, Florida

and a 41% limited partner in this limited partnership which has owned and operated a restaurant in Kendall, Florida under our "Flanigan's
Seafood Bar and Grill" service mark since April 4, 2000. 28.3% of the limited partnership interest is owned by persons who are
either our officers, directors or their family members. This limited partnership has returned to its investors all of their initial cash
invested and we receive an annual management fee equal to one-half () of the cash available for distribution by this limited
partnership. This entity is consolidated in the accompanying consolidated financial statements.

 West Miami, Florida

and a 32% limited partner in this limited partnership which has owned and operated a restaurant in West Miami, Florida under our "Flanigan's
Seafood Bar and Grill" service mark since October 11, 2001. 32.7% of the limited partnership interest is owned by persons who are
either our officers, directors or their family members. This limited partnership has returned to its investors all of their initial cash
invested and we receive an annual management fee equal to one-half () of the cash available for distribution by this limited
partnership. This entity is consolidated in the accompanying consolidated financial statements.

 Wellington, Florida

and a 33% limited partner in this limited partnership which has owned and operated a restaurant in Wellington, Florida under our "Flanigan's
Seafood Bar and Grill" service mark since May 27, 2005. 21.9% of the limited partnership interest is owned by persons who are either
our officers, directors or their family members. This limited partnership has returned to its investors all of their initial cash invested
and we receive an annual management fee equal to one-half () of the cash available for distribution by this limited partnership.
This entity is consolidated in the accompanying consolidated financial statements.

 Pinecrest, Florida

and 50% limited partner in this limited partnership which has owned and operated a restaurant in Pinecrest, Florida under our "Flanigan's
Seafood Bar and Grill" service mark since August 14, 2006. 19.4% of the limited partnership interest is owned by persons who are
either our officers, directors or their family members. This limited partnership has returned to its investors all of their initial cash
invested and we receive an annual management fee equal to one-half () of the cash available for distribution by this limited
partnership. This entity is consolidated in the accompanying consolidated financial statements.

 Pembroke Pines, Florida

and a 29% limited partner in this limited partnership which has owned and operated a restaurant in Pembroke Pines, Florida under our
"Flanigan's Seafood Bar and Grill" service mark since October 29, 2007. 23.0% of the limited partnership interest is
owned by persons who are either our officers, directors or their family members. This limited partnership has returned to its investors
all of their initial cash invested and we receive an annual management fee equal to one-half () of the cash available for distribution
by this limited partnership. This entity is consolidated in the accompanying consolidated financial statements.

 Davie, Florida

and a 54% limited partner in this limited partnership which has owned and operated a restaurant in Davie, Florida under our "Flanigan's
Seafood Bar and Grill" service mark since July 28, 2008. 12.0% of the limited partnership interest is owned by persons who are
either our officers, directors or their family members. This limited partnership has returned to its investors all of their initial cash
invested and we receive an annual management fee equal to one-half () of the cash available for distribution by this limited
partnership. This entity is consolidated in the accompanying consolidated financial statements.

and a 11% limited partner in this limited partnership which has owned and operated a restaurant in Miami, Florida under our "Flanigan's
Seafood Bar and Grill" service mark since December 27, 2012. 26.3% of the limited partnership interest is owned by persons who
are either our officers, directors or their family members. This limited partnership has returned to its investors all of their initial
cash invested and we receive an annual management fee equal to one-half () of the cash available for distribution by this limited
partnership. This entity is consolidated in the accompanying consolidated financial statements.

 Sunrise, Florida

and a 7% limited partner in this limited partnership which has owned and operated a restaurant in Sunrise, Florida under our "Flanigan's"
service mark since March 22, 2022. 32.1% of the limited partnership interest is owned by persons who are either our officers, directors
or their family members. As of the end of our fiscal year 2025, this limited partnership has returned to its investors approximately
26.5% of their initial cash invested and as a result, we are currently not entitled to receive any management fees from this limited
partnership. This entity is consolidated in the accompanying consolidated financial statements.

 Miramar, Florida

in this limited partnership which has owned and operated a restaurant in Miramar, Florida under our "Flanigan's" service
mark since April 18, 2023. No units of limited partnership interest were purchased by the Company. 25.5% of the limited partnership interest
is owned by persons who are either our officers, directors or their family members. As of the end of our fiscal year 2025, this limited
partnership has returned to its investors approximately 45% of their initial cash invested and as a result, we are currently not entitled
to receive any management fee from this limited partnership. This entity is consolidated in the accompanying consolidated financial statements.

 Fort Lauderdale, Florida

 A corporation, owned by a
member of our Board of Directors, acts as sole general partner of a limited partnership which has owned and operated a restaurant in
Fort Lauderdale, Florida under our "Flanigan's Seafood Bar and Grill" service mark since April 1, 1997. We have a 25%
limited partnership interest in this limited partnership. 56.9% of the limited partnership interest is owned by persons who are either
our officers, directors or their family members. This limited partnership has returned to its investors all cash invested, but since
we are not the general partner of this limited partnership, we do not receive an annual management fee. We have a franchise arrangement
with this limited partnership and for accounting purposes, we do not consolidate the operations of this limited partnership into our
operations.

 Management Agreement for "The Whale's Rib"

 Since January 2006, we have
managed "The Whale's Rib", a casual dining restaurant located in Deerfield Beach, Florida, pursuant to a management
agreement. We paid $500,000 in exchange for our rights to manage this restaurant. The restaurant is owned by a third party unaffiliated
with us. In exchange for providing management, bookkeeping and related services, we receive one-half () of the net profit, if
any, from the operation of the restaurant. For the fiscal years ended September 27, 2025 and September 28, 2024, we generated $200,000
of revenue in each respective fiscal year from providing these management services.

 Operations and Management

 We emphasize systematic operations
and control of all package liquor stores and restaurants regardless of whether we own, franchise or manage the unit. Each unit has its
own manager who is responsible for monitoring inventory levels, supervising sales personnel, food preparation and service in restaurants
and generally assuring that the unit is managed in accordance with our guidelines and procedures. We have in effect an incentive cash
bonus program for our managers and salespersons based upon various performance criteria. Our operations are supervised by supervisors,
who visit all Company, limited partnership and franchise owned units and the managed unit to provide on-site management and support.
There are three supervisors responsible for package liquor store operations and six supervisors responsible for restaurant operations.

 All of our managers and salespersons
receive extensive training in sales techniques. We arrange for independent third parties, or "shoppers", to inspect each
unit in order to evaluate the unit's operations, including the handling of cash transactions.

 Purchasing and Inventory

 The package liquor business
requires a constant substantial capital investment in inventory at the stores. Our inventory consists primarily of liquor and wine products
and as such, does not become excessive or obsolete that would require identifying and recording of the same. Liquor inventory purchased
can normally be returned only if defective or broken.

 All of our purchases of liquor
inventory are made through our purchasing department from our corporate headquarters. The major portion of inventory is purchased under
individual purchase orders with licensed wholesalers and distributors who deliver the merchandise within one or two days of the placing
of an order. Frequently there is only one wholesaler in the immediate marketing area with an exclusive distributorship of certain liquor
product lines. Substantially all of our liquor inventory is shipped by the wholesalers or distributors directly to our stores. We significantly
increase our inventory prior to Christmas, New Year's Eve and other holidays. Under Florida law, we are required to pay for our
liquor purchases within ten days of delivery.

 Negotiations with food suppliers
are conducted by our purchasing department at our corporate headquarters. We believe this ensures that the best quality and prices will
be available to each restaurant. Orders for food products are regularly prepared by each restaurant's kitchen manager and reviewed
by the restaurant's general manager before orders are placed. Food is delivered by the supplier directly to each restaurant. Orders
are placed several times a week to ensure product freshness. Food inventory is primarily paid for weekly. We purchase food and other
commodities for use in our operations based on market prices established with our suppliers. Many of the food products purchased by us
can be subject to price volatility due to market supply and demand factors outside of our control. We mitigate the risk of supply shortages
and obtain competitive prices by utilizing multiple qualified suppliers for substantially all our food products.

 We negotiate short-term and
long-term agreements for certain of our principal food product requirements, depending on market conditions and expected demand. We evaluate
the possibility of entering into arrangements to assist us in managing risk and variability associated with the supply and demand of
food products.

 In order to fix the cost
and ensure adequate supply of baby back ribs for our restaurants for calendar year 2026, we entered into a purchase agreement with our
existing rib supplier, whereby we agreed to purchase approximately $9.2 million of "2.5 & Down Baby Back Ribs" (weight
range in which baby back ribs are sold) during calendar year 2026, at a prescribed cost, which we believe is competitive. For calendar
year 2025, we entered into a purchase agreement with a new rib supplier, whereby we agreed to purchase approximately $7.8 million of
"2.5 & Down Baby Back Ribs" during calendar year 2025, at a prescribed cost, which we also believe is competitive. The
increase in our cost of baby back ribs for calendar year 2026 compared to calendar year 2025 is due to an increase in market price and
quantity ordered.

 While we anticipate purchasing
all of our rib supply from this vendor, we believe there are several other alternative vendors available, if needed.

 Information Technology

 Our
restaurant and package liquor store point-of-sale and back-office systems provide information regarding daily sales, cash receipts, inventory,
food and beverage costs, labor costs and other controllable operating expenses. Our restaurants and package liquor stores offer
online ordering for to-go sales and our package liquor stores also offer delivery services by third-party vendors.

and package liquor store hardware and software support is provided by both our internal support services team as well as third-party
vendors. Each restaurant and package liquor store has a private high-speed wide area connection to send and receive critical business
data as well as to access web-based applications securely as well as a failover capability. All of our core and critical applications
are backed up to external data centers. To mitigate business interruptions, we utilize a data backup and replication infrastructure
between our onsite and external data centers, so all data is replicated nightly between the sites.

 We require cybersecurity
awareness training for all staff members with access to our cyber systems. We also maintain cyber risk insurance coverage to further
reduce our risk profile. Security of our financial data and other sensitive information remains a high priority for us, led by our
information technology department. In an effort to further secure our customers' credit card information, we employ an encryption
and tokenization platform for all credit card transactions in our restaurants, ensuring no credit card data is stored in our internal
systems. We also transact business through online ordering for both our restaurants and package liquor stores through third party vendors.
(See Item 1A. Risk Factors and the discussion of cybersecurity risks and Item 1C information on cybersecurity risk management.)

 Government Regulation

 Our operations are subject
to various federal, state and local laws affecting our business. In particular, our operations are subject to regulation by federal agencies
and to licensing and regulation by state and local health, food preparation and safety, sanitation, alcoholic beverage control, safety
and fire department agencies in the state or municipality where our units are located.

 Alcoholic beverage control
regulations require each of our restaurants and package liquor stores to obtain a license to sell alcoholic beverages from a state authority
and in certain locations, county and municipal authorities.

 In Florida, where all of
our restaurants and package liquor stores are located, most of our liquor licenses are issued on a "quota license" basis.
Quota licenses are issued on the basis of a population count established from time to time under the latest applicable census. Because
the total number of liquor licenses available under a quota license system is limited and restrictions are placed upon their transfer,
the licenses have purchase and resale value based upon supply and demand in the particular areas in which they are issued. The quota
licenses held by us allow the sale of liquor for on and off premises consumption (the "4 COP Quota Liquor License"). The
other liquor licenses held by us or limited partnerships of which we are the general partner, are restaurant liquor licenses, which do
not have quota restrictions or purchase or resale value. A restaurant liquor license is issued to every applicant who meets all of the
state and local licensing requirements, including, but not limited to zoning and minimum restaurant size, seating and menu. The restaurant
liquor licenses held by us allow the sale of liquor for on premises consumption only.

 All licenses must be renewed
annually and may be revoked or suspended for cause at any time. Suspension or revocation may result from violation by the licensee or
its employees of any federal, state or local law regulation pertaining to alcoholic beverage control. Alcoholic beverage control regulations
relate to numerous aspects of the daily operations of our units, including, minimum age of patrons and employees, hours of operations,
advertising, wholesale purchasing, inventory control, handling, storage and dispensing of alcoholic beverages, internal control and accounting.

 As the sale of alcoholic
beverages constitutes a large share of our revenue, the failure to receive or retain, or a delay in obtaining a liquor license in a particular
location could adversely affect our operations in that location and could impair our ability to obtain licenses elsewhere.

 During our fiscal years 2025
and 2024, no significant pending matters have been initiated concerning any of our licenses which might be expected to result in a revocation
of a liquor license or other significant actions against us.

 We are subject to "dram-shop"
statutes due to our restaurant operations. These statutes generally provide a person injured by an intoxicated person the right to recover
damages from an establishment that wrongfully served alcoholic beverages to the intoxicated individual. We carry liquor liability coverage
as part of our existing comprehensive general liability insurance, which we believe is consistent with coverage carried by other entities
in the restaurant industry. Although we are covered by insurance, a judgment against us under a dram-shop statute in excess of our liability
coverage could have a material adverse effect on us. We currently have no "dram shop" claims.

 Our operations are also subject
to federal and state laws governing such matters as wages, working conditions, citizenship requirements and overtime. Significant numbers
of hourly personnel at our restaurants are paid at rates related to the federal or Florida minimum wage, whichever is higher, and accordingly,
increases in the minimum wage will increase labor costs. We are also subject to the Americans with Disability Act of 1990 ("ADA"),
which, among other things, may require certain renovations to our restaurants to meet federally mandated requirements. The cost of any
such renovations is not expected to materially affect us.

 A significant number of our
hourly restaurant staff members receive income from gratuities. Many of our locations participate voluntarily in a Tip Reporting Alternative
Commitment ("TRAC") agreement with the Internal Revenue Service ("IRS"). By complying with the educational and
other requirements of the TRAC agreement, we reduce the likelihood of potential employer-only Federal Insurance Contributions Act ("FICA")
tax assessments for unreported or underreported tips. We are not under investigation or audit, nor have we been assessed for potential
employer-only FICA tax assessments for unreported or underreported tips.

 We are also subject to laws
relating to information security, privacy, cashless payments and consumer credit protection and fraud.

 We are not aware of any statute,
ordinance, rule or regulation under present consideration which would significantly limit or restrict our business as now conducted.
However, in view of the number of local jurisdictions within the State of Florida in which we conduct business, and the highly regulated
nature of the liquor business, there can be no assurance that additional limitations may not be imposed in the future, even though none
are presently anticipated.

 Human Capital

 We
depend on our staff members to successfully execute all aspects of our day-to-day operations. Our ability to attract highly motivated
staff members and retain an engaged, experienced team is key to successful execution of our strategy. We are currently operating in a
competitive labor environment. If we are unable to hire or retain qualified restaurant management and operating personnel in an increasingly
competitive market, we may be unable to effectively operate and grow our business and revenues, which could materially adversely affect
our financial performance.

 Development and Training

 We
invest resources to ensure our staff receive training in order to maximize their potential. In addition, we strive to provide our staff
with career advancement opportunities. Our training programs allow us to fill certain of our management positions with internal candidates.

 Benefits and Wellness

 We
believe access to healthcare is a compelling benefit for many staff members and we offer healthcare benefits to our hourly staff members
who work a minimum of 30 hours per week, on average. We attempt to provide a robust suite of benefits and wellness offerings.

 Employee Engagement

 Listening
to our staff members is an essential part of building an engaged workforce, and we provide avenues for staff to share their ideas and
concerns.

 As
of our fiscal year end 2025, we employed 2,033 persons, of which 773 were full-time and 1,260 were part-time. Of these, 58 were employed
at our corporate offices in administrative capacities and 13 were employed in maintenance. Of the remaining employees, 76 were employed
in our package liquor stores and 1,886 in our restaurants. None of our employees are represented by collective bargaining organizations.
We consider our labor relations to be favorable.

 Giving Back

 Another
key aspect of our culture is giving back to the communities where our staff live and work and uniting our staff members around charitable
causes personal to them. We periodically donate to philanthropic organizations through campaigns designed to engage our staff, as follows:

 Breast
 Cancer Awareness – We donate $10,000 annually to local Breast Cancer Support organizations.

 Rockin' Rib run 10k – We donate over $40,000 to Mami HOPE mission through our
 annual 10k event. Money is used for disaster and hunger relief all over the world, youth
 outreach, and community building.

 Achievement
 Awards – We provide schools in Miami-Dade, Broward, and Palm Beach County with free
 kids' meals and achievement awards throughout the year. We give out approximately 85,000
 awards every year.

 Fishing
 Tournaments/Marine Conservation – We donate to fishing tournaments and beach cleanup
 projects.

 Supporting
 the local community – We donate funds to boy scouts, baseball teams, schools, etc.

 Reclaimed
 Wood – All of our locations use reclaimed wood on interior walls.

 We
also believe our sustainability programs and initiatives like restaurant-based recycling and replacing our off-premise packaging with
materials that reduce the use of plastics and improve recyclability serve to foster pride in our staff.

 Executive Officers

 Name

 Positions
 and Offices Currently Held

 Age

 Office
 or Position

 Held Since

 James G. Flanigan

 Chairman of the Board of Directors, Chief Executive
 Officer and President

 (1)

 August Bucci

 Chief Operating Officer and Executive Vice President

 2002

 Jeffrey D. Kastner

 Chief Financial Officer, General Counsel and Secretary

 (2)

 Christopher O'Neil

 Vice President of Package Operations

 2016

 (1)
 Chairman of the Board
 of Directors, Chief Executive Officer since 2005; President since 2002.

 (2)
 Chief Financial Officer
 since 2004; Secretary since 1995; and General Counsel since 1982.

 Flanigan's 401(k) Plan

 Effective July 1, 2004, we
began sponsoring a 401(k) retirement plan covering substantially all employees who meet certain eligibility requirements. Employees may
contribute elective deferrals to the plan up to amounts allowed under the Internal Revenue Code. We are not required to contribute to
the plan but may make discretionary profit sharing and/or matching contributions. During our fiscal years ended September 27, 2025 and
September 28, 2024, the Board of Directors approved discretionary matching contributions totaling $87,000 and $74,000, respectively.

 General Liability Insurance

 For the policy year beginning
December 30, 2024, we have general liability insurance which incorporates a $50,000 self-insured retention per occurrence for us and
a $10,000 self-insured retention per occurrence for the limited partnerships. Our insurance carrier is responsible for $1,000,000 coverage
per occurrence above our self-insured retentions, up to a maximum aggregate of $2,000,000 per year. We were also able to purchase excess
liability insurance whereby our excess insurance carrier is responsible for $10,000,000 coverage above our primary general liability
insurance coverage. We are uninsured against liability claims in excess of $11,000,000 per occurrence and in the aggregate.

 Our general policy is to
settle only those legitimate and reasonable claims asserted and to aggressively defend and go to trial, if necessary, on frivolous and
unreasonable claims. Under our current liability insurance policy, certain expenses incurred by us in defending a claim, including attorney's
fees, are a part of our $50,000 self-insured retention, and a part of our limited partnerships' $10,000 self-insured retention.

 In accordance with accounting
guidance, we accrue for any liability by recognizing costs when it is probable that a covered liability has been incurred and the cost
can be reasonably estimated. Accordingly, our annual insurance costs may be subject to adjustment from previous estimates as facts and
circumstances change. Our accruals are included in the accompanying consolidated balance sheets in the caption "Accounts payable
and accrued expenses". A significant unfavorable judgment or settlement against us in excess of our liability insurance coverage
could have a materially adverse effect on the Company.

 Property Insurance; Windstorm Insurance

 For the policy year beginning
December 30, 2024, our property insurance is a one (1) year policy with an unaffiliated third party insurance carrier, including coverage
for properties leased by us and our consolidated limited partnerships, and provides for full insurance coverage for property losses,
including those caused by windstorms, such as a hurricane. For property losses caused by windstorm, the property insurance has a fixed
deductible of $100,000, plus 5% of all insured losses, per occurrence. For all other property losses, the property insurance has deductibles
of $10,000 per location, per occurrence.

 Insurance Premiums

 Due to continuing higher
interest rates, for the policy year commencing December 30, 2024 we paid the premiums for general liability, auto, property, excess liability
and terrorism policies totaling approximately $4.01 million, which includes coverage for our franchises (of approximately $911,000),
which are not included in our consolidated financial statements. For the policy year commencing December 30, 2025, we will pay the premiums
for general liability, auto, property, excess liability and terrorism policies in full again due to continuing higher interest rates.

 Competition and the Company's Market

 The liquor and hospitality
industries are highly competitive and are often affected by changes in taste and entertainment trends among the public, by local, national
and economic conditions affecting spending habits, and by population and traffic patterns. We believe that the principal means of competition
among package liquor stores is price and that, in general, the principal means of competition among restaurants include the location,
type and quality of facilities and the type, quality and price of beverage and food served.

 Our package liquor stores
compete directly or indirectly with local retailers and discount "superstores". Due to the competitive nature of the liquor
industry in South Florida, we have had to adjust our pricing to stay competitive. Such practices will continue in the package liquor
business. We believe that we have a competitive position in our market because of widespread consumer recognition of the "Big Daddy's
Liquors" and "Big Daddy's Wine & Liquors" names.

 Our restaurants compete directly
or indirectly with many well-established competitors, both nationally and locally owned. During the second quarter of our fiscal year
2025, we increased our menu prices for our bar offerings (effective February 23, 2025) to target an increase to our bar revenues of approximately
0.84% annually to offset higher food and liquor costs and higher overall expenses. During the first quarter of our fiscal year 2025,
we increased our menu prices for our bar offerings (effective December 4, 2024) to target an increase to our bar revenues of approximately
4.90% annually and we increased our menu prices for our food offerings (effective November 17, 2024) to target an increase to our food
revenues of approximately 4.14% annually to offset higher food and liquor costs and higher overall expenses. During our fiscal year 2024,
we increased menu prices for our bar offerings (effective August 25, 2024) to target an increase to our bar revenues of approximately
5.63% annually to offset higher food and liquor costs and higher overall expenses. Prior to these increases we previously raised menu
prices in the second quarter of our fiscal year 2023. We believe that we have a competitive position in our market because of widespread
consumer recognition of the "Flanigan's Seafood Bar and Grill" and "Flanigan's" names.

 We have many well-established
competitors, both nationally and locally owned, with substantially greater financial resources than we do. Their resources and market
presence may provide advantages in marketing, purchasing and negotiating leases. We compete with other restaurant and retail establishments
for sites and finding management personnel.

 Our business is subject to
seasonal effects, including that liquor purchases tend to increase during the holiday seasons.

 Trade Names

 We operate our package liquor
stores and restaurants under the service marks: "Big Daddy's Liquors", "Big Daddy's Wine & Liquors",
"Flanigan's Seafood Bar and Grill", and "Flanigan's". We operate our sports bar under the service
mark: "Brendan's Sports Pub". Our right to the use of the "Big Daddy's" service mark is set forth
under a consent decree of a federal court entered into by us in settlement of federal trademark litigation. The consent decree and the
settlement agreement allow us to continue to use and to expand our use of the "Big Daddy's" service mark in connection
with our package liquor sales in Florida, while restricting future liquor sales in Florida under the "Big Daddy's"
name by the other party who has a federally registered service mark for "Big Daddy's" use in the restaurant business.
The federal court retained jurisdiction to enforce the consent decree. We have acquired registered Federal trademarks on the principal
register for our "Big Daddy's Liquors", "Flanigan's" and "Flanigan's Seafood Bar and
Grill" service marks.

 The standard symbolic trademark
associated with our facilities and operations is the bearded face and head of "Big Daddy" which is predominantly displayed
at all "Flanigan's" facilities and all "Big Daddy's" facilities throughout the country. The face
comprising this trademark is that of the Company's founder, Joseph "Big Daddy" Flanigan, and is a federally registered
trademark owned by us.

 ITEM
1A. RISK FACTORS

 An investment in our common
stock involves a high degree of risk. These risks should be considered carefully with the uncertainties described below, and all other
information included in this Annual Report on Form 10-K, before deciding whether to purchase our common stock. Additional risks and uncertainties
not currently known to management or that management currently deems immaterial and therefore not referenced herein, may also become
material and may harm our business, financial condition or results of operations. The occurrence of any of the following risks could
harm our business, financial condition and results of operations. The trading price of our common stock could decline due to any of these
risks and uncertainties and you may lose part or all of your investment.

 Certain statements in this
report contain forward-looking information. In general, forward-looking statements include estimates of future revenues, cash flow, capital
expenditures, or other financial items and assumptions underlying any of the foregoing. Forward-looking statements reflect management's
current expectations regarding future events and use words such as "anticipate", "believe", "expect",
"may", "will" and other similar terminology. These statements speak only as of the date they were made and involve
a number of risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking
statements. Several factors, many beyond our control, could cause actual results to differ materially from management's expectations.
New risks and uncertainties arise from time to time, and we cannot predict when they may arise or how they may affect us. We assume no
obligation to update any forward-looking statements after the date of this report as a result of new information, future events or other
developments, except as required by applicable laws and regulations.

 Risks Related to Our Business
and Industry

 If we are unable
to staff and retain qualified restaurant and package liquor store management and operating personnel in an increasingly competitive market,
we may be unable to effectively operate and grow our business and revenues, which could materially adversely affect our financial performance.

 The market for qualified talent continues to
be competitive and we must continue to offer competitive wages, benefits and workplace conditions to retain qualified employees. We have
experienced and may in the future experience challenges in hiring and retaining restaurant and store employees and in maintaining full
restaurant staffing in various locations, which could result in decreased employee and customer satisfaction. A shortage of qualified
candidates who meet legal work authorization requirements, failure to hire, train and retain new employees in a timely manner or higher
than expected turnover levels could affect our ability to open new restaurants, grow sales at existing restaurants or meet our labor
cost objectives. Anticipated changes in immigration laws and regulations could decrease the pool of candidates with legal work authorization,
cause disruption in the workforce for all companies that rely on hourly workers and increase the costs, time and requirements to hire
new employees. In addition, failure to adequately monitor and proactively respond to employee dissatisfaction could lead to poor customer
satisfaction, higher turnover and litigation, which could negatively impact our financial results. If we are unable to attract
and retain qualified people, our restaurants could be short staffed, we may be forced to incur overtime expenses, and our ability to
operate and expand our concepts effectively and to meet our customers' demand could be limited, any of which could materially adversely
affect our financial performance.

 We have experienced
and continue to experience significant labor cost inflation. If we are unable to offset higher labor costs, our cost of doing business
will significantly increase, which could materially adversely impact our financial performance.

 Increases
in minimum wages and minimum tip credit wages, extensions of personal and other leave policies, other governmental regulations affecting
labor costs and a diminishing pool of potential staff members when the unemployment rate falls and legal immigration is restricted, especially
in certain localities, could significantly increase our labor costs and make it more difficult to fully staff our restaurants, any of
which could materially adversely affect our financial performance.

 We
believe the United States federal government may significantly increase the federal minimum wage and tip credit wage (or eliminate the
tip credit wage) and require significantly more mandated benefits than what is currently required under federal law. The State of Florida
has already enacted a minimum wage and tip credit, with the minimum wage currently at $14.00 per hour and a tip credit of $3.02 per hour.
The minimum wage increases $1.00 per hour annually until it reaches $15.00 per hour in 2026. The tip credit does not increase. In addition
to increasing the overall wages paid to our minimum wage and tip credit wage earners, these increases create pressure to increase wages
and other benefits paid to other staff members who, in recognition of their tenure, performance, job responsibilities and other similar
considerations, historically received a rate of pay exceeding the applicable minimum wage or minimum tip credit wage. Because we employ
a large workforce, any wage increase and/or expansion of benefits mandates will have a particularly significant impact on our labor costs.
Our vendors, contractors and business partners are similarly impacted by wage and benefit cost inflation, and many have or will increase
their price for goods, construction and services in order to offset their increasing labor costs. Additionally, while our employees are
not currently covered by any collective bargaining agreements, union organizers may engage in efforts to organize our employees and those
of other restaurant companies. If a significant portion of our employees were to unionize, our labor costs could increase and it could
negatively impact our culture, reduce our flexibility and disrupt our business. In addition, our responses to any union organizing efforts
could negatively impact our reputation and dissuade guests from patronizing our restaurants.

 Our
labor expenses include significant costs related to our health benefit plans. Health care costs continue to rise and are especially difficult
to project. Material increases in costs associated with medical claims, or an increase in the severity or frequency of such claims, may
cause health care costs to vary substantially from year-over-year. Given the unpredictable nature of actual health care claims trends,
including the severity or frequency of claims, in any given year our health care costs could significantly exceed our estimates,
which could materially adversely affect our financial performance.

 Any
significant changes to the healthcare insurance system could impact our healthcare costs. Material increases in healthcare costs could
materially adversely affect our financial performance.

 While
we try to offset labor cost increases through price increases, more efficient purchasing practices, productivity improvements and greater
economies of scale, there can be no assurance that these efforts will be successful. If we are unable to effectively anticipate and respond
to increased labor costs, our financial performance could be materially adversely affected.

 Our sales and profit growth could be adversely
affected if comparable restaurant sales increases are less than we expect, and we may not successfully increase comparable restaurant
sales or they may decrease.

 While future sales growth
will depend substantially on our opening new restaurants, changes in comparable restaurant sales (which represent the change in period-over-period
sales for restaurants) will also affect our sales growth and will continue to be a critical factor affecting profit growth. This is because
the profit margin on comparable restaurant sales is generally higher, as comparable restaurant sales increases enable fixed costs to
be spread over a higher sales base. Conversely, declines in comparable restaurant sales can have a significant adverse effect on profitability
due to the loss of the positive impact on profit margins associated with comparable restaurant sales increases. There is no assurance
that comparable restaurant sales will increase in fiscal year 2026 due to, among other things, ongoing consumer and economic uncertainty.

 Our ability to increase comparable
restaurant sales depends on many factors, including:

 perceptions
 of the Flanigan's brand;

 competition,
 especially from an increasing number of competitors in the fast casual segment of the restaurant
 industry and from other restaurants whose strategies overlap ours, as well as from grocery
 stores, meal kit delivery services and other dining options;

 executing
 our strategies effectively, including our marketing and branding strategies;

 changes
 in consumer preferences and discretionary spending;

 our
 ability to increase menu prices without adversely affecting our existing business;

 weather,
 natural disasters and other factors limiting access to our restaurants; and

 changes
 in government regulation that may impact customer perceptions of our food.

 As a result, it is possible
that we will not achieve our targeted comparable restaurant sales or that the change in comparable restaurant sales could be negative.
A number of these factors are beyond our control and therefore we cannot assure that we will be able to sustain comparable restaurant
sales increases.

 High unemployment, instability in the housing
market, high energy and food costs and general economic uncertainty could result in a decline in consumer discretionary spending that
would materially affect our financial performance.

 Dining out is a discretionary
expense. Factors that affect consumer behavior and spending for restaurant dining, such as changes in general economic conditions (including
national, regional and local economic conditions), discretionary spending patterns, employment levels, instability in the housing market,
and high energy and food costs may have a material adverse effect on us. If economic conditions worsen, our financial performance could
be adversely affected.

 Intense competition in the restaurant and
package liquor store industry could prevent us from increasing or sustaining our revenues and profitability.

 The restaurant and package
liquor store industry is intensely competitive with respect to food quality, price-value relationships, ambiance, service and location
and many restaurants and package liquor stores compete with us at each of our locations. There are a number of well-established competitors
with substantially greater financial, marketing, personnel and other resources than ours, and many of our competitors are well established
in the markets where we have restaurants and/or stores or where we intend to locate restaurants. Additionally, other companies may develop
restaurants and/or stores that operate with similar concepts.

 Any inability to compete
successfully with the other restaurants and/or stores in our markets will prevent us from increasing or sustaining our revenues and profitability
and will result in a material adverse effect on our business, financial condition, results of operations and cash flows. We may also need
to modify or refine elements of our business to evolve our concepts in order to compete with popular new restaurant formats or store
concepts that may develop in the future. There can be no assurance that we will be successful in implementing these modifications or
that these modifications will not reduce our profitability.

 New information or attitudes regarding
diet and health could result in changes in regulations and consumer eating habits that could adversely affect our revenues.

 Regulations and consumer
eating habits may change because of new information or attitudes regarding diet and health. These changes may include regulations that
impact the ingredients and nutritional content of our menu items at our restaurants. For example, a number of states, counties and cities
are enacting menu-labeling laws requiring multi-unit restaurant operators to make certain nutritional information available to guests
or restrict the sales of certain types of ingredients in restaurants. The success of our restaurant operations is dependent, in part,
upon our ability to respond effectively to changes in consumer health and disclosure regulations and to adapt our menu offerings to trends
in eating habits. If consumer health regulations or consumer eating habits change significantly, we may be required to modify or delete
certain menu items. To the extent we are unable to respond with appropriate changes to our menu offerings, it could materially affect
customer demand and have an adverse impact on our revenues.

 Adverse public or medical opinions about
health effects of consuming our products as well as negative publicity about us, our restaurants and/or package liquor stores and about
others across the food and liquor industry supply chain, whether or not accurate, could negatively affect us.

 Restaurant operators have
received more scrutiny from regulators and health organizations in recent years relating to the health effects of consuming certain products.
An unfavorable report on the products we use in our menu, the size of our portions or the consumption of those items could influence
the demand for our offerings. In addition, adverse publicity or news reports, whether or not accurate, of food quality issues, illness,
injury, health concerns, or operating issues stemming from a single restaurant, a limited number of restaurants, restaurants operated
by others or generally in the food supply chain could be damaging to the restaurant industry overall and specifically harm our reputation.
A decrease in guest traffic because of these types of health concerns or negative publicity could materially harm our results of operations.

 Our inability to successfully and sufficiently
raise menu prices could result in a decline in profitability.

 We utilize menu price increases
to help offset cost increases, including increased cost for commodities, minimum wages, employee benefits, insurance arrangements, construction,
utilities and other key operating costs. If our selection and amount of menu price increases are not accepted by consumers and reduce
guest traffic, or are insufficient to counter increased costs, our financial results could be negatively affected. However, we have not
experienced any adverse effects from past menu price increases.

 Increases in food costs, raw materials
and other supplies and services due to inflation may have a material adverse impact on our financial performance.

 Our operating margins depend
on, among other things, our ability to anticipate and react to changes in the costs of key operating resources, including food and beverage
costs, utilities and other supplies and services due to inflation. We attempt to negotiate short-term and long-term agreements for our
principal commodity, supply and equipment requirements, depending on market conditions and expected demand. However, we are currently
unable to contract for extended periods of time for certain commodities. Consequently, these commodities can be subject to unforeseen
supply and cost fluctuations due to factors such as changes in demand patterns, increases in the cost of key inputs, fuel costs, weather
and other market conditions outside of our control caused by inflation. Dairy costs can also fluctuate due to government regulation.
Our suppliers also may be affected by higher costs to produce and transport commodities used in our restaurants, higher minimum wage
and benefit costs, and other expenses that they pass through to their customers, which could result in higher costs for goods and services
supplied to us.

 Shortages or interruptions in the supply
of food offering ingredients and/or liquor inventory could adversely affect our operating results.

 Our
business is dependent on frequent and consistent deliveries of food offering ingredients and liquor inventory. We may experience shortages,
delays or interruptions in the supply of ingredients and other supplies to our restaurants due to inclement weather, natural disasters,
labor issues or other operational disruptions at our suppliers, distributors or transportation providers or other conditions beyond our
control. In addition, we have a single or a limited number of suppliers for some of our ingredients, including baby back ribs. Although
we believe we have potential alternative suppliers and sufficient reserves of food offering ingredients and liquor inventory, shortages
or interruptions in our supply of food offering ingredients and liquor inventory could adversely affect our financial results.

 Our business could be materially adversely
affected if we are unable to expand in a timely and profitable manner.

 To
grow successfully, we must open new restaurants and/or package liquor stores on a timely and profitable basis. We have experienced delays
in restaurant and/or package liquor store openings from time to time and may experience delays in the future. During our fiscal year
2024, we opened our restaurant in Hollywood, Florida (Store #19R) which replaced our restaurant destroyed by fire that previously operated
at that site.

 Our ability to open and profitably
operate restaurants and/or package liquor stores is subject to various risks such as identification and availability of suitable and
economically viable locations, the negotiation of acceptable leases or the purchase terms of existing locations, the availability of
limited partner investors or other means to raise capital, the need to obtain all required governmental permits (including zoning approvals)
on a timely basis, the need to comply with other regulatory requirements, the availability of necessary contractors and subcontractors,
the availability of construction materials and labor, the ability to meet construction schedules and budgets, variations in labor and
building material costs, changes in weather or other acts of God that could result in construction delays and adversely affect the results
of one or more restaurants and/or package liquor stores for an indeterminate amount of time. If we are unable to manage these risks successfully,
we will face increased costs and lower than anticipated revenues which will materially adversely affect our business, financial condition,
operating results and cash flow.

 Changes in customer tastes and preferences,
spending patterns and demographic trends could cause sales to decline and adversely affect financial performance.

 Changes
in customer preferences, general economic conditions, discretionary spending priorities, demographic trends, traffic patterns and the
type, number and location of competing restaurants affect the restaurant industry. Our success depends to a significant extent on consumer
confidence, which is influenced by general economic conditions and discretionary income levels. Our sales may decline during economic
downturns, which can be caused by various economic factors such as high gasoline prices, or during periods of uncertainty. Any material
decline in consumer confidence or a decline in spending on casual dining away from home could cause our sales, operating results, business
or financial condition to decline. We offer a large variety of entrees, side dishes and desserts and our continued success depends, in
part, on the popularity of our cuisine and casual style of dining. A change from this dining style may have an adverse effect on our business.
If we fail to adapt to changes in customer preferences and trends, we may lose customers and our sales may deteriorate.

 Our success depends substantially on the
value of our brands and our reputation for offering guests a satisfactory experience.

 We believe we have built
a reasonably strong reputation for the predictability of our menu items, as part of the experience that guests enjoy in our restaurants.
We believe we must protect and grow the value of our brands to continue to be successful in the future. Any incident that erodes consumer
trust in or affinity for our brands could be harmful to us. If consumers perceive or experience a reduction in food quality, service
or ambiance, or in any way believe we failed to deliver a consistently positive experience, our brand value could suffer.

 Our marketing and advertising strategies
may not be successful, which could adversely impact our business.

 From time to time, we introduce
new advertising campaigns and media strategies. If our advertising campaign and new media strategies do not resonate with customers in
the manner we hope, they may not result in increased sales, but would still increase our expenses. We will continue to invest in marketing
and advertising strategies that we believe will attract customers or increase their connection with our brand. If these marketing and
advertising investments do not drive increased restaurant and/or package store sales, the expense associated with these programs will
adversely impact our financial results, and we may not generate the levels of comparable sales we expect.

 Labor shortages, an increase in labor costs, or inability to
attract employees could harm our business.

 Our employees are essential
to our operations and our ability to deliver an enjoyable dining experience to our customers. If we are unable to attract and retain
enough qualified restaurant and/or package liquor store personnel at a reasonable cost, and if they do not deliver an enjoyable dining
experience, our results may be negatively affected. Additionally, competition for qualified employees could require us to pay higher
wages, which could result in higher labor costs.

 Due to our geographic locations, restaurants
are subject to climate conditions that could affect operations.

 All but one (1) of our restaurants
and package liquor stores are located in South Florida, with the remaining restaurant located in Central Florida. During hurricane season,
(June 1 through November 30 each year), our restaurants and/or package liquor stores may face harsh weather associated with hurricanes
and tropical storms. These harsh weather conditions may make it more difficult for customers to visit our restaurants and package liquor
stores or may necessitate the closure of the stores and restaurants for a period of time. If customers are unable to visit our restaurants
and/or package liquor stores, our sales and operating results may be negatively affected.

 If we were to experience widespread difficulty
renewing existing leases on favorable terms, our revenue or occupancy costs could be adversely affected.

 Most
of the properties on which we operate restaurants are leased from third parties, and some of our leases are due for renewal or extension
options in the next several years. Some leases expire without any renewal options. While we currently expect to pursue the renewal of
substantially all of our expiring restaurant leases, any difficulty renewing a significant number of such leases, or any substantial
increase in rents associated with lease renewals, could adversely impact us. If we have to close any restaurants due to difficulties
in renewing leases, we would lose revenue from the affected restaurants and may not be able to open suitable replacement restaurants.
Substantial increases in rents associated with lease renewals would increase our occupancy costs, reducing our restaurant margins.

 Due to our geographic locations, we may
not be able to acquire windstorm insurance coverage or adequate windstorm insurance coverage at a reasonable rate.

 Due to the anticipated active
hurricane seasons in South Florida in the future, we may not be able to acquire windstorm insurance coverage for our restaurant and package
liquor store locations on a year-to-year basis or may not be able to get adequate windstorm insurance coverage at reasonable rates. If
we are unable to obtain windstorm insurance coverage or adequate windstorm insurance coverage at reasonable rates, then we will be self-insured
for all or a part of the exposure for damages caused by a hurricane impacting South Florida, which may have a material adverse effect
upon our financial condition and/or results of operations.

 Our inability or failure to execute a comprehensive
business continuity plan at our restaurant support centers following a disaster or force majeure event could have a material adverse
impact on our business.

 Many
of our corporate systems and processes and corporate support for our restaurant and package liquor store operations are centralized at
one location. We have disaster recovery procedures and business continuity plans in place to address crisis-level events, including
hurricanes and other natural disasters and back up and off-site locations for recovery of electronic and other forms of data and information.
However, if we are unable to fully implement our disaster recovery plans, we may experience delays in recovery of data, inability to
perform vital corporate functions, tardiness in required reporting and compliance, failures to adequately support field operations and
other breakdowns in normal communication and operating procedures that could have a material adverse effect on our financial condition,
results of operation and exposure to administrative and other legal claims. In addition, these threats are constantly evolving, which
increases the difficulty of accurately and timely predicting, planning for and protecting against the threat. As a result, our disaster
recovery procedures and business continuity plans may not adequately address all threats we face or protect us from loss.

 Inability to attract and retain customers
could affect results of operations.

 We take pride in our ability
to attract and retain customers, however, if we do not deliver an enjoyable dining experience for our customers, they may not return
and results may be negatively affected.

 A failure to comply with governmental regulations
could harm our business and our reputation.

 We are subject to regulation
by federal agencies and regulation by state and local health, sanitation, building, zoning, safety, fire and other departments relating
to the development and operation of restaurants. These regulations include matters relating to the following:

 the
 preparation and sale of food and alcoholic beverages;

 employment;

 building
 construction and access;

 zoning
 requirements; and

 the
 environment.

 Our facilities are licensed
and subject to regulation under state and local fire, health and safety codes. The construction and remodeling of restaurants will be
subject to compliance with applicable zoning, land use and environmental regulations. We may not be able to obtain necessary licenses
or other approvals on a cost-effective and timely basis in order to construct and develop restaurants in the future.

 Various federal and state
labor laws govern our operations and our relationship with our employees, minimum wage, overtime, working conditions, fringe benefit
and work authorization requirements. In particular, we are subject to federal immigration regulations. Given the location of many of
our restaurants, even if we operate those restaurants in strict compliance with federal immigration requirements, our employees may not
all meet federal work authorization or residency requirements, which could lead to disruptions in our work force.

 We are required to comply
with the alcohol licensing requirements of the federal government, states and municipalities where our restaurants are located. Alcoholic
beverage control regulations require applications to state authorities and, in certain locations, county and municipal authorities for
a license and permit to sell alcoholic beverages. Typically, licenses must be renewed annually and may be revoked or suspended for cause
at any time. Alcoholic beverage control regulations relate to numerous aspects of the daily operations of the restaurants, including
minimum age of guests and employees, hours of operation, advertising, wholesale purchasing, inventory control and handling and storage
and dispensing of alcoholic beverages. If we fail to comply with federal, state or local regulations, our licenses may be revoked and
we may be forced to terminate the sale of alcoholic beverages at one or more of our restaurants.

 The Federal Americans with
Disabilities Act (the "ADA") prohibits discrimination on the basis of disability in public accommodations and employment.
We are required to comply with the ADA and regulations relating to accommodating the needs of disabled persons in connection with the
construction of new facilities and with significant renovations of existing facilities.

 Failure to comply with these
and other regulations could negatively impact our reputation and could have an adverse effect on our business, financial condition, results
of operations or cash flows.

 We may face liability under dram shop statutes.

 Our sale of alcoholic
beverages subjects us to "dram shop" statutes, which allow an injured person to recover damages from an establishment
that served alcoholic beverages to an intoxicated person. If we receive a judgment substantially in excess of our insurance
coverage, or if we fail to maintain our insurance coverage, our business, financial condition, operating results or cash flows could
be materially and adversely affected. There are currently no "dram shop" claims pending against us. See "Item 1.
Business - Government Regulation" for a discussion of the regulations with which we must comply.

 Concerns relating
to pandemics and other diseases, food safety and food-borne illness could reduce customer traffic to our restaurants, disrupt our food
supply chain or cause us to be the target of litigation, which could materially adversely affect our financial performance.

 The
COVID-19 pandemic had a significant adverse impact on our customer traffic and ability to operate our restaurants and future pandemics
and other diseases may have a similar or more severe impact.

 In years past, several nationally
known restaurants experienced outbreaks of food poisoning believed to be caused by E.coli contained in fresh spinach, which is not included
in any of the items on our menu, Asian and European countries experienced outbreaks of avian flu and incidents of "mad cow"
disease have occurred in Canadian and U.S. cattle herds. These problems, other food-borne illnesses (such as, hepatitis A, trichinosis
or salmonella) and injuries caused by food tampering have in the past, and could in the future, adversely affect the price and availability
of affected ingredients and cause changes in consumer preference. As a result, our sales could decline.

 Instances of food-borne illnesses,
real or perceived, whether at our restaurants or those of our competitors, could also result in negative publicity about us or the restaurant
industry, which could adversely affect sales. If we react to negative publicity by changing our menu or other key aspects of the dining
experience we offer, we may lose customers who do not accept those changes and may not be able to attract enough new customers to produce
the revenue needed to make our restaurants profitable. If our guests become ill from food-borne illnesses, we could be forced to temporarily
close some restaurants. A decrease in guest traffic as a result of health concerns or negative publicity, or as a result of a change
in our menu or dining experience or a temporary closure of any of our restaurants, could materially harm our business.

 If we are unable to protect our customers'
credit card data, we could be exposed to data loss, litigation and liability, and our reputation could be significantly harmed.

 In connection with credit
card sales, we transmit confidential credit card information by way of secure private retail networks. Although we use private networks,
third parties may have the technology or know-how to breach the security of the customer information transmitted in connection with credit
card sales, and our security measures and those of our technology vendors may not effectively prohibit others from obtaining improper
access to this information. If a person is able to circumvent these security measures, he or she could destroy or steal valuable information
or disrupt our operations. Any security breach could expose us to risks of data loss, litigation, and liability, and could seriously
disrupt our operations and any resulting negative publicity could significantly harm our reputation. We have not experienced any security
breaches to date.

 If we experience a significant failure
in or interruption of certain key information technology systems, our business could be adversely impacted.

 We use a variety of
applications and systems to manage the flow of information securely within each of our restaurants and within our centralized
corporate infrastructure. The services available within our systems and applications include restaurant and store operations, supply
chain, inventory, scheduling, training, human capital management, financial tools and data protection services. The restaurant and
store structure is based primarily on a point-of-sale system that operates locally and is integrated with other functions necessary
to operations. It records sales transactions, receives out of store orders and authorizes, batches and transmits credit card
transactions. The system also allows employees to enter time clock information and to produce a variety of management reports.
Select information that is captured from this system at each restaurant or store is collected in the central corporate
infrastructure, which enables management to continually monitor operating results. Our ability to efficiently and effectively manage
our business depends significantly on the reliability and capacity of these and other systems and our operations depend
substantially on the availability of our point-of-sale system and related networks and applications. These systems may be vulnerable
to attacks or outages from security breaches, viruses and other disruptive problems, as well as from physical theft, fire, power
loss, telecommunications failure or other catastrophic events. Any failure of these systems to operate effectively, whether from
security breaches, maintenance problems, upgrades or transitions to new platforms, or other factors could result in interruptions to
or delays in our restaurant or other operations, adversely impacting the restaurant or store experience for our customers or
negatively impacting our ability to manage our business. If our information technology systems fail and our redundant systems or
disaster recovery plans are not adequate to address such failures, or if our business interruption insurance does not sufficiently
compensate us for any losses that we may incur, our revenues and profits could be reduced and the reputation of our brand and our
business could be materially adversely affected. In addition, remediation of any problems with our systems could result in
significant, unplanned expenses.

 The effect of changes to U.S. healthcare
laws may increase our healthcare costs and negatively impact our financial results.

 We offer eligible full-time
employees the opportunity to enroll in healthcare coverage subsidized by the Company. For various reasons, many of our eligible employees
currently choose not to participate in our healthcare plans. The costs and other effects of any new healthcare requirements cannot be
determined with certainty, but they may have a material adverse effect on our financial and operating results.

 Governmental regulation in one or more
of the following areas may adversely affect our existing and future operations and results, including by harming our ability to open
new restaurants or increasing our operating costs.

 Employment
and immigration regulations

 We are subject to various federal and state laws governing our relationship
with our employees, including wage and hour laws, requirements to provide meal and rest periods or other benefits, healthcare, family
leave mandates, requirements regarding working conditions and accommodations to certain employees, citizenship or work authorization and
related requirements, insurance and workers' compensation rules and anti-discrimination laws. Complying with these rules subjects
us to substantial expense and can be cumbersome and can also expose us to liabilities from claims for non-compliance. For example, historically,
lawsuits have been filed against us alleging violations of federal and state laws regarding employee wages and payment of overtime. We
could suffer losses from and incur legal costs to defend these and similar cases and the amount of such losses or costs could be significant.
In addition, several states and localities in which we operate and the federal government have from time to time enacted minimum wage
increases, paid sick leave and mandatory vacation accruals and similar requirements and these changes could increase our labor costs.
Changes in U.S. healthcare laws could also adversely impact us if they result in significant new welfare and benefit costs or increased
compliance expenses.

 We
also are subject to being audited from time to time for compliance with citizenship or work authorization requirements. From time to
time, the State of Florida considers adopting new state immigration laws and the U.S. Congress and Department of Homeland Security from
time to time consider or implement changes to Federal immigration laws, regulations or enforcement programs as well. Changes in immigration
or work authorization laws may increase our obligations for compliance and oversight, which could subject us to additional costs and
make our hiring process more cumbersome or reduce the availability of potential employees. Although we require all workers to provide
us with government-specified documentation evidencing their employment eligibility, some of our employees may, without our knowledge,
be unauthorized workers. We currently participate in the "E-Verify" program, an Internet-based, free program run by the U.S.
government to verify employment eligibility for all employees throughout our company. However, use of E-Verify does not guarantee that
we will properly identify all applicants who are ineligible for employment. Unauthorized workers may subject us to fines or penalties
and we could experience adverse publicity that negatively affects our brand and may make it more difficult to hire and keep qualified
employees. Termination of a significant number of employees would disrupt our operations including slowing our throughput and could also
cause additional adverse publicity and temporary increases in our labor costs as we train new employees. We could also become subject
to fines, penalties and other costs related to claims that we did not fully comply with all recordkeeping obligations of federal
and state immigration compliance laws. Our reputation and financial performance may be materially harmed as a result of any of these
factors.

 On
the other hand, in the event we wrongfully reject work authorization documents or if our compliance procedures are found to have a disparate
impact on a protected class, such as a racial minority or based on the citizenship status of applicants, we could be found to be in violation
of anti-discrimination laws. We could experience adverse publicity arising from enforcement activity related to work authorization compliance,
anti-discrimination compliance, or both, that negatively impacts our brand and may make it more difficult to hire and keep qualified
employees. Moreover, our business could be adversely affected by increased labor costs or difficulties in finding the right employees
for our restaurants.

 Additionally,
while we do not currently have any unionized employees, union organizers have engaged in efforts to organize employees of other restaurant
companies. If a significant portion of our employees were to become union organized, our labor costs could increase and our efforts to
maintain a culture appealing only to top performing employees could be impaired. Potential changes in labor laws, including the possible
passage of legislation designed to make it easier for employees to unionize, could increase the likelihood of some or all of our employees
being subjected to greater organized labor influence and could have an adverse effect on our business and financial results by imposing
requirements that could potentially increase our costs, reduce our flexibility and impact our employee culture.

 Americans
with disabilities act and similar state laws

 We
are subject to the U.S. Americans with Disabilities Act, or ADA, and similar state laws that give civil rights protections to individuals
with disabilities in the context of employment, public accommodations and other areas. We have incurred legal fees in connection with
ADA-related complaints in the past and we may in the future have to modify restaurants, for example by adding access ramps or redesigning
certain architectural features, to provide service to or make reasonable accommodations for disabled persons under these laws. The expenses
associated with these modifications or any damages, legal fees and costs associated with litigating or resolving claims under the ADA
or similar state laws, could be material.

 Nutrition
and food regulation

 In
recent years there has been an increased legislative, regulatory and consumer focus at the federal, state and municipal levels on the
food industry including nutrition and advertising practices. Restaurants operating in the quick-service and fast-casual segments have
been a particular focus. Numerous jurisdictions around the U.S. have adopted regulations requiring that chain restaurants include calorie
information on their menus and/or make other nutritional information available and U.S. health care reform law included nation-wide nutrition
disclosure requirements. These nutrition disclosure requirements may increase our expenses or slow customers as they select their food
and beverage choices decreasing our throughput. These initiatives may also change customers' buying habits in a way that adversely
impacts our sales.

 Privacy/Cybersecurity

 We
are required to collect and maintain personal information about our employees and we collect information about customers as part of some
of our marketing programs as well. The collection and use of such information is regulated at the federal and state levels and the regulatory
environment related to information security and privacy is increasingly demanding. If our security and information systems are compromised
or if we otherwise fail to comply with these laws and regulations, we could face litigation and the imposition of penalties that could
adversely affect our financial performance. Our reputation as a brand or as an employer could also be adversely affected from these types
of security breaches or regulatory violations, which could impair our sales or ability to attract and keep qualified employees.

 Complex
local, state and federal laws and regulations apply to the collection, use, retention, protection, disclosure, transfer and other processing
of personal data. These privacy and data protection laws and regulations are quickly evolving, with new or modified laws and regulations
proposed and implemented frequently and existing laws and regulations subject to new or different interpretations and enforcement. Complying
with these laws and regulations can be costly. If we fail or are perceived to have failed to comply with applicable privacy and data protection
laws, or fail to properly respond to or honor consumer requests under any of the foregoing privacy laws, we could be subject to enforcement
actions and regulatory investigations, or claims for damages by guests and other affected individuals or parties, or incur fines and damage
to our brand reputation, any of which could have a material adverse effect on our operations, financial performance, and business. The
amount and scope of insurance we maintain may not cover all types of claims that may arise.

 Local
licensure, zoning and other regulation

 Each
of our restaurants is also subject to state and local licensing and regulation by health, alcoholic beverage, sanitation, food and workplace
safety and other agencies. We may experience material difficulties or failures in obtaining the necessary licenses or approvals for new
restaurants, which could delay planned restaurant openings. In addition, stringent and varied requirements of local regulators with respect
to zoning, use and environmental factors could delay or prevent development of new restaurants in particular locations.

 Environmental
laws

 We
are subject to federal, state and local environmental laws and regulations concerning the discharge, storage, handling, release and disposal
of hazardous or toxic substances, as well as local ordinances relating to our operations. We have not conducted a comprehensive environmental
review of our properties or operations. We cannot predict what environmental laws will be enacted in the future, how existing or future
environmental laws will be administered or interpreted, or the amount of future expenditures that we may need to make to comply with
or to satisfy claims relating to environmental laws.

 We could be party
to litigation that could adversely affect us by distracting management, increasing our expenses or subjecting us to material money damages
and other remedies.

 We could become subject to numerous claims alleging violations of federal
and state laws regarding workplace and employment matters, including wages, work hours, overtime, vacation and family leave, discrimination,
wrongful termination and similar matters, and we could become subject to class action or other lawsuits related to these or different
matters. Our customers could file complaints or lawsuits against us alleging that we are responsible for some illness or injury they suffered
at or after a visit to our restaurants or that we have problems with food quality, operations or our food related disclosure or advertising
practices. The restaurant industry has been subject to a growing number of claims based on the nutritional content of food products sold
and disclosure and advertising practices.

 Regardless
of whether any claims against us are valid or whether we are ultimately held liable for such claims, they may be expensive to defend
and may divert time and money away from our operations and hurt our performance. A significant judgment for any claims against us could
materially and adversely affect our financial condition or results of operations. Any adverse publicity resulting from these allegations,
whether directed at us or at fast casual or quick-service restaurants generally, may also materially and adversely affect our reputation
or prospects, which in turn could adversely affect our results.

 Our success may
depend on the continued service and availability of key personnel.

 Our
Chairman and Chief Executive Officer and President, James Flanigan, has been the principal architect of our business strategy since 2002.
August Bucci, Jeffrey Kastner and Christopher O'Neil, our Chief Operating Officer, Chief Financial Officer and Vice President of
Package Operations, respectively, have also served with us since 2002 in the case of Mr. Bucci, since 2004 in the case of Mr. Kastner
and 2016 in the case of Mr. O'Neil, and much of our growth has occurred under their direction as well. We believe our executive
officers have created an employee culture, food culture and business strategy at our company that has been critical to our success and
that may be difficult to replicate under another management team. We also believe that it may be difficult to locate and retain executive
officers who are able to grasp and implement our unique strategic vision. If our company culture were to deteriorate following a change
in leadership, or if a new management team were to be unsuccessful in executing our strategy or were to change important elements of
our current strategy, our growth prospects or future operating results may be adversely impacted.

 We are exposed to risks related to cybersecurity.

 Although
we maintain systems and processes that are designed to protect the security of our computer systems, software, networks and other technology,
there is no assurance that all of our security measures will provide absolute security. Any material incidents could cause us to experience
financial losses that are either not insured against or not fully covered through any insurance maintained by us and increased expenses
related to addressing or mitigating the risks associated with any such material incidents. Cyber threats are rapidly evolving and
are becoming increasingly sophisticated. Despite our efforts to ensure the integrity of our systems, as cyber threats evolve and become
more difficult to detect and successfully defend against, one or more cyber threats might defeat the measures that we or our vendors
take to anticipate, detect, avoid or mitigate such threats. Certain techniques used to obtain unauthorized access, introduce malicious
software, disable or degrade service, or sabotage systems may be designed to remain dormant until a triggering event and we may be unable
to anticipate these techniques or implement adequate preventative measures since techniques change frequently or are not recognized until
launched, and because cyberattacks can originate from a wide variety of sources. If our information security systems or data are
compromised in a material way, our ability to conduct our business may be impaired, we may incur financial losses and we may incur costs
to remediate possible harm and/or to pay fines or take other action which could have a material adverse impact on our business.

 If there is a
material failure in our information technology systems, our business operations and profits could be negatively affected and our systems
may be inadequate to support our future growth strategies.

 We
rely heavily on information technology systems in all aspects of our operations including our restaurant point-of sale systems, financial
systems, marketing programs, employee engagement, supply chain management, cyber-security, and various other processes and transactions.
Our ability to effectively manage and run our business depends on the reliability and capacity of our information technology systems,
including technology services and systems for which we contract from third parties. These systems and services may be insufficient to
effectively manage and run our business. These systems and our business needs will continue to evolve and require upgrades and maintenance
over time, consequently requiring significant future commitments of resources and capital.

 Moreover,
these technology services and systems, communication systems, and electronic data could be subject or vulnerable to damage or interruption
from hurricanes, terrorist attacks, floods, fires, power loss, telecommunications failures, computer viruses, loss of data, data breaches,
or other attempts to harm our systems. A failure of these systems to operate effectively, problems with transitioning to upgraded or
replacement systems, or any other failure to maintain a continuous and secure information technology network for any of the above reasons
could result in interruption and delays in customer services, adversely affect our reputation, and negatively impact our results of operations.

 Acts of violence
at or threatened against our restaurants or the centers in which they are located, including active shooter situations and terrorism,
could unfavorably impact our restaurant sales, which could materially adversely affect our financial performance.

 Any
act of violence at or threatened against our restaurants or the centers in which they are located, including active shooter situations
and terrorist activities, may result in restricted access to our restaurants and/or restaurant closures in the short-term and, in the
long-term, may cause our customers and staff to avoid our restaurants. Any such situation could adversely impact customer traffic and
make it more difficult to staff our restaurants fully, which could materially adversely affect our financial performance.

 The occurrence or threat of extraordinary events, such as active shooter
or future terrorist attacks, military and governmental responses, and the protest of future wars, may result in negative changes to economic
conditions likely resulting in decreased consumer spending. Additionally, decreases in consumer discretionary spending may impact the
frequency with which our customers choose to dine out at restaurants or the amount they spend on meals while dining out at restaurants,
thereby adversely affecting our sales and results of operations. A decrease in consumer discretionary spending may also adversely affect
our ability to achieve the benefit of planned menu price increases to help preserve our operating margins.

 Social media impact
on customer perceptions of our brand.

 The
considerable expansion in the use of social media over recent years can further amplify any negative publicity that may be generated.
The adverse impact of publicity on customers' perception of us could have a further negative impact on our sales. If the impact
of any such publicity is particularly long-lasting, the value of our brand may suffer and our ability to grow could be diminished.

 Our digital business
has become an increasingly significant part of our business.

 Our
revenue derived from digital orders, which includes delivery and customer pickup has increased substantially. We have implemented technology,
targeted advertising and promotions and to some extent remodeled our restaurants, to accommodate the growth of our digital business.
If we do not continue to grow our digital business, it may be difficult for us to recoup these costs or achieve our sales growth potential.
We rely on third-party delivery services to fulfill package store delivery orders, and the ordering and payment platforms used by these
third-parties, or online ordering system, could be interrupted by technological failures, user errors, cyber-attacks or other factors,
which could adversely impact sales through these channels and negatively impact our reputation. Additionally, our delivery partners are
responsible for order fulfillment and errors or failures to make timely deliveries could cause guests to stop ordering from us. The third-party
delivery business is competitive, with a number of players competing for market share and delivery drivers. If the third-party delivery
services that we utilize cease or curtail operations, increase their fees, or give greater priority or promotions on their platforms
to our competitors, our delivery business and our sales may be negatively impacted.

 Changes in interest
rates.

 As part of our ongoing operations,
we are exposed to interest rate fluctuations on our borrowings. We use interest rate swap agreements to manage these risks. These instruments
are not used for speculative purposes but are used to modify variable rate obligations into fixed rate obligations.

we had one variable rate instrument outstanding that is impacted by changes in interest rates. In September 2022, we refinanced the mortgage
loan encumbering the property where our combination package liquor store and restaurant located at 4 N. Federal Highway, Hallandale Beach,
Florida, (Store #31) operates, which mortgage loan is held by an unaffiliated third-party lender (the "$8.90M Loan"). The
interest rate of our variable rate debt instrument was equal to the lender's BSBY Screen Rate plus one and one-half percent (1.50%)
per annum. Effective November 15, 2024, the publication of BSBY was terminated and as of such date, the variable rate of interest under
our debt instrument is equal to the lender's 1 Month CME Term Secured Overnight Financing Rate ("SOFR"), plus 10 basis
points, as an equivalent alternative approved by the lender.

 As a means of managing our
interest rate risk on this debt instrument, we entered into an interest rate swap agreement with an unrelated third-party lender to convert
this variable rate debt obligation to a fixed rate. We entered into an interest rate swap agreement in September 2022 relating to the
$8.90M Loan (the "$8.90M Term Loan Swap"). The $8.90M Term Loan Swap required us to pay interest for a fifteen (15) year
period at a fixed rate of 4.90% on an initial amortizing notional principal amount of $8,900,000, while receiving interest for the same
period at BSBY Screen Rate – 1 Month, plus 1.50%, on the same amortizing notional principal amount. We had previously determined
that this interest rate swap agreement was an effective hedging agreement and we recorded changes in fair value to accumulated other
comprehensive income each quarter from the fourth quarter of our fiscal year 2023 through the first quarter of our fiscal year 2025.

 On November 22, 2024, we
terminated the $8.90M Term Loan Swap and simultaneously entered into a new interest rate swap agreement for $8,015,601, the balance due
on the $8.90M Loan, which requires us to pay interest for twelve (12) years, ten (10) months, which is the balance of the original fifteen
(15) year period at a fixed rate of 4.90% on an initial amortizing notional principal amount of $8,015,601, while receiving interest
for the same period at the lender's 1 Month CME Term Secured Overnight Financing Rate ("SOFR"), plus 10 basis points,
at the same amortizing notional principal amount. During the second quarter of our fiscal year 2025, we recognized the $290,000 of non-cash
gains, net of tax, related to the above interest rate swap agreement as interest and other income. We determined that the new interest
rate swap agreement is an economic hedge and beginning in the second quarter of our fiscal year 2025, we recognize the changes in fair
value on our interest rate swap in interest and other income on our consolidated statements of income.

 ITEM
1B UNRESOLVED STAFF COMMENTS

 As a Smaller Reporting Company
as defined by Rule 12b-2 of the Exchange Act and in Item 10(f)(1) of Regulation S-K, we are electing scaled disclosure reporting obligations
and therefore are not required to provide the information requested by this Item 1B.

 ITEM
1C CYBERSECURITY

 Cybersecurity Risk Management and Strategy

 We are committed to safeguarding
our information and information systems from unauthorized access, use, disclosure, disruption, modification or destruction. Our program
to protect our information assets and the management of risks to those assets supports the confidentiality, integrity, and availability
of the information necessary to our long-term business success.

 Our cybersecurity risk management
program includes:

 the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security controls, including, third-party network security reviews, scans, and audits, on at least an annual basis;

 regular
 cybersecurity awareness training for employees with access to our information systems, incident
 response personnel, and senior management;

 a
 cybersecurity incident response plan that includes procedures for responding to cybersecurity
 incidents;

 a
 disaster recovery plan and controls designed to protect against business interruption, including
 by backing up our critical systems;

 use
 of end-to-end encryption and tokenization technology, a public key infrastructure, designed
 to ensure that only trusted devices can access our enterprise information technology network,
 and Intrusion Prevention System (IPS) that scans data in transit to help prevent the execution
 of harmful code; and

 a
 third-party risk management process for service providers, suppliers, and vendors who have
 access to our information systems.

 There can be no assurance
that our cybersecurity risk management program and processes, including our policies, controls or procedures, will be fully implemented,
complied with or are effective in protecting our systems and information. We are not currently aware of risks from known cybersecurity
threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially
affect us, including our operations, business strategy, results of operations, or financial condition.

 Cybersecurity Governance

 Our Board of Directors has
oversight responsibility for the Company's cybersecurity risk management, including technology and cybersecurity risks facing the
Company. Management updates the Board, as necessary, regarding cybersecurity risk management matters, including reporting any material
cybersecurity incidents.

 Our management team, including
the CEO, CFO, COO, Senior Director of Information Technology, Director of Information Technology, and Director of Accounting, as appropriate,
supervises efforts to prevent, detect, mitigate and remediate cybersecurity risks and incidents through various means, which may include
briefings from internal security personnel; threat intelligence and other information obtained from governmental, public or private sources,
including external consultants engaged by us; and alerts and reports produced by security tools deployed in the information technology
environment.

 ITEM
2. PROPERTIES.

 Our operations are conducted
primarily on leased property with the exception of the following:

 (i)

 a 10,000 square foot stand-alone
 building located in Fort Lauderdale, Florida that we purchased in December 1999, which since April 2001 has housed our corporate
 headquarters;

 (ii)

 a 4,600 square foot stand-alone
 building located in Hallandale, Florida that we purchased in July 2006 and which since September 1968 has housed our Hallandale,
 Florida Company-owned combination restaurant and package liquor store (Store #31);

 (iii)

 a 4,120 square foot stand-alone
 building in Hollywood, Florida we constructed in November 2003, upon real property we acquired in September 2001 pursuant to a 25
 year ground lease interest, (a portion of this building is leased to an unaffiliated third party), and which since November 2003
 has housed our Hollywood, Florida Company-owned package liquor store (Store #4);

 (iv)

 a 4,500 square foot stand-alone
 building located in Hollywood, Florida that we purchased in October 2009 and which housed our Hollywood, Florida Company-owned combination
 restaurant and package liquor store (Store #19) from March, 1972 until it was destroyed by fire on October 2, 2018 and the vacant
 parcel of real property adjacent thereto which we purchased in February 2015. Subsequent to the fire, (i) we constructed a 3,000
 square foot stand-alone building on the vacant parcel of real property for the operation of our Company-owned package liquor store
 (Store #19P), which opened for business during the first quarter of our fiscal year 2024; and (ii) we constructed a 4,500 square
 foot stand-alone building here for the operation of the Company-owned restaurant, (Store #19R), which opened for business during
 the second quarter of our fiscal year 2024;

 (v)

 a 4,600 square foot stand-alone
 building located in Fort Lauderdale, Florida that we purchased in August 2010 and which since December 1968 has housed our Fort Lauderdale,
 Florida Company-owned restaurant (Store #22);

 (vi)

 a 5,100 square foot stand-alone
 building in North Miami, Florida that we purchased in November 2010; the two parcels of real property adjacent thereto which we purchased
 in December 2012, one of which is contiguous to the real property and which we previously leased for non-exclusive parking and the
 vacant parcel of real property adjacent to the two parcels of real property which we purchased in March 2017. The stand-alone building
 housed our North Miami, Florida Company-owned combination restaurant and package liquor store, (Store #20), from July 1968 until
 June 2017 when the package liquor store was re-located to a new building we constructed on the adjacent property;

 (vii)

 a 23,678 square foot two
 building shopping center in Miami, Florida that we purchased in November 2010: (A) one stand-alone building, approximately 18,828
 square feet, (i) houses our package liquor store #45 and (ii) is otherwise leased to ten unaffiliated third party retailers; and
 (B) the second stand-alone building, approximately 4,850 square feet, has housed our limited partnership owned Kendall, Florida based
 restaurant since April 4, 2000, (Store #70);

 (viii)

 a 6,400 square foot building
 in Fort Lauderdale, Florida that we purchased in February 2014, 4,000 square feet of which has been leased to a related franchisee
 (Store #15) since April 1, 1997 and the balance (2,400 square feet) of which we use as storage. In August 2018 we purchased the real
 property and quadraplex adjacent thereto to insure adequate parking for the franchised restaurant in the future, if needed;

 (ix)

 a 6,000 square foot stand-alone
 building in Fort Lauderdale, Florida and the vacant real property diagonally adjacent that we purchased in October 2015, which we
 use as office and warehouse space, covered parking for our food truck and as a storage yard;

 (x)

 a 6,900 square foot stand-alone
 building in Sunrise, Florida, which we purchased in March 2021 and houses our limited partnership owned Sunrise, Florida based restaurant,
 (Store #85), which opened for business in March 2022;

 (xi)

 a 6,000 square foot commercial
 space in Miami, Florida, which we purchased in April 2023 and in which we operate our package liquor store and warehouse (Store #47),
 through a sublease agreement from a sale-leaseback arrangement in January 1974;

 (xii)

 a 5,450 square foot three building shopping
 center in Hallandale Beach, Florida (adjacent to our combination package store and restaurant in Hallandale Beach, Florida (Store
 #31)), that we purchased in April 2023: (A) one stand-alone building, approximately 1,450 square feet, of which 950 square feet
 is leased to one unaffiliated third party retailer and 500 square feet which is occupied by us; (B) the second stand-alone building,
 approximately 1,500 square feet, which is leased to one unaffiliated third party retailer and (C) the third stand-alone building,
 approximately 2,500 square feet, which is leased to one unaffiliated third party retailer, (collectively Store #38); and

 (xiii)

 we are developing a 6,400 square foot stand-alone building in Cutler Bay, Florida, which vacant property we purchased in May
 2025 and will house our limited partnership owned Cutler Bay, Florida based restaurant, (Store #3), which we anticipate will open
 for business during our fiscal year 2027.

 All of our units require
periodic refurbishing in order to remain competitive. We have budgeted $750,000 for our refurbishing program for fiscal year 2026, although
capital expenditures of our refurbishing program for our fiscal year 2026 may be significantly higher. See Item 7, "Liquidity and
Capital Resources" for discussion of the amounts spent in fiscal year 2025.

 The following table summarizes
information related to the properties upon which our operations are conducted and/or will be conducted. For all locations that include
lease options, the lessor must extend the term of the lease for a location if we exercise the lease option. If there is no lease option
or if we do not exercise the same, the lessor is not required to extend the term of the lease upon expiration.

 Name
 and Location

 Seats

 Owned
 by

 Big Daddy's Liquors
 #4
Flanigan's Enterprises Inc. (5)
7003 Taft Street

 Hollywood, Florida

 1,978

 N/A

 3/1/02 to 2/28/27
 Options to 2/28/47

 Big Daddy's Liquors #7
1550 W. 84th Street

 Hialeah, Florida

 1,450

 N/A

 11/1/00 to
 10/31/2030
 10/31/2035

 Big Daddy's Liquors #8
959 State Road 84

 Fort Lauderdale, Florida

 4,084

 N/A

 5/1/99 to 4/30/29

 Flanigan's Seafood Bar and Grill
 #9
1550 W. 84th Street

 Hialeah, Florida

 4,700

 1/1/10 to 12/31/29
 12/31/49

 Flanigan's Legends Seafood Bar
 and Grill #11
11 Corporation, Inc. (1)
330 Southern Blvd.

 W. Palm Beach, Florida

 5,000

 1/4/00 to 1/3/30

 Flanigan's Seafood Bar and Grill
 #12
2405 Tenth Ave. North

 Lake Worth, Florida

 5,000

 11/16/92 to
 11/15/28
 11/15/38

 Flanigan's Seafood Bar and Grill
 #14
Big Daddy's #14, Inc. (1) (4)
2041 NE Second St.

 Deerfield Beach, Florida

 3,320

 6/1/79 to
6/1/29
 Options to 6/1/34

 Name and Location

 Seats

 Owned by

 Flanigan's Seafood Bar and Grill #15
CIC
 Investors #15 Ltd. (1) (7)
1479 E. Commercial Blvd.

 Ft. Lauderdale, Florida

 4,000

 Franchise/

 1/1/09 to 8/31/26
 Options to 8/31/36

 Flanigan's Seafood Bar and
Grill #18
Twenty
 Seven Birds Corp. (1) (2)
2721 Bird Avenue

 4,500

 2/15/72 to 12/31/25
Options to 12/31/35

 Big Daddy's Liquors #18
 Twenty
 Seven Birds Corp. (1) (2)
 2988
 S.W. 27 th Avenue
 Miami,

 3,000

 N/A

 2/15/72 to 12/31/25
Options to 12/31/35

 Flanigan's Wine & Liquors #19 (8)
2505 N. University Dr., Building A

 Hollywood, Florida

 3,000

 N/A

 Seafood Bar and
Grill #19 (8)
2505 N. University
 Dr., Building B

 Hollywood,

 4,500

 Seafood Bar and Grill #20
13205 Biscayne Blvd.

 North

 5,100

 Big
 Daddy's Liquors #20
13185 Biscayne Blvd.

 North

 2,500

 N/A

 Seafood Bar and Grill #22

 2600
 W. Davie Blvd.

 Ft.
 Lauderdale, Florida

 4,100

 Big Daddy's Wine & Liquors #24
 Enterprises, Inc. (10)
11225 Miramar Parkway, #245

 Miramar, Florida

 2,000

 N/A

 3/5/22 to 3/5/32
Options to 3/5/47

 Name and Location

 Seats

 Owned by

 Brendan's Sports Pub

 3,500

 6/16/22 to 6/30/72

868 S. Federal Highway

 Pompano Beach, Florida

 Seafood Bar and Grill #31
4 N. Federal Highway

 Hallandale,

 4,600

 Flanigan's Seafood Bar and Grill #33
45 S. Federal Highway

 Boca Raton, Florida

 4,620

 10/1/10 to 6/30/30

 Big Daddy's Liquors #34
Flanigan's Enterprises,
 Inc.
9494 Harding Ave.

 Surfside, Florida

 3,000

 N/A

 5/29/97 to 5/28/27
 Options to 5/28/37

 Flanigan's Seafood Bar and Grill #40
5450 N. State Road 7

 N. Lauderdale, Florida

 4,600

 Piranha Pat's #43
BD 43 Corporation (1) (2)
2500
 E. Atlantic Blvd.

 Pompano Beach, Florida

 4,500

 12/1/72 to 11/30/27

 Big Daddy's Liquors #45
Flanigan's Enterprises,
 Inc.
12776 S.W. 88th Street

 3,250

 N/A

 7/1/19 to 6/30/29
Options to 6/30/34

 Big Daddy's Liquors #47
 Enterprises, Inc. (3)
8600 Biscayne Blvd.

 6,000

 N/A

 12/21/68 to 1/1/30
 Options to 1/1/50
(Sublease) Company-Owned

 Flanigan's Seafood Bar and Grill #13
CIC Investors
 #13, Ltd.
11415 S. Dixie Highway

 Pinecrest, Florida

 8,000

 6/01/91 to 1/31/31
Options to 1/31/36

 Name
 and Location

 Seats

 Owned by

 Flanigan's #25
CIC Investors #25, Ltd. (9)
11225 Miramar Parkway, #250
Miramar,

 6,000

 3/5/22 to 3/5/32
Options to 3/5/47

 Flanigan's Seafood Bar and Grill #50
CIC Investors
 #50, Ltd.
17185 Pines Boulevard

 Pembroke Pines, Florida

 4,000

 10/24/06 to
 10/23/26
 10/23/31

 Flanigan's Seafood Bar and Grill #55
CIC Investors #55, Ltd.
2190 S. University Drive

Davie, Florida

 5,900

 1/5/07 to 12/31/26
12/31/31

 Flanigan's Seafood Bar and Grill #60
CIC Investors
 #60 Ltd.
9516 Harding Avenue

 Surfside, Florida

 6,800

 8/1/97 to 12/31/26

 Flanigan's Seafood Bar and Grill #65
CIC Investors #65, Ltd.
2335 State Road 7, Suite
Wellington, Florida

 6,128

 5/01/05 to 6/30/35
Options to 6/30/40

 Flanigan's Seafood Bar and Grill #70
CIC Investors
 #70 Ltd.
12790 SW 88 St.

 4,850

 4/1/00 to 3/31/30
 Options to 3/31/35

 Flanigan's Seafood Bar and Grill #75
950 S. Federal
 Highway
Stuart, Florida

 7,000

 5/1/10 to 4/30/26
 Options to 4/30/31

 Flanigan's Seafood Bar and
 Grill #80
 CIC
 Investors #80 Ltd.
 8695
 N.W. 12 th St
 Miami,

 5,000

 6/15/01 to 12/14/29
Options to 12/14/39

 Flanigan's Seafood Bar and Grill #85
CIC Investors #85 Ltd.
14301 W. Sunrise Blvd.
Sunrise,

 6,900

 3/1/19 to 2/28/29
Options to 2/28/44

 Name and Location

 Seats

 Owned by

 Flanigan's Seafood
 Bar and Grill #90
 CIC
 Investors #90 Ltd.
 9857
 S.W. 40 th Street
 Miami,

 6,400

 Limited Partnership

 4/1/11 to 3/31/31
Options to 3/31/36

 Flanigan's Seafood Bar and Grill #95
2460 Weston Road

 Weston, Florida

 5,700

 10/1/17 to 9/30/27
 Options to 9/30/32

 Flanigan's Calusa Center, LLC
 (6)
 12750
 – 12790 S.W. 88 th Street
 Miami,

 23,700

 N/A

 Company-owned
shopping center

 Flanigan's Enterprises, Inc. (11)
615 – 715
 E. Hallandale Beach Blvd.

 Hallandale Beach, Florida

 5,450

 N/A

 Company-owned
 shopping center

 (12)
 5055
 NE 13 th Avenue
 Oakland
 Park, FL 33334

 3,600

 N/A

 7/1/2025-6/30/2027

 Flanigan's #3 (13)

 6,400

 Limited Partnership

 TBD

 (1)
 Franchised
 by Company.

 (2)
 Lease
 assigned to franchisee. We are no longer contingently liable on the lease.

 (3)
 In
 1974, we sold and assigned the underlying ground lease to unaffiliated third parties and
 simultaneously subleased it back. We have re-purchased from the unaffiliated third
 parties and currently own 56% of the underlying ground lease, as well as the sublease agreement.
 In April 2023 we purchased the real property, subject to the ground lease and sublease agreement
 through which we continue to occupy the premises. As a result, we pay 44% of the rent due
 under the ground lease and the sublease agreement.

 (4)
 Effective
 December 1, 1998, we purchased the Management Agreement to operate the franchised restaurant
 for the franchisee.

 (5)
 Ground
 lease executed by us on September 25, 2001. We constructed a 4,120 square foot building,
 of which 1,978 square feet is used by us for the operation of a package liquor store and
 the other 2,142 square feet is subleased to an unaffiliated third party as retail space.
 The package liquor store opened for business on November 17, 2003.

 (6)
 the first quarter of our fiscal year 2012, our wholly owned subsidiary, Flanigan's
 Calusa Center, LLC, closed on the purchase of a two building shopping center in Miami, Florida,
 which consists of (i) one stand-alone building which is leased to ten unaffiliated third
 parties and houses our package liquor store #45 (approximately 3,250 square feet) and (ii)
 a second stand-alone building where our limited partnership owned restaurant located at 12790
 SW 88 th Street, Miami, Florida, (Store #70), operates.

 (7)
 the second quarter of our fiscal year 2014, we closed on the purchase of the building in
 Fort Lauderdale, Florida, which is leased to our franchisee owned restaurant located at 1479
 E. Commercial Boulevard, Fort Lauderdale, Florida, (Store #15).

 (8)
 the first quarter of our fiscal year 2019, our combination package liquor store and restaurant
 located at 2505 N. University Drive, Hollywood, Florida (Store #19), was damaged by a fire
 and was forced to close. We determined that Store #19 should be demolished and rebuilt as
 separate buildings. As a result, the package liquor store was closed since our first quarter
 year 2019, but re-opened for business in the first quarter of fiscal 2023 in a newly constructed
 stand-alone building #19P. During the second quarter of our fiscal year 2024, we re-opened
 our restaurant in a stand-alone building on the same site in Hollywood, Florida adjacent
 to Store #19P.

 (9)
 the fourth quarter of our fiscal year 2019, we entered into a lease for this location, which
 lease was subsequently assigned to a limited partnership. We raised funds to renovate this
 new location for operation as a "Flanigan's" restaurant using our limited
 partnership ownership model, which location opened for business in April 2023.

 (10)
 the fourth quarter of our fiscal year 2019, we entered into a lease for this location. This
 new location opened for business as a "Big Daddy's Wine & Liquors"
 retail package liquor store in March 2023.

 (11)
 the third quarter of our fiscal year 2023, we closed on the purchase of a three building
 shopping center in Hallandale Beach, Florida adjacent to our combination package store and
 restaurant in Hallandale Beach, Florida (Store #31), which consists of: (A) one stand-alone
 building which is leased to two unaffiliated third party retailers; (B) the second stand-alone
 building which is leased to one unaffiliated third party retailer; and (C) the third stand-alone
 building which is leased to one unaffiliated third party retailer.

 (12)
 During the second quarter
 of our fiscal year 2025, we entered into a two-year lease for this storage unit. Previously
 this storage unit had been a one year lease.

 (13)
 During the third quarter
 of our fiscal year 2025, we purchased vacant real property located in Cutler Bay, Florida. We
 plan to construct a 6,400 square foot building to lease to a limited partnership to be formed
 of which we will be the sole general partner to construct and operate a "Flanigan's"
 restaurant.

 Re-construction Following Casualty Loss

 During the first quarter
of our fiscal year 2019, our combination package liquor store and restaurant located at 2505 N. University Drive, Hollywood, Florida
(Store #19) was damaged by a fire and was forced to close. The package liquor store re-opened for business during the first quarter of
our fiscal year 2023 in a newly constructed stand-alone building. The restaurant re-opened for business during the second quarter of
our fiscal year 2024 in a newly constructed stand-alone building where our combination package liquor store and restaurant was previously
located.

 Purchase of Real Property; Leasehold /
Sub-leasehold Interests

 Purchase of Real Property

 During the third quarter
of our fiscal year 2025, we purchased the vacant real property located at 20971 Old Cutler Road, Cutler Bay, Florida 33189 (the "Cutler
Bay Property") for a purchase price of $2,200,000. We paid all cash at closing. We plan to construct a 6,400 square foot building
on the Cutler Bay Property to lease to a limited partnership of which we will be the sole general partner pursuant to our limited partnership
financial arrangement to develop and operate a "Flanigan's" restaurant.

 Purchase of Leasehold/Sub-leasehold Interests

 In 1974, we sold the underlying
ground lease to the real property located at 8600 Biscayne Boulevard, El Portal, Florida to related and unrelated third parties and simultaneously
subleased it back. We operate our retail package liquor store (Store #47) and warehouse from this location. During the first quarter
of our fiscal year 2024, we re-purchased a 4% interest in the underlying ground lease, as well as the sublease agreement from an unrelated
third party for $31,000 and currently own 56% of each lease. As a result, we now only pay 44% of the rent due under the ground lease
and the sublease agreement.

 Subsequent Events

 Subsequent to the end of our
fiscal year 2025, we re-financed with our institutional lender, our mortgage loan encumbering the real property and improvements located
at 12750 – 12790 S.W. 88 th Street, Miami, Florida where our Flanigan's Calusa Center and our limited partnership
owned Flanigan's Seafood Bar and Grill restaurant operate (Store #70), without increasing the principal amount borrowed at this
time ($5,676,856). The re-financed mortgage loan earns interest at a fluctuating rate per year equal to the sum of (i) the greater of
the Term SOFR Daily Floating Rate or the Index Floor (which for purposes hereof is 0.00%) and (ii) 2.25%, with the first payment of principal
and interest due January 31, 2026 and monthly thereafter on the last day of each month until November 30, 2030 when the entire principal
payment and all accrued interest is due in full. We received no excess funds from the re-financing of this mortgage loan.

 ITEM
3. LEGAL PROCEEDINGS

 From time to time, we are
a defendant in litigation arising in the ordinary course of our business, including claims resulting from "slip and fall"
accidents, dram shop claims, claims under federal and state laws governing access to public accommodations, employment-related claims
and claims from guests alleging illness, injury or other food quality, health or operational concerns. To date, none of this litigation,
some of which is covered by insurance, has had a material effect on us.

 ITEM 4. MINE
SAFETY DISCLOSURES.

 Not applicable.

 ITEM
5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES.

 Our common stock is traded
on the NYSE AMERICAN under the symbol "BDL".

 Holders

 As of the close of business on December 17, 2025, there were approximately
149 holders of record of our common stock.

 Dividend Policy

 During our fiscal year 2025,
our Board of Directors declared a cash dividend of $0.55 per share to shareholders of record on June 12, 2025 and was made payable on
June 27, 2025. During our fiscal year 2024, our Board of Directors declared a cash dividend of $0.50 per share to shareholders of record
on June 14, 2024 and was made payable on June 28, 2024. Any future determination to pay cash dividends will be at our Board's discretion
and will depend upon our financial condition, operating results, capital requirements and such other factors as our Board deems relevant.

 Issuer Repurchases of Equity Securities

 Pursuant to a discretionary
plan approved by the Board of Directors at its meeting on May 17, 2007, the Board of Directors authorized management to purchase up to
100,000 shares of our common stock, at a purchase price up to $15.00 per share. Since the Board's 2007 authorization, we have purchased
an aggregate of 34,586 shares, none of which were purchased by us in our fiscal year 2025. As of September 27, 2025, we still have authority
to purchase 65,414 shares of our common stock under the discretionary plan approved by the Board of Directors.

 ITEM
6. RESERVED

 Not Applicable.

 ITEM
7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

 Except for the historical
information contained herein, the following discussion contains forward-looking statements that are subject to known and unknown risks,
uncertainties and other factors that may cause our actual results to differ materially from those expressed or implied by such forward-looking
statements. We discuss such risks, uncertainties and other factors throughout this report and specifically under the captions "Risk
Factors". In addition, the following discussion and analysis should be read in conjunction with the 2025 and 2024 Consolidated
Financial Statements and the related Notes to Consolidated Financial Statements included elsewhere in this report.

 OVERVIEW

 Financial Information Concerning Industry Segments

 Our business is conducted
principally in two segments: the restaurant segment and the package liquor store segment. Financial information broken into these two
principal industry segments for the two fiscal years ended September 27, 2025 and September 28, 2024 is set forth in the Consolidated
Financial Statements which are attached hereto.

 General

we (i) operated 32 units, consisting of restaurants, sports bar, package liquor stores and combination restaurants/package liquor stores
that we either own or have operational control over and partial ownership in; and (ii) franchises an additional five units, consisting
of two restaurants (one of which we operate) and three combination restaurants/package liquor stores.

 Franchised Units.
In exchange for our providing management and related services to our franchisees and granting them the right to use our service marks
"Flanigan's Seafood Bar and Grill" and "Big Daddy's Liquors", our franchisees (four of which are
franchised to members of the family of our Chairman of the Board, officers and/or directors), are required to (i) pay to us a royalty
equal to 1% of gross package liquor sales and 3% of gross restaurant sales; and (ii) make advertising expenditures equal to between 1.5%
to 3% of all gross sales based upon our actual advertising costs allocated between stores, pro-rata, based upon gross sales.

 Affiliated Limited Partnership
Owned Units. We manage and control the operations of ten of the eleven restaurants owned by limited partnerships, except the Fort
Lauderdale, Florida restaurant which is managed and controlled by a related franchisee. Accordingly, the results of operations of all
limited partnership owned restaurants, except the Fort Lauderdale, Florida restaurant are consolidated with our results of operations
for accounting purposes. The results of operations of the Fort Lauderdale, Florida restaurant are accounted for by us utilizing the equity
method.

 RESULTS OF OPERATIONS

 REVENUES (in thousands):

 For the Fiscal Year Ended

 September 27, 2025

 September 28, 2024

 Percent

 Percent

 (In thousands)

 (In thousands)

 Restaurant food sales

 $
 124,501

 61.25

 $
 114,795

 61.95

 Restaurant bar sales

 31,764

 15.63

 30,010

 16.20

 Package store sales

 23.12

 21.85

 Total Sales

 $
 203,253

 100.00

 $
 185,302

 100.00

 Franchise related revenues

 1,754

 1,693

 Other revenues

 Total Revenue

 $
 205,248

 $
 187,216

 Comparison of Fiscal Years Ended September 27, 2025 and September
28, 2024

 Revenues.
Total revenue for our fiscal year 2025 increased $18,032,000 or 9.63% to $205,248,000 from $187,216,000 for our fiscal year 2024 due
primarily to increased package liquor store and restaurant sales, increased menu prices and revenue generated from our Company-owned
restaurant in Hollywood, Florida (Store #19R) for our entire fiscal year 2025 as opposed to a part of our fiscal year 2024.
Effective February 23, 2025, we increased our menu prices for our bar offerings to target an increase to our bar revenues of
approximately 0.84% annually. Effective December 4, 2024, we increased our menu prices for our bar offerings to target an increase
to our bar revenues of approximately 4.90% annually and effective November 17, 2024 we increased our menu prices for our food
offerings to target an increase to our food revenues of approximately 4.14% annually. Effective August 25, 2024, we increased menu
prices for our bar offerings to target an increase to our bar revenues of approximately 5.63% annually to offset higher food and
liquor costs and higher overall expenses (collectively the "Recent Price Increases").

 Restaurant Food Sales.
Restaurant revenue generated from the sale of food, including non-alcoholic beverages, at restaurants totaled $124,501,000 for our fiscal
year 2025 as compared to $114,795,000 for our fiscal year 2024. The increase in restaurant food sales is attributable to the Recent Price
Increases and food sales generated from our Company-owned restaurant in Hollywood, Florida (Store #19R) for our entire fiscal year 2025
as opposed to a part of our fiscal year 2024. Comparable weekly restaurant food sales for restaurants open for all of our fiscal years
2025 and 2024, which consists of ten restaurants owned by us (excluding our Hollywood, Florida location Store #19R which opened for business
during the second quarter of our fiscal year 2024) and ten restaurants owned by affiliated limited partnerships was $2,245,000 and $2,122,000
for our fiscal years 2025 and 2024 respectively, an increase of 5.80%. Comparable weekly restaurant food sales for Company-owned restaurants
only (excluding our Hollywood, Florida location Store #19R which opened for business during the second quarter of our fiscal year 2024)
was $997,000 and $938,000 for our fiscal years 2025 and 2024, respectively, an increase of 6.29%. Comparable weekly restaurant food sales
for affiliated limited partnership owned restaurants only was $1,248,000 and $1,184,000 for our fiscal years 2025 and 2024 respectively,
an increase of 5.41%. We expect that restaurant food sales, including non-alcoholic beverages, for our fiscal year 2026 will increase
due to increased restaurant traffic.

 Restaurant Bar Sales.
Restaurant revenue generated from the sale of alcoholic beverages at restaurants totaled $31,764,000 for our fiscal year 2025 as compared
to $30,010,000 for our fiscal year 2024. The increase in restaurant bar sales is attributable to the Recent Price Increases and bar sales
generated from our Company-owned restaurant in Hollywood, Florida (Store #19R) for our entire fiscal year 2025 as opposed to a part of
our fiscal year 2024. Comparable weekly restaurant bar sales for restaurants open for all of our fiscal years 2025 and 2024 respectively,
which consists of ten restaurants owned by us (excluding our Hollywood, Florida location Store #19R which opened for business during
the second quarter of our fiscal year 2024) and ten restaurants owned by affiliated limited partnerships was $583,000 for our fiscal
year 2025 and $562,000 for our fiscal year 2024, an increase of 3.74%. Comparable weekly restaurant bar sales for Company-owned restaurants
only (excluding our Hollywood, Florida location Store #19R which opened for business during the second quarter of our fiscal year 2024)
was $244,000 and $234,000 for our fiscal years 2025 and 2024 respectively, an increase of 4.27%. Comparable weekly restaurant bar sales
affiliated limited partnership owned restaurants only was $339,000 and $328,000 for our fiscal years 2025 and 2024 respectively, an increase
of 3.35%. We expect that restaurant bar sales for our fiscal year 2026 will increase due to increased restaurant traffic.

 Package Liquor Store
Sales. Revenue generated from sales of liquor and related items at package liquor stores totaled $46,988,000 for our fiscal year
2025 as compared to $40,497,000 for our fiscal year 2024, an increase of $6,491,000. This increase was primarily due to increased package
liquor store traffic. The weekly average of same store package liquor store sales, which includes eleven (11) Company-owned package liquor
stores was $904,000 and $779,000 for our fiscal years 2025 and 2024 respectively, an increase of 16.05%. We expect that package liquor
store sales for our fiscal year 2026 will increase due to increased package liquor store traffic.

 Costs and Expenses.
Costs and expenses (consisting of cost of merchandise sold, payroll and related costs, operating expenses, occupancy costs, selling,
general and administrative expenses and depreciation and amortization) for our fiscal year 2025 increased $15,128,000 or 8.34% to $196,503,000
from $181,375,000 for our fiscal year 2024. The increase was primarily due to increased payroll, an expected general increase in food
costs and overall expenses, as well as costs and expenses incurred from our Company-owned restaurant in Hollywood Florida (Store #19R)
for our entire fiscal year 2025 as opposed to a part of our fiscal year 2024, partially offset by actions taken by management to reduce
and/or control costs. We anticipate that our operating costs and expenses will continue to increase through our fiscal year 2026. Operating
costs and expenses decreased as a percentage of total revenue to approximately 95.74% in our fiscal year 2025 from 96.88% in our fiscal
year 2024.

 Gross Profit.
Gross profit is calculated by subtracting the cost of merchandise sold from sales.

 Restaurant Food and
Bar Sales. Gross profit for food and bar sales for our fiscal year 2025 increased to $104,091,000 from $94,943,000 for our fiscal
year 2024. Gross profit margin for the restaurant food and bar sales increased during our fiscal year 2025 when compared to our fiscal
year 2024 due to the Recent Price Increases, partially offset by higher food costs. Our gross profit margin for restaurant food and bar
sales (calculated as gross profit reflected as a percentage of restaurant food and bar sales), was 66.61% for our fiscal year 2025 and
65.57% for our fiscal year 2024.

 Package Store Sales.
Gross profit for package store sales for our fiscal year 2025 increased to $11,803,000 from $10,369,000 for our fiscal year 2024. Our
gross profit margin, (calculated as gross profit reflected as a percentage of package liquor store sales), for package store sales was
25.12% for our fiscal year 2025 and 26.60% for our fiscal year 2024. We anticipate that the gross profit margin for package liquor store
merchandise will decrease for our fiscal year 2026 due to higher costs and a reduction in pricing of certain package store merchandise
to remain competitive.

 Payroll and Related
Costs. Payroll and related costs for our fiscal year 2025 increased $4,352,000 or 7.33% to $63,701,000 from $59,349,000 for our
fiscal year 2024. Payroll and related costs for our fiscal year 2025 are higher due primarily to the operation of our Company-owned restaurant
in Hollywood, Florida (Store #19R) for our full fiscal year 2025 as opposed to part of our fiscal year 2024 and the increase to the Florida
minimum wage. Payroll and related costs as a percentage of total revenue was 31.04% for our fiscal year 2025 and 31.70% of total revenue
for our fiscal year 2024.

 Operating Expenses.
Operating expenses (including but not limited to utilities, insurance, cleaning, credit card fees, supplies, security, and other costs
closely related to running restaurant and package operations) for our fiscal year 2025 increased $2,737,000 or 11.08% to $27,438,000
from $24,701,000 for our fiscal year 2024 due primarily to the operation of our Company-owned restaurant in Hollywood, Florida (Store
#19R) for our full fiscal year 2025 as opposed to part of our fiscal year 2024, inflation and otherwise due to increases in expenses
across all categories.

 Occupancy Costs.
Occupancy costs (consisting of percentage rent, common area maintenance, repairs, real property taxes, amortization of leasehold purchases
and rent expense associated with operating lease liabilities under ASC 842) for our fiscal year 2025 increased $116,000 or 1.50% to $7,870,000
from $7,754,000 for our fiscal year 2024.

 Selling, General and
Administrative Expenses. Selling, general and administrative expenses (consisting of general corporate expenses, including but
not limited to advertising, professional costs, clerical and administrative overhead) for our fiscal year 2025 increased $150,000 or
2.82% to $5,463,000 from $5,313,000 for our fiscal year 2024 due primarily to increased television and radio advertising costs. Selling,
general and administrative expenses decreased as a percentage of total revenue for our fiscal year 2025 to 2.66% as compared to 2.84%
for our fiscal year 2024.

 Depreciation and Amortization.
 Depreciation and amortization expense for our fiscal year 2025 increased $404,000 or 9.47% to $4,672,000 from $4,268,000 for
our fiscal year 2024. This increase is driven by the operation of our Company-owned restaurant in Hollywood, Florida (Store #19R) for
the full fiscal year 2025 as opposed to part of the fiscal year 2024. Depreciation and amortization remained flat as a percentage of
total revenue at 2.28% for each of our fiscal years 2025 and 2024.

 Interest Expense, Net.
Interest expense, net, for our fiscal year 2025 decreased $62,000 to $957,000 from $1,019,000 for our fiscal year 2024.

 Rental Income/ Rental
Expense Rental income was $1,077,000 and rental expense was $622,000 for our fiscal year 2025, while rental income was $1,105,000
and rental expense was $550,000 for our fiscal year 2024. Previously, Rental income was presented in Revenues and rental expense was
presented in Occupancy costs, Operating expense and Selling, general and administrative expenses, however, both Rental income and Rental
expense are now presented in Other Income.

 Income Taxes. Income
tax for our fiscal year 2025 was an expense of $622,000, as compared to an expense of $286,000 for our fiscal year 2024. Income taxes
as a percentage of income before provision for income taxes for our fiscal year 2025 is 7.2% as compared to 5.12% in our fiscal year
2024.

 Net Income. Net
income for our fiscal year 2025 increased $2,717,000 or 51.26% to $8,017,000 from $5,300,000 for our fiscal year 2024 due primarily to
the Recent Price Increases and the operation of our Company-owned restaurant in Hollywood, Florida (Store #19R) for our full fiscal year
2025 as opposed to part of our fiscal year 2024. As a percentage of total revenue, net income for our fiscal year 2025 is 3.91%, as compared
to 2.83% for our fiscal year 2024.

 Net Income Attributable
to Flanigan's Enterprise, Inc.'s Stockholders. Net income attributable to stockholders for our fiscal year 2025 increased
$1,677,000 or 49.97% to $5,033,000 from $3,356,000 for our fiscal year 2024 due primarily to the Recent Price Increases and the operation
of our Company-owned restaurant in Hollywood, Florida (Store #19R) for our full fiscal year 2025 as opposed to part of our fiscal year
2024. As a percentage of revenue, net income attributable to stockholders for our fiscal year 2025 is 2.45%, as compared to 1.79% for
our fiscal year 2024.

 New Limited Partnership Restaurants

 As new limited partnership
restaurants open, our income from operations will be adversely affected due to our obligation to advance pre-opening costs, including
but not limited to pre-opening rent for the new limited partnership locations. During our fiscal year 2025 we did not open any new limited
partnership restaurants, however, we do have one in the development stage in Cutler Bay, Florida.

 Menu Price Increases

 During the second quarter
of our fiscal year, 2025, we increased our menu prices for our bar offerings (effective February 23, 2025) to target an increase to our
bar revenues of approximately 0.84% annually to offset higher food and liquor costs and higher overall expenses. During the first quarter
of our fiscal year 2025, we increased our menu prices for our bar offerings (effective December 4, 2024) to target an increase to our
bar revenues of approximately 4.90% annually and we increased our menu prices for our food offerings (effective November 17, 2024) to
target an increase to our food revenues of approximately 4.14% annually to offset higher food and liquor costs and higher overall expenses.
During our fiscal year 2024, we increased menu prices for our bar offerings (effective August 25, 2024) to target an increase to our
bar revenues of approximately 5.63% annually to offset higher food and liquor costs and higher overall expenses. Prior to these increases
we previously raised menu prices in the second quarter of our fiscal year 2023.

 LIQUIDITY AND CAPITAL RESOURCES

 We fund our operations through
cash from operations and borrowings from third parties. As of September 27, 2025, we had cash and cash equivalents of approximately $20,094,000,
a decrease of $1,308,000 from our cash balance of $21,402,000 as of September 28, 2024. The decrease is primarily due to our purchase
of the Cutler Bay property ($2,200,000).

 Inflation is affecting all
aspects of our operations, including but not limited to food, beverage, fuel and labor costs. Inflation is having a material impact on
our operating results.

 We believe that our
current cash availability from our cash on hand and positive cash flow from operations will be sufficient to fund our operations and
planned capital expenditures for at least the next twelve months.

 CASH FLOWS

 The following table is a summary of our cash flows
for our fiscal years 2025 and 2024.

 Fiscal Years

 2025

 2024

 Net cash provided by operating activities

 $
 10,510

 $
 6,630

 Net cash used in investing activities

 (6,117
)

 (5,141
)

 Net cash used in financing activities

 (5,701
)

 (5,619
)

 Net Decrease in Cash and Cash Equivalents

 (1,308
)

 (4,130
)

 Cash and Cash Equivalents, Beginning

 25,532

 Cash and Cash Equivalents, Ending

 $
 20,094

 $

 Capital Expenditures

 In addition to using cash for our operating expenses, we use cash generated
from operations and borrowings to fund the development and construction of new restaurants and to fund capitalized property improvements
for our existing restaurants. During the fiscal year 2025, we acquired property and equipment of $5,844,000, (of which $2.2 million was
for the purchase of the Cutler Bay Property and $11,000 was purchase deposits transferred to property and equipment), including $566,000
for renovations to four (4) Company-owned location and $137,000 for renovations to one (1) limited partnership owned restaurant. During
the fiscal year 2024, we acquired property and equipment and construction in progress of $6,047,000, (of which $289,000 was purchase deposits
transferred to property and equipment, $715,000 was purchase deposits transferred to CIP, and $4,000 was property and equipment in accounts
payable), including $528,000 for renovations to three (3) Company-owned restaurants and $135,000 for one (1) limited partnership owned
restaurant.

 Debt

we had long term debt (including the current portion) of $20,618,000, as compared to $21,912,000 as of September 28, 2024.

we are in compliance with the financial covenants contained in our loans with our unrelated third-party institutional lender (the "Institutional
Lender") under which we owe in the aggregate, approximately $19,306,000 of our total loans of approximately $20,618,000. As of
September 27, 2025, the year-end fair value of our debt approximates carrying value.

 We repaid long term debt,
including auto loans and mortgages in the amount of $1,330,000 and $1,251,000 in our fiscal years 2025 and 2024, respectively.

 Commitments

 Master Service Agreement

 During the first quarter
of our fiscal year 2025, we entered into a new Master Services Agreement with our current major vendor for a period of one (1) year
effective January 1, 2025, with Company options for four (4) one (1) year renewal options to extend the term of the same. During the
fourth quarter of our fiscal year 2025, we exercised the first (1st) one (1) year renewal option for a period of one (1) year
effective January 1, 2026. In this new Master Service Agreement, as in our prior Master Service Agreements, we commit to purchase
specific products through our current major vendor but are free to purchase other products through other vendors, provided no less
than 80% of our overall product needs are purchased through our current major vendor. During the third quarter of our fiscal year
2025, we exercised the first one (1) year renewal option and extended the term of the Master Services Agreement for a period of one
(1) year effective January 1, 2026.

 ERP Contract

 In the third quarter of our
fiscal year 2024, we entered into an agreement with Oracle, an unrelated third-party vendor for the licensing and support of NetSuite,
a cloud-based Oracle ERP solution to replace our general ledger. The agreement is for a period of five years at a fixed rate
of approximately $40,000 annually, with a cap on the percentage increase to our fees for our options to extend the term of the agreement
for years six and seven. The implementation of NetSuite was complete and functional at the start of the fourth quarter
of our fiscal year 2025.

 Purchase Commitments/Supply

 In order to fix the cost
and ensure adequate supply of baby back ribs for our restaurants for calendar year 2026, we entered into a purchase agreement with our
existing rib supplier, whereby we agreed to purchase approximately $9.2 million of "2.5 & Down Baby Back Ribs" (weight
range in which baby back ribs are sold) during calendar year 2026, at a prescribed cost, which we believe is competitive. For calendar
year 2025, we entered into a purchase agreement with a new rib supplier, whereby we agreed to purchase approximately $7.8 million of
"2.5 & Down Baby Back Ribs" during calendar year 2025, at a prescribed cost, which we also believe is competitive. The
increase in our cost of baby back ribs for calendar year 2026 compared to calendar year 2025 is due to an increase in market price and
quantity ordered.

 While we anticipate purchasing
all of our rib supply from this vendor, we believe there are several other alternative vendors available, if needed.

 Flanigan's Fish Company, LLC

Flanigan's Fish Company, LLC, a Florida limited liability company ("FFC"), supplies certain fish to all of our restaurants.
Since we hold the controlling interest in FFC, the balance sheet and operating results of this entity are consolidated into the accompanying
consolidated financial statements of the Company. Sales and purchases of fish are recognized in restaurant food sales and restaurant
(cost of merchandise sold), respectively, in the consolidated statements of income at the time of sale to the restaurant. In addition,
the 49% of FFC owned by the unrelated third party is recognized as a noncontrolling interest in our consolidated financial statements.

 Working Capital

 The table below summarizes the current assets,
current liabilities, and working capital as of the end of our fiscal years 2025 and 2024.

 Item

 2025

 2024

 Current Assets

 $
 30,593

 $
 31,529

 Current Liabilities

 18,118

 19,924

 Working Capital

 $
 12,475

 $
 11,605

 While there can be no assurance
due to, among other things, unanticipated expenses or unanticipated decline in revenues, or both, we believe that our cash on hand and
positive cash flow from operations will adequately fund operations, debt reductions and planned capital expenditures throughout our fiscal
year 2026.

 Off-Balance Sheet Arrangements

 We do not have off-balance
sheet arrangements.

 Recently Adopted and Recently Issued Accounting
Pronouncements

 Adopted

 The FASB issued guidance,
Accounting Standards Update (ASU) 2016-13 Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial
Instruments, which provides a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the
net amount expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost
basis of the financial asset(s) to present the net carrying value at the amount expected to be collected on the financial asset. The
measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions,
and reasonable and supportable forecasts that affect the collectability of the reported amount. This guidance was effective for the Company
in the first quarter of our fiscal year 2024; however, after performing a thorough analysis the Company concluded there was no material
impact from the adoption of this ASU.

 In November 2023, the FASB
issued ASU 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures," which updates reportable
segment disclosure requirements, primarily through requiring enhanced disclosures about significant segment expenses and information
used to assess segment performance. We early adopted this ASU in the third quarter of our fiscal year 2024 and this ASU affected the
expense presentation of our Consolidated Statements of Income and our Business Segments footnote. For further information regarding the
Company's Business Segments, please refer to our Consolidated Statements of Income and Business Segments footnote.

 Recently Issued

 In December 2023, the FASB
issued ASU 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures," which requires enhanced income tax
disclosures, primarily related to standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction.
This ASU will be effective for the Company for our fiscal year 2026 annual reporting period, with the guidance applied either prospectively
or retrospectively. Early adoption is permitted. We are currently evaluating the impact that the adoption of this ASU will have on our
tax disclosures.

 In November 2024, the FASB
issued ASU 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures" which
requires disclosure of disaggregated information about certain income statement expense line items in the notes to the financial statements
on an interim and annual basis. In January 2025, the FASB issued ASU 2025-01 clarifying the effective date of ASU 2024-03, which will
be effective for the Company for our fiscal year 2027 annual reporting period, with guidance applied either prospectively or retrospectively.
Early adoption is permitted. We are currently evaluating the impact that the adoption of this ASU will have on our interim and consolidated
financial statements.

 In September 2025, the FASB
issued ASU 2025-06, "Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40)" which eliminates all references
to project stages and requires capitalization of software costs when: (i) management authorizes and commits to funding the software project,
and (ii) it is probable the software project will be completed and used as intended, known as the "probable-to-completion recognition
threshold." Entities must consider whether there is significant uncertainty associated with the development activities of the software
in determining if the threshold is met. In addition, the amendments in the update specify that property, plant and equipment disclosure
requirements are required for capitalized internal-use software costs, regardless of financial statement presentation and also incorporate
the recognition requirements for website-specific development costs. This ASU will be effective for the Company for our fiscal year fiscal
year 2029 annual reporting period with the guidance applied either prospectively, retrospectively, or via a modified prospective transition
method. Early adoption is permitted. We are currently evaluating the impact that the adoption of this ASU will have on our interim and
consolidated financial statements.

 There are no other
recently issued accounting pronouncements that we have not yet adopted that we believe will have a material effect on our financial statements.

 Critical Accounting Policies

 Our significant accounting
policies are more fully described in Note 1 to our consolidated financial statements located in Item 8 of this Annual Report on Form
10-K. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses,
and the related disclosures of contingent assets and liabilities. Actual results could differ from those estimates under different assumptions
or conditions. We believe that the following critical accounting policies are subject to estimates and judgments used in the preparation
of our consolidated financial statements:

 Estimated Useful Lives of Property and Equipment

 The estimates of useful lives
for property and equipment are significant estimates. Expenditures for the leasehold improvements and equipment when a restaurant is
first constructed are material. In addition, periodic refurbishing takes place and those expenditures can be material. We estimate the
useful life of those assets by considering, among other things, expected use, life of the lease on the building, and warranty period,
if applicable. The assets are then depreciated using a straight-line method over those estimated lives. These estimated lives are reviewed
periodically and adjusted if necessary. Any necessary adjustment to depreciation expense is made in the income statement of the period
in which the adjustment is determined to be necessary.

 Valuation of Long-Lived Assets

 We continually evaluate whether
events and circumstances have occurred that may warrant revision of the estimated life of our intangible and other long-lived assets
and/or whether the remaining balance of our intangible and other long-lived assets should be evaluated for possible impairment. If and
when such factors, events or circumstances indicate that intangible and/or other long-lived assets should be evaluated for possible impairment,
we will determine the fair value of the asset by making an estimate of expected future cash flows over the remaining lives of the respective
assets and compare that fair value with the carrying value of the assets in measuring their recoverability. In determining the expected
future cash flows, the assets will be grouped at the lowest level for which there are cash flows, at the individual store level.

 Leases

 Under Accounting Standards
Codification Topic 842, Leases ("ASC 842"), lease arrangements must be presented on the lessee's balance sheet by recording
a right-of-use asset and a lease liability equal to the present value of the related future minimum lease payments. We currently lease
a portion of our restaurant and package locations under various lease agreements. Determining the probable term for each lease requires
judgment by management and can impact the classification and accounting for a lease as financing or operating, as well as the period
for straight-lined rent expense and the depreciation period for lease hold improvements. Generally, the lease term is a minimum
of the noncancelable period of the lease or the lease term inclusive of reasonably certain renewal periods up to a term of 15 years.
If the estimate of our reasonably certain lease term was changed, our depreciation and rent expense could differ materially. To determine
the present value of lease payments not yet paid, we estimate incremental borrowing rates (IBR) corresponding to the reasonably certain
lease term. The IBR is an estimate based on several factors, including financial market conditions, comparable company and credit analysis
as well as management judgment. If the IBR was changed, our operating lease right-of-use assets and lease liabilities could differ materially.

 Income Taxes

 We account for our income
taxes using FASB ASC Topic 740, " Income Taxes ", which requires among other things, recognition of future tax benefits
measured at enacted rates attributable to deductible temporary differences between financial statement and income tax basis of assets
and liabilities and tax credits to the extent that realization of said tax benefits is more likely than not. For discussion regarding
our carryforwards refer to Note 10 to the consolidated financial statements for our fiscal year 2025.

 Other Matters

 Impact of Inflation

 The primary inflationary
factors affecting our operations are food, beverage and labor costs. A large number of restaurant personnel are paid at rates based upon
applicable minimum wage and increases in minimum wage directly affect labor costs. Inflation is having a material impact on our operating
results, especially rising food, fuel and labor costs.

 ITEM
7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 Economic Risk

 The current government administration
has imposed changes in trade policy, including an increase in the use of tariffs which has resulted in retaliatory tariffs by other countries,
shifts in immigration policies and international relations and changes to the overall regulation and enforcement by government agencies.
We cannot predict the timing or impact, if any, of such actions.

 Legislative and Regulatory
Risk

 On July 4, 2025, the One Big
Beautiful Bill Act (Public Law No. 119-21) was signed into law. Among other provisions, the legislation includes certain tax incentives
and regulatory changes applicable to businesses in the food service and hospitality industries. The legislation has multiple effective
dates, with certain provisions effective in 2025 and others to be implemented through 2027. We continue to review the legislation to determine
its potential impact.

 Interest Rate Risk

 As part of our ongoing operations,
we are exposed to interest rate fluctuations on our borrowings. As described in Note 13 "Fair Value Measurements of Financial Instruments"
to the Consolidated Financial Statements included in "Item 8. Financial Statements and Supplementary Data" of this Annual
Report on Form 10-K for our fiscal year ended September 27, 2025, we use interest rate swap agreements to manage these risks. These instruments
are not used for speculative purposes but are used to modify variable rate obligations into fixed rate obligations.

 At the end of our fiscal
year 2025, we had approximately an aggregate principal amount $1,414,000 of 90-day government guaranteed certificates of deposit at fixed
annual interest rates between 4.05% and 5.15%. Otherwise, as of September 27, 2025, our cash resources offset our bank charges and any
excess cash resources earn interest at variable rates. Accordingly, our return on these funds is affected by fluctuations in interest
rates.

 There is no assurance that
interest rates will increase or decrease over our next fiscal year or that an increase will not have a material adverse effect on our
operations.

 ITEM
8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

 Our Consolidated Financial
Statements are on pages F-1 through F-31.

 ITEM
9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

 None.

 ITEM
9A. CONTROLS AND PROCEDURES.

 Evaluation of Disclosure Controls and Procedures

 We maintain disclosure controls
and procedures that are designed to ensure that information required to be disclosed in our reports filed with the U.S. Securities and
Exchange Commission (the "SEC") is recorded, processed, summarized and reported within the time periods specified in the
SEC's rules and forms, and that such information is accumulated and communicated to management, including our Chief Executive Officer
and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

an evaluation was performed under the supervision and with the participation of management, including our Chief Executive Officer and
Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e)
and 15d-15(e) to the Securities Exchange Act of 1934). Based on that evaluation, management, including our Chief Executive Officer and
Chief Financial Officer, concluded that our disclosure controls and procedures were not effective as of September 27, 2025.

 Remediation of Material Weakness in Internal
Control over Financial Reporting

the course of our independent registered public accounting firm performing its year end audit procedures in connection with our consolidated
financial statements to be included in our Form 10-K for the fiscal year 2024, Information technology general controls (ITGCs) were
not designed and implemented effectively to ensure (i) that access to applications and data, and the ability to make program and database
changes, were adequately restricted to appropriate personnel and (ii) that database changes were logged completely and accurately. Business
process controls (automated and manual) that are dependent on the affected ITGCs were also deemed ineffective because they could have
been adversely impacted. This material weakness did not result in any material misstatements in our financial statements or disclosures,
and there were no changes to previously released financial results.

 As a result of this
finding, during the first quarter of our fiscal year 2025, we began the process of addressing this material weakness by bolstering
our internal controls over the access to applications and data and the logging of database changes. During the fourth quarter of our
fiscal year 2025, the additional controls had been implemented and evaluated by management and determined to be operating
effectively as of the end of our fiscal year 2025. As such, we have concluded that our previously listed ITGC material weakness has
been remediated.

 Material Weakness in Internal Control
Over Financial Reporting

 A material weakness is a
deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility
that a material misstatement of our interim or annual financial statements will not be prevented or detected on a timely basis.

 We currently do not have
adequate internal controls to ensure the timely and accurate recognition of deferred revenues associated with promotional gift cards
that are provided in conjunction with certain sales from time to time, including during holiday periods. During the course of our independent
registered public accounting firm performing its quarterly review procedures in connection with our unaudited condensed consolidated
financial statements for the first and second quarters of our fiscal year 2025, we became aware of certain errors made by management in
recording revenues and deferred revenue liabilities pertaining to the package loyalty program and the restaurant promotional gift cards,
which constituted a material weakness in our internal controls.

 The material weakness
identified above did not result in any material misstatements in our financial statements or disclosures, and there were no changes
to previously released financial results. As of our fiscal year ended September 27, 2025, we are in the process of remediating the
material weakness surrounding deferred revenue.

 Changes in Internal Control Over Financial
Reporting

 Apart from the changes discussed
above we have not made any additional changes to our internal controls over financial reporting that have materially affected, or are
reasonably likely to materially affect, our internal controls over financial reporting.

 Management's Assessment on Internal
Control over Financial Reporting

 Our management is responsible
for establishing and maintaining adequate internal control over financial reporting. Management, including our Chief Executive Officer
and Chief Financial Officer, performed an evaluation of the effectiveness of the Company's internal control over financial reporting.
This evaluation was based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations
of the Treadway Commission in 2013 ("COSO"). Based on that evaluation, our Chief Executive Officer and Chief Financial Officer
have concluded that as of September 27, 2025, our internal control over financial reporting was ineffective.

 Limitations on the Effectiveness of Controls
and Permitted Omission from Management's Assessment

 Our internal control over
financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation
of financial statements for external purposes in accordance with generally accepted accounting principles. All internal control systems,
no matter how well designed, have inherent limitations, including the possibility of human error and the circumvention or overriding
of controls. Accordingly, even effective internal controls can only provide reasonable assurance with respect to financial statement
preparation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

 This annual report does not
include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting.
Management's report was not subject to attestation by our independent registered public accounting firm pursuant to rules of the
SEC that permit us to provide only management's report in this Annual Report on Form 10-K.

 ITEM
9B. OTHER INFORMATION.

 During the fiscal year ended
September 27, 2025, none of the Company's directors or officers (as defined in Rule 16a-1(f) under the Exchange Act) adopted or
 terminated a "Rule 10b5-1 trading arrangement" or a "non-Rule 10b5-1 trading arrangement," each as defined in
Item 408(a) of Regulation S-K under the Exchange Act.

 ITEM
9C DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS.

 Not Applicable.

 The information required
by Item 10 (Directors, Executive Officers and Corporate Governance), Item 11 (Executive Compensation), Item 12 (Security Ownership of
Certain Beneficial Owners and Management and Related Stockholder Matters), Item 13 (Certain Relationships and Related Transactions, and
Director Independence), and Item 14 (Principal Accountant Fees and Services) is incorporated by reference to our Proxy Statement for
our 2026 Annual Meeting of Shareholders, which will be filed with the Securities and Exchange Commission no later than 120 days from
the end of our 2025 fiscal year. The information under the heading "Executive Officers" in Part I of this Form 10-K is also
incorporated herein by reference.

 ITEM
15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

 (a)(1) Financial Statements

 See Part II, Item 8, "Financial
Statements and Supplementary Data" for Financial Statements included with this Annual Report on Form 10-K.

 (a)(2) Financial Statement Schedules

 All other schedules have
been omitted because the required information is not applicable or the information is included in the consolidated financial statements
or the Notes thereto.

 (a)(3) Exhibits

 The exhibits
listed on the accompanying Index to Exhibits are filed as part of this Annual Report.

 Exhibit

 Incorporated
 by Reference

 Filed

 Number

 Exhibit
 Description

 Form

 Date

 Number

 Herewith

 Plan of Reorganization,
 Amended Disclosure Statement, Amended Plan of Reorganization, Modification of Amended Plan of Reorganization, Second Modification
 of Amended Plan of Reorganization, Order Confirming Plan of Reorganization

 SB-2

 5/5/1987

 Restated Articles of Incorporation, adopted
 January 9, 1984

 12/29/1982

 10(a)(1)

 Employment Agreement with
 Joseph G. Flanigan*

 DEF14A

 1/27/1988

 10(a)(1)

 10(a)(2)

 Form of Employment Agreement
 between Joseph G. Flanigan and the Company (as ratified and amended by the stockholders at the 1988 annual meeting is incorporated
 herein by reference).*

 10(a)(1)

 10(c)

 Consent Agreement regarding
 the Company's Trademark Litigation

 4/10/1985

 10(c)

 10(r)

 Partnership Agreement of CIC Investors #13, Ltd,. between Flanigan's Enterprises, Inc., as General Partner and fifty percent owner
 of the limited partnership, and Hotel Properties, LTD. *

 9/30/1995

 10(r)

 10(s)

 Form
 of Franchise Agreement between Flanigan's Enterprises, Inc. and Franchisees.*

 9/30/1995

 10(s)

 10(t)

 Licensing
 Agreement between Flanigan's Enterprises, Inc. and James B. Flanigan, dated November 4, 1996, for non-exclusive use of the service
 mark "Flanigan's" in the Commonwealth of Pennsylvania. *

 9/28/1996

 10(t)

 10(u)

 Partnership Agreement of CIC Investors #15 Ltd., dated March 28, 1997, between B.D. 15 Corp. as General Partner and numerous limited
 partners, including Flanigan's Enterprises, Inc. as a limited partner owning twenty five percent of the limited partnership. *

 9/27/1997

 10(u)

 10(v)

 Partnership Agreement of CIC Investors #60 Ltd., dated July 8, 1997, between Flanigan's Enterprises, Inc., as General Partner and
 numerous limited partners, including Flanigan's Enterprises, Inc. as limited partner owning forty percent of the limited partnership.
 *

 9/27/1997

 10(v)

 10(x)

 Partnership Agreement of CIC Investors #70, Ltd. dated February 1999 between Flanigan's Enterprises, Inc. as General Partner and
 numerous limited partners, including Flanigan's Enterprises, Inc. as limited partner owning forty percent of the limited partnership.
 *

 10/02/1999

 10(x)

 10(y)

 Partnership Agreement of CIC Investors #80, Ltd., dated May 2001, between Flanigan's Enterprises, Inc. as General Partner and numerous
 limited partners, including Flanigan's Enterprises, Inc., as limited partner owning twenty five percent of the limited partnership.
 *

 9/29/2001

 10(y)

 10(z)

 Partnership Agreement of CIC Investors #95, Ltd., dated July 2001, between Flanigan's Enterprises, Inc., as General Partner and numerous
 limited partners, including Flanigan's Enterprises, Inc. as limited partner owning twenty eight percent of the limited partnership. *

 9/29/2001

 10(z)

 10(bb)

 Partnership Agreement of CIC Investors #65, Ltd., dated June 24, 2004, between Flanigan's Enterprises, Inc., as General Partner,
 and numerous limited partners, including Flanigan's Enterprises, Inc. as limited partner owning twenty six percent of the limited
 partnership. *

 10/2/2004

 10(bb)

 10(cc)

 Amended
 and Restated Limited Partnership Certificate and Agreement of CIC Investors #13, Ltd., dated March 1, 2006, between Flanigan's
 Enterprises, Inc., as General Partner, Flanigan's Management Services, Inc. and numerous limited partners, including Flanigan's
 Enterprises, Inc. as limited partner owning thirty nine percent of the limited partnership. *

 9/30/2006

 10(cc)

 10(dd)

 Partnership Agreement of CIC Investors #50, Ltd., dated October 17, 2006, between Flanigan's Enterprises, Inc., as General
 Partner, Flanigan's Management Services, Inc. and numerous limited partners, including Flanigan's Enterprises, Inc. as
 limited partner owning sixteen percent of the limited partnership. *

 9/29/2007

 10(dd)

 10(ee)

 Partnership Agreement of CIC Investors #55, Ltd., dated December 12, 2006, between Flanigan's Enterprises, Inc., as General
 Partner, Flanigan's Management Services, Inc. and numerous limited partners, including Flanigan's Enterprises, Inc. as
 limited partner owning forty eight percent of the limited partnership. *

 9/29/2007

 10(ee)

 10(ff)

 Partnership Agreement of CIC Investors #90, Ltd., dated January 18, 2012, between Flanigan's Enterprises, Inc., as General
 Partner, Flanigan's Management Services, Inc. and numerous limited partners, including Flanigan's Enterprises, Inc. as
 limited partner owning five percent of the limited partnership. *

 9/29/2012

 10(ff)

 10(gg)

 Partnership Agreement of CIC Investors #85, Ltd., dated April 4, 2019, between Flanigan's Enterprises, Inc., as General Partner,
 Flanigan's Management Services, Inc. and numerous limited partners, including Flanigan's Enterprises, Inc. as limited
 partner owning seven percent of the limited partnership. *

 10/1/2022

 10(gg)

 10(hh)

 Partnership Agreement of CIC Investors #25, Ltd., dated September 21, 2021, between Flanigan's Enterprises, Inc., as General
 Partner, Flanigan's Management Services, Inc. and numerous limited partners, excluding Flanigan's Enterprises, Inc. *

 10/1/2022

 10(hh)

 19.1

 Insider Trading Policy and related Rule 10b5-1 Trading Plan Policy

 9/28/2024

 19.1

 97.1

 Incentive Compensation Clawback Policy

 9/28/2024

 97.1

 Registrant's Form 10-K
 constitutes the Annual Report to Shareholders for the fiscal year ended September 27, 2025.

 X

 21(a)

 Company's subsidiaries
 are set forth in this Annual Report on Form 10-K.

 X

 31.1

 Certification
 Pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended of Chief Executive Officer.

 X

 31.2

 Certification
 Pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended of Chief Financial Officer.

 X

 32.1

 Certification
 Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of Chief Executive Officer.

 X

 32.2

 Certification
 Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 of Chief Financial Officer.

 X

 *
 Compensatory
 plan or arrangement.

 ITEM
16. FORM 10-K SUMMARY

 None.

 SIGNATURES

 Pursuant to the requirements
of Section 13 or 15(d) of the Securities Exchange Act of 1934 the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.

 FLANIGAN'S
 ENTERPRISES, INC.

 By:

 /s/
 JAMES G. FLANIGAN II

 JAMES G. FLANIGAN II

 Chief Executive Officer

 By:

 /s/
 JEFFREY D. KASTNER

 JEFFREY D. KASTNER

 Chief Financial Officer
 and Secretary

 (Principal Financial and
 Accounting Officer)

 Pursuant to the requirements
of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in
their capacities and on the dates indicated.

 /s/
 JAMES G. FLANIGAN II

 Chairman of
 the Board,

 James G. Flanigan II

 Chief Executive Officer, and

 /s/
 JEFFREY D. KASTNER

 Chief Financial Officer,

 Jeffrey D. Kastner

 Secretary and Director

 /s/
 AUGUST BUCCI

 Chief Operating Officer

 August Bucci

 and Director

 /s/
 MICHAEL B. FLANIGAN

 Michael B. Flanigan

 /s/
 PATRICK J. FLANIGAN

 Patrick J. Flanigan

 /s/ CHRISTOPHER
 O'NEIL

 Vice President of Package
 Operations

 Christopher O'Neil

 and Director

 /s/
 MARY ELIZABETH BENNETT

 Mary Elizabeth Bennett

 /s/
 CHRISTOPHER J. NELMS

 Christopher J. Nelms

 /s/ JOHN
 P. FOSTER

 John P. Foster

 CONSOLIDATED FINANCIAL STATEMENTS

 SEPTEMBER 27, 2025 AND SEPTEMBER 28, 2024

 INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

 PAGE

 REPORTS OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRMS (PCAOB ID 199 and 688)

 F-2 – F-3

 CONSOLIDATED FINANCIAL STATEMENTS

 Balance Sheets

 F-4 – F-5

 Statements of Income

 Statements of Comprehensive Income

 Statements of Stockholders' Equity

 Statements of Cash Flows

 F-9 – F-10

 Notes to Consolidated Financial Statements

 F-11 – F-31

 F- 1

 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM

 To the Stockholders and Board of Directors of

 Opinion on the Financial Statements

 We have audited the accompanying consolidated
balance sheet of Flanigan's Enterprises, Inc. and subsidiaries (the "Company") as of September 27, 2025, the related
consolidated statements of income, comprehensive income, stockholders' equity and cash flows for the year ended September 27, 2025,
and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present
fairly, in all material respects, the financial position of the Company as of September 27, 2025, and the results of its operations and
its cash flows for the year ended September 27, 2025, in conformity with accounting principles generally accepted in the United States
of America.

 Basis for Opinion

 These financial statements are the responsibility
of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We
are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are
required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and
regulations of the Securities and Exchange Commission and the PCAOB.

 We conducted our audit in accordance with the
standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged
to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding
of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal
control over financial reporting. Accordingly, we express no such opinion.

 Our audit included performing procedures to assess
the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond
to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating
the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

 Critical Audit Matters

 Critical audit matters are matters arising from
the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and
that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging,
subjective, or complex judgments. We determined that there are no critical audit matters.

 /s/ CBIZ CPAs P.C.

 CBIZ CPAs P.C.

 We have served as the Company's auditor
since 1999 (such date takes into account the acquisition of the attest business of Marcum llp
by CBIZ CPAs P.C. effective November 1, 2024).

 Fort Lauderdale, FL

 December 19, 2025

 F- 2

 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 To the Stockholders and Board of Directors of

 Opinion on the Financial Statements

 We have audited the accompanying consolidated
balance sheet of Flanigan's Enterprises, Inc. and subsidiaries (the "Company") as of September 28, 2024, the related
consolidated statements of income, comprehensive income, stockholders' equity and cash flows for the year ended September
28, 2024, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements
present fairly, in all material respects, the financial position of the Company as of September 28, 2024, and the results of its operations
and its cash flows for the year ended September 28, 2024, in conformity with accounting principles generally accepted in the United States
of America.

 Basis for Opinion

 These financial statements are the responsibility
of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We
are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are
required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and
regulations of the Securities and Exchange Commission and the PCAOB.

 We conducted our audit in accordance with the
standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged
to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding
of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal
control over financial reporting. Accordingly, we express no such opinion.

 Our audit included performing procedures to assess
the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond
to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating
the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

 /s/ Marcum llp

 We have served as the Company's auditor from 1999 through May
9, 2025.

 Fort Lauderdale, FL

 December 27, 2024

 F- 3

 CONSOLIDATED BALANCE SHEETS

 SEPTEMBER 27, 2025 AND SEPTEMBER 28, 2024

 (in thousands, except share and per share amounts)

 2025

 2024

 ASSETS

 Current Assets:

 Cash and cash equivalents

 $
 20,094

 $

 Prepaid income taxes

 Other receivables

 1,063

 Inventories

 6,920

 7,020

 Prepaid expenses

 1,810

 1,874

 Other current assets

 —

 Total current assets

 30,593

 31,529

 Property and equipment, net

 82,689

 81,747

 Construction in progress

 —

 82,692

 81,747

 Right-of-use assets, operating leases

 24,817

 26,828

 Investment in Limited Partnerships

 Other Assets:

 Liquor licenses

 1,268

 1,268

 Deposits on property and equipment

 Leasehold interests, net

 Other

 Total other assets

 2,199

 1,704

 Total assets

 $
 140,623

 $
 142,082

 F- 4

 CONSOLIDATED BALANCE SHEETS

 SEPTEMBER 27, 2025 AND SEPTEMBER 28, 2024

 (in thousands, except share and per share amounts)

 (Continued)

 2025

 2024

 LIABILITIES AND STOCKHOLDERS' EQUITY

 Current Liabilities:

 Accounts payable and accrued expenses

 $
 5,889

 $
 7,213

 Accrued compensation

 2,113

 1,798

 Due to franchisees

 3,192

 4,149

 Current portion of long term debt

 1,484

 1,400

 Operating lease liabilities, current

 2,704

 2,467

 Other current liabilities

 —

 Deferred revenue

 2,579

 2,897

 Total current liabilities

 18,118

 19,924

 Long term debt, net of current portion

 19,134

 20,512

 Operating lease liabilities, non-current

 23,793

 25,847

 Deferred tax liabilities

 Total liabilities

 61,526

 66,672

 Commitments and Contingencies Note 12

 Stockholders' Equity:

 Flanigan's Enterprises, Inc.'s Stockholders' Equity Common stock, $.10 par value, 5,000,000 shares authorized; 4,197,642 shares issued; 1,858,647 outstanding for the years ended 2025 and 2024

 Capital in excess of par value

 6,128

 6,240

 Retained earnings

 64,685

 60,674

 Accumulated other comprehensive income

 —

 ( 41
)

 Treasury stock, at cost, 2,338,995 shares

)

)

 Total Flanigan's Enterprises, Inc.'s Stockholders'
 Equity

 65,156

 61,216

 Noncontrolling interests

 13,941

 14,194

 Total stockholders' equity

 79,097

 75,410

 Total liabilities and stockholders'
 equity

 $
 140,623

 $
 142,082

 F- 5

 CONSOLIDATED STATEMENTS OF INCOME

 Years Ended September 27, 2025 and September 28,
2024

 (in thousands, except share and per share amounts)

 2025

 2024

 Revenues:

 Restaurant food sales

 $
 124,501

 $
 114,795

 Restaurant bar sales

 31,764

 30,010

 Package store sales

 Franchise related revenues

 1,754

 1,693

 Other revenues

 205,248

 187,216

 Costs and Expenses:

 Cost of merchandise sold:

 52,174

 49,862

 Package goods

 35,185

 30,128

 Payroll and related costs

 63,701

 59,349

 Operating expenses

 27,438

 24,701

 Occupancy costs

 7,870

 7,754

 Selling, general and administrative expenses

 5,463

 5,313

 Depreciation and amortization

 4,672

 4,268

 196,503

 181,375

 Income from Operations

 8,745

 5,841

 Other Income (Expense):

 Interest expense

 ( 957
)

 ( 1,019
)

 Interest and other income

 Rental income

 1,077

 1,105

 Rental expense

 ( 622
)

 ( 550
)

 Gain on sale of property and equipment

 —

 ( 106
)

 ( 255
)

 Income before Provision for Income Taxes

 8,639

 5,586

 Provision for Income Taxes

 ( 622
)

 ( 286
)

 Net Income

 8,017

 5,300

 Less: Net Income Attributable to Noncontrolling Interests

 ( 2,984
)

 ( 1,944
)

 Net Income Attributable to Flanigan's Enterprises Inc.'s
 Stockholders

 $
 5,033

 $
 3,356

 Net Income Per Common Share:

 Basic and Diluted

 $
 2.71

 $
 1.81

 Weighted Average Shares and Equivalent Shares Outstanding

 Basic and Diluted

 F- 6

 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

 Years Ended September 27, 2025 and September 28,
2024

 2025

 2024

 Net income:

 $
 8,017

 $
 5,300

 Other comprehensive income:

 Change in fair value of interest rate swap, net of tax

 ( 436
)

 Reclassification of gains from
 interest rate swap to interest and other income, net of tax

 ( 331
)

 —

 Total Comprehensive Income

 8,017

 4,864

 F- 7

 CONSOLIDATED STATEMENTS OF STOCKHOLDERS'
EQUITY

 YEARS ENDED SEPTEMBER 27, 2025 AND SEPTEMBER 28,
2024

 (in thousands, except share amounts)

 Capital in

 Common Stock

 Excess of

 Retained

 Treasury Stock

 Noncontrolling

 Shares

 Par Value

 AOCI

 Earnings

 Shares

 Interests

 Total

 Balance, September 29, 2024

 4,197,642

 $

 $
 6,240

 $
 ( 41
)

 $
 60,674

 2,338,995

 $
)

 $
 14,194

 $
 75,410

 Net income

 —

 —

 —

 —

 5,033

 —

 —

 2,984

 8,017

 Other comprehensive income

 —

 —

 —

 —

 —

 —

 —

 Reclassification of realized gain on interest rate swap
 to interest and other income, net of tax

 —

 —

 —

 ( 290
)

 —

 —

 —

 —

 ( 290
)

 Distributions to noncontrolling interests

 —

 —

 —

 —

 —

 —

 —

 ( 2,968
)

 ( 2,968
)

 Purchase of noncontrolling interest

 —

 —

 ( 112
)

 —

 —

 —

 —

 ( 269
)

 ( 381
)

 Dividends paid

 —

 —

 —

 —

 ( 1,022
)

 —

 —

 —

 ( 1,022
)

 Balance, September 27, 2025

 4,197,642

 $

 $
 6,128

 $
 -

 $
 64,685

 2,338,995

 $
)

 $
 13,941

 $
 79,097

 Capital in

 Common Stock

 Excess of

 Retained

 Treasury Stock

 Noncontrolling

 Shares

 Par Value

 AOCI

 Earnings

 Shares

 Interests

 Total

 Balance, September 30, 2023

 4,197,642

 $

 $
 6,240

 $

 $
 58,247

 2,338,995

 $
)

 $
 15,689

 $
 74,914

 Net income

 —

 —

 —

 —

 3,356

 —

 —

 1,944

 5,300

 Other comprehensive loss

 —

 —

 —

 ( 436
)

 —

 —

 —

 —

 ( 436
)

 Distributions to noncontrolling interests

 —

 —

 —

 —

 —

 —

 —

 ( 3,439
)

 ( 3,439
)

 Dividends paid

 —

 —

 —

 —

 ( 929
)

 —

 —

 —

 ( 929
)

 Balance, September 28, 2024

 4,197,642

 $

 $
 6,240

 $
 ( 41
)

 $
 60,674

 2,338,995

 $
)

 $
 14,194

 $
 75,410

 F- 8

 CONSOLIDATED STATEMENTS OF CASH FLOWS

 YEARS ENDED SEPTEMBER 27, 2025 AND SEPTEMBER 28,
2024

 2025

 2024

 Cash Flows from Operating Activities:

 Net income

 $
 8,017

 $
 5,300

 Adjustments to reconcile net income to net cash and cash
 equivalents provided by operating activities:

 Depreciation and amortization

 4,672

 4,268

 Amortization of leasehold interests

 Amortization of operating lease right-of-use assets

 2,649

 2,549

 Gain on interest rate swap

 ( 35
)

 —

 Gain on sale of property and equipment

 —

 ( 2
)

 Loss on abandonment of property and equipment

 Gain on casualty loss

 —

 ( 30
)

 Amortization of deferred loan costs

 Deferred income taxes

 ( 20
)

 ( 265
)

 Income from unconsolidated limited partnership

 ( 64
)

 ( 42
)

 Changes in operating assets and liabilities:

 (Increase) decrease in:

 Other receivables

 ( 199
)

 Prepaid income taxes

 ( 2
)

 Inventories

 Prepaid expenses

 ( 363
)

 Other current assets

 ( 705
)

 —

 Other assets

 ( 16
)

 Increase (decrease) in:

 Accounts payable and accrued expenses

 ( 1,009
)

 ( 2,072
)

 Other current liabilities

 —

 Operating lease liabilities

 ( 2,455
)

 ( 2,311
)

 Due to franchisees

 ( 957
)

 ( 828
)

 Deferred revenue

 ( 318
)

 Net cash and cash equivalents
 provided by operating activities

 10,510

 6,630

 Cash Flows from Investing Activities:

 Purchase of property and equipment

 ( 5,830
)

 ( 3,445
)

 Purchase of construction in progress

 ( 3
)

 ( 1,594
)

 Deposits on property and equipment

 ( 410
)

 ( 174
)

 Purchase of leaseholds

 —

 ( 31
)

 Proceeds from sale of property and equipment

 Proceeds from insurance recovery

 —

 Distributions from unconsolidated
 limited partnership

 Net cash and cash equivalents used
 in investing activities

 ( 6,117
)

 ( 5,141
)

 F- 9

 CONSOLIDATED STATEMENTS OF CASH FLOWS

 YEARS ENDED SEPTEMBER 27, 2025 AND SEPTEMBER 28,
2024

 2025

 2024

 Cash Flows from Financing Activities:

 Payments on long term debt

 ( 1,330
)

 ( 1,251
)

 Dividends paid

 ( 1,022
)

 ( 929
)

 Purchase of noncontrolling limited partnership interests

 ( 381
)

 —

 Distributions to limited partnerships'
 noncontrolling interests

 ( 2,968
)

 ( 3,439
)

 Net cash and cash equivalents
 used in financing activities

 ( 5,701
)

 ( 5,619
)

 Net Decrease in Cash and Cash Equivalents

 ( 1,308
)

 ( 4,130
)

 Cash and Cash Equivalents - Beginning
 of Period

 25,532

 Cash and Cash Equivalents - End
 of Period

 $
 20,094

 $

 Supplemental Disclosure for Cash Flow Information:

 Cash paid during the year for:

 Interest

 $

 $

 Income taxes

 $

 $

 Supplemental Disclosure of Non-Cash Investing and Financing
 Activities:

 Increase (decrease) in fair value
 of interest rate swap

 $

 $
 ( 583
)

 Purchase deposits capitalized
 to property and equipment

 $

 $

 Purchase deposits transferred
 to construction in progress

 $
 —

 $

 Construction in progress transferred
 to property and equipment

 $
 —

 $
 7,676

 Construction in progress in accounts
 payable and accrued expenses

 $
 —

 $

 Remeasurement of right-of-use
 operating lease

 $

 $
 2,390

 F- 10

 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

 YEARS ENDED SEPTEMBER 27, 2025 AND SEPTEMBER 28,
2024

 NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 Organization and Capitalization

 The Company was incorporated in 1959 and operates
in South Florida as a chain of full-service restaurants and package liquor stores. Restaurant food and beverage sales make up the majority
of our total revenue. As of September 27, 2025, we (i) operate 32 units consisting of restaurants, package liquor stores and combination
restaurants/package liquor stores that we either own or have operational control over and partial ownership in; and (ii) franchise an
additional five units, consisting of two restaurants, (one of which we operate) and three combination restaurants/package liquor stores.
With the exception of one restaurant we operate under the name "The Whale's Rib", a restaurant in which we do not have
an ownership interest, and "Brendan's Sports Pub", a restaurant/bar we own, all of the restaurants operate under our
service marks "Flanigan's Seafood Bar and Grill" or "Flanigan's" and all of the package liquor stores
operate under our service marks "Big Daddy's Liquors" or "Big Daddy's Wine & Liquors".

 The Company's Articles of Incorporation,
as amended, authorize us to issue and have outstanding at any one time 5,000,000 shares of common stock at a par value of $ 0.10 per share.

 We operate under a 52-53 week year ending the
Saturday closest to September 30. Our fiscal years 2025 and 2024 are each comprised of a 52-week period.

 Principles of Consolidation

 The consolidated financial statements include
the accounts of the Company and our subsidiaries, all of which are wholly owned, and the accounts of the ten limited partnerships in
which we act as general partner and have controlling interests. All significant intercompany transactions and balances have been eliminated
in consolidation.

 Noncontrolling interests in consolidated subsidiaries are included
in the consolidated balance sheets as a separate component of equity. We report consolidated net income inclusive of both the Company's
and the noncontrolling interests' share, as well as amounts of consolidated net income attributable to each of the Company and the
noncontrolling interests.

 We use the consolidation method of accounting
when we have a controlling interest in other companies and limited partnerships. We use the equity method of accounting when we have
significant influence and an interest between twenty to fifty percent in other companies and limited partnerships, but do not exercise
control. Under the equity method, our original investments are recorded at cost and are adjusted for our share of undistributed earnings
or losses. All intercompany profits are eliminated.

 Revised Presentation of Rental Income

 For the fiscal year ended September 27, 2025, we adjusted our Consolidated
Statements of Income to correct rental income from Revenues to Other Income and rental expense from Operating, Occupancy and Selling,
General and Administrative expenses to Other Expense. We believe this presentation more accurately reflects revenue generated from ancillary
activity rather than revenue generated from core operations. Prior period amounts have been adjusted. This correction had no impact on
reported results of operations.

 Use of Estimates

 The consolidated financial statements and related
disclosures are prepared in conformity with accounting principles generally accepted in the United States and SEC rules. We are required
to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and
liabilities at the date of the financial statements, and revenue and expenses during the periods reported. These estimates include assessing
the estimated useful lives of tangible assets, the recognition of deferred tax assets and liabilities and estimates relating to the calculation
of incremental borrowing rates and length of leases associated with right-of-use assets and corresponding liabilities, and estimates
relating to loyalty reward programs and gift cards. Estimates and assumptions are reviewed periodically and the effects of revisions
are reflected in our consolidated financial statements in the period they are determined to be necessary. Although these estimates are
based on our knowledge of current events and actions we may undertake in the future, they may ultimately differ from actual results.

 F- 11

 NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

 Cash and Cash Equivalents

 We consider all highly liquid investments with
an original maturity of 3 months or less at the date of purchase and receivables from our credit card merchants to be cash equivalents.

 We maintain deposit balances with financial institutions,
which balances may from time to time, exceed the federally insured limits which are $ 250,000 for interest and non-interest bearing accounts.
The deposit balances that exceed the federally insured limits are approximately $ 13,135,000 as of September 27, 2025. We have not experienced
any losses on such accounts.

 Other Receivables

 Our receivables consist primarily of rebates
due to our restaurant or package stores.

 Inventories

 Our inventories, which consist primarily of package
liquor products, are stated at the lower of weighted average cost or net realizable value. The movement of package inventory approximates
first in, first out (FIFO).

 Liquor Licenses

 In accordance with the Financial Accounting Standards
Board (FASB) Accounting Standards Codification (ASC) Topic 350, " Intangibles - Goodwill and Other ", our liquor
licenses are indefinite lived assets, which are not being amortized, but are tested annually for impairment (see Note 9).

 Property and Equipment

 Our property and equipment are stated at cost
less accumulated depreciation and amortization. We capitalize expenditures for major improvements and depreciation commences when the
assets are placed in service. We record depreciation on a straight-line basis over the estimated useful lives of the respective assets.
We charge maintenance and repairs, which do not improve or extend the life of the respective assets, to expense as incurred. When we
dispose of assets, the cost and related accumulated depreciation are removed from the accounts and any gain or loss is included in income.

 Our estimated useful lives range from 3 to 5
years for vehicles and 3 to 7 years for furniture and equipment. Leasehold improvements are currently being amortized over the shorter
of the life of the lease or the life of the asset up to a maximum of 15 years. Our buildings of our corporate offices in Fort Lauderdale,
Florida; our construction office/warehouse in Fort Lauderdale, Florida; our combination restaurant and package liquor stores in Hallandale,
Florida and North Lauderdale, Florida; our restaurants in N. Miami and Fort Lauderdale, Florida; our property in Sunrise, Florida which
we lease to a limited partnership (Store #85), our property in Fort Lauderdale, Florida which we lease to a franchisee (Store #15), our
package stores in N. Miami, Florida and El Portal, Florida and our shopping centers in Miami, Florida and Hallandale Beach, Florida all
of which we own, are being depreciated over 40 years. Building improvements are being depreciated over 20 years.

 Leasehold Interests

 Our purchase of an existing restaurant location
usually includes a lease to the business premises. As a result, a portion of the purchase price is allocated to the leasehold interest.
We capitalize the cost of the leasehold interest and amortization commences upon our assumption of the lease. We amortize leasehold interests
on a straight-line basis over the remaining term of the lease.

 Concentrations of Credit Risk

 Financial instruments that potentially subject
us to concentrations of credit risk are cash and cash equivalents.

 F- 12

 NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

 Major Suppliers

 Throughout our fiscal years 2025 and 2024, we
purchased a significant portion of our food products from two major suppliers. The first major supplier represents approximately 34 %
and 38 % of our cost of goods sold and approximately 20 % and 31 % of our accounts payable and accrued expenses as of September 27, 2025
and September 28, 2024, respectively. The second major supplier represents approximately 9 % and 11 % of our cost of goods sold and approximately
 2 % of our accounts payable and accrued expenses as of September 27, 2025 and September 28, 2024. We believe that several other alternative
vendors are available, if necessary.

 Throughout our fiscal years 2025 and 2024, we
purchased the majority of our alcoholic beverages from three local distributors. One of these three local distributors represents approximately
 26 % and 23 % of our cost of goods sold for the years ended September 27, 2025 and September 28, 2024, respectively and approximately 5 %
and 6 % of our accounts payable and accrued expenses as of September 27, 2025 and September 28, 2024, respectively. Each distributor has
exclusive rights from the manufacturers to sell specific brands in given areas, so unless the exclusive distribution rights are transferred
to another vendor, there are no alternate distributors available.

 Revenue Recognition

 Revenue-related to food, bar and package sales
are recorded at the point of sale. Royalty-related revenues, which are 1 % of package sales and 3 % of restaurant sales, are recorded as
income on a weekly basis, in arrears. We report our revenues net of sales tax.

 We sell gift cards which do not have expiration
dates. Revenue from gift cards is recognized when gift cards are redeemed by the customer and breakage revenue is recognized quarterly
according to historical redemption patterns.

 Our Big Daddy's Good Customer Loyalty Program
awards customers with a $ 20 Good Customer Gift Card, ("Gift Card") to be used at our Flanigan's Seafood Bar and Grill
restaurants for every ten (10) purchases of at least $ 25 made by such customer at our Big Daddy's Liquors package liquor stores.
Pursuant to ASC 606, we recognize deferred revenue in the amount of the Gift Card upon the issuance of the Gift Card and reduce package
liquor store revenue by a like amount. We recognize revenue when the Gift Card is redeemed in our restaurants or when it expires unused.
Gift cards have various expiration dates based upon each program, while gift cards purchased for cash have no expiration dates.

 Through mid-June 2025, our Lunch Club Loyalty
Program awarded customers with a free lunch once they earned the required number of points. Pursuant to ASC 606, we recognized deferred
revenue in the amount of the free lunch and reduced restaurant store revenue by a like amount. We recognized revenue when the free lunch
was redeemed in our restaurants or when it expired unused. Beginning in mid-June 2025, our Lunch Club Loyalty Program awards customers
with a $ 10 off coupon once they earn the required number of points. We recognize deferred revenue of $ 10 and reduce restaurant store
revenues by this same amount. We recognize revenue when the $ 10 off coupon is redeemed in our restaurants or when it expires unused.

 Holiday Promotional Card Program awards customers
with a $ 20 promotional gift card ("Promo Gift Card") when they spend $ 100 in the restaurants on food/drink or purchase a
$ 100 gift card. This $ 20 promotional card can only be redeemed within a three month window. Pursuant to ASC 606, we recognize deferred
revenue in the amount of the Promo Gift Card upon issuance and reduce restaurant store revenue by a like amount. We recognize revenue
when the "Promo Gift Card" is redeemed in our restaurants or when it expires unused.

 Pre-opening Costs

 As new restaurants open, our income from operations
will be adversely affected due to our obligation to fund pre-opening costs. Pre-opening costs are those typically associated with the
opening of a new restaurant and generally include payroll costs associated with the new restaurant opening, rent and promotional costs.
We expense pre-opening costs as incurred and during our fiscal year ended September 27, 2025 we incurred no preopening expenses. During
our fiscal year ended September 28, 2024 we expensed $ 77,000 for our store #19R.

 Advertising Costs

 Our advertising costs are expensed as incurred.
Advertising costs incurred during our fiscal years ended September 27, 2025 and September 28, 2024 were approximately $ 438,000 and $ 223,000,
respectively.

 F- 13

 NOTE 1. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES (Continued)

 General Liability Insurance

 We have general liability insurance which incorporates
a $ 50,000 self-insured retention per occurrence for us and a $ 10,000 self-insured retention per occurrence for the limited partnerships.
Our insurance carrier is responsible for $ 1,000,000 coverage per occurrence above our self-insured retentions, up to a maximum aggregate
of $ 2,000,000 per year. We were also able to purchase excess liability insurance, whereby our excess insurance carrier is responsible
for $ 10,000,000 coverage above our primary general liability insurance coverage. We are un-insured against liability claims in excess
of $ 11,000,000 per occurrence and in the aggregate.

 Our general policy is to settle only those legitimate
and reasonable claims asserted and to aggressively defend and go to trial, if necessary, on frivolous and unreasonable claims. Under
our current liability insurance policy, certain expenses incurred by us in defending a claim, including attorney's fees, are a
part of our $ 50,000 self-insured retention, and a part of our limited partnerships' $ 10,000 self-insured retention.

 Fair Value of Financial Instruments

 The respective carrying value of our on-balance-sheet
financial instruments approximate their fair value. These instruments include cash and cash equivalents, other receivables, accounts
payables, accrued expenses and debt. We have assumed carrying values to approximate fair values for those financial instruments, which
are short-term in nature or are receivable or payable on demand. We estimated the fair value of debt based on current rates offered to
us for debt of comparable maturities and similar collateral requirements.

 In accordance with FASB ASC Topic 820-10-50-1,
we utilized a valuation model to determine the fair value of our swap agreement. As the valuation models for the swap agreement were
based upon observable inputs, they are classified as Level 2 (see Note 13).

 Derivative Instruments

 We account for derivative instruments in accordance
with FASB ASC Topic 815-10-05-4, " Accounting for Derivative Instruments and Hedging Activities" as amended, which
establishes accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other
contracts, and hedging activities. In accordance with FASB ASC Topic 815-10-05-4, derivative instruments are recognized as assets or
liabilities in the Company's consolidated balance sheets and are measured at fair value.

 Beginning in the second quarter of our fiscal
year 2025, we determined that our interest rate swap agreement is an economic hedge and recognize the changes in fair value on our interest
rate swap in interest and other income.

 Income Taxes

 We account for our income taxes using FASB ASC
Topic 740, " Income Taxes ", which requires the recognition of deferred tax liabilities and assets for expected future
tax consequences of events that have been included in the consolidated financial statements or tax returns. Under this method, deferred
tax liabilities and assets are determined based on the difference between the financial statement and tax bases of assets and liabilities
using enacted tax rates in effect for the year in which the differences are expected to reverse.

 We follow the provisions regarding Accounting
for Uncertainty in Income Taxes, which require the recognition of a financial statement benefit of a tax position only after determining
that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more
likely than not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent
likelihood of being realized upon ultimate settlement with the relevant tax authority. For our fiscal years ended September 27, 2025
and September 28, 2024, we had no material unrecognized tax benefits and no adjustments to our financial position, results of operations
or cash flows were required. Generally, federal, state and local authorities may examine the Company's tax returns for three years
from the date of filing and the current and prior three years remain subject to examination as of September 27, 2025.

 Long-Lived Assets

 We continually evaluate whether events and circumstances
have occurred that may warrant revision of the estimated life of our intangible and other long-lived assets or whether the remaining
balance of our intangible and other long-lived assets should be evaluated for possible impairment. If and when such factors, events or
circumstances indicate that intangible or other long-lived assets should be evaluated for possible impairment, we will determine the
fair value of the asset by making an estimate of expected future cash flows over the remaining lives of the respective assets and compare
that fair value with the carrying value of the assets in measuring their recoverability. In determining the expected future cash flows,
the assets will be grouped at the lowest level for which there are cash flows, at the individual store level.

 Earnings Per Share

 We follow FASB ASC Topic 260 - " Earnings
per Share." This section provides for the calculation of basic and diluted earnings per share. Basic earnings per share includes
no dilution. Earnings per share are computed by dividing income available to common stockholders by the basic and diluted weighted average
number of common shares.

 F- 14

 NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

 Recently Adopted and Recently Issued Accounting
Pronouncements

 Adopted

 The FASB issued guidance, Accounting Standards
Update (ASU) 2016-13 Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,
which provides a financial asset (or a group of financial assets) measured at amortized cost basis to be presented at the net amount
expected to be collected. The allowance for credit losses is a valuation account that is deducted from the amortized cost basis of the
financial asset(s) to present the net carrying value at the amount expected to be collected on the financial asset. The measurement of
expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable
and supportable forecasts that affect the collectability of the reported amount. This guidance was effective for the Company in the first
quarter of our fiscal year 2024; however, after performing a thorough analysis the Company concluded there was no material impact from
the adoption of this ASU.

 In November 2023, the FASB issued ASU 2023-07,
"Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures," which updates reportable segment disclosure
requirements, primarily through requiring enhanced disclosures about significant segment expenses and information used to assess segment
performance. We early adopted this ASU in the third quarter of our fiscal year 2024 and this ASU affected the expense presentation of
our Consolidated Statements of Income and our Business Segments footnote. For further information regarding the Company's Business
Segments, please refer to our Consolidated Statements of Income and Business Segments footnote.

 Recently Issued

 In December 2023, the FASB
issued ASU 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures," which requires enhanced income tax
disclosures, primarily related to standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction.
This ASU will be effective for the Company for our fiscal year 2026 annual reporting period, with the guidance applied either prospectively
or retrospectively. Early adoption is permitted. We are currently evaluating the impact that the adoption of this ASU will have on our
tax disclosures.

 In November 2024, the FASB
issued ASU 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures" which
requires disclosure of disaggregated information about certain income statement expense line items in the notes to the financial statements
on an interim and annual basis. In January 2025, the FASB issued ASU 2025-01 clarifying the effective date of ASU 2024-03, which will
be effective for the Company for our fiscal year 2027 annual reporting period, with guidance applied either prospectively or retrospectively.
Early adoption is permitted. We are currently evaluating the impact that the adoption of this ASU will have on our interim and consolidated
financial statements.

 In September 2025, the FASB
issued ASU 2025-06, "Intangibles-Goodwill and Other-Internal-Use Software (Subtopic 350-40)" which eliminates all references
to project stages and requires capitalization of software costs when: (i) management authorizes and commits to funding the software project,
and (ii) it is probable the software project will be completed and used as intended, known as the "probable-to-completion recognition
threshold." Entities must consider whether there is significant uncertainty associated with the development activities of the software
in determining if the threshold is met. In addition, the amendments in the update specify that property, plant and equipment disclosure
requirements are required for capitalized internal-use software costs, regardless of financial statement presentation and also incorporate
the recognition requirements for website-specific development costs. This ASU will be effective for the Company for our fiscal year fiscal
year 2029 annual reporting period with the guidance applied either prospectively, retrospectively, or via a modified prospective transition
method. Early adoption is permitted. We are currently evaluating the impact that the adoption of this ASU will have on our interim and
consolidated financial statements.

 There are no other recently
issued accounting pronouncements that we have not yet adopted that we believe will have a material effect on our financial statements.

 F- 15

 NOTE 2. PROPERTY AND EQUIPMENT, NET

 2025

 2024

 Furniture and equipment

 $
 17,907

 $
 17,741

 Leasehold improvements

 33,256

 32,381

 Land and land improvements

 38,182

 36,221

 Building and improvements

 37,885

 38,065

 Vehicles

 2,426

 2,281

 Other

 130,258

 127,006

 Less accumulated depreciation and amortization

 ( 47,569
)

 ( 45,259
)

 82,689

 81,747

 Construction in progress

 —

 $
 82,692

 $
 81,747

 Depreciation and amortization expense for the
fiscal years ended September 27, 2025 and September 28, 2024 was approximately $ 4,672,000 and $ 4,268,000, respectively.

 NOTE 3. LEASEHOLD INTERESTS, NET

 2025

 2024

 Leasehold interests, at cost

 $
 3,055

 $
 3,055

 Less accumulated amortization

 ( 3,014
)

 ( 2,987
)

 $

 $

 Future leasehold amortization as of September 27,
2025 is as follows:

 2026

 $

 2027

 2028

 2029

 2030

 Thereafter

 —

 Total

 $

 Leasehold amortization expense for the fiscal
years ended September 27, 2025 and September 28, 2024 was approximately $ 27,000 and $ 26,000, respectively.

 F- 16

 NOTE 4. INVESTMENT IN LIMITED PARTNERSHIPS

 We have invested along with others (some of whom
are affiliated with our officers and directors) in eleven limited partnerships which currently own and operate eleven South Florida based
restaurants under our service marks "Flanigan's Seafood Bar and Grill" or "Flanigan's". In addition
to being a limited partner in these limited partnerships, we are the sole general partner of ten of these limited partnerships and manage
and control the operations of these restaurants except for the restaurant located in Fort Lauderdale, Florida where we only hold a limited
partnership interest.

 Generally, the terms of the limited partnership
agreements provide that until the investors' cash investment in a limited partnership (including any cash invested by us) is returned
in full, (available cash is distributed to the investors pro-rata based on ownership interest), the limited partnership distributes to
the investors annually out of available cash from the operation of the restaurant, as a return of capital, up to 25 % of the cash invested
in the limited partnership, with no management fee paid to us. Any available cash in excess of the 25 % of the cash invested in the limited
partnership distributed to the investors annually, is paid one-half () to us as a management fee and one-half () to the
investors (including us), pro-rata based on the investors' investment, as a return of capital. Once all of the investors (including
us), have received, in full, amounts equal to their cash invested, an annual management fee becomes payable to us equal to one-half ()
of cash available to be distributed, with the other one-half () of available cash distributed to the investors (including us),
as a profit distribution, pro-rata based on the investors' investment. As of September 27, 2025, all limited partnerships, with
the exception of the limited partnership which owns the restaurant in Sunrise, Florida (Store #85), which opened for business in March
2022 and the limited partnership which owns the restaurant in Miramar, Florida (Store #25), which opened for business in April 2023,
have returned all cash invested and we receive an annual management fee equal to one-half () of the cash available for distribution
by the limited partnership.

 In addition to receipt of distributable amounts
from the limited partnerships, we receive a fee equal to 3 % of gross sales for use of our service marks "Flanigan's Seafood
Bar and Grill" or "Flanigan's", which use is authorized while we act as general partner only. This 3 % fee is
"earned" when sales are made by the limited partnerships and is paid weekly, in arrears. Whether we will have any additional
restaurants in the future will be dependent, among other things, on market conditions and our ability to raise capital. We anticipate
that we will continue to form limited partnerships to raise funds to own and operate restaurants under our service marks "Flanigan's
Seafood Bar and Grill" or "Flanigan's" using the same or substantially similar financial arrangements.

 Below is information on the eleven limited partnerships
which own and operate "Flanigan's Seafood Bar and Grill" or "Flanigan's" restaurants:

 Surfside, Florida

 We are the sole general partner and a 46 % limited
partner in this limited partnership which has owned and operated a restaurant in Surfside, Florida under our "Flanigan's
Seafood Bar and Grill" service mark since March 6, 1998. 33.3 % of the limited partnership interest is owned by persons who are
either our officers, directors or their family members. This limited partnership has returned to its investors all of their initial cash
invested and we receive an annual management fee equal to one-half () of the cash available for distribution by this limited
partnership. This entity is consolidated in the accompanying consolidated financial statements.

 Kendall, Florida

 We are the sole general partner and a 41 % limited
partner in this limited partnership which has owned and operated a restaurant in Kendall, Florida under our "Flanigan's Seafood
Bar and Grill" service mark since April 4, 2000. 28.3 % of the limited partnership interest is owned by persons who are either our
officers, directors or their family members. This limited partnership has returned to its investors all of their initial cash invested
and we receive an annual management fee equal to one-half () of the cash available for distribution by this limited partnership.
This entity is consolidated in the accompanying consolidated financial statements.

 West Miami, Florida

 We are the sole general partner and a 32 % limited
partner in this limited partnership which has owned and operated a restaurant in West Miami, Florida under our "Flanigan's
Seafood Bar and Grill" service mark since October 11, 2001. 32.7 % of the limited partnership interest is owned by persons who are
either our officers, directors or their family members. This limited partnership has returned to its investors all of their initial cash
invested and we receive an annual management fee equal to one-half () of the cash available for distribution by this limited
partnership. This entity is consolidated in the accompanying consolidated financial statements.

 F- 17

 NOTE 4. INVESTMENT IN LIMITED PARTNERSHIPS (Continued)

 Wellington, Florida

 We are the sole general partner and a 33 % limited
partner in this limited partnership which has owned and operated a restaurant in Wellington, Florida under our "Flanigan's
Seafood Bar and Grill" service mark since May 27, 2005. 21.9 % of the limited partnership interest is owned by persons who are either
our officers, directors or their family members. This limited partnership has returned to its investors all of their initial cash invested
and we receive an annual management fee equal to one-half () of the cash available for distribution by this limited partnership.
This entity is consolidated in the accompanying consolidated financial statements.

 Pinecrest, Florida

 We are the sole general partner and 50 % limited
partner in this limited partnership which has owned and operated a restaurant in Pinecrest, Florida under our "Flanigan's
Seafood Bar and Grill" service mark since August 14, 2006. 19.4 % of the limited partnership interest is owned by persons who are
either our officers, directors or their family members. This limited partnership has returned to its investors all of their initial cash
invested and we receive an annual management fee equal to one-half () of the cash available for distribution by this limited
partnership. This entity is consolidated in the accompanying consolidated financial statements.

 Pembroke Pines, Florida

 We are the sole general partner and a 29 % limited
partner in this limited partnership which has owned and operated a restaurant in Pembroke Pines, Florida under our "Flanigan's
Seafood Bar and Grill" service mark since October 29, 2007. 23.0 % of the limited partnership interest is owned by persons who are
either our officers, directors or their family members. This limited partnership has returned to its investors all of their initial cash
invested and we receive an annual management fee equal to one-half () of the cash available for distribution by this limited
partnership. This entity is consolidated in the accompanying consolidated financial statements.

 Davie, Florida

 We are the sole general partner and a 54 % limited
partner in this limited partnership which has owned and operated a restaurant in Davie, Florida under our "Flanigan's Seafood
Bar and Grill" service mark since July 28, 2008. 12.0 % of the limited partnership interest is owned by persons who are either our
officers, directors or their family members. This limited partnership has returned to its investors all of their initial cash invested
and we receive an annual management fee equal to one-half () of the cash available for distribution by this limited partnership.
This entity is consolidated in the accompanying consolidated financial statements.

 We are the sole general partner and a 11 % limited
partner in this limited partnership which has owned and operated a restaurant in Miami, Florida under our "Flanigan's Seafood
Bar and Grill" service mark since December 27, 2012. 26.3 % of the limited partnership interest is owned by persons who are either
our officers, directors or their family members. This limited partnership has returned to its investors all of their initial cash invested
and we receive an annual management fee equal to one-half () of the cash available for distribution by this limited partnership.
This entity is consolidated in the accompanying consolidated financial statements.

 F- 18

 NOTE 4. INVESTMENT IN LIMITED PARTNERSHIPS (Continued)

 Sunrise, Florida

 We are the sole general partner and a 7 % limited
partner in this limited partnership which has owned and operated a restaurant in Sunrise, Florida under our "Flanigan's"
service mark since March 22, 2022. 32.1 % of the limited partnership interest is owned by persons who are either our officers, directors
or their family members. As of the end of our fiscal year 2025, this limited partnership has returned to its investors approximately
 26.5 % of their initial cash invested and as a result, we are currently not entitled to receive any management fees from this limited
partnership. This entity is consolidated in the accompanying consolidated financial statements.

 Miramar, Florida

 We are the sole general partner in this limited
partnership which has owned and operated a restaurant in Miramar, Florida under our "Flanigan's" service mark since
April 18, 2023. No units of limited partnership interest were purchased by the Company. 25.5 % of the limited partnership interest is
owned by persons who are either our officers, directors or their family members. As of the end of our fiscal year 2025, this limited
partnership has returned to its investors approximately 45 % of their initial cash invested and as a result, we are currently not entitled
to receive any management fee from this limited partnership. This entity is consolidated in the accompanying consolidated financial statements.

 Fort Lauderdale, Florida

 A corporation, owned by a member of our Board
of Directors, acts as sole general partner of a limited partnership which has owned and operated a restaurant in Fort Lauderdale, Florida
under our "Flanigan's Seafood Bar and Grill" service mark since April 1, 1997. We have a 25 % limited partnership interest
in this limited partnership. 56.9 % of the limited partnership interest is owned by persons who are either our officers, directors or
their family members. This limited partnership has returned to its investors all cash invested, but since we are not the general partner
of this limited partnership, we do not receive an annual management fee. We have a franchise arrangement with this limited partnership
and for accounting purposes, we do not consolidate the operations of this limited partnership into our operations. Our investment in
this entity is reported using the equity method in the accompanying consolidated financial statements. The following is a summary of
financial information pertaining to our limited partnership investment in Fort Lauderdale, Florida:

 Unaudited

 2025

 2024

 Financial Position:

 Current Assets

 $

 $

 Non-Current Assets

 Total Assets

 1,333

 1,143

 Current Liabilities

 Non-Current Liabilities

 —

 —

 Total Liabilities

 Equity

 1,107

 Total Liabilities and Equity

 $
 1,333

 $
 1,143

 Operating Results:

 Revenues

 5,413

 5,051

 Gross Profit

 3,631

 3,311

 Net Income

 F- 19

 NOTE 5. PURCHASE OF REAL PROPERTY; LEASEHOLD / SUB-LEASEHOLD INTERESTS

 Purchase of Real Property

 During the third quarter of our fiscal year 2025,
we purchased the vacant real property located at 20971 Old Cutler Road, Cutler Bay, Florida 33189 (the "Cutler Bay Property")
for a purchase price of $ 2,200,000. We paid all cash at closing. We plan to construct a 6,400 square foot building on the Cutler Bay
Property to lease to a limited partnership of which we will be the sole general partner pursuant to our limited partnership financial
arrangement to develop and operate a "Flanigan's" restaurant.

 Purchase of Leasehold/Sub-leasehold Interests

 In 1974, we sold the underlying ground lease
to the real property located at 8600 Biscayne Boulevard, El Portal, Florida to related and unrelated third parties and simultaneously
subleased it back. We operate our retail package liquor store (Store #47) and warehouse from this location. During the first quarter
of our fiscal year 2024, we re-purchased a 4 % interest in the underlying ground lease, as well as the sublease agreement from an unrelated
third party for $ 31,000 and currently own 56 % of each lease. As a result, we now only pay 44 % of the rent due under the ground lease
and the sublease agreement.

 NOTE 6. INSURANCE PREMIUMS

 Due to continuing higher interest rates, for
the policy year commencing December 30, 2024 we paid the premiums for general liability, auto, property, excess liability and terrorism
policies totaling approximately $ 4.01 million, which includes coverage for our franchises (of approximately $ 911,000), which are not
included in our consolidated financial statements. For the policy year commencing December 30, 2025, we will pay the premiums for general
liability, auto, property, excess liability and terrorism policies in full again due to continuing higher interest rates.

 NOTE 7. DEFERRED REVENUE

 Changes in deferred revenue on the consolidated
balance sheets were as follows:

 Loyalty Program

 Gift Cards

 Holiday
 Promo

 Lunch
 Club

 Big Daddy
 Good
 Customer

 Other

 Total

 September 28, 2024

 $
 1,388

 $
 —

 $

 $
 1,405

 $

 $
 2,897

 Revenue deferred

 3,598

 1,811

 1,404

 6,840

 Revenue recognized

 ( 3,434
)

 ( 1,811
)

 ( 87
)

 ( 1,819
)

 ( 7
)

 ( 7,158
)

 September 27, 2025

 $
 1,552

 $
 —

 $

 $

 $

 $
 2,579

 September 30, 2023

 $
 1,215

 $
 —

 $

 $
 1,341

 $
 —

 $
 2,635

 Revenue deferred

 3,560

 1,663

 6,080

 Revenue recognized

 ( 3,387
)

 ( 1,663
)

 ( 1
)

 ( 767
)

 —

 ( 5,818
)

 September 28, 2024

 $
 1,388

 $
 —

 $

 $
 1,405

 $

 $
 2,897

 NOTE 8. RE-CONSTRUCTION FOLLOWING CASUALTY
LOSS

 During the first quarter of our fiscal year 2019,
our combination package liquor store and restaurant located at 2505 N. University Drive, Hollywood, Florida (Store #19) was damaged by
a fire and was forced to close. The package liquor store re-opened for business during the first quarter of our fiscal year 2023 in a
newly constructed stand-alone building. The restaurant re-opened for business during the second quarter of our fiscal year 2024 in a
newly constructed stand-alone building where our combination package liquor store and restaurant was previously located.

 F- 20

 NOTE 9. LIQUOR LICENSES

 Liquor licenses, which are indefinite lived assets,
are tested for impairment in September of each of our fiscal years. The fair value of liquor licenses at September 27, 2025, exceeded
the carrying amount; therefore, we recognized no impairment loss. The fair value of the liquor licenses was evaluated by comparing the
carrying value to recent sales for similar liquor licenses issued in the County. At September 27, 2025 and September 28, 2024, the total
carrying amount of our liquor licenses was $ 1,268,000.

 NOTE 10. INCOME TAXES

 The components of our provision for income taxes
for our fiscal years 2025 and 2024 are as follows:

 2025

 2024

 Current:

 Federal

 $

 $

 State

 Deferred:

 Federal

 ( 1
)

 ( 282
)

 State

 ( 265
)

 $

 $

 A reconciliation of income tax computed at the statutory
federal rate to income tax expense is as follows:

 2025

 2024

 Tax provision at the statutory rate

 $
 1,814

 $
 1,173

 Non-controlling interests

 ( 627
)

 ( 408
)

 State income taxes, net of federal income tax

 FICA tip credit

 ( 1,112
)

 ( 1,029
)

 True up adjustment

 Other permanent items, net

 $

 $

 We have deferred tax liabilities and assets which
arise primarily due to depreciation recorded at different rates for tax and book purposes offset by cost basis differences in depreciable
assets due to the deferral of the recognition of insurance recoveries on casualty losses for tax purposes, investments in and management
fees paid by limited partnerships, accruals for potential uninsured claims, bonuses accrued for book purposes but not paid within two
and a half months for tax purposes, the capitalization of certain inventory costs for tax purposes not recognized for financial reporting
purposes, the recognition of revenue from gift cards and other promotional programs not redeemed within twelve months of issuance, allowances
for uncollectable receivables, unfunded limited retirement commitments, book-tax differences related to operating leases, interest rate
swap mark-to-market adjustments and FICA tax credit.

 The components of our deferred tax assets (liabilities)
at September 27, 2025 and September 28, 2024 were as follows:

 2025

 2024

 Deferred tax assets:

 Reversal of aged payables

 $

 $

 Capitalized inventory costs

 Accrued bonuses

 Accruals for potential uninsured claims

 Gift cards

 Deferred revenue

 Tip credit

 1,200

 Operating lease liabilities

 3,208

 3,319

 Limited partnership investments

 Accrued limited retirement

 Interest rate swaps

 —

 Subtotal

 $
 5,363

 $
 5,344

 Less: Valuation allowance

 —

 —

 Total net deferred tax assets

 5,363

 5,344

 F- 21

 NOTE 10. INCOME TAXES (Continued)

 2025

 2024

 Deferred tax liabilities:

 Limited partnership management fees

 $
 ( 636
)

 $
 ( 680
)

 Book/tax differences in property and equipment and intangible assets

 ( 2,154
)

 ( 1,901
)

 Operating lease right of use assets

 ( 3,020
)

 ( 3,152
)

 Interest Rate Swaps

 ( 34
)

 —

 Total deferred tax liabilities

 ( 5,844
)

 ( 5,733
)

 Net deferred tax liability

 $
 ( 481
)

 $
 ( 389
)

 As of September 27, 2025, the Company has federal
general business credit carryforward of $ 1,200,000. General business credit carryovers can be carried back 1 year and carried forward
 20 years. The Company's general business credit carryforward will begin to expire in fiscal year 2044. The Company and its subsidiaries
file a U.S. Corporation federal income tax return and a Florida Corporation income tax return. These returns are subject to examination
by taxing authorities for all fiscal years after 2021.

 NOTE 11. DEBT

 Debt consists of the following as of September 27,
2025 and September 28, 2024:

 Long-Term Debt

 2025

 2024

 Mortgage payable to institutional lender, secured by a first mortgage on real property and improvements, bearing interest at 3.86 %, amortized over twenty ( 20) years, payable in monthly installments of principal and interest of approximately $ 43,400, with a balloon payment of approximately $ 5,373,000 due on November 27, 2026. As of September 27 2025, the net book value of the collateral securing this mortgage was $ 5,460,000.

 5,750

 6,016

 Mortgage payable to institutional lender, secured by first mortgage on real property and improvements, bearing interest at the fixed rate of 3.63 % per annum, fully amortized over fifteen ( 15) years, payable in monthly installments of principal and interest of approximately $ 31,100, with a final payment on July 1, 2036. As of September 27, 2025, the net book value of the collateral securing this mortgage was $ 10,741,000.

 3,332

 3,579

 Mortgage payable to institutional lender, secured by first mortgage on real property and improvements, bearing interest at the fixed rate of 3.65 % per annum, fully amortized over fifteen ( 15) years, payable in monthly installments of principal and interest of approximately $ 16,000, with a final payment on March 2, 2036. As of September 27, 2025, the net book value of the collateral securing this mortgage was $ 7,667,000.

 1,663

 1,790

 Mortgage payable to institutional lender, secured by a first mortgage on real property and improvements, bearing interest at the lender's 1 Month CME Term Secured Overnight Financing Rate ("SOFR"), plus 10 basis points (4.42% at September 27, 2025), but with the interest fixed at 4.90 % pursuant to a swap agreement, amortized over fifteen ( 15) years, payable in monthly installments of principal of approximately $38,700, with a final payment on September 28, 2037. As of September 27, 2025, the net book value of the collateral securing this mortgage was $ 3,419,000.

 7,686

 8,124

 Mortgage payable to institutional lender, secured by a first mortgage on real property and improvements, bearing interest at the fixed rate of 4.65 % per annum, fully amortized over fifteen ( 15) years, payable in monthly installments of principal and interest of approximately $ 6,400, with a final payment on December 28, 2031. As of September 27, 2025, the net book value of the collateral securing this mortgage was $ 1,001,000.

 F- 22

 NOTE 11. DEBT (Continued)

 Mortgage payable to a related party, an entity the owners of which include persons who are either our officers, directors or their family members, secured by first mortgage on real property and improvements, bearing interest at 6 % per annum, amortized over fifteen ( 15) years, payable in monthly installments of principal and interest of approximately $ 9,300, with a balloon payment of approximately $ 487,000 on August 1, 2032. As of September 27, 2025, the net book value of the collateral securing this mortgage was $ 2,157,000.

 1,000

 Mortgage payable to institutional lender, secured by a first mortgage on real property and improvements, bearing interest at the fixed rate of 4.65 % per annum, fully amortized over fifteen ( 15) years, payable in monthly installments of principal and interest of approximately $ 6,500, with a final payment on December 28, 2031. As of September 27, 2025, the net book value of the collateral securing this mortgage was $ 975,000.

 Mortgage payable to unrelated third party, secured by first mortgage on real property and improvements, bearing interest at 7.5 %, amortized over twenty ( 20) years, payable in monthly installments of principal and interest of approximately $ 7,300, with a final payment on March 1, 2034. As of September 27, 2025, the net book value of the collateral securing this mortgage was $ 1,027,000.

 Mortgage payable to related third party, secured by first mortgage on real property and improvements, bearing interest at 4 %, amortized over eight ( 8) years, payable in monthly installments of principal and interest of approximately $ 3,000, with a final payment on November 1, 2026. As of September 27, 2025, the net book value of the collateral securing this mortgage was $ 551,000.

 Other

 Less unamortized loan costs

 ( 239
)

 ( 275
)

 20,618

 21,912

 Less current portion

 ( 1,484
)

 ( 1,400
)

 $
 19,134

 $
 20,512

 Long-term debt at September 27, 2025 matures as
follows:

 2026

 1,484

 2027

 6,555

 2028

 1,180

 2029

 1,239

 2030

 1,301

 Thereafter

 9,098

 20,857

 Less unamortized loan costs

 ( 239
)

 $
 20,618

 F- 23

 NOTE 11. DEBT (Continued)

 As of September 27, 2025, we are in compliance
with the financial covenants contained in our loans with our unrelated third-party institutional lender under which we owe in the aggregate,
approximately $ 19,306,000 of our total loans of approximately $ 20,618,000. As of September 27, 2025, the year-end fair value of our debt
approximates carrying value.

 NOTE 12. COMMITMENTS, CONTINGENCIES AND OTHER MATTERS

 Master Service Agreement

 During the first quarter of our fiscal year 2025,
we entered into a new Master Services Agreement with our current major vendor for a period of one (1) year effective January 1, 2025,
with Company options for four (4) one (1) year renewal options to extend the term of the same. In this new Master Service
Agreement, as in our prior Master Service Agreements, we commit to purchase specific products through our current major vendor but are
free to purchase other products through other vendors, provided no less than 80% of our overall product needs are purchased through our
current major vendor. During the third quarter of our fiscal year 2025, we exercised the first one (1) year renewal option and extended
the term of the Master Services Agreement for a period of one (1) year effective January 1, 2026.

 ERP Contract

 In the third quarter of our fiscal year 2024,
we entered into an agreement with Oracle, an unrelated third-party vendor for the licensing and support of NetSuite, a cloud-based Oracle
ERP solution to replace our previous general ledger. The agreement is for a period of five years at a fixed rate of approximately $ 40,000
annually, with a cap on the percentage increase to our fees for our options to extend the term of the agreement for years six and seven.
Effective June 29, 2025, the first day of the fourth quarter of our fiscal year 2025, NetSuite functions as the Company's general
ledger.

 Legal Matters

 Our sale of alcoholic beverages subjects us to
"dram shop" statutes, which allow an injured person to recover damages from an establishment that served alcoholic beverages
to an intoxicated person. If we receive a judgment substantially in excess of our insurance coverage or if we fail to maintain our insurance
coverage, our business, financial condition, operating results or cash flows could be materially and adversely affected. There are currently
no "dram shop" claims pending against us.

 We are a party to various other claims, legal
actions and complaints arising in the ordinary course of our business. It is our opinion that all such matters are without merit or involve
such amounts that an unfavorable disposition would not have a material adverse effect on our financial position or results of operations.

 F- 24

 NOTE 12. COMMITMENTS, CONTINGENCIES AND OTHER MATTERS (Continued)

 Leases

 To conduct certain operations, we lease restaurant and package liquor
store space in South Florida from unrelated third parties. Our leases have remaining lease terms of up to 47 years, some of which include
options to renew and extend the lease terms for up to an additional 24 years. We presently intend to renew some of the extension options
available to us and for purposes of computing the right-of-use assets and lease liabilities required by ASC 842, we have incorporated
into all lease terms which may be extended, an additional term of the lesser of (i) the amount of years the lease may be extended; or
(ii) 15 years.

 Common area maintenance and property taxes are not considered to be
lease components. Variable lease costs include amounts based on a percentage of gross sales in excess of specified levels. They are recognized
when probable and are not included in determining the present value of our operating lease liability.

 The components of lease expense are as follows:

 52 Weeks

 52 Weeks

 Ended

 2025

 Ended

 2024

 Operating Lease Expense, which is included in occupancy costs

 $
 3,983

 $
 3,852

 Variable Lease Expense, which is included in occupancy costs

 $

 $

 Classification on the Condensed Consolidated Balance Sheets

 2025

 2024

 Assets

 Operating lease assets

 $
 24,817

 $
 26,828

 Liabilities

 Operating lease current liabilities

 $
 2,704

 $
 2,467

 Operating lease non-current liabilities

 $
 23,793

 $
 25,847

 Weighted Average Remaining Lease Term:

 Operating leases

 9.53 Years

 10.17 Years

 Weighted Average Discount:

 Operating leases

 5.13
 %

 5.02
 %

 The following table outlines the minimum future
lease payments for the next five years and thereafter:

 For fiscal year

 Operating

 2026

 3,946

 2027

 3,840

 2028

 3,816

 2029

 3,836

 2030

 3,474

 Thereafter

 17,735

 Total lease payments (undiscounted cash flows)

 36,647

 Less imputed interest

 ( 10,150
)

 Total operating lease liabilities

 $
 26,497

 F- 25

 NOTE 12. COMMITMENTS, CONTINGENCIES AND OTHER MATTERS (Continued)

 Purchase Commitments

 In order to fix the cost and ensure adequate
supply of baby back ribs for our restaurants for calendar year 2026, we entered into a purchase agreement with our existing rib supplier,
whereby we agreed to purchase approximately $ 9.2 million of "2.5 & Down Baby Back Ribs" (weight range in which baby back
ribs are sold) during calendar year 2026, at a prescribed cost, which we believe is competitive. For calendar year 2025, we entered into
a purchase agreement with a new rib supplier, whereby we agreed to purchase approximately $ 7.8 million of "2.5 & Down Baby
Back Ribs" during calendar year 2025, at a prescribed cost, which we believed was competitive. The increase in our cost of baby
back ribs for calendar year 2026 compared to calendar year 2025 is due to an increase in market price and quantity ordered.

 Flanigan's Fish Company, LLC

 As of September 27, 2025, Flanigan's Fish
Company, LLC, a Florida limited liability company ("FFC"), supplies certain fish to all of our restaurants. Since we hold
the controlling interest in FFC, the balance sheet and operating results of this entity are consolidated into the accompanying consolidated
financial statements of the Company. Sales and purchases of fish are recognized in restaurant food sales and restaurant (cost of merchandise
sold), respectively, in the consolidated statements of income at the time of sale to the restaurant. In addition, the 49 % of FFC owned
by the unrelated third party is recognized as a noncontrolling interest in our consolidated financial statements.

 Franchise Program

 At September 27, 2025 and September 28, 2024,
we were the franchisor of five units under franchise agreements. Of the five franchised stores, three are combination restaurant/package
liquor stores and two are restaurants (one of which we operate). Four franchised stores are owned and operated by related parties as
follows:

 James G. Flanigan, our Chairman of the Board of Directors, Chief Executive Officer and President of the Company, and Michael B. Flanigan, a member of our Board of Directors and James G. Flanigan's brother, are 52.28 % and 40.00 % owners, respectively, which has a franchise arrangement with us for the operation of a restaurant and adjacent package liquor store located in Coconut Grove, Florida (Store #18).

 Patrick J. Flanigan, brother to both James G. Flanigan and Michael B. Flanigan and a member of our Board of Directors, owns 100 % of a company which has a franchise arrangement with us for the operation of a combination restaurant/package liquor store located in Pompano Beach, Florida (Store #43).

 Our officers and directors collectively own 30 % of the shareholder interest of a company which has a franchise arrangement with us for the operation of a restaurant located in Deerfield Beach, Florida. The shareholder interest of James G. Flanigan's family represents an additional 60 % of the total invested capital in this franchised location (Store #14).

 Patrick J. Flanigan is the sole general partner and a 25 % limited partner in a limited partnership which has a franchise arrangement with us for the operation of a restaurant located in Fort Lauderdale, Florida. The Company is a 25 % limited partner in this limited partnership and officers and directors of the Company (excluding Patrick J. Flanigan) own an additional 31.9 % limited partnership interest in this franchised location (Store #15).

 Under the franchise agreements, we provide guidance,
advice and management assistance to the franchisees. In addition and for an additional annual fee of approximately $ 25,000, we also act
as fiscal agent for the franchisees whereby we collect all revenues and pay all expenses and distributions. We also, from time to time,
advance funds on behalf of the franchisees for the cost of renovations. The resulting amounts receivable from and payable to these franchisees
are reflected in the accompanying consolidated balance sheet as either an asset or a liability. We also agree to sponsor and manage cooperative
buying groups on behalf of the franchisees for the purchase of inventory. The franchise agreements provide for royalties to us of approximately
 3 % of gross restaurant sales and 1 % of gross package liquor sales. During our fiscal years 2025 and 2024, we earned royalties of $ 1,242,000
and $ 1,195,000, respectively, from our related franchises, which royalties are included in Franchise-related revenues in our Consolidated
Statements of Income. We are not currently offering or accepting new franchises.

 F- 26

 NOTE 12. COMMITMENTS, CONTINGENCIES AND OTHER MATTERS (Continued)

 Employment Agreements/Bonuses

 As of September 27, 2025 and September 28, 2024, we had no employment
agreements.

 Our Board of Directors approved an annual performance
bonus, with 14.75 % of the corporate pre-tax net income, plus or minus non-recurring items, but before depreciation and amortization in
excess of $ 650,000 paid to the Chief Executive Officer and 5.25 % paid to other members of management, (the "Officers Bonus").
Officers Bonuses for our fiscal years 2025 and 2024 amounted to approximately $ 1,849,000 and $ 1,434,000, respectively.

 Our Board of Directors also approved an additional
annual performance bonus, with 5 % of the pre-tax net income before depreciation and amortization from our restaurants in excess of $ 1,875,000
and our share of the pre-tax net income before depreciation and amortization from the restaurants owned by the limited partnerships paid
to the Chief Operating Officer and 5 % paid to the Chief Financial Officer (the "Restaurant Bonus''). Restaurant Bonuses
for our fiscal years 2025 and 2024 amounted to approximately $ 1,311,000 and $ 1,037,000, respectively.

 Management Agreements

 Deerfield Beach, Florida

 Since January 2006, we have managed "The
Whale's Rib", a casual dining restaurant located in Deerfield Beach, Florida, pursuant to a management agreement. We paid
$ 500,000 in exchange for our rights to manage this restaurant. The management agreement was amortized and paid on a straight-line basis
over the life of the initial term of the agreement, ten ( 10) years. The restaurant is owned by a third party unaffiliated with us. In
exchange for providing management, bookkeeping and related services, we receive one-half () of the net profit, if any, from the
operation of the restaurant. During the third quarter of our fiscal year 2011, the term of the management agreement was extended through
January 9, 2036. For the fiscal years ended September 27, 2025 and September 28, 2024, we generated $ 200,000 of revenue in each respective
fiscal year from providing these management services.

 NOTE 13. FAIR VALUE MEASUREMENTS OF FINANCIAL INSTRUMENTS

 We follow FASB (ASC) Topic 820, "Fair Value
Measurement", for financial assets and liabilities and for non-financial assets and liabilities that are recognized or disclosed
at fair value on at least an annual basis. Topic 820 defines fair value as the price that would be received from selling an asset or
paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair
value measurements for assets and liabilities required or permitted to be recorded at fair value, we consider the principal or most advantageous
market in which it would transact and consider assumptions that market participants would use when pricing the asset or liability, such
as inherent risk, transfer restrictions and risk of non-performance. Topic 820 establishes a fair market hierarchy that requires an entity
to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Topic 820 establishes
three levels of inputs that may be used to measure fair value:

 Level 1 Inputs – Unadjusted quoted prices in
 active markets for identical assets or liabilities.

 Level 2 Inputs –
 Inputs other than quoted prices included in Level 1 that are either directly or indirectly observable through correlation with market
 data. These include quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets
 or liabilities in markets that are not active; and inputs to evaluation models or other pricing methodologies that do not require
 significant judgment because the inputs used in the model, such as interest rates and volatility, can be corroborated by readily
 observable market data.

 Level 3 Inputs –
 One or more significant inputs that are unobservable and supported by little or no market activity, and that reflect the use of significant
 management judgment. Level 3 assets and liabilities include those whose fair value measurements are determined using pricing models,
 discounted cash flow methodologies or similar valuation techniques, and significant management judgment or estimation.

 Interest Rate Swap Agreements

 As of September 27, 2025, we had one variable
rate instrument outstanding that is impacted by changes in interest rates. In September 2022, we refinanced the mortgage loan encumbering
the property where our combination package liquor store and restaurant located at 4 N. Federal Highway, Hallandale Beach, Florida, (Store
#31) operates, which mortgage loan is held by an unaffiliated third-party lender (the "$ 8.90 M Loan"). The interest rate of
our variable rate debt instrument was equal to the lender's BSBY Screen Rate plus one and one-half percent ( 1.50 %) per annum. Effective
November 15, 2024, the publication of BSBY was terminated and as of such date, the variable rate of interest under our debt instrument
is equal to the lender's 1 Month CME Term Secured Overnight Financing Rate ("SOFR"), plus 10 basis points, as an equivalent
alternative approved by the lender.

 F- 27

 NOTE 13. FAIR VALUE MEASUREMENTS OF FINANCIAL INSTRUMENTS (Continued)

 As a means of managing our interest rate risk
on this debt instrument, we entered into an interest rate swap agreement with an unrelated third-party lender in September 2022 to convert
this variable rate debt obligation to a fixed rate. The $ 8.90 M Term Loan Swap required us to pay interest for a fifteen ( 15) year period
at a fixed rate of 4.90 % on an initial amortizing notional principal amount of $ 8,900,000, while receiving interest for the same period
at BSBY Screen Rate – 1 Month, plus 1.50%, on the same amortizing notional principal amount. We had previously determined that
this interest rate swap agreement was an effective hedging agreement and we recorded changes in fair value to accumulated other comprehensive
income each quarter from the fourth quarter of our fiscal year 2023 through the first quarter of our fiscal year 2025.

 On November 22, 2024, we terminated the $ 8.90 M
Term Loan Swap and simultaneously entered into a new interest rate swap agreement for $ 8,015,601, the balance due on the $ 8.90 M Loan,
which requires us to pay interest for twelve (12) years, ten (10) months, which is the balance of the original fifteen (15) year period
at a fixed rate of 4.90 % on an initial amortizing notional principal amount of $ 8,015,601, while receiving interest for the same period
at the lender's 1 Month CME Term Secured Overnight Financing Rate ("SOFR"), plus 10 basis points, at the same amortizing
notional principal amount. During the second quarter of our fiscal year 2025, we recognized the $ 290,000 of non-cash gains, net of tax,
related to the above interest rate swap agreement as interest and other income. We determined that the new interest rate swap agreement
is an economic hedge and beginning in the second quarter of our fiscal year 2025, we recognize the changes in fair value on our interest
rate swap in interest and other income on our consolidated statements of income.

 NOTE 14. COMMON STOCK

 Treasury Stock

 Purchase of Common Shares

 During our fiscal years 2025 and 2024, we did
not purchase any shares of our common stock. As of September 27, 2025, we still have authority to purchase 65,414 shares of our common
stock under the discretionary plan approved by the Board of Directors on May 17, 2007. Our current repurchase plan has no expiration
date and purchases under this program may be made from time to time on the open market and in private transactions, depending on market
conditions, up to a purchase price of price of $ 15 per share. The Internal Revenue Service imposes a 1.0 % tax on stock repurchases after
December 31, 2022 over $ 1,000,000 within a fiscal year.

 NOTE 15. BUSINESS SEGMENTS

 We operate in two reportable segments –
package stores and restaurants. The operation of package stores consists of retail liquor sales and related items. The operation of restaurants
consists of restaurant food and bar sales. Operating income is total revenue less cost of merchandise sold and operating expenses relative
to each segment. In order to evaluate each of these two operating segments we also break out our Corporate entity which functions as
a cost center accumulating expenses that do not directly relate to the reportable segments operations. As such, our Chief Operating Decision
Maker (CODM) (our Chief Financial Officer) ensures that these expenses are separated in order to properly evaluate the two main reportable
segments as presented below. We have disclosed for each reportable segment the significant expense categories that are reviewed by CODM
in the tables below and there are no additional significant expenses within the expense categories presented. The key areas of focus
by CODM for allocation of resources are revenues from each reportable segment, as well as their cost of merchandise sold, payroll related
costs, and operating expenses (these figures are presented both pre-elimination and post-elimination with a line clearly distinguishing
the elimination amounts). While CODM analyzes these categories, the area of focus is period over period fluxes to determine that the
right allocation of resources is attributed to each segment in order to ensure profitability is maximized. Gross profit is not shown
on the Consolidated Statements of Income but is a metric that CODM uses to assess segment performance and as such is included in the
tables below. In computing operating income, none of the following items have been included: interest expense, other non-operating income
and expenses and income taxes. Identifiable assets by segment are those assets that are used in our operations in each segment. Corporate
assets are principally cash and real property, improvements, furniture, equipment and vehicles used at our corporate headquarters. We
do not have any operations outside of the United States and transactions between restaurants and package liquor stores are not material.
The accounting policies of the segments are the same as those described in the summary of significant accounting policies. CODM analyzes
each segment's income from operations for making decisions regarding resource allocation. Information concerning the revenues and
operating income for the years ended September 27, 2025 and September 28, 2024, and identifiable assets for the two reportable segments
in which we operate, are shown in the following tables.

 F- 28

 NOTE 15. BUSINESS SEGMENTS (Continued)

 For the Fiscal Year Ended September 27, 2025

 Package

 Corporate

 Eliminations

 Total

 REVENUES:

 Restaurant food sales

 $
 124,501

 $
 —

 $
 —

 $
 —

 $
 124,501

 Intersegment revenues

 4,529

 —

 —

 ( 4,529
)

 —

 Restaurant bar sales

 31,764

 —

 —

 —

 31,764

 Package goods sales

 —

 —

 —

 TOTAL REVENUE:

 160,794

 —

 ( 4,529
)

 203,253

 COST OF MERCHANDISE SOLD:

 Cost of merchandise sold:

 52,174

 35,185

 —

 —

 87,359

 Intersegment cost of merchandise
 sold

 4,529

 —

 —

 ( 4,529
)

 —

 TOTAL COST OF MERCHANDISE SOLD:

 56,703

 35,185

 —

 ( 4,529
)

 87,359

 GROSS PROFIT:

 104,091

 11,803

 —

 —

 115,894

 ADDITIONAL REVENUES:

 Franchise-related revenues

 —

 —

 1,754

 —

 1,754

 Intersegment franchise-related revenues

 —

 —

 5,664

 ( 5,664
)

 —

 Intersegment partnership income

 —

 —

 1,651

 ( 1,651
)

 —

 Other revenues

 —

 —

 TOTAL ADDITIONAL REVENUES:

 —

 9,148

 ( 7,315
)

 1,995

 ADDITIONAL EXPENSES:

 Payroll and related costs

 52,272

 3,479

 7,950

 —

 63,701

 Operating expenses

 22,795

 3,063

 1,580

 —

 27,438

 Intersegment operating expenses

 2,507

 —

 2,871

 ( 5,378
)

 —

 Occupancy costs

 6,719

 —

 7,870

 Intersegment occupancy costs

 —

 ( 860
)

 —

 Selling, general and administrative expenses

 1,578

 3,719

 —

 5,463

 Intersegment selling, general and administrative expenses

 —

 —

 ( 286
)

 —

 Depreciation and amortization

 3,443

 —

 4,672

 TOTAL ADDITIONAL EXPENSES:

 89,980

 8,318

 17,370

 ( 6,524
)

 109,144

 Income (Loss) from Operations

 14,273

 3,485

 ( 8,222
)

 ( 791
)

 8,745

 OTHER INCOME (EXPENSE):

 Interest expense

 —

 —

 ( 957
)

 —

 ( 957
)

 Intersegment interest expense

 —

 —

 ( 8
)

 —

 Interest and other income

 —

 Intersegment interest and other income

 —

 —

 ( 8
)

 —

 Rental income

 —

 —

 1,077

 —

 1,077

 Intersegment rental income

 —

 —

 ( 860
)

 —

 Rental expense

 —

 —

 ( 622
)

 —

 ( 622
)

 ( 860
)

 ( 106
)

 Income (loss) before provision
 for income taxes:

 14,283

 3,575

 ( 7,568
)

 ( 1,651
)

 8,639

 Provision for income taxes

 —

 —

 ( 622
)

 —

 ( 622
)

 Net Income (Loss)

 14,283

 3,575

 ( 8,190
)

 ( 1,651
)

 8,017

 Less: Net Income attributable to
 noncontrolling interests

 ( 2,984
)

 —

 —

 —

 ( 2,984
)

 Net Income (Loss) Attributable to

 $
 11,299

 $
 3,575

 $
 ( 8,190
)

 $
 ( 1,651
)

 $
 5,033

 F- 29

 NOTE 15. BUSINESS SEGMENTS (Continued)

 For the Fiscal Year Ended September 28, 2024

 Package

 Corporate

 Eliminations

 Total

 REVENUES:

 Restaurant food sales

 $
 114,795

 $
 —

 $
 —

 $
 —

 $
 114,795

 Intersegment revenues

 4,141

 —

 —

 ( 4,141
)

 —

 Restaurant bar sales

 30,010

 —

 —

 —

 30,010

 Package goods sales

 —

 —

 —

 TOTAL REVENUE:

 148,946

 —

 ( 4,141
)

 185,302

 COST OF MERCHANDISE SOLD:

 Cost of merchandise sold:

 49,862

 30,128

 —

 —

 79,990

 Intersegment cost of merchandise
 sold

 4,141

 —

 —

 ( 4,141
)

 —

 TOTAL COST OF MERCHANDISE SOLD:

 54,003

 30,128

 —

 ( 4,141
)

 79,990

 GROSS PROFIT:

 94,943

 10,369

 —

 —

 105,312

 ADDITIONAL REVENUES:

 Franchise-related revenues

 —

 —

 1,693

 —

 1,693

 Intersegment franchise-related revenues

 —

 —

 5,845

 ( 5,845
)

 —

 Intersegment partnership income

 —

 —

 1,156

 ( 1,156
)

 —

 Other revenues

 —

 —

 TOTAL ADDITIONAL REVENUES:

 —

 8,750

 ( 7,001
)

 1,914

 ADDITIONAL EXPENSES:

 Payroll and related costs

 49,024

 3,153

 7,172

 —

 59,349

 Intersegment payroll costs

 —

 ( 24
)

 —

 —

 Operating expenses

 20,517

 2,640

 1,544

 —

 24,701

 Intersegment operating expenses

 2,431

 —

 3,173

 ( 5,604
)

 —

 Occupancy costs

 6,534

 —

 7,754

 Intersegment occupancy costs

 —

 ( 849
)

 —

 Selling, general and administrative expenses

 1,232

 3,914

 —

 5,313

 Intersegment selling, general and administrative expenses

 —

 —

 ( 286
)

 —

 Depreciation and amortization

 3,216

 —

 4,268

 TOTAL ADDITIONAL EXPENSES:

 83,619

 7,481

 17,000

 ( 6,715
)

 101,385

 Income (Loss) from Operations

 11,489

 2,888

 ( 8,250
)

 ( 286
)

 5,841

 OTHER INCOME (EXPENSE):

 Interest expense

 —

 —

 ( 1,019
)

 —

 ( 1,019
)

 Intersegment interest expense

 —

 —

 ( 8
)

 —

 Interest and other income

 —

 Intersegment interest and other income

 —

 ( 28
)

 —

 Rental income

 —

 —

 1,105

 —

 1,105

 Intersegment rental income

 —

 —

 ( 849
)

 —

 Rental expense

 —

 —

 ( 550
)

 —

 ( 550
)

 Gain on sale of property and equipment

 —

 —

 —

 ( 869
)

 ( 255
)

 Income (loss) before provision
 for income taxes:

 11,511

 2,990

 ( 7,760
)

 ( 1,155
)

 5,586

 Provision for income taxes

 —

 —

 ( 286
)

 —

 ( 286
)

 Net Income (Loss)

 11,511

 2,990

 ( 8,046
)

 ( 1,155
)

 5,300

 Less: Net Income attributable to
 noncontrolling interests

 ( 1,944
)

 —

 —

 —

 ( 1,944
)

 Net Income (Loss) Attributable to

 $
 9,567

 $
 2,990

 $
 ( 8,046
)

 $
 ( 1,155
)

 $
 3,356

 F- 30

 NOTE 15. BUSINESS SEGMENTS (Continued)

 For the Fiscal Year Ended

 2025

 2024

 Capital Expenditures:

 Restaurants

 $
 4,815

 $
 4,986

 Package stores

 Corporate

 Consolidated Totals

 $
 5,844

 $
 6,047

 2025

 2024

 Identifiable Assets:

 Restaurants

 $
 76,500

 $
 77,613

 Package stores

 24,053

 23,084

 Corporate

 40,070

 41,385

 Consolidated Totals

 $
 140,623

 $
 142,082

 NOTE 16. QUARTERLY INFORMATION (UNAUDITED)

 The
following is a summary of our unaudited quarterly results of operations for the quarters in our fiscal years 2025 and 2024. Rental income
previously presented in Revenues is currently presented in Other Income. Rental expense previously presented in Operating, Occupancy,
and Selling, General and Administrative expenses is currently presented in Other Expense. Revenues and Income from operations reflect
this revised presentation but there was no impact to Net Income.

 Quarter Ended

 December 28,
 2024

 March 29,

 2025

 June 28,

 2025

 Sep. 27,
 2025

 Revenues

 $
 49,995

 $
 53,359

 $
 51,894

 $
 50,000

 Income from operations

 3,514

 2,853

 1,625

 Net income attributable to stockholders

 2,690

 1,392

 Net income per share – basic and diluted

 0.03

 1.45

 0.75

 0.48

 Weighted average common stock outstanding – basic
 and diluted

 Quarter Ended

 December 30,

 2023

 March 30,

 2024

 June 29,

 2024

 Sep. 28,

 2024

 Revenues

 $
 44,887

 $
 47,757

 $
 48,823

 $
 45,749

 Income from operations

 2,502

 2,149

 Net income (loss) attributable to stockholders

 1,942

 1,121

 Net income (loss) per share – basic and diluted

 0.06

 1.04

 0.60

 0.10

 Weighted average common stock outstanding – basic
 and diluted

 Quarterly operating results are not necessarily
representative of our operations for a full year for various reasons including the seasonal nature of both the restaurant and package
store segments.

 NOTE 17. 401(k) PLAN

 Effective July 1, 2004, we began sponsoring a
401(k) retirement plan covering substantially all employees who meet certain eligibility requirements. Employees may contribute elective
deferrals to the plan up to amounts allowed under the Internal Revenue Code. We are not required to contribute to the plan but may make
discretionary profit sharing and/or matching contributions. During our fiscal years ended September 27, 2025 and September 28, 2024,
the Board of Directors approved discretionary matching contributions totaling $ 87,000 and $ 74,000, respectively.

 NOTE 18. SUBSEQUENT EVENTS

 Subsequent to the end of our fiscal year end 2025,
we approved the 2026 baby back rib contract with our existing rib supplier. See the section titled "Purchase Commitments"
in Note 12 for additional details.

 Subsequent to the end of our fiscal year 2025,
we re-financed with our institutional lender, our mortgage loan encumbering the real property and improvements located at 12750 –
12790 S.W. 88 th Street, Miami, Florida where our Flanigan's Calusa Center and our limited partnership owned Flanigan's
Seafood Bar and Grill restaurant operate (Store #70), without increasing the principal amount borrowed at this time ($ 5,676,856). The
re-financed mortgage loan earns interest at a fluctuating rate per year equal to the sum of (i) the greater of the Term SOFR Daily Floating
Rate or the Index Floor (which for purposes hereof is 0.00 %) and (ii) 2.25 %, with the first payment of principal and interest due January
31, 2026 and monthly thereafter on the last day of each month until November 30, 2030 when the entire principal payment and all accrued
interest is due in full. We received no excess funds from the re-financing of this mortgage loan.

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