BT Brands (BTBD) 10-Q 12 May 20 2020 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 29, 2020	May 12, 2020
Document And Entity Information
Entity Registrant Name	BT BRANDS, INC.
Entity Central Index Key	0001718224
Document Type	10-Q
Amendment Flag	false
Current Fiscal Year End Date	--01-03
Entity Small Business	true
Entity Shell Company	false
Entity Emerging Growth Company	true
Entity Current Reporting Status	Yes
Document Period End Date	Mar. 29, 2020
Entity Filer Category	Non-accelerated Filer
Document Fiscal Period Focus	Q1
Document Fiscal Year Focus	2020
Entity Ex Transition Period	false
Entity Common Stock Shares Outstanding		8,095,004
Entity Interactive Data Current	Yes

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Mar. 29, 2020	Dec. 29, 2019
CURRENT ASSETS
Cash	$ 310,134	$ 258,101
Receivables	5,782	15,363
Inventory	52,973	56,432
Prepaid expenses	5,297	6,929
Total current assets	374,186	336,825
PROPERTY AND EQUIPMENT, net	1,605,617	1,650,012
LAND AND BUILDINGS HELD FOR SALE	449,244	449,244
INVESTMENT IN NOTES RECEIVABLE FROM RELATED COMPANY	207,000	179,000
OTHER ASSETS, net	18,034	18,459
Total assets	2,654,081	2,633,539
CURRENT LIABILITIES
Current maturities of long-term debt	243,784	277,666
Accounts payable	483,622	321,855
Accrued expenses	179,083	202,732
Income taxes payable	2,898	2,898
Total current liabilities	909,387	805,151
LONG-TERM DEBT, less current maturities	3,254,808	3,221,035
UNEARNED VENDOR REBATE	2,445	3,668
Total liabilities	4,166,640	4,029,854
COMMITMENTS AND CONTINGENCIES
Preferred stock, $.001 par value, 500,000 shares authorized, no shares outstanding at March 29, 2020 and December 29, 2019
Common stock, $.001 par value, 50,000,000 authorized, 8,095,004 shares outstanding at March 29, 2020 and December 29, 2019	8,095	8,095
Additional paid-in capital	497,671	497,671
Accumulated deficit	(2,018,325)	(1,902,081)
Total shareholders' deficit	(1,512,559)	(1,396,315)
Total liabilities and shareholders' deficit	$ 2,654,081	$ 2,633,539

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 29, 2020	Dec. 29, 2019
CONDENSED CONSOLIDATED BALANCE SHEETS
Preferred stock, shares par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	500,000	500,000
Preferred stock, shares outstanding	0	0
Common stock, shares par value	$ .001	$ .001
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares outstanding	8,095,004	8,095,004

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($)	3 Months Ended
	Mar. 29, 2020	Mar. 31, 2019
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
SALES	$ 1,303,430	$ 1,377,833
Restaurant operating expenses
Food and paper costs	540,100	560,271
Labor costs	483,309	486,245
Occupancy costs	162,588	207,603
Other operating expenses	86,174	64,612
Depreciation	44,395	58,810
Amortization	425	425
General and administrative	66,216	127,784
Total costs and expenses	1,383,207	1,505,750
Income (loss) from operations	(79,777)	(129,177)
INTEREST EXPENSE	(36,467)	(42,573)
INCOME (LOSS) BEFORE TAXES	(116,244)	(170,490)
PROVISION FOR INCOME TAXES
NET LOSS	$ (116,244)	$ (170,490)
LOSS PER COMMON SHARE - Basic and Diluited	$ (0.01)	$ (0.02)
WEIGHTED AVERAGE SHARES USED IN
COMPUTING PER COMMON SHARE AMOUNTS - Basic and Diluited	8,095,004	8,086,004

CONSOLIDATED STATEMENTS OF SHAR

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' DEFICIT (Unaudited) - USD ($)	Total	Common Stock	Additional Paid-In Capital	Accumulated (Deficit)
Balance, shares at Dec. 30, 2018		8,086,004
Balance, amount at Dec. 30, 2018	$ (1,041,238)	$ 8,086	$ 484,180	$ (1,533,504)
Net (loss)	(170,490)			(170,490)
Balance, shares at Mar. 31, 2019		8,086,004
Balance, amount at Mar. 31, 2019	(1,211,728)	$ 8,086	484,180	(1,703,994)
Balance, shares at Dec. 29, 2019		8,095,004
Balance, amount at Dec. 29, 2019	(1,396,315)	$ 8,095	497,671	(1,902,081)
Net (loss)	(116,244)			(116,244)
Balance, shares at Mar. 29, 2020		8,095,004
Balance, amount at Mar. 29, 2020	$ (1,512,559)	$ 8,095	$ 497,671	$ (2,018,325)

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($)	3 Months Ended
	Mar. 29, 2020	Mar. 31, 2019
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income (loss)	$ (116,244)	$ (170,490)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities-
Depreciation	44,395	58,810
Amortization of franchise agreement	425	425
Amortization of debt issuance cost	1,295	1,277
Changes in operating assets and liabilities
Receivables	9,581	7,199
Inventory	3,459	4,367
Prepaid expenses	1,632	125
Accounts payable	161,767	104,380
Unearned vendor rebate	(1,223)	(815)
Accrued expenses	(23,649)	(30,918)
Net cash provided by (used in) operating activities	81,438	(25,640)
CASH FLOWS FROM INVESTING ACTIVITIES
Investment in notes receivable from related entity	(28,000)
Net cash used in investing activities	(28,000)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long-term debt	50,000
Principal payments on long-term debt	(51,405)	(63,293)
Net cash used in financing activities	(1,405)	(63,293)
CHANGE IN CASH	52,033	(88,933)
CASH, BEGINNING OF PERIOD	258,101	663,511
CASH, END OF PERIOD	310,134	574,578
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid for interest	$ 35,172	$ 41,296

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
	Mar. 29, 2020
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the accounts of BT Brands, Inc. and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. These interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and on a basis consistent in all material respects with the accounting policies for the fiscal year ended December 29, 2019. In our opinion, all adjustments, which are normal and recurring in nature, necessary for a fair presentation of our financial position and results of operation have been included. Operating results for interim periods are not necessarily indicative of the results that may be expected for a full fiscal year. The accompanying Condensed Consolidated Balance Sheet as of March 29, 2020 does not include all of the disclosures required by GAAP. These interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements as of December 29, 2019 and the related notes thereto included in the Company’s Form 10-K for the fiscal year ended December 29, 2019. Use of Estimates The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Reverse Merger Transaction BT Brands, Inc. (the “Company”) was incorporated as Hartmax of NY Inc. on January 19, 2016 with the objective of acquiring an operating entity. Effective on July 30, 2018, the Company acquired 100% of the ownership BTND, LLC. in exchange for common stock in the Company through a Share Exchange Agreement (“Share Exchange”) with BTND, LLC (“BTND”), and its Members. Following the Share Exchange, BTND became a wholly owned subsidiary of the Company for reporting purposes under GAAP. Business The Company currently operates company-owned fast-food restaurants called Burger Time. The Company also operates one unit in Minnesota as a franchisee of International Dairy Queen. The Company operates three Burger Time locations in Minnesota, four in North Dakota, and two in South Dakota. The Company closed a store in Richmond, Indiana during the year, which is listed for sale, resulting in a total of ten operating restaurants at March 29, 2020. The Company owns a restaurant property in St. Louis, Missouri currently held for sale. The Company’s Dairy Queen store is operated pursuant to the terms of a franchise agreement with International Dairy Queen. The Company is required to pay regular royalty and advertising payments to the franchisor and to remain in compliance with the terms of the franchise agreement. Fiscal Year Period The Company’s fiscal year is a 52/53-week year, ending on the Sunday closest to December 31. Most years consist of four 13-week accounting periods comprising the 52-week year. All references to years in this report refer to the 13-week periods in the respective fiscal year periods. Fiscal 2020 is a 53-week year ending January 3, 2021. Cash For purposes of reporting cash and cash flows, cash is net of outstanding checks and includes, amounts on deposit at banks, a money market mutual fund holding, and deposits in transit. Receivables Receivables consists of rebates due from a primary vendor. Inventory Inventory consists of food, beverages and supplies and is stated at lower of cost (first-in, first-out method) or net realizable value. Property and Equipment Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives which range from three to thirty years. The Company reviews long-lived assets to determine if the carrying value of these assets may not be recoverable based on estimated cash flows. Assets are reviewed at the lowest level for which cash flows can be identified, which is at the restaurant level. In determining future cash flows, significant estimates are made by the Company with respect to future operating results of each restaurant over its remaining life. If such assets are considered impaired, the impairment to be recognized is measured by the amount by which the carrying value of the assets exceeds the fair value of the assets. Assets Held for Sale From time-to-time the Company may sell an existing operating unit or may close an operating unit and list the property for sale. A property in the St. Louis area is currently listed for sale. Also, in September of 2018 the Company closed an operating Burger Time unit in Richmond, Indiana and the Richmond property is listed for sale. In the second quarter of fiscal 2019 it was concluded to record a charge of $93,488 for impairment of the value of the Richmond location. Income Taxes We account for income taxes using the liability method, whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value. The deferred tax assets are reviewed periodically for recoverability and valuation allowances are adjusted as necessary. The Company has a net operating loss carry-forward from the prior year and incurred additional net operating losses during the periods ended March 29, 2020 and March 31, 2019. These losses resulted in an increase in the related deferred tax assets; however, full valuation allowances were made which reduced these deferred tax assets to zero; therefore, no income tax provision or benefit was recognized for the periods ending March 29, 2020 and March 31, 2019 resulting in an effective income tax rate of 0% for both periods. Per Common Share Amounts Net income (loss) per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net income or (loss) per share is computed by dividing net income or loss by the weighted average number of shares of common stock outstanding during the period. Diluted net income per share is computed by dividing net income by the weighted average number of shares of common stock and potentially outstanding shares of common stock during each period. Common stock equivalents are excluded from the computation of diluted net loss per share because their effect would be anti-dilutive. There were no potentially dilutive shares outstanding as of the periods ending in 2020 and 2019, as the strike price for warrants outstanding was above the fair market price of the underlying stock in both periods. Other Assets Other assets principally is the allocated fair value of the acquired Dairy Queen franchise agreement related to the Company’s location in Ham Lake, Minnesota, and is being amortized over an estimated useful life of 14 years. Liquidity and Capital Resources The consolidated financial statements have been prepared on a going concern basis. For the 13 weeks ended March 29, 2020, the Company incurred a net loss of $116,244. On March 29, 2020, the Company had $310,134 in cash and a working capital deficit of $535,201 an increase of $66,875 from the year-end deficit of $468,326. On March 11, 2020, the World Health Organization declared the novel strain of coronavirus (‘Covid-19”) a global pandemic. Covid-19 is having a significant adverse impact on the United States economy. At this time, it is impossible to predict either the near-term effects or the ultimate impact of the Covid-19 pandemic on the Company’s operating results and financial condition as the situation is rapidly evolving. A cash flow forecast for the next 12 months prepared by management has been adjusted to reflect recent offers by banks, in the wake of the COVID-19 Pandemic, including the Company’s principal lenders, Northview Bank and Bremer Bank, to abate all loan payments for the period from March through May of 2020. In May, 2020 the Company received loans of $487,900 of that amount, $460,400 was borrowed under the Small Business Administration Payroll Protection Program and assuming certain conditions are met, these loans may be forgiven. In May, 2020, the Company also borrowed $27,500 at no interest under the Minnesota Small Business Emergency Loan Program. The Company expects to have sufficient cash assets to meet its obligations for a year from the issuance of these consolidated financial statements. No adjustments have been made relating to recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company not continue as a going concern.

PROPERTY AND EQUIPMENT

PROPERTY AND EQUIPMENT	3 Months Ended
	Mar. 29, 2020
PROPERTY AND EQUIPMENT
NOTE 2 - PROPERTY AND EQUIPMENT	Property and equipment consisted of the following at end of the respective fiscal years: 03/29/2020 12/29/2019 Land $ 555,885 $ 555,885 Equipment 2,390,545 2,390,545 Buildings 1,363,642 1,363,642 Total property and equipment 4,310,072 4,310,072 Accumulated depreciation (2,255,211 ) (2,210,816 ) Less - Property held for sale (449,244 ) (449,244 ) Net property and equipment $ 1,605,617 $ 1,650,012 Depreciation expense for the 13-week periods in 2020 and 2019 was $44,395 and $58,810, respectively.

ACCRUED EXPENSES

ACCRUED EXPENSES	3 Months Ended
	Mar. 29, 2020
ACCRUED EXPENSES
NOTE 3 - ACCRUED EXPENSES	Accrued expenses consisted of the following at the dates: 3/29/2020 12/29/2019 Accrued real estate taxes $ 24,888 $ 66,959 Accrued payroll 38,529 69,572 Accrued payroll taxes 7,522 7,058 Accrued sales taxes payable 82,763 35,380 Accrued vacation pay 24,791 23,204 Other accrued expenses 590 559 $ 179,083 $ 202,732

LONG TERM DEBT

LONG TERM DEBT	3 Months Ended
	Mar. 29, 2020
LONG TERM DEBT
NOTE 4 - LONG TERM DEBT	The Company had the following long term debt obligations as of: 3/29/2020 12/29/2019 Note payable to bank dated October 30, 2015 due in monthly installments of $6,916 through October 30, 2030, which includes principal and interest at a fixed rate of 4.75%. This note is secured by two of the Company's Minnesota locations and the personal guaranty of a shareholder of the Company. $ 691,092 $ 699,311 Note payable to bank dated November 16, 2015 due in monthly installments of $14,846, which includes principal and interest at fixed rate of 4.75% through November 16, 2030. This note is secured by four of the Company's North Dakota locations and the personal guaranty of a shareholder of the Company. 1,482,482 1,509,435 Note payable to bank dated October 10, 2015 due in monthly installments of $4,153 through March 11, 2030, which includes principal and interest at fixed rate of 4.75%. This note is secured by the Company's Dairy Queen location and the personal guaranty of a shareholder of the Company. 409,686 414,562 Note payable to bank dated March 11, 2016 due in monthly installments of $3,692 through March 11, 2031 which includes principal and interest at a fixed rate of 4.75%. This note is secured by one of the Company's South Dakota locations and the personal guaranty of a shareholder of the Company. 377,618 384,208 Notes payable to bank dated November 10, 2016 payable in monthly installments of $1,331 which includes principal and interest at 4%, the interest rate is subject to adjustment based on 5-year Treasury Note rate 2021 and cannot be be less than 4%. This note is secured by property held for sale in Richmond Indiana and the personal guaranty of a shareholder of the Company. 148,737 151,234 Unsecured 8% notes payable to an entity controlled by shareholders of the Company dated December 26, 2017 originally due on demand after June 1, 2020. Effectice July 1, 2019 a revised note was entered into due June 1, 2021 with monthly payments of $5,000 due beginning August 1, 2019. An additional $50,000 was advanced to the Company in January 2020 and this advance is included in current maturities. 257,264 207,264 Note payable to bank dated December 28, 2018 due in monthly installments of $1,644 through December 31, 2023 which includes principal and interest at a fixed rate of 5.50%. This note is secured by the West St. Paul location and the personal guaranty of a shareholder of the Company. 189,800 192,068 3,556,679 3,558,082 Less - unamortized debt issuance costs (58,087 ) (59,381 ) Current maturities (243,784 ) (277,666 ) Total $ 3,254,808 $ 3,221,035 In the first quarter of fiscal 2020, as a result of the many uncertainties surrounding the economy during the COVID-19 response, two of the Company’s mortgage lenders agreed to suspend current payments for a period of three months. The loans will continue to accrue interest at the stated rate, which included in the principal outstanding, and the suspended payments will be treated as balloon-payments due at the end of the mortgage term.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	3 Months Ended
	Mar. 29, 2020
RELATED PARTY TRANSACTIONS
NOTE 5 - RELATED PARTY TRANSACTIONS	BTND Trading BTND Trading is an entity separate from the Company owned by certain significant shareholders of the Company, from time-to-time BTND Trading has advanced funds to the Company. In 2020 no payments have been made on this note and during the first quarter BTND Trading advanced an additional $50,000 to the Company which amount has been added to the current portion long-term debt as it is anticipated this advance will be repaid before the end of the year. Next Gen Ice In 2019 the Company made a series of advances in the form of investments in Next Gen Ice, Inc. (NGI) Series C Notes totaling $179,000. In the first quarter of 2020 the Company advanced an additional $28,000 to NGI and the $28,000 advance was repaid following the end of the quarter, in April 2020. The Company’s CEO, Gary Copperud, is Chairman of NGI and the Company’s Chief Operating Officer, Kenneth Brimmer, is a member of the Board of Directors of NGI and is currently serving as Chief Financial Officer of NGI on a part-time contract basis. Mr. Copperud and limited liability companies controlled by him together own approximately 55% of the outstanding equity of NGI. The Series C Notes were originally due on March 3, 2020. On March 3, 2020, the Company and NGI entered into a Loan Modification and Extension Agreement pursuant to which the Company agreed to extend the maturity date of the NGI Notes to August 31, 2020. In consideration of the extension of the term of the NGI Notes: (i) NGI granted to the Company a security interest in all of NGI’s assets, (ii) issued to the Company a warrant entitling it to purchase 179,000 shares of common stock of NGI at a price of $1.00 per share at any time through March 31, 2023, and (iii) the founders of NGI including Mr. Copperud agreed to transfer to the Company 179,000 common shares of NGI.

CONTINGENCIES

CONTINGENCIES	3 Months Ended
	Mar. 29, 2020
CONTINGENCIES
NOTE 6 - CONTINGENCIES	In the course of its business, the Company may be a party to claims and legal or regulatory actions arising from the conduct of its business. The Company is not aware of any significant asserted or potential claims which could impact its financial position

Covid-19 AND EMERGENCY LOAN REL

Covid-19 AND EMERGENCY LOAN RELIEF	3 Months Ended
	Mar. 29, 2020
Covid-19 AND EMERGENCY LOAN RELIEF
NOTE 7 - Covid-19 AND EMERGENCY LOAN RELIEF	On March 11, 2020, the World Health Organization declared the novel strain of coronavirus (‘Covid-19”) a global pandemic. Covid-19 has had a significant adverse impact on the United States economy. While we have experienced some product shortages and some labor shortages, we have continued to operate all of our locations on a drive-through basis only with some limited hours and closing access to both the walk-up window and any indoor seating. Indoor seating is only available in our Dairy Queen and one other location. At this time, it is impossible to predict the ultimate impact of the Covid-19 pandemic on the Company’s operating results and financial condition as the situation and regulations surrounding government response to the pandemic are constantly changing. On May 1, 2020, the Company received funding in connection with “Small Business Loans” under the federal Paycheck Protection Program provided in Section 7(a) of the Small Business Act of 1953, as amended by the Coronavirus Aid, Relief and Economic Security Act, as amended from time to time (the “PPP”). Pursuant to the terms of the Promissory Notes dated May 1, 2020, by BTND and BTNDDQ, L.L.C. in favor of Northview Bank. BTND borrowed $418,900 original principal amount, and BTNDDQ, L.L.C. borrowed $41,500 original principal amount. Both PPP loans were funded on May 1, 2020. The PPP Loans bear interest at 1% per annum and mature in two years from the date of disbursement of funds. Interest and principal payments under the PPP Loans will be deferred for a period of six months. Under certain circumstances, all or a portion of the PPP Loans may be forgiven, however, there can be no assurance that any portion of the PPP Loans will be forgiven and that BTND and BTNDDQ, L.L.C. would not be required to repay the PPP Loans in full. The PPP Loan contains certain covenants which, among other things, restrict the borrower’s use of the proceeds of the PPP Loan to the payment of payroll costs, interest on mortgage obligations, rent obligations and utility expenses, require compliance with all other loans or other agreements with any creditor of the borrower, to the extent that a default under any loan or other agreement would materially affect the borrower’s ability to repay the PPP Loan and limit the ability of the borrower to make certain changes to its ownership structure. On April 29, 2020, BTNDDQ, L.L.C. also borrowed $27,500 at no interest under the Minnesota Small Business Emergency Loan Program from Central Minnesota Development Corporation. This loan is interest free and under certain conditions up to 50% of the loan may be forgiven, BTNDDQ, L.L.C., initially, is required to make 18 monthly payments of $458.33 beginning December 15, 2020, following the initial 18 months, in the event the note does not qualify for loan forgiveness, it will be repaid in equal installments over an additional 36 months.

SUMMARY OF SIGNIFICANT ACCOUN_2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
	Mar. 29, 2020
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation	The accompanying unaudited condensed consolidated financial statements include the accounts of BT Brands, Inc. and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. These interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and on a basis consistent in all material respects with the accounting policies for the fiscal year ended December 29, 2019. In our opinion, all adjustments, which are normal and recurring in nature, necessary for a fair presentation of our financial position and results of operation have been included. Operating results for interim periods are not necessarily indicative of the results that may be expected for a full fiscal year. The accompanying Condensed Consolidated Balance Sheet as of March 29, 2020 does not include all of the disclosures required by GAAP. These interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements as of December 29, 2019 and the related notes thereto included in the Company’s Form 10-K for the fiscal year ended December 29, 2019.
Use of Estimates	The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
Reverse Merger Transaction	BT Brands, Inc. (the “Company”) was incorporated as Hartmax of NY Inc. on January 19, 2016 with the objective of acquiring an operating entity. Effective on July 30, 2018, the Company acquired 100% of the ownership BTND, LLC. in exchange for common stock in the Company through a Share Exchange Agreement (“Share Exchange”) with BTND, LLC (“BTND”), and its Members. Following the Share Exchange, BTND became a wholly owned subsidiary of the Company for reporting purposes under GAAP.
Business	The Company currently operates company-owned fast-food restaurants called Burger Time. The Company also operates one unit in Minnesota as a franchisee of International Dairy Queen. The Company operates three Burger Time locations in Minnesota, four in North Dakota, and two in South Dakota. The Company closed a store in Richmond, Indiana during the year, which is listed for sale, resulting in a total of ten operating restaurants at March 29, 2020. The Company owns a restaurant property in St. Louis, Missouri currently held for sale. The Company’s Dairy Queen store is operated pursuant to the terms of a franchise agreement with International Dairy Queen. The Company is required to pay regular royalty and advertising payments to the franchisor and to remain in compliance with the terms of the franchise agreement.
Fiscal Year Period	The Company’s fiscal year is a 52/53-week year, ending on the Sunday closest to December 31. Most years consist of four 13-week accounting periods comprising the 52-week year. All references to years in this report refer to the 13-week periods in the respective fiscal year periods. Fiscal 2020 is a 53-week year ending January 3, 2021.
Cash	For purposes of reporting cash and cash flows, cash is net of outstanding checks and includes, amounts on deposit at banks, a money market mutual fund holding, and deposits in transit.
Receivables	Receivables consists of rebates due from a primary vendor.
Inventory	Inventory consists of food, beverages and supplies and is stated at lower of cost (first-in, first-out method) or net realizable value.
Property and Equipment	Property and equipment are stated at cost. Depreciation is computed using the straight-line method over the estimated useful lives which range from three to thirty years. The Company reviews long-lived assets to determine if the carrying value of these assets may not be recoverable based on estimated cash flows. Assets are reviewed at the lowest level for which cash flows can be identified, which is at the restaurant level. In determining future cash flows, significant estimates are made by the Company with respect to future operating results of each restaurant over its remaining life. If such assets are considered impaired, the impairment to be recognized is measured by the amount by which the carrying value of the assets exceeds the fair value of the assets.
Assets Held for Sale	From time-to-time the Company may sell an existing operating unit or may close an operating unit and list the property for sale. A property in the St. Louis area is currently listed for sale. Also, in September of 2018 the Company closed an operating Burger Time unit in Richmond, Indiana and the Richmond property is listed for sale. In the second quarter of fiscal 2019 it was concluded to record a charge of $93,488 for impairment of the value of the Richmond location.
Income Taxes	We account for income taxes using the liability method, whereby deferred tax asset and liability account balances are determined based on differences between the financial reporting and tax bases of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value. The deferred tax assets are reviewed periodically for recoverability and valuation allowances are adjusted as necessary. The Company has a net operating loss carry-forward from the prior year and incurred additional net operating losses during the periods ended March 29, 2020 and March 31, 2019. These losses resulted in an increase in the related deferred tax assets; however, full valuation allowances were made which reduced these deferred tax assets to zero; therefore, no income tax provision or benefit was recognized for the periods ending March 29, 2020 and March 31, 2019 resulting in an effective income tax rate of 0% for both periods.
Per Common Share Amounts	Net income (loss) per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net income or (loss) per share is computed by dividing net income or loss by the weighted average number of shares of common stock outstanding during the period. Diluted net income per share is computed by dividing net income by the weighted average number of shares of common stock and potentially outstanding shares of common stock during each period. Common stock equivalents are excluded from the computation of diluted net loss per share because their effect would be anti-dilutive. There were no potentially dilutive shares outstanding as of the periods ending in 2020 and 2019, as the strike price for warrants outstanding was above the fair market price of the underlying stock in both periods.
Other Assets	Other assets principally is the allocated fair value of the acquired Dairy Queen franchise agreement related to the Company’s location in Ham Lake, Minnesota, and is being amortized over an estimated useful life of 14 years.
Liquidity and Capital Resources	The consolidated financial statements have been prepared on a going concern basis. For the 13 weeks ended March 29, 2020, the Company incurred a net loss of $116,244. On March 29, 2020, the Company had $310,134 in cash and a working capital deficit of $535,201 an increase of $66,875 from the year-end deficit of $468,326. On March 11, 2020, the World Health Organization declared the novel strain of coronavirus (‘Covid-19”) a global pandemic. Covid-19 is having a significant adverse impact on the United States economy. At this time, it is impossible to predict either the near-term effects or the ultimate impact of the Covid-19 pandemic on the Company’s operating results and financial condition as the situation is rapidly evolving. A cash flow forecast for the next 12 months prepared by management has been adjusted to reflect recent offers by banks, in the wake of the COVID-19 Pandemic, including the Company’s principal lenders, Northview Bank and Bremer Bank, to abate all loan payments for the period from March through May of 2020. In May, 2020 the Company received loans of $487,900 of that amount, $460,400 was borrowed under the Small Business Administration Payroll Protection Program and assuming certain conditions are met, these loans may be forgiven. In May, 2020, the Company also borrowed $27,500 at no interest under the Minnesota Small Business Emergency Loan Program. The Company expects to have sufficient cash assets to meet its obligations for a year from the issuance of these consolidated financial statements. No adjustments have been made relating to recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company not continue as a going concern.

PROPERTY AND EQUIPMENT (Tables)

PROPERTY AND EQUIPMENT (Tables)	3 Months Ended
	Mar. 29, 2020
PROPERTY AND EQUIPMENT
Schedule of property and equipment	03/29/2020 12/29/2019 Land $ 555,885 $ 555,885 Equipment 2,390,545 2,390,545 Buildings 1,363,642 1,363,642 Total property and equipment 4,310,072 4,310,072 Accumulated depreciation (2,255,211 ) (2,210,816 ) Less - Property held for sale (449,244 ) (449,244 ) Net property and equipment $ 1,605,617 $ 1,650,012

ACCRUED EXPENSES (Tables)

ACCRUED EXPENSES (Tables)	3 Months Ended
	Mar. 29, 2020
ACCRUED EXPENSES
Schedule of accrued expenses	3/29/2020 12/29/2019 Accrued real estate taxes $ 24,888 $ 66,959 Accrued payroll 38,529 69,572 Accrued payroll taxes 7,522 7,058 Accrued sales taxes payable 82,763 35,380 Accrued vacation pay 24,791 23,204 Other accrued expenses 590 559 $ 179,083 $ 202,732

LONG TERM DEBT (Tables)

LONG TERM DEBT (Tables)	3 Months Ended
	Mar. 29, 2020
LONG TERM DEBT
Schedule of maturities of long-term debt	3/29/2020 12/29/2019 Note payable to bank dated October 30, 2015 due in monthly installments of $6,916 through October 30, 2030, which includes principal and interest at a fixed rate of 4.75%. This note is secured by two of the Company's Minnesota locations and the personal guaranty of a shareholder of the Company. $ 691,092 $ 699,311 Note payable to bank dated November 16, 2015 due in monthly installments of $14,846, which includes principal and interest at fixed rate of 4.75% through November 16, 2030. This note is secured by four of the Company's North Dakota locations and the personal guaranty of a shareholder of the Company. 1,482,482 1,509,435 Note payable to bank dated October 10, 2015 due in monthly installments of $4,153 through March 11, 2030, which includes principal and interest at fixed rate of 4.75%. This note is secured by the Company's Dairy Queen location and the personal guaranty of a shareholder of the Company. 409,686 414,562 Note payable to bank dated March 11, 2016 due in monthly installments of $3,692 through March 11, 2031 which includes principal and interest at a fixed rate of 4.75%. This note is secured by one of the Company's South Dakota locations and the personal guaranty of a shareholder of the Company. 377,618 384,208 Notes payable to bank dated November 10, 2016 payable in monthly installments of $1,331 which includes principal and interest at 4%, the interest rate is subject to adjustment based on 5-year Treasury Note rate 2021 and cannot be be less than 4%. This note is secured by property held for sale in Richmond Indiana and the personal guaranty of a shareholder of the Company. 148,737 151,234 Unsecured 8% notes payable to an entity controlled by shareholders of the Company dated December 26, 2017 originally due on demand after June 1, 2020. Effectice July 1, 2019 a revised note was entered into due June 1, 2021 with monthly payments of $5,000 due beginning August 1, 2019. An additional $50,000 was advanced to the Company in January 2020 and this advance is included in current maturities. 257,264 207,264 Note payable to bank dated December 28, 2018 due in monthly installments of $1,644 through December 31, 2023 which includes principal and interest at a fixed rate of 5.50%. This note is secured by the West St. Paul location and the personal guaranty of a shareholder of the Company. 189,800 192,068 3,556,679 3,558,082 Less - unamortized debt issuance costs (58,087 ) (59,381 ) Current maturities (243,784 ) (277,666 ) Total $ 3,254,808 $ 3,221,035

SUMMARY OF SIGNIFICANT ACCOUN_3

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	1 Months Ended	3 Months Ended
	Mar. 29, 2020	Mar. 29, 2020	Jun. 30, 2019	Mar. 31, 2019	Mar. 31, 2019	Dec. 29, 2019	Jul. 30, 2018
Date of incorporation		Jan. 19, 2016
Increase in working capital deficit		$ (66,875)
Working capital deficit	$ (535,201)	(535,201)				$ (468,326)
Cash	310,134	310,134				$ 258,101
Net Income (loss)		$ (116,244)		$ (170,490)	$ (170,490)
Estimated useful life of the acquired Dairy Queen		14 years
Impairment of asset held for sale			$ 93,488
Loan received	487,900
Share Exchange Agreement [Member] | BTND, LLC. [Member]
Equity method investment, ownership percentage							100.00%
Minnesota Small Business Emergency Loan Program [Member]
Loan received	27,500
Small Business Administration Payroll Protection Program [Member]
Loan received	$ 460,400

PROPERTY AND EQUIPMENT (Details

PROPERTY AND EQUIPMENT (Details) - USD ($)	Mar. 29, 2020	Dec. 29, 2019
LONG TERM DEBT
Land	$ 555,885	$ 555,885
Equipment	2,390,545	2,390,545
Buildings	1,363,642	1,363,642
Total property and equipment	4,310,072	4,310,072
Accumulated depreciation	(2,255,211)	(2,210,816)
Less - property held for sale	(449,244)	(449,244)
Net property and equipment	$ 1,605,617	$ 1,650,012

PROPERTY AND EQUIPMENT (Detai_2

PROPERTY AND EQUIPMENT (Details Narrative) - USD ($)	3 Months Ended
	Mar. 29, 2020	Mar. 31, 2019
LONG TERM DEBT
Depreciation	$ 44,395	$ 58,810

ACCRUED EXPENSES (Details)

ACCRUED EXPENSES (Details) - USD ($)	Mar. 29, 2020	Dec. 29, 2019
LONG TERM DEBT
Accrued real estate taxes	$ 24,888	$ 66,959
Accrued payroll	38,529	69,572
Accrued payroll taxes	7,522	7,058
Accrued sales taxes payable	82,763	35,380
Accrued vacation pay	24,791	23,204
Other accrued expenses	590	559
Accrued expenses	$ 179,083	$ 202,732

LONG TERM DEBT (Details)

LONG TERM DEBT (Details) - USD ($)	Mar. 29, 2020	Dec. 29, 2019
Notes payable to bank	$ 3,556,679	$ 3,558,082
Less - unamortized debt issuance costs	(58,087)	(59,381)
Current maturities	(243,784)	(277,666)
Notes payable to bank, Total	3,254,808	3,221,035
October 30, 2015 [Member] | Long Term Debt [Member]
Notes payable to bank, Total	691,092	699,311
November 16, 2015 [Member] | Long Term Debt [Member]
Notes payable to bank, Total	1,482,482	1,509,435
October 10, 2015 [Member] | Long Term Debt [Member]
Notes payable to bank, Total	409,686	414,562
March 11, 2016 [Member] | Long Term Debt [Member]
Notes payable to bank, Total	377,618	384,208
November 10, 2016 [Member] | Long Term Debt [Member]
Notes payable to bank, Total	148,737	151,234
December 26, 2017 [Member] | Long Term Debt [Member] | Shareholders [Member]
Unsecured notes payable	257,264	207,264
December 28, 2018 [Member] | Long Term Debt [Member]
Notes payable to bank, Total	$ 189,800	$ 192,068

RELATED PARTY TRANSACTIONS (Det

RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)	Mar. 03, 2020	Mar. 29, 2020
BTND, LLC. [Member]
Advance from related party		$ 50,000
Next Gen Ice, Inc. [Member] | Loan Modification and Extension Agreement [Member] | Subsequent Event [Member]
Issuance of warrants	179,000
Exercise Price	$ 1
Class of Warrant or Right, Date from which Warrants or Rights Exercisable	Mar. 31, 2023
Ownership percentage		55.00%
Notes Due from Related Party		$ 179,000
Transfer of shares	179,000
Advance to related party		$ 28,000

Covid-19 AND EMERGENCY LOAN R_2

Covid-19 AND EMERGENCY LOAN RELIEF (Details Narrative) - Subsequent Event [Member] - USD ($)	May 01, 2020	Apr. 20, 2020
Loan received	$ 418,900
Interest rate	1.00%
Maturitiy term	2 years
BTNDDQ, L.L.C. [Member]
Loan received	$ 41,500	$ 27,500
Debt description		This loan is interest free and under certain conditions up to 50% of the loan may be forgiven, BTNDDQ, L.L.C., initially, is required to make 18 monthly payments of $458.33 beginning December 15, 2020, following the initial 18 months, in the event the note does not qualify for loan forgiveness, it will be repaid in equal installments over an additional 36 months.