Bermuda corporation Small Island Investments Ltd. has closed a deal to buy 4.2 million shares worth $2.1 million from Good Times Restaurants Inc. following shareholder approval of the transaction, it was announced on Friday.Good Times Restaurants has also reported that it has simultaneously entered into an amended credit agreement with Wells Fargo Bank on its existing term loan that modifies certain financial loan covenants and collateral commitments, but without any change to the interest rate or term of the loan. The company had been in technical default of certain loan covenants but had never been in any payment default and is now in full compliance with the modified covenants.Plans to buy a majority stake in the company were reported in The Royal Gazette last month.Boyd Hoback, president and CEO of Good Times Restaurants, said: “The proceeds of the equity transaction along with continued improvement in our operating results allowed us to reduce short-term debt and liabilities and provides additional strength to our balance sheet and working capital position.“We will continue to reinvest in our existing restaurants as we look toward future growth as liquidity returns to the capital markets for new company owned and franchised store development. In the near term we are focused on building cash flow from our existing asset base through continued sales growth and margin improvement.”The company's board of diThe company's board of directors approved a one for three reverse split of the company's common stock that was also approved by shareholders at the special meeting on December 13, 2010. The reverse split will be effective as of December 31, 2010.Mr Hoback said: “The equity transaction and the reverse split allow us to maintain our listing on the Nasdaq Capital Market as we evaluate possible further long term strategic moves to improve shareholder value and liquidity.”Mastodon Ventures Inc. provided strategic advisory services to the company in the transaction. A fairness opinion for the Small Island Investments transaction was provided to the board of directors by Woodville Hall Capital LLC, of Middleburg, Virginia.Bellmark Partners, LLC acted as Small Island Investment's financial advisor in connection with the transaction.Small Island Investments, which is based in Boston, Massachusetts, is an affiliate of a company that owns and operates three restaurant brands operating in Canada and the US generating approximately $75 million in annual revenues.