UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarter ended:~~April 30,~~July 31, 2019

[ ] 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:000-54954

MamaMancini’s Holdings, Inc.

(Exact name of Registrant as specified in its charter)

Nevada		27-067116
(State or other jurisdiction of incorporation)		(IRS Employer I.D. No.)

25 Branca Road

East Rutherford, NJ 07073

(Address of principal executive offices and zip Code)

(201) 531-1212

(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
None		None		None

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 past 12 months, and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files. Yes [X] No [ ]

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

Large accelerated filer	[ ]	Accelerated filer	[ ]

Non-accelerated filer	[ ]	Smaller reporting company	[X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

As of ~~June 14,~~September 12, 2019, there were ~~31,866,241~~31,991,241 shares outstanding of the registrant’s common stock.

TABLE OF CONTENTS

		Page
PART I – FINANCIAL INFORMATION

Item 1.	Financial Statements.	F-1

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations.	2

Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	45

Item 4.	Controls and Procedures.	45

PART II – OTHER INFORMATION

Item 1.	Legal Proceedings.	56

Item 1A.	Risk Factors.	56

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	56

Item 3.	Defaults Upon Senior Securities.	56

Item 4.	Mine Safety Disclosures.	56

Item 5.	Other Information	56

Item 6.	Exhibits.	56

Signatures		67

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements.

MamaMancini’s Holdings, Inc.

Condensed Consolidated Balance Sheets

April 30, 2019 January 31, 2019
(unaudited)
Assets

Current Assets:
Cash $ 686,505 $ 609,409
Accounts receivable, net 2,335,516 2,698,562
Inventories 1,459,984 1,396,400
Prepaid expenses 253,829 155,178
Total current assets 4,735,834 4,859,549

Property and equipment, net 3,001,092 2,884,594

Operating lease right of use assets, net 1,589,172 -

Deposits 20,177 20,177
Total Assets $ 9,346,275 $ 7,764,320

Liabilities and Stockholders’ Deficit

Liabilities:
Current Liabilities:
Accounts payable and accrued expenses $ 2,974,521 $ 3,061,932
Term loan 500,000 500,000
Operating lease liability 91,038 -
Finance leases payable 55,850 53,730
Total current liabilities 3,621,409 3,615,662

Term loan – net 1,596,688 1,914,401
Line of credit – net 2,596,169 2,612,034
Operating lease liability – net 1,498,941 -
Finance leases payable – net 200,449 162,527
Notes payable - related party 641,844 641,844
Total long-term liabilities 6,534,091 5,330,806

Total Liabilities 10,155,500 8,946,468

Commitments and contingencies

Stockholders’ Deficit:
Series A Preferred stock, $0.00001 par value; 120,000 shares authorized; 23,400 issued as of April 30, 2019 and January 31, 2019, 0 and 0 shares outstanding as of April 30, 2019 and January 31, 2019 - -
Preferred stock, $0.00001 par value; 19,880,000 shares authorized; no shares issued and outstanding - -
Common stock, $0.00001 par value; 250,000,000 shares authorized; 31,866,241 shares issued and outstanding as of April 30, 2019 and January 31, 2019 320 320
Additional paid in capital 16,564,544 16,547,287
Accumulated deficit (17,224,589 ) (17,580,255 )
Less: Treasury stock, 230,000 shares at cost, respectively (149,500 ) (149,500 )
Total Stockholders’ Deficit (809,225 ) (1,182,148 )
Total Liabilities and Stockholders’ Deficit $ 9,346,275 $ 7,764,320

	July 31, 2019			January 31, 2019
		(unaudited)
Assets

Current Assets:
Cash	$	635,227		$	609,409
Accounts receivable, net		2,711,332			2,698,562
Inventories		1,464,924			1,396,400
Prepaid expenses		379,446			155,178
Total current assets		5,190,929			4,859,549

Property and equipment, net		2,858,233			2,884,594

Operating lease right of use assets, net		1,556,873			-

Deposits		20,177			20,177
Total Assets	$	9,626,212		$	7,764,320

Liabilities and Stockholders’ Deficit

Liabilities:
Current Liabilities:
Accounts payable and accrued expenses	$	3,065,435		$	3,061,932
Term loan		500,000			500,000
Operating lease liability		124,500			-
Finance leases payable		99,556			53,730
Total current liabilities		3,789,491			3,615,662

Term loan – net		1,118,704			1,914,401
Line of credit – net		2,677,348			2,612,034
Operating lease liability – net		1,432,372			-
Finance leases payable – net		339,654			162,527
Notes payable - related party		641,844			641,844
Total long-term liabilities		6,209,922			5,330,806

Total Liabilities		9,999,413			8,946,468

Commitments and contingencies

Stockholders’ Deficit:
Series A Preferred stock, $0.00001 par value; 120,000 shares authorized; 23,400 issued as of July 31, 2019 and January 31, 2019, 0 and 0 shares outstanding as of July 31, 2019 and January 31, 2019		-			-
Preferred stock, $0.00001 par value; 19,880,000 shares authorized; no shares issued and outstanding		-			-
Common stock, $0.00001 par value; 250,000,000 shares authorized; 31,991,241 and 31,866,241 shares issued and outstanding as of July 31, 2019 and January 31, 2019		321			320
Additional paid in capital		16,642,259			16,547,287
Accumulated deficit		(16,866,281	)		(17,580,255	)
Less: Treasury stock, 230,000 shares at cost, respectively		(149,500	)		(149,500	)
Total Stockholders’ Deficit		(373,201	)		(1,182,148	)
Total Liabilities and Stockholders’ Deficit	$	9,626,212		$	7,764,320

See accompanying notes to the condensed consolidated financial statements

F-1

MamaMancini’s Holdings, Inc.

Condensed Consolidated Statements of Operations

(unaudited)

For the Three Months Ended
April 30, 2019 April 30, 2018

Sales - net of slotting fees and discounts $ 7,364,824 $ 7,741,994

Cost of sales 4,933,770 4,913,448

Gross profit 2,371,054 2,828,546

Operating expenses
Research and development 25,326 30,096
General and administrative 1,866,162 2,244,937
Total operating expenses 1,891,488 2,275,033

Income from operations 479,566 553,513

Other expenses
Interest (116,612 ) (188,141 )
Amortization of debt discount (7,288 ) (41,371 )
Total other expenses (123,900 ) (229,512 )

Net income 355,666 324,001

Less: preferred dividends - -

Net income available to common stockholders $ 355,666 $ 324,001

Net income per common share - basic and diluted $ 0.01 $ 0.01

Weighted average common shares outstanding
- basic 31,866,240 31,780,111
- diluted 32,098,426 34,655,399

	For the Three Months Ended July 31,						For the Six Months Ended July 31,
	2019			2018			2019			2018

Sales-net of slotting fees and discounts	$	8,099,445		$	5,640,830		$	15,464,269		$	13,382,824

Costs of sales		5,408,049			3,578,840			10,401,819			8,492,288

Gross profit		2,691,396			2,061,990			5,062,450			4,890,536

Operating expenses:
Research and development		24,509			37,083			49,835			67,179
General and administrative		2,215,945			1,895,081			4,082,107			4,140,018
Total operating expenses		2,240,454			1,932,164			4,131,942			4,207,197

Income from operations		450,942			129,826			930,508			683,339

Other expenses
Interest		(87,284	)		(291,441	)		(203,896	)		(479,582	)
Amortization of debt discount		(5,350	)		(48,580	)		(12,638	)		(89,951	)
Total other expenses		(92,634	)		(340,021	)		(216,534	)		(569,533	)

Net income (loss)		358,308			(210,195	)		713,974			113,806

Less: preferred dividends		-			-			-			-

Net income (loss) available to common stockholders	$	358,308		$	(210,195	)	$	713,974		$	113,806

Net income (loss) per common share
– basic	$	0.01		$	(0.01	)	$	0.02		$	0.00
– diluted	$	0.01		$	(0.01	)	$	0.02		$	0.00

Weighted average common shares outstanding
– basic		31,947,763			31,859,812			31,907,676			31,820,898
– diluted		31,981,806			31,859,812			34,941,719			32,564,932

See accompanying notes to the condensed consolidated financial statements

F-2

MamaMancini’s Holdings, Inc.

Condensed Consolidated Statements of Changes in Stockholders’ Deficit

(unaudited)

For the Period from May 1, 2019 through July 31, 2019

	Series A Preferred Stock				Common Stock				Treasury Stock						Additional Paid In		Accumulated			Stockholders’
	Shares		Amount		Shares		Amount		Shares			Amount			Capital		Deficit			Deficit

Balance, May 1, 2019		-	$	-		31,866,241	$	320		(230,000	)	$	(149,500	)	$	16,564,544	$	(17,224,589	)	$	(809,225	)

Stock options issued for services		-		-		-		-		-			-			5,841		-			5,841

Common stock issued for services		-		-		125,000		1		-			-			71,874		-			71,875

Net income		-		-		-		-		-			-			-		358,308			358,308
Balance, July 31, 2019		-	$	-		31,991,241	$	321		(230,000	)	$	(149,500	)	$	16,642,259	$	(16,866,281	)	$	(373,201	)

For the Period from May 1, 2018 through July 31, 2018

	Series A Preferred Stock				Common Stock				Treasury Stock						Additional Paid In			Accumulated			Stockholders’
	Shares		Amount		Shares		Amount		Shares			Amount			Capital			Deficit			Deficit

Balance, May 1, 2018		-	$	-		31,823,993	$	319		(230,000	)	$	(149,500	)	$	16,427,012		$	(17,806,302	)	$	(1,528,471	)

Share-based compensation		-		-		-		-		-			-			36,945			-			36,945

Common stock issued for the exercise of warrants		-		-		42,248		1		-			-			(1	)		-			-

Net loss		-		-		-		-		-			-			-			(210,195	)		(210,195	)
Balance, July 31, 2018		-	$	-		31,866,241	$	320		(230,000	)	$	(149,500	)	$	16,463,956		$	(18,016,497	)	$	(1,701,721	)

See accompanying notes to the condensed consolidated financial statements

F-3

MamaMancini’s Holdings, Inc.

Condensed Consolidated Statements of Changes in Stockholders’ Deficit

(unaudited)

For the Period from February 1, 2019 through ~~April 30,~~July 31, 2019

	Series A Preferred Stock				Common Stock				Treasury Stock						Additional Paid In		Accumulated			Stockholders’			Series A Preferred Stock				Common Stock				Treasury Stock						Additional Paid In		Accumulated			Stockholders’
	Shares		Amount		Shares		Amount		Shares			Amount			Capital		Deficit			Deficit			Shares		Amount		Shares		Amount		Shares			Amount			Capital		Deficit			Deficit

Balance, February 1, 2019		-	$	-		31,866,241	$	320		(230,000	)	$	(149,500	)	$	16,547,287	$	(17,580,255	)	$	(1,182,148	)		-	$	-		31,866,241	$	320		(230,000	)	$	(149,500	)	$	16,547,287	$	(17,580,255	)	$	(1,182,148	)

Stock options issued for services		-		-		-		-		-			-			17,257		-			17,257			-		-		-		-		-			-			23,098		-			23,098

Common stock issued for services																								-		-		125,000		1		-			-			71,874		-			71,875

Net income		-		-		-		-		-			-			-		355,666			355,666			-		-		-		-		-			-			-		713,974			713,974
Balance, April 30, 2019		-	$	-		31,866,241	$	320		(230,000	)	$	(149,500	)	$	16,564,544	$	(17,224,589	)	$	(809,225	)
Balance, July 31, 2019																								-	$	-		31,991,241	$	321		(230,000	)	$	(149,500	)	$	16,642,259	$	(16,866,281	)	$	(373,201	)

For the Period from February 1, 2018 through ~~April 30,~~July 31, 2018

	Series A Preferred Stock				Common Stock				Treasury Stock						Additional Paid In		Accumulated			Stockholders’			Series A Preferred Stock				Common Stock				Treasury Stock						Additional Paid In			Accumulated			Stockholders’
	Shares		Amount		Shares		Amount		Shares			Amount			Capital		Deficit			Deficit			Shares		Amount		Shares		Amount		Shares			Amount			Capital			Deficit			Deficit

Balance, February 1, 2018		-	$	-		31,753,437	$	319		(230,000	)	$	(149,500	)	$	16,344,794	$	(18,130,303	)	$	(1,934,690	)		-	$	-		31,753,437	$	319		(230,000	)	$	(149,500	)	$	16,344,794		$	(18,130,303	)	$	(1,934,690	)

Share-based compensation		-		-		-		-		-			-			42,218		-			42,218			-		-		-		-		-			-			79,163			-			79,163

Common stock issued for the exercise of options		-		-		40,000		-		-			-			40,000		-			40,000			-		-		40,000		-		-			-			40,000			-			40,000

Common stock issued for the exercise of warrants		-		-		30,556		-		-			-			-		-			30,556			-		-		72,804		1		-			-			(1	)		-			72,804

Net income		-		-		-		-		-			-			-		324,001			324,001			-		-		-		-		-			-			-			113,806			113,806
Balance, April 30, 2018		-	$	-		31,823,993	$	319		(230,000	)	$	(149,500	)	$	16,427,012	$	(17,806,302	)	$	(1,528,471	)
Balance, July 31, 2018																								-	$	-		31,866,241	$	320		(230,000	)	$	(149,500	)	$	16,463,956		$	(18,016,497	)	$	(1,701,721	)

See accompanying notes to the condensed consolidated financial statements

F-4

MamaMancini’s Holdings, Inc.

Condensed Consolidated Statements of Cash Flows

(unaudited)

For the Three Months Ended
April 30, 2019 April 30, 2018

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 355,666 $ 324,001
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation 180,485 155,242
Amortization of debt discount 7,288 41,371
Share-based compensation 17,257 42,218
Amortization of right of use assets 10,658 -
Changes in operating assets and liabilities:
Accounts receivable 363,046 (697,253 )
Inventories (63,584 ) (298,319 )
Prepaid expenses (98,651 ) 73,211
Accounts payable and accrued expenses (87,411 ) 498,427
Current portion of operating lease liability (9,851 ) -
Net Cash Provided by Operating Activities 674,903 138,898

CASH FLOWS FROM INVESTING ACTIVITIES:
Cash paid for fixed assets (242,820 ) (420,220 )
Net Cash Used in Investing Activities (242,820 ) (420,220 )

CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of note payable - (300,000 )
Borrowings (repayments) of line of credit, net (15,865 ) 480,495
Repayment of term loan (325,001 ) (41,385 )
Repayment of capital lease obligations (14,121 ) -
Proceeds from exercise of options - 40,000
Net Cash Provided by (Used in) Financing Activities (354,987 ) 179,110

Net Increase (Decrease) in Cash 77,096 (102,212 )

Cash - Beginning of Period 609,409 581,322

Cash - End of Period $ 686,505 $ 479,110

SUPPLEMENTARY CASH FLOW INFORMATION:
Cash Paid During the Period for:
Income taxes $ - $ -
Interest $ 151,968 $ 181,204

SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Operating lease liability $ 1,599,830 $ -
Finance lease asset additions $ 54,163 $ -

	For the Six Months Ended
	July 31, 2019			July 31, 2018

CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	713,974		$	113,806
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		370,052			337,833
Amortization of debt discount		12,638			89,951
Share-based compensation		29,943			79,163
Amortization of right of use assets		42,958			-
Changes in operating assets and liabilities:
Accounts receivable		(12,770	)		1,334,738
Inventories		(68,524	)		(455,281	)
Prepaid expenses		(159,239	)		(56,776	)
Accounts payable and accrued expenses		3,503			(2,987	)
Current portion of operating lease liability		(42,958	)		-
Net Cash Provided by Operating Activities		889,577			1,440,447

CASH FLOWS FROM INVESTING ACTIVITIES:
Cash paid for fixed assets		(89,525	)		(903,959	)
Net Cash Used in Investing Activities		(89,525	)		(903,959	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of note payable – related party		-			(7,812	)
Borrowings from term loan		-			300,000
Repayment of note payable		-			(500,000	)
Borrowings (repayments) of line of credit, net		65,314			(708,909	)
Proceeds from capital lease		-			213,250
Repayment of term loan		(808,335	)		(95,270	)
Repayment of capital lease obligations		(31,213	)		(12,037	)
Proceeds from exercise of options		-			40,000
Net Cash Used in Financing Activities		(774,234	)		(770,778	)

Net Increase (Decrease) in Cash		25,818			(234,290	)

Cash - Beginning of Period		609,409			581,322

Cash - End of Period	$	635,227		$	347,032

SUPPLEMENTARY CASH FLOW INFORMATION:
Cash Paid During the Period for:
Income taxes	$	-		$	-
Interest	$	253,763		$	302,034

SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:
Operating lease liability	$	1,599,830		$	-
Finance lease asset additions	$	254,166		$	30,000
Accrued interest on note payable reclassified to principal	$	-		$	392,702
Common stock issued for services to be rendered	$	71,875			-

See accompanying notes to the condensed consolidated financial statements

F-5

MamaMancini’s Holdings, Inc.

Notes to Condensed Consolidated Financial Statements

~~April 30,~~July 31, 2019

Note 1 - Nature of Operations and Basis of Presentation

Nature of Operations

MamaMancini’s Holdings, Inc. (the “Company”), (formerly known as Mascot Properties, Inc.) was organized on July 22, 2009 as a Nevada corporation. The Company has a year-end of January 31.

The Company is a manufacturer and distributor of beef meatballs with sauce, turkey meatballs with sauce, beef meat loaf, chicken parmesan and other similar meats and sauces. In addition, the Company continues to diversify its product line by introducing new products such as ready to serve dinners, single-size Pasta Bowls, bulk deli, packaged refrigerated and packed frozen products. The Company’s customers are located throughout the United States, with a large concentration in the Northeast and Southeast.

Note 2 - Summary of Significant Accounting Policies

Basis of Presentation

The condensed consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) and include the accounts of the Company and its wholly-owned subsidiaries. All ~~material~~ intercompany balances and transactions have been eliminated in consolidation.

The unaudited financial information furnished herein reflects all adjustments, consisting solely of normal recurring items, which in the opinion of management are necessary to fairly state the financial position of the Company and the results of its operations for the periods presented. This report should be read in conjunction with the Company’s consolidated financial statements and notes thereto included in the Company’s Form 10-K for the year ended January 31, 2019 filed on April 23, 2019. The Company assumes that the users of the interim financial information herein have read or have access to the audited financial statements for the preceding fiscal year and that the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The condensed consolidated balance sheet at January 31, 2019 was derived from audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. The results of operations for the interim periods presented are not necessarily indicative of results for the year ending January 31, 2020.

Principles of Consolidation

The condensed consolidated financial statements include all accounts of the entities as of the reporting period ending date(s) and for the reporting period(s). All inter-company balances and transactions have been eliminated.

Following the closing of the merger with Joseph Epstein Food Enterprises, Inc. (“JEFE”) on November 1, 2017, the financial statements of JEFE are consolidated with that of the Company. The prior period financial statements included in the condensed consolidated financial statements have been adjusted to reflect this transaction.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Such estimates and assumptions impact, among others, the following: allowance for doubtful accounts, inventory obsolescence and the fair value of share-based payments.

Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the consolidated financial statements, which management considered in formulating its estimate could change in the near term due to one or more future confirming events. Accordingly, the actual results could differ significantly from our estimates.

F-6

Risks and Uncertainties

The Company operates in an industry that is subject to intense competition and change in consumer demand. The Company’s operations are subject to significant risk and uncertainties including financial and operational risks including the potential risk of business failure.

The Company has experienced, and in the future expects to continue to experience, variability in sales and earnings. The factors expected to contribute to this variability include, among others, (i) the cyclical nature of the grocery industry, (ii) general economic conditions in the various local markets in which the Company competes, including a potential general downturn in the economy, and (iii) the volatility of prices pertaining to food and beverages in connection with the Company’s distribution of the product. These factors, among others, make it difficult to project the Company’s operating results on a consistent basis.

Cash

The Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents. The Company held no cash equivalents at ~~April 30,~~July 31, 2019 and January 31, 2019.

The Company minimizes its credit risk associated with cash by periodically evaluating the credit quality of its primary financial institution. The balance at times may exceed federally insured limits.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are stated at the amount management expects to collect from outstanding balances. The Company generally does not require collateral to support customer receivables. The Company provides an allowance for doubtful accounts based upon a review of the outstanding accounts receivable, historical collection information and existing economic conditions. The Company determines if receivables are past due based on days outstanding, and amounts are written off when determined to be uncollectible by management. The maximum accounting loss from the credit risk associated with accounts receivable is the amount of the receivable recorded, which is the face amount of the receivable net of the allowance for doubtful accounts. As of ~~April 30,~~July 31, 2019 and January 31, 2019, the Company had reserves of $2,000.

Inventories

Inventories are stated at the lower of cost or net realizable value using the first-in, first-out (FIFO) valuation method. Inventory was comprised of the following at ~~April 30,~~July 31, 2019 and January 31, 2019:

	April 30, 2019		January 31, 2019		July 31, 2019		January 31, 2019
Raw Materials	$	830,981	$	556,703	$	907,229	$	556,703
Work in Process		27,496		38,769		4,530		38,769
Finished goods		601,507		800,928		553,165		800,928
	$	1,459,984	$	1,396,400	$	1,464,924	$	1,396,400

Property and Equipment

Property and equipment are recorded at cost. Depreciation expense is computed using straight-line methods over the estimated useful lives.

Asset lives for financial statement reporting of depreciation are:

Machinery and equipment			2-7 years
Furniture and fixtures			3 years
Leasehold improvements			*

(*) Amortized on a straight-line basis over the term of the lease or the estimated useful lives, whichever period is shorter.

F-7

Upon sale or retirement of property and equipment, the related cost and accumulated depreciation are removed from the accounts and any gain or loss is reflected in the condensed consolidated statements of operations.

Leases

In February 2016, the FASB issued ASU 2016-02 “Leases” (Topic 842) which amended guidance for lease arrangements to increase transparency and comparability by providing additional information to users of financial statements regarding an entity’s leasing activities. Subsequent to the issuance of Topic 842, the FASB clarified the guidance through several ASUs; hereinafter the collection of lease guidance is referred to as ASC 842. The revised guidance seeks to achieve this objective by requiring reporting entities to recognize lease assets and lease liabilities on the balance sheet for substantially all lease arrangements.

On January 1, 2019, the Company adopted ASC 842 using the modified retrospective approach and recognized a right of use (“ROU”) asset and liability in the condensed consolidated balance sheet in the amount of ~~$1,599,830~~$1,556,873 related to the operating lease for office and warehouse space. Results for the ~~three~~six months ended ~~April 30,~~July 31, 2019 are presented under ASC 842, while prior period amounts were not adjusted and continue to be reported in accordance with the legacy accounting guidance under ASC Topic 840,Leases.

As part of the adoption the Company elected the practical expedients permitted under the transition guidance within the new standard, which among other things, allowed the Company to:

	1.	Not separate non-lease components from lease components and instead to account for each separate lease component and the non-lease components associated with that lease component as a single lease component.

	2.	Not to apply the recognition requirements in ASC 842 to short-term leases.

	3.	Not record a right of use asset or right of use liability for leases with an asset or liability balance that would be considered immaterial.

Refer to Note 7. Leases for additional disclosures required by ASC 842.

Fair Value of Financial Instruments

For purpose of this disclosure, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. The carrying amount of the Company’s short-term financial instruments approximates fair value due to the relatively short period to maturity for these instruments.

Research and Development

Research and development is expensed as incurred. Research and development expenses for the three months ended ~~April 30,~~July 31, 2019 and 2018 were ~~$25,326~~$24,509 and ~~$30,096,~~$37,083, respectively. Research and development expenses for the six months ended July 31, 2019 and 2018 were $49,835 and $67,179, respectively.

Shipping and Handling Costs

The Company classifies freight billed to customers as sales revenue and the related freight costs as general and administrative expenses.

F-8

Revenue Recognition

In May 2014, the FASB issued ASU 2014-09,Revenue from Contracts with Customers (Topic 606). ASU 2014-09 supersedes the revenue recognition requirements under Topic 605,Revenue Recognition, and most industry-specific guidance throughout the Industry Topics of the ASC. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which an entity expects to be entitled in exchange for those goods or services. Under the new guidance, an entity is required to perform the following five steps: (1) identify the contract(s) with a customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when (or as) the entity satisfies a performance obligation. The new guidance will significantly enhance comparability of revenue recognition practices across entities, industries, jurisdictions and capital markets. Additionally, the guidance requires improved disclosures as to the nature, amount, timing and uncertainty of revenue that is recognized. In May 2016, the FASB issued ASU No. 2016-12,Revenue from Contracts with Customers (Topic 606)—Narrow-Scope Improvements and Practical Expedients. This update clarifies the objectives of collectability, sales and other taxes, noncash consideration, contract modifications at transition, completed contracts at transition and technical correction. The amendments in this update affect the guidance in ASU 2014-09. In September 2017, the FASB issued additional amendments providing clarification and implementation guidance.

The Company adopted this guidance and related amendments as of the first quarter of fiscal 2019, applying the full retrospective transition method. As the underlying principles of the new standard, relating to the measurement of revenue and the timing of recognition, are closely aligned with the Company’s current business model and practices, the adoption of ASU 2014-09 did not have a material impact on the consolidated financial statements. In addition, the adoption of ASC 606 did not impact the previously reported financial statements in any prior period nor did it result in a cumulative effect adjustment to retained earnings.

The Company’s sales predominantly are generated from the sale of finished products to customers, contain a single performance obligation and revenue is recognized at a single point in time when ownership, risks and rewards transfer. Typically, this occurs when the goods are shipped to the customer. Revenues are recognized in an amount that reflects the net consideration the Company expects to receive in exchange for the goods. The Company reports all amounts billed to a customer in a sale transaction as revenue. Under the new revenue guidance, the Company elected to treat shipping and handling activities as fulfillment activities, and the related costs are recorded as selling expenses in general and administrative expenses on the consolidated statement of operations.

The Company promotes its products with advertising, consumer incentives and trade promotions. These programs include discounts, slotting fees, coupons, rebates, in-store display incentives and volume-based incentives. Customer trade promotion and consumer incentive activities are recorded as a reduction to the transaction price based on amounts estimated as being due to customers and consumers at the end of a period. The Company derives these estimates principally on historical utilization and redemption rates. The Company does not receive a distinct service in relation to the advertising, consumer incentives and trade promotions.

Payment terms in the Company’s invoices are based on the billing schedule established in contracts and purchase orders with customers. The Company generally recognizes the related trade receivable when the goods are shipped.

Expenses such as slotting fees, sales discounts, and allowances are accounted for as a direct reduction of revenues as follows:

For the Three Months Ended
April 30, 2019 April 30, 2018
Gross Sales $ 7,456,956 $ 7,858,034
Less: Slotting, Discounts, Allowances 92,132 116,040
Net Sales $ 7,364,824 $ 7,741,994

	For the Six Months Ended
	July 31, 2019		July 31, 2018
Gross Sales	$	15,658,081	$	13,585,549
Less: Slotting, Discounts, Allowances		193,812		202,725
Net Sales	$	15,464,269	$	13,382,824

Disaggregation of Revenue from Contracts with Customers. The following table disaggregates gross revenue by significant geographic area for the ~~three~~six months ended ~~April 30,~~July 31, 2019 and 2018:

	For the Three Months Ended				For the Six Months Ended
	April 30, 2019		April 30, 2018		July 31, 2019		July 31, 2018
Northeast	$	2,396,830	$	2,365,565	$	5,219,863	$	4,115,947
Southeast		1,861,809		1,826,419		3,681,339		3,052,174
Midwest		987,186		1,241,378		2,134,045		2,182,830
West		1,260,184		1,395,325		2,713,142		2,547,803
Southwest		950,947		1,029,347		1,909,692		1,686,795
Total revenue	$	7,456,956	$	7,858,034	$	15,658,081	$	13,585,549

F-9

Cost of Sales

Cost of sales represents costs directly related to the production and manufacturing of the Company’s products. Costs include product development, ~~freight,~~freight-in, packaging, and print production costs.

Advertising

Costs incurred for producing and communicating advertising for the Company are charged to operations as incurred. Producing and communicating advertising expenses for the three months ended ~~April 30,~~July 31, 2019 and 2018 were ~~$342,822~~$413,973 and ~~$515,157,~~$391,026, respectively. Producing and communicating advertising expenses for the six months ended July 31, 2019 and 2018 were $756,795 and $906,183, respectively.

Stock-Based Compensation

The Company accounts for stock-based compensation in accordance with ASC Topic 718, “Compensation – Stock Compensation”(“ASC 718”) which establishes financial accounting and reporting standards for stock-based employee compensation. It defines a fair value-based method of accounting for an employee stock option or similar equity instrument. The Company accounts for compensation cost for stock option plans in accordance with ASC 718.

The Company recognizes all forms of share-based payments, including stock option grants, warrants and restricted stock grants, at their fair value on the grant date, which are based on the estimated number of awards that are ultimately expected to vest.

Share-based payments, excluding restricted stock, are valued using a Black-Scholes option pricing model. Grants of share-based payment awards issued to non-employees for services rendered have been recorded at the fair value of the share-based payment, which is the more readily determinable value. The grants are amortized on a straight-line basis over the requisite service periods, which is generally the vesting period. If an award is granted, but vesting does not occur, any previously recognized compensation cost is reversed in the period related to the termination of service. Stock-based compensation expenses are included in cost of goods sold or selling, general and administrative expenses, depending on the nature of the services provided, in the consolidated statement of operations. Share-based payments issued to placement agents are classified as a direct cost of a stock offering and are recorded as a reduction in additional paid in capital.

For the three months ended ~~April 30,~~July 31, 2019, ~~and 2018,~~ share-based compensation amounted to ~~$17,257~~$12,686 relating to shares of common stock and ~~$42,218, respectively.~~options issued to employees and consultants for services.

For the three months ended ~~April 30,~~July 31, 2018, share-based compensation amounted to $36,945 relating to options issued to employees and consultants for services.

For the six months ended July 31, 2019, share-based compensation amounted to $29,943 relating to shares of common stock and options issued to employees and consultants for services.

For the six months ended July 31, 2018, share-based compensation amounted to $79,163 relating to options issued to employees and consultants for services.

For the six months ended July 31, 2019 and 2018, when computing fair value of share-based payments, the Company has considered the following variables:

	April 30, 2019			April 30, 2018			July 31, 2019			July 31, 2018
Risk-free interest rate		2.29	%		1.60% to 1.99	%		1.84 - 2.29	%		1.99	%
Expected life of grants		3.5 years			2.0 – 4.0 years			3 - 3.5 years			2.0 years
Expected volatility of underlying stock		150	%		139% to 177	%		129 - 150	%		172	%
Dividends		0	%		0	%		0	%		0	%

F-10

The expected option term is computed using the “simplified” method as permitted under the provisions of ASC 718-10-S99. The Company uses the simplified method to calculate expected term of share options and similar instruments as the Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate expected term.

The expected stock price volatility for the Company’s stock options was estimated using the historical volatilities of the Company’s common stock. Risk free interest rates were obtained from U.S. Treasury rates for the applicable periods.

Earnings (Loss) Per Share

Earnings per share (“EPS”) is the amount of earnings attributable to each share of common stock. For convenience, the term is used to refer to either earnings or loss per share. EPS is computed pursuant to Section 260-10-45 of the FASB Accounting Standards Codification. Pursuant to ASC Paragraphs 260-10-45-10 through 260-10-45-16, basic EPS shall be computed by dividing income available to common stockholders (the numerator) by the weighted-average number of common shares outstanding (the denominator) during the period. Income available to common stockholders shall be computed by deducting both the dividends declared in the period on preferred stock (whether or not paid) and the dividends accumulated for the period on cumulative preferred stock (whether or not earned) from income from continuing operations (if that amount appears in the income statement) and also from net income. The computation of diluted EPS is similar to the computation of basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued during the period to reflect the potential dilution that could occur from common shares issuable through contingent shares issuance arrangement, stock options or warrants.

The following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income (loss) attributable to common stockholders per common share.

	For the Three Months Ended				For the Three Months Ended
	April 30, 2019		April 30, 2018		July 31, 2019		July 31, 2018
Numerator:
Net income attributable to common stockholders	$	335,666	$	324,001	$	358,308	$	(210,195	)
Effect of dilutive securities:		—		—		—		—

Diluted net income	$	335,666	$	324,001
Diluted net income (loss)					$	358,308	$	(210,195	)

Denominator:
Weighted average common shares outstanding - basic		31,866,240		31,780,111		31,947,763		31,859,812
Dilutive securities (a):
Series A Preferred		-		-		-		-
Options		108,854		212,229		34,043		-
Warrants		123,332		2,663,059		-		-

Weighted average common shares outstanding and assumed conversion – diluted		32,098,426		34,655,399		31,981,806		31,859,812

Basic net income per common share	$	0.01	$	0.01
Basic net income (loss) per common share					$	0.01	$	(0.01	)

Diluted net income per common share	$	0.01	$	0.01
Diluted net income (loss) per common share					$	0.01	$	(0.01	)

(a) - Anti-dilutive securities excluded:		3,106,167		3,079,001		6,777,164		7,216,665

F-11

	For the Six Months Ended
	July 31, 2019		July 31, 2018
Numerator:
Net income attributable to common stockholders	$	713,974	$	113,806
Effect of dilutive securities:		-		-

Diluted net income	$	713,974	$	113,806

Denominator:
Weighted average common shares outstanding - basic		31,907,676		31,820,898
Dilutive securities (a):
Series A Preferred		-		-
Options		34,043		166,259
Warrants		-		577,775

Weighted average common shares outstanding and assumed conversion – diluted		31,941,719		32,564,932

Basic net income per common share	$	0.02	$	0.00

Diluted net income per common share	$	0.02	$	0.00

(a) - Anti-dilutive securities excluded:		6,777,164		3,365,001

Income Taxes

Income taxes are provided in accordance with ASC No. 740, “Accounting for Income Taxes”. A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss carryforwards. Deferred tax expense (benefit) results from the net change during the period of deferred tax assets and liabilities.

Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

The Company is no longer subject to tax examinations by tax authorities for years prior to 2017.

Related Parties

The Company follows subtopic ASC 850-10 for the identification of related parties and disclosure of related party transactions.

Pursuant to Section 850-10-20, the related parties include: (a) affiliates of the Company (“Affiliate” means, with respect to any specified person, any other person that, directly or indirectly through one or more intermediaries, controls, is controlled by or is under common control with such person, as such terms are used in and construed under Rule 405 under the Securities Act); (b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of Section 825-10-15, to be accounted for by the equity method by the investing entity; (c) trusts for the benefit of employees, such as pension and profit-sharing trusts that are managed by or under the trusteeship of management; (d) principal owners of the Company; (e) management of the Company; (f) other parties with which the Company may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and (g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.

F-12

Recent Accounting Pronouncements

In June 2018, the FASB issued Accounting Standards Update (ASU) No. 2018-07,Compensation – Stock Compensation (Topic718): Improvements to Nonemployee Share-Based Payment Accounting. Under the new standard, companies will no longer be required to value non-employee awards differently from employee awards. Companies will value all equity classified awards at their grant-date under ASC 718 and forgo revaluing the award after the grant date. ASU 2018-07 is effective for annual reporting periods beginning after December 15, 2018, including interim reporting periods within that reporting period. Early adoption is permitted, but no earlier than the Company’s adoption date of Topic 606,Revenue from Contracts with Customers(as described above under “Revenue Recognition”). The adoption of the new standard did not have a significant impact on its condensed consolidated financial statements.

In August 2018, the FASB issued ASU 2018-13,“Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement”. This update is to improve the effectiveness of disclosures in the notes to the financial statements by facilitating clear communication of the information required by U.S. GAAP that is most important to users of each entity’s financial statements. The amendments in this update apply to all entities that are required, under existing U.S. GAAP, to make disclosures about recurring or nonrecurring fair value measurements. The amendments in this update are effective for all entities for fiscal years beginning after December 15, 2019, and interim periods within those fiscal years. The Company is currently evaluating this guidance and the impact of this update on its consolidated financial statements.

Management does not believe that any recently issued, but not yet effective accounting pronouncements, when adopted, will have a material effect on the accompanying condensed consolidated financial statements.

Subsequent Events

The Company evaluates subsequent events and transactions that occur after the balance sheet date for potential recognition or disclosure. Any material events that occur between the balance sheet date and the date that the financial statements were issued are disclosed as subsequent events, while the financial statements are adjusted to reflect any conditions that existed at the balance sheet date.

Note 3 - Property and Equipment:

Property and equipment on ~~April 30,~~July 31, 2019 and January 31, 2019 are as follows:

	April 30, 2019		January 31, 2019		July 31, 2019		January 31, 2019
Machinery and Equipment	$	2,941,002	$	2,662,403	$	2,982,294	$	2,662,403
Furniture and Fixtures		89,627		81,099		89,443		81,099
Leasehold Improvements		2,904,802		2,894,949		2,910,402		2,894,949
		5,935,431		5,638,451		5,982,139		5,638,451
Less: Accumulated Depreciation		2,934,339		2,753,857		3,123,906		2,753,857
	$	3,001,092	$	2,884,594	$	2,858,233	$	2,884,594

Depreciation expense charged to income for the three months ended ~~April 30,~~July 31, 2019 and 2018 amounted to ~~$180,485~~$189,567 and ~~$155,242,~~$203,591, respectively. Depreciation expense charged to income for the six months ended July 31, 2019 and 2018 amounted to $370,052 and $337,833, respectively.

Note 4 - Investment in Meatball Obsession, LLC

During 2011, the Company acquired a 34.62% interest in Meatball Obsession, LLC (“MO”) for a total investment of $27,032. This investment is accounted for using the equity method of accounting. Accordingly, investments are recorded at acquisition cost plus the Company’s equity in the undistributed earnings or losses of the entity.

At December 31, 2011, the investment was written down to $0 due to losses incurred by MO.

F-13

The Company’s ownership interest in MO has decreased due to dilution. At ~~April 30,~~July 31, 2019 and January 31, 2019, the Company’s ownership interest in MO was 12% and 12%, respectively.

Note 5 - Related Party Transactions

Meatball Obsession, LLC

A current director of the Company is the chairman of the board and shareholder of Meatball Obsession LLC (“MO”).

For the three months ended ~~April 30,~~July 31, 2019 and 2018, the Company generated approximately ~~$29,338~~$3,911 and ~~$28,738~~$11,972 in revenues from MO, respectively. For the six months ended July 31, 2019 and 2018, the Company generated approximately $33,248 and $40,710 in revenues from MO, respectively.

As of ~~April 30,~~July 31, 2019 and January 31, 2019, the Company had a receivable of ~~$48,587~~$33,497 and $57,374 due from MO, respectively.

WWS, Inc.

A current director of the Company is the president of WWS, Inc.

For the three months ended ~~April 30,~~July 31, 2019 and 2018, the Company recorded ~~$6,000~~$8,000 and $12,000 in commission expense from WWS, Inc. generated sales, respectively. For the six months ended July 31, 2019 and 2018, the Company recorded $24,000 in commission expense from WWS, Inc. generated sales.

Notes Payable – Related Party

During the year ended January 31, 2016, the Company received aggregate proceeds of $125,000 from notes payable with the CEO of the Company. The notes bear interest at a rate of 4% per annum and matured on December 31, 2016. The notes were subsequently extended until January 2024. As of ~~April 30,~~July 31, 2019 and January 31, 2019, the outstanding principal balance of the notes was $109,844.

The Company received advances from the CEO of the Company which bear interest at 8%. The advances are due on January 2024. At ~~April 30,~~July 31, 2019 and January 31, 2019, there was $400,000 of principal outstanding.

The Company received advances from an entity 100% owned by the CEO of the Company, which bear interest at 8%. The advances are due on January 2024. At ~~April 30,~~July 31, 2019 and January 31, 2019, there was $132,000 of principal outstanding, respectively.

For the three months ended ~~April 30,~~July 31, 2019 and 2018, the Company recorded interest expense of ~~$10,888~~$11,881 and ~~$11,826,~~$19,601, respectively, related to the above related party notes payable. For the six months ended July 31, 2019 and 2018, the Company recorded interest expense of $22,769 and $32,687, respectively, related to the above related party notes payable. At ~~April 30,~~July 31, 2019 and January 31, 2019, there was ~~$2,473~~$2,485 and $48,141 of accrued interest on the above related party notes, respectively.

Note 6 - Loan and Security Agreement

M&T Bank

Effective, January 4, 2019, the Company also entered into a $2.5 million five-year note with M&T Bank at LIBOR plus four points with repayments in equal payments over 60 months. The new facility is supported by a first priority security interest in all of the Company’s business assets and is further subject to various affirmative and negative financial covenants and a limited Guaranty by the Company’s Chief Executive Officer, Carl Wolf. The Company recorded $89,321 as a debt discount and will be amortized over the remaining life of the note using the effective interest method. There was unamortized debt discount of ~~$78,311~~$72,961 and $85,599 as of ~~April 30,~~July 31, 2019 and January 31, 2019, respectively. The outstanding balance on the term loan was ~~$2,174,999~~$1,691,665 and $2,500,000 as of ~~April 30,~~July 31, 2019 and January 31, 2019, respectively.

F-14

Effective, January 4, 2019, the Company has arranged a new $3.5 million working capital line of credit with M&T Bank at LIBOR plus four points with a two-year expiration. The new facility is supported by a first priority security interest in all of the Company’s business assets and is further subject to various affirmative and negative financial covenants and a limited Guaranty by the Company’s Chief Executive Officer, Carl Wolf. Advances under the line of credit are limited to eighty percent (80%) of eligible accounts receivable (which is subject to an agreed limitation and is further subject to certain asset concentration provisions) and fifty percent (50%) of eligible inventory (which is subject to an agreed dollar limitation). All advances under the line of credit are due upon maturity. The outstanding balance on the line of credit was ~~$2,596,169~~$2,677,348 and $2,612,034 as of ~~April 30,~~July 31, 2019 and January 31, 2019, respectively.

Future maturities of all debt (excluding debt discount discussed above in Notes 5 and 6) are as follows:

For the Years Ending April 30,
For the Years Ending July 31,
2020	$	500,000	$	500,000
2021		3,096,172		3,177,351
2022		500,004		500,004
2023		500,004		191,658
2024		816,832		641,844
	$	5,413,012	$	5,010,857

~~NOTE 7. LEASES~~Note 7 - Leases

The Company determines if an arrangement contains a lease at inception. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. ROU assets and liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term.

The Company’s leases consist of leaseholds on office space, manufacturing space and machinery and equipment. The Company utilized a portfolio approach in determining the discount rate. The portfolio approach takes into consideration the range of the term, the range of the lease payments, the category of the underlying asset and the Company’s estimated incremental borrowing rate, which is derived from information available at the lease commencement date, in determining the present value of lease payments. The Company also considered its recent debt issuances as well as publicly available data for instruments with similar characteristics when calculating the incremental borrowing rates.

The lease term includes options to extend the lease when it is reasonably certain that the Company will exercise that option. These operating leases contain renewal options for periods ranging from three to five years that expire at various dates with no residual value guarantees. Future obligations relating to the exercise of renewal options is included in the measurement if, based on the judgment of management, the renewal option is reasonably certain to be exercised. Factors in determining whether an option is reasonably certain of exercise include, but are not limited to, the value of leasehold improvements, the value of the renewal rate compared to market rates, and the presence of factors that would cause a significant economic penalty to the Company if the option is not exercised. Management reasonably plans to exercise all options, and as such, all renewal options are included in the measurement of the right-of-use assets and operating lease liabilities.

Leases with a term of 12 months or less are not recorded on the balance sheet, per the election of the practical expedient noted above.

The Company recognizes lease expense for these leases on a straight-line basis over the lease term. The Company recognizes variable lease payments in the period in which the obligation for those payments is incurred. Variable lease payments that depend on an index or a rate are initially measured using the index or rate at the commencement date, otherwise variable lease payments are recognized in the period incurred.

F-15

The components of lease expense were as follows:

	Three Months Ended April 30, 2019		Six Months Ended July 31, 2019
Finance leases:
Depreciation of assets		16,567		47,009
Interest on lease liabilities		7,167		14,113
Operating leases		62,991		132,749
Short-term lease		2,087		5,566
Total net lease cost	$	88,812	$	199,437

Supplemental balance sheet information related to leases was as follows:

	April 30, 2019		July 31, 2019
Operating leases:
Operating lease ROU assets	$	1,589,172	$	1,556,873

Current operating lease liabilities, included in current liabilities	$	91,038	$	124,500
Noncurrent operating lease liabilities, included in long-term liabilities		1,498,941		1,432,372
Total operating lease liabilities	$	1,589,979	$	1,556,872

Finance leases:
Property and equipment, at cost	$	297,416	$	510,866
Accumulated depreciation		73,840		103,921
Property and equipment, net	$	223,576	$	406,945

Current obligations of finance leases, included in current portion of long-term debt	$	55,850	$	125,264
Finance leases, net of current obligations, included in long-term debt		200,449		313,946
Total finance lease liabilities	$	256,299	$	439,210

Supplemental cash flow and other information related to leases was as follows:

	Three Months Ended April 30, 2019		Six Months Ended July 31, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	807	$	42,958
Financing cash flows from finance leases		14,121		31,213

ROU assets obtained in exchange for lease liabilities:
Operating leases	$	1,599,830	$	1,599,830
Finance leases		54,163		254,166

Weighted average remaining lease term (in years):
Operating leases				9.0
Finance leases				3.9

Weighted average discount rate:
Operating leases				6.54	%
Finance leases				5.85	%

~~Weighted average remaining lease term (in years):~~F-16


~~Operating leases~~	~~9.7~~
~~Finance leases~~	~~3.2~~

~~Weighted average discount rate:~~
~~Operating leases~~	~~6.54~~	%
~~Finance leases~~	~~7.17~~	%

Total future minimum payments required under the lease obligations as of ~~April 30,~~July 31, 2019 are as follows:

Twelve Months Ending April 30,
Twelve Months Ending July 31,
2020	$	306,164		$	350,693
2021		307,166			354,728
2022		348,420			371,686
2023		228,331			268,175
2024		213,007			252,288
Thereafter		1,041,663			988,697
Total lease payments	$	2,444,751		$	2,586,867
Less: amounts representing interest		(608,887	)		(596,061	)
Total lease obligations	$	1,835,864		$	1,990,806

Note 9 - Concentrations

Revenues

During the ~~three~~six months ended ~~April 30,~~July 31, 2019, the Company earned revenues from three customers representing approximately ~~44%~~46%, ~~12%~~10% and 10% of gross sales. During the ~~three~~six months ended ~~April 30,~~July 31, 2018, the Company earned revenues from one customer representing approximately ~~55%~~52% of gross sales. As of ~~April 30,~~July 31, 2019, three customers represented approximately ~~45%, 14%~~38% 13% and ~~12%~~10% of total gross outstanding receivables, respectively. As of ~~April 30,~~July 31, 2018, this one customer represented approximately ~~60%~~49% of total gross outstanding receivables.

Note 10 - Stockholders’ Deficit

Common Stock

On June 1, 2019, the Company issued 125,000 shares of its common stock to a consultant for services to be rendered. At the date of grant, the shares had a fair value of $71,875 and is included in prepaid expenses on the unaudited condensed consolidated balance sheets. During the three and six months ended July 31, 2019, the Company recorded $6,845 of stock-based compensation related to these shares.

(A) Options

The following is a summary of the Company’s option activity:

Options Weighted
Average
Exercise Price
Outstanding – January 31, 2019 649,000 $ 0.77
Exercisable – January 31, 2019 521,500 $ 0.71
Granted 7,500 $ 0.74
Exercised - $ -
Forfeited/Cancelled - $ -
Outstanding – April 30, 2019 656,500 $ 0.77
Exercisable – April 30, 2019 556,500 $ 0.72
Options Outstanding Options Exercisable
Exercise
Price Number
Outstanding Weighted
Average
Remaining
Contractual
Life
(in years) Weighted
Average
Exercise Price Number
Exercisable Weighted
Average
Exercise Price

$ 0.39 – 1.38 656,000 2.62 $ 0.77 556,500 $ 0.72

	Options		Weighted Average Exercise Price
Outstanding – January 31, 2019		649,000	$	0.77
Exercisable – January 31, 2019		521,500	$	0.71
Granted		257,500	$	0.53
Exercised		-	$	-
Forfeited/Cancelled		-	$	-
Outstanding – July 31, 2019		906,500	$	0.70
Exercisable – July 31, 2019		581,500	$	0.73

		Options Outstanding						Options Exercisable
Exercise Price		Number Outstanding		Weighted Average Remaining Contractual Life (in years)		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price

$	0.39 – 1.38		906,500		3.09	$	0.70		581,500	$	0.73

F-17

At ~~April 30,~~July 31, 2019 the total intrinsic value of options outstanding and exercisable was ~~$76,187~~$16,000 and ~~$76,187,~~$16,000, respectively.

During the ~~three~~six months ended ~~April 30,~~July 31, 2019, the Company issued to 250,000 options to the members of the Board of Directors and an employee. The options have an exercise price of $0.52 per share, a term of 5 years, and 1-year vesting. The options have an aggregated fair value of approximately $85,625 that was calculated using the Black-Scholes option-pricing model based on the assumptions discussed above in Note 2.

During the six months ended July 31, 2018, 40,000 options were exercised by the option holders. The Company issued 40,000 shares of common stock as a result of this exercise and received proceeds of $40,000. No options were exercised during the ~~three~~six months ended ~~April 30,~~July 31, 2019.

For the ~~three~~six months ended ~~April 30,~~July 31, 2019 and 2018, the Company recognized share-based compensation related to options of an aggregate of ~~$17,257~~$23,098 and ~~$42,218,~~$79,163, respectively. At ~~April 30,~~July 31, 2019, unrecognized share-based compensation was ~~$13,708.~~$112,106.

(B) Warrants

The following is a summary of the Company’s warrant activity:

	Warrants		Weighted Average Exercise Price		Warrants			Weighted Average Exercise Price

Outstanding – January 31, 2019		6,245,331	$	1.04		6,245,331		$	1.04
Exercisable – January 31, 2019		6,245,331	$	1.04		6,245,331		$	1.04
Granted		-	$	-		-		$	-
Exercised		-	$	-		-		$	-
Forfeited/Cancelled		-	$	-		(174,667	)	$	-
Outstanding – April 30, 2019		6,245,331	$	1.04
Exercisable – April 30, 2019		6,245,331	$	1.04
Outstanding – July 31, 2019						6,070,664		$	1.03
Exercisable – July 31, 2019						6,070,664		$	1.03

Warrants Outstanding	Warrants Outstanding					Warrants Exercisable						Warrants Outstanding					Warrants Exercisable
Exercise Price	Exercise Price	Number Outstanding		Weighted Average Remaining Contractual Life (in years)		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price		Exercise Price	Number Outstanding		Weighted Average Remaining Contractual Life (in years)		Weighted Average Exercise Price		Number Exercisable		Weighted Average Exercise Price

$	0.68 – 2.50		6,245,331		1.58	$	1.04		6,245,331	$	1.04	0.67 – 2.50		6,070,664		1.37	$	1.03		6,070,664	$	1.03

At ~~April 30,~~July 31, 2019, the total intrinsic value of warrants outstanding and exercisable was ~~$86,320~~$0 and ~~$86,320,~~$0, respectively.

During the ~~three~~six months ended ~~April 30,~~July 31, 2019, no warrants were exercised by the warrant holders.

During the ~~three~~six months ended ~~April 30,~~July 31, 2018, ~~120,430~~467,496 warrants were exercised by the warrant holders on a cashless basis. The Company issued ~~30,556~~72,804 shares of common stock as a result of this exercise.

Note 11 - Commitments and Contingencies

Litigations, Claims and Assessments

From time to time, the Company may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of business. Litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm its business. The Company is currently not aware of any such legal proceedings or claims that they believe will have, individually or in the aggregate, a material adverse effect on its business, financial condition or operating results.

F-18

Licensing and Royalty Agreements

On March 1, 2010, the Company was assigned a Development and License agreement (the “Agreement”). Under the terms of the Agreement the Licensor shall develop for the Company a line of beef meatballs with sauce, turkey meatballs with sauce and other similar meats and sauces for commercial manufacture, distribution and sale (each a “Licensor Product” and collectively the “Licensor Products”). Licensor shall work with Licensee to develop Licensor Products that are acceptable to Licensee. Upon acceptance of a Licensor Product by Licensee, Licensor’s trade secret recipes, formulas methods and ingredients for the preparation and production of such Licensor Products (the “Recipes”) shall be subject to this Development and License Agreement.

The Exclusive Term began on January 1, 2009 (the “Effective Date”) and ends on the 50th anniversary of the Effective Date.

The Royalty Rate shall be: 6% of net sales up to $500,000 of net sales for each Agreement year; 4% of Net Sales from $500,000 up to $2,500,000 of Net Sales for each Agreement year; 2% of Net Sales from $2,500,000 up to $20,000,000 of Net Sales for each Agreement year; and 1% of Net Sales in excess of $20,000,000 of Net Sales for each Agreement year.

In order to continue the Exclusive term, the Company shall pay a minimum royalty with respect to the preceding Agreement year as follows:

Agreement Year	Minimum Royalty to be Paid with Respect to Such Agreement Year
1^stand 2^nd	$	-
3^rdand 4^th	$	50,000
5^th, 6^th and 7^th	$	75,000
8^thand 9^th	$	100,000
10^thand thereafter	$	125,000

The Company incurred ~~$116,466~~$104,380 and ~~$129,863~~$70,993 of royalty expenses for the three months ended ~~April 30,~~July 31, 2019 and 2018. The Company incurred $220,846 and $200,856 of royalty expenses for the six months ended July 31, 2019 and 2018. Royalty expenses are included in general and administrative expenses on the consolidated statement of operations.

Agreements with Placement Agents and Finders

The Company entered into a fourth Financial Advisory and Investment Banking Agreement with Spartan Capital Securities, LLC (“Spartan”) effective April 1, 2015 (the “Spartan Advisory Agreement”). Pursuant to the Spartan Advisory Agreement, the Company shall pay to Spartan a non-refundable monthly fee of $10,000 through October 1, 2015. The monthly fee shall survive any termination of the Agreement. Additionally, (i) if at least $4,000,000 is raised in the Financing, the Company shall pay to Spartan a non-refundable fee of $5,000 per month from November 1, 2015 through October 2017; and (ii) if at least $5,000,000 is raised in the Financing, the Company shall pay to Spartan a non-refundable fee of $5,000 per month from November 1, 2017 through October 2019. If $10,000,000 or more is raised in the Financing, the Company shall issue to Spartan shares of its common stock having an aggregate value of $5,000 (as determined by reference to the average volume weighted average trading price for the last five trading days of the immediately preceding month) on the first day of each month during the period from November 1, 2015 through October 1, 2019.

The Company, upon closing of the Financing, shall pay consideration to Spartan, in cash, a fee in an amount equal to 10% of the aggregate gross proceeds raised in the Financing and 3% of the aggregate gross proceeds raised in the Financing for expenses incurred by Spartan. The Company shall grant and deliver to Spartan at the closing of the Financing, for nominal consideration, five-year warrants to purchase a number of shares of the Company’s common stock equal to 10% of the number of shares of common stock (and/or shares of common stock issuable upon exercise of securities or upon conversion or exchange of convertible or exchangeable securities) sold at such closing. The warrants shall be exercisable at any time during the five-year period commencing on the closing to which they relate at an exercise price equal to the purchase price per share of common stock paid by investors in the Financing or, in the case of exercisable, convertible, or exchangeable securities, the exercise, conversion or exchange price thereof. If the Financing is consummated by means of more than one closing, Spartan shall be entitled to the fees provided herein with respect to each such closing.

If the Company enters into a change of control transaction during the term of the agreement through October 1, 2022, the Company shall pay to Spartan a fee equal to 3% of the consideration paid or received by the Company and/or its stockholders in such transaction.

Advisory Agreement

The Company entered into an Advisory Agreement with Spartan effective June 1, 2019 (the “Advisory Agreement”). Pursuant to the agreement, the Company shall pay to Spartan a non-refundable monthly fee of $5,000 over a 21-month period. Additionally, the Company granted Spartan 125,000 shares of common stock which are considered fully-paid and non-assessable upon execution of the agreement. During the term or this Agreement, the Consultant will provide non-exclusive consulting services related to general corporate matters, including, but not limited to (i) advice and input with respect to raising capital and potential M&A transactions, (ii) identifying suitable personal for management and Board positions (iii) developing corporate structure and finance strategies, (iv) assisting the Company with strategic introductions, (v) assisting management with enhancing corporate and shareholder value, and (vi) introducing the Company to potential investors (collectively, the “Advisory Services”).

F-19

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

THE FOLLOWING DISCUSSION OF OUR PLAN OF OPERATION AND RESULTS OF OPERATIONS SHOULD BE READ IN CONJUNCTION WITH THE FINANCIAL STATEMENTS AND RELATED NOTES TO THE FINANCIAL STATEMENTS INCLUDED ELSEWHERE IN THIS REPORT. THIS DISCUSSION CONTAINS FORWARD-LOOKING STATEMENTS THAT RELATE TO FUTURE EVENTS OR OUR FUTURE FINANCIAL PERFORMANCE. THESE STATEMENTS INVOLVE KNOWN AND UNKNOWN RISKS, UNCERTAINTIES AND OTHER FACTORS THAT MAY CAUSE OUR ACTUAL RESULTS, LEVELS OF ACTIVITY, PERFORMANCE OR ACHIEVEMENTS TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, LEVELS OF ACTIVITY, PERFORMANCE OR ACHIEVEMENTS EXPRESSED OR IMPLIED BY THESE FORWARD- LOOKING STATEMENTS. THESE RISKS AND OTHER FACTORS INCLUDE, AMONG OTHERS, THOSE LISTED UNDER “FORWARD-LOOKING STATEMENTS” AND “RISK FACTORS” DETAILED IN PRIOR COMPANY FILINGS AND THOSE INCLUDED ELSEWHERE IN THIS REPORT.

Results of Operations for the Three Months ended ~~April 30,~~July 31, 2019 and 2018

The following table sets forth the summary statements of operations for the three months ended ~~April 30,~~July 31, 2019 and 2018:

Three Months Ended
April 30, 2019 April 30, 2018
Sales - Net of Slotting Fees and Discounts $ 7,364,824 $ 7,741,994
Gross Profit $ 2,371,054 $ 2,828,546
Operating Expenses $ (1,891,488 ) $ (2,275,033 )
Other Expenses $ (123,900 ) $ (229,512 )
Net Income $ 355,666 $ 324,001

	Three Months Ended
	July 31, 2019			July 31, 2018
Sales - Net of Slotting Fees and Discounts	$	8,099,445		$	5,640,830
Gross Profit	$	2,691,396		$	2,061,990
Operating Expenses	$	(2,240,454	)	$	(1,932,164	)
Other Expenses	$	(92,634	)	$	(340,021	)
Net Income (Loss)	$	358,308		$	(210,195)

For the three months ended ~~April 30,~~July 31, 2019 and 2018, the Company reported a net income (loss) of ~~$355,666~~$358,308 and ~~$324,001,~~$(210,195), respectively. The change in net income between the three months ended ~~April 30,~~July 31, 2019 and 2018 was primarily attributable to increase gross profit, lower interest and amortization expenses in 2019.

Sales:Sales, net of slotting fees and discounts ~~decreased~~increased by approximately 5%44% to ~~$7,364,824~~$8,099,445 during the three months ended ~~April 30,~~July 31, 2019, from ~~$7,741,994~~$5,640,830 during the three months ended ~~April 30,~~July 31, 2018. ~~During the three months ended April 30, 2019, the Company did not participate in any major merchandising events versus the prior year which resulted in the~~Sales increased from sales decrease. Also in the prior year period there was 13 ship weeks and in this year, there was 12. Management estimates that this effected sales by about $500,000 during the three months ended April 30, 2019.with existing customer s as well as new customers.

Gross Profit:The gross profit margin was ~~32%~~33% for the three months ended ~~April 30,~~July 31, 2019 compared to 37% for the three months ended ~~April 30,~~July 31, 2018. During the three months ended ~~April 30,~~July 31, 2019, cost of sales included an increase in depreciation expense of approximately ~~$179,000 (representing~~$187,800 (thereby reducing gross margin by approximately ~~3% of sales)~~2%) related to the significant plant capacity additions during the last 12 months. Gross margin also decreased slightly due to a change in product ~~mix~~mix. In future periods the Company expects sales to increase from the current quarter level which should increase gross profit margin as plant efficiencies should take effect.

Operating Expenses:Operating expenses increased by 16% during the three months ended July 31, 2019, as compared to the three months ended July 31, 2018. Operating expenses decreased as a percentage of sales from 34% in 2018 to 28% in 2019. The increase in total operating expenses is primarily attributable to the following approximate increases in operating expenses:

●	Postage and freight of $298,226 due to higher charges from freight carriers and higher volume;

●	Professional fees of $87,643 due to additional business and sales consulting;

●	Other general and administrative of $71,143;

●	Commission expense of $56,310 due to increased sales with existing clients as well as the addition of new clients; and

●	Royalty fees of $33,887.

These expense increases were offset by decreases in the following as well as minimal decreases in other expense categories:

●	Stock-based compensation for services rendered by employees and consultants decreased by $24,259 compared to the prior period; and

●	Trade show and travel expenses of $20,101 related to a change in the timing of shows.

Other Expense: Other expenses decreased by $247,387 to $92,634 for the three months ended July 31, 2019 as compared to $340,021 during the three months ended July 31, 2018. For three months ended July 31, 2019, other expenses consisted of $87,284 in interest expense incurred on the Company’s financing arrangements. In addition, the Company recorded $5,350 of amortization expense related to the debt discount. For the three months ended July 31, 2018, other expenses consisted of $291,441 in interest expense incurred on the Company’s finance arrangements. In addition, the Company recorded $48,580 of amortization expense related to the debt discount and ~~lower~~finance arrangements.

Results of Operations for the Six Months ended July 31, 2019 and 2018

The following table sets forth the summary statements of operations for the six months ended July 31, 2019 and 2018:

	Six Months Ended
	July 31, 2019			July 31, 2018
Sales - Net of Slotting Fees and Discounts	$	15,464,269		$	13,382,824
Gross Profit	$	5,062,450		$	4,890,536
Operating Expenses	$	(4,131,942	)	$	(4,207,197	)
Other Expenses	$	(216,534	)	$	(569,533	)
Net Income	$	713,974		$	113,806

For the six months ended July 31, 2019 and 2018, the Company reported a net income of $713,974 and $113,806, respectively. The change in net income between the six months ended July 31, 2019 and 2018 was primarily attributable to an increase in sales of 16% in addition to a decrease in expenses.

Sales:Sales, net of slotting fees and discounts increased by approximately 16% to $15,464,269 during the six months ended July 31, 2019, from $13,382,824 during the six months ended July 31, 2018. In addition, during the six months ended July 31, 2019, the Company was able to increase its sales through new customers as well as its existing customer base.

Gross Profit:The gross profit margin was 33% for the six months ended July 31, 2019 compared to 37% for the six months ended July 31, 2018. During the six months ended July 31, 2019, cost of sales included an increase in depreciation expense of approximately $367,000 (thereby reducing gross margin by approximately 2%) related to the significant plant ~~efficiencies.~~capacity additions during the last 12 months. Gross margin also decreased slightly due to a change in product mix. In future periods the Company expects sales to increase from the current quarter level which should increase gross profit margin as plant efficiencies should take effect.

Operating Expenses:Operating expenses decreased by ~~17%~~2% during the ~~three~~six months ended ~~April 30,~~July 31, 2019, as compared to the ~~three~~six months ended ~~April 30,~~July 31, 2018. Operating expenses decreased as a percentage of sales from 31% in 2018 to 27% in 2019. The ~~change~~$75,255 decrease in total operating expenses is primarily attributable to the following approximate ~~decreases~~increases in operating expenses:

●	Postage and freight of $297,862 due to higher charges from freight carriers and increased sales;

●	Professional fees of $78,470 due to additional business and sales consulting;

●	Other general and administrative of $49,168; and

●	Commission expense of $41,906 due to increased sales with existing clients as well as the addition of new clients.

These expense increases were offset by decreases in the following as well as minimal decreases in other expense categories:

●	Advertising ~~social media~~ and ~~promotional~~promotion of 149,388 due to reduced merchandising expenses ~~of $172,335 related to a change in customer mix~~with customers; and ~~lower demo merchandising expenses.~~

●	Stock-based compensation for services rendered by employees and consultants decreased by ~~$24,961~~$49,220 compared to the prior ~~year; and~~period.

Other Expense:Other expenses decreased by ~~$105,612~~$352,999 to ~~$123,900~~$216,534 for the ~~three~~six months ended ~~April 30,~~July 31, 2019 as compared to ~~$229,512~~$569,533 during the ~~three~~six months ended ~~April 30,~~July 31, 2018. For ~~three~~six months ended ~~April 30,~~July 31, 2019, other expenses consisted of ~~$116,612~~$203,896 in interest expense incurred on the Company’s financing arrangements. In addition, the Company recorded ~~$7,288~~$12,638 of amortization expense related to the debt discount. For the ~~three~~six months ended ~~April 30,~~July 31, 2018, other expenses consisted of ~~$188,141~~$479,582 in interest expense incurred on the Company’s finance arrangements. In addition, during the six months ended July 31, 2018, the Company recorded ~~$41,371~~$89,951 of amortization expense related to the debt discount and finance arrangements. During the six months ended July 31, 2018, the Company also incurred non-recurring interest charges of approximately $112,500 in relation to the extension of the Manatuck note and the corresponding accounting for debt modification which resulted in additional interest expense, finance charges and the write-off of debt discount related to prior debt.

Liquidity and Capital Resources

The following table summarizes total current assets, liabilities and working capital at ~~April 30,~~July 31, 2019 compared to January 31, 2019:

April 30, 2019 January 31, 2019 Increase/(Decrease)
Current Assets $ 4,735,834 $ 4,859,549 $ (123,715 )
Current Liabilities $ 3,621,409 $ 3,615,662 $ 5,747
Working Capital (Deficit) $ 1,114,425 $ 1,243,887 $ (129,462 )

	July 31, 2019		January 31, 2019		Increase/(Decrease)
Current Assets	$	5,190,929	$	4,859,549	$	331,380
Current Liabilities	$	3,789,491	$	3,615,662	$	173,829
Working Capital	$	1,401,438	$	1,243,887	$	157,551

As of ~~April 30,~~July 31, 2019, we had working capital of ~~$1,114,425~~$1,401,438 as compared to a working capital ~~deficit~~ of $1,243,887 as of January 31, 2019, ~~a decrease~~an increase of ~~$129,462.~~$157,551. The ~~decrease~~increase in working capital ~~deficit~~ is primarily attributable to an increase in cash balances of ~~approximately $77,100,~~$25,818, an increase in inventories of ~~$63,600,~~$68,524, an increase in accounts receivable of $12,770 and an increase in prepaid expenses of ~~approximately $98,700 and a decrease~~$224,268. These amounts were offset by an increase in accounts payable and accrued expenses of ~~approximately $87,400. These amounts were offset by~~$3,503 and a ~~decrease in accounts receivable of $363,000 and an approximate $93,200~~$170,326 increase in the current portion of ~~debt.~~lease obligations.

Net cash provided by operating activities for the ~~three~~six months ended ~~April 30,~~July 31, 2019 and 2018 was ~~$674,903~~$889,577 and ~~$138,898,~~$1,440,447, respectively. The net income for the ~~three~~six months ended ~~April 30,~~July 31, 2019 and 2018 was ~~$355,666~~$709,974 and ~~$324,001,~~$113,806, respectively.

Net cash used in all investing activities for the ~~three~~six months ended ~~April 30,~~July 31, 2019 was ~~$242,820~~$89,525 as compared to ~~$420,220~~$903,959 for the ~~three~~six months ended ~~April 30,~~July 31, 2018, respectively, to acquire new machinery and equipment and leasehold improvements. Our capital expenditures are attributed to a Plant Expansion Project in progress since mid-2017 to expand plant capacity and efficiency to meet growing demand.

Net cash used by all financing activities for the ~~three~~six months ended ~~April 30,~~July 31, 2019 was ~~$354,987~~$774,234 as compared to ~~$179,110~~$770,778 provided by financing activities for the ~~three~~six months ended ~~April 30,~~July 31, 2018. During the ~~three~~six months ended ~~April 30,~~July 31, 2019, the Company made net ~~repayments of~~borrowings on the line of credit of ~~$15,865,~~$65,314. These cash in-flows were offset by payments of term loan of ~~$325,001~~$808,335 and ~~$14,121~~$31,213 paid for capital lease payments. During the ~~three~~six months ended ~~April 30,~~July 31, 2018, the Company had net borrowings ~~increase~~decrease of ~~$480,495~~$708,909 for transactions pursuant to the line of credit in addition to proceeds of $40,000 received from the exercise of ~~options.~~options proceeds of $213,250 from a capital leaseback transaction and proceeds of $300,000 from term loan. These cash in-flows were offset by ~~$41,385~~$95,270 and ~~$300,000~~$500,000 paid for repayments on a term loan and net payments of the note payable to Manatuck Hill Partners, respectively.

As reflected in the accompanying condensed consolidated financial statements, the Company has a net income and net cash provided by operations of ~~$355,666~~$713,974 and ~~$674,903,~~$1,060,409, respectively, for the ~~three~~six months ended ~~April 30,~~July 31, 2019.

Although the expected revenue growth and control of expenses leads management to believe that it is probable that the Company’s cash resources will be sufficient to meet our cash requirements through the fiscal year ending January 31, 2020, the Company may require additional funding to finance the growth of its current and expected future operations as well as to achieve its strategic objectives. table to the Company, if at all. In that event, the Company would be required to change its growth strategy and seek funding on that basis, though there is no guarantee it will be able to do so.

Recent Accounting Pronouncements

Critical Accounting Policies

Our condensed consolidated financial statements and related public financial information are based on the application of accounting principles generally accepted in the United States (“GAAP”). GAAP requires the use of estimates; assumptions, judgments and subjective interpretations of accounting principles that have an impact on the assets, liabilities, revenues and expense amounts reported. These estimates can also affect supplemental information contained in our external disclosures including information regarding contingencies, risk and financial condition. We believe our use of estimates and underlying accounting assumptions adhere to GAAP and are consistently and conservatively applied. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ materially from these estimates under different assumptions or conditions. We continue to monitor significant estimates made during the preparation of our financial statements.

Our significant accounting policies are summarized in Note 2 of our condensed consolidated financial statements.

Other than the adoption of FASB ASU 2016-02,“Leases” (Topic 842), there have been no material changes to our critical accounting policies and estimates from the information provided in Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” included in our January 31, 2019 Annual Report.

Off Balance Sheet Arrangements:

We do not have any off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons, also known as “special purpose entities” (SPEs).

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We do not hold any derivative instruments and do not engage in any hedging activities.

Item 4. Controls and Procedures

(a) Evaluation of Disclosure Controls and Procedures

Based on evaluation as of the end of the period covered by this Form 10-Q, our principal executive officer and principal financial officer have concluded that our disclosure controls and procedures (as defined in Rules 13a-15(c) and 15d-15(e) under the Exchange Act) are effective to ensure that information required to be disclosed by us in report that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the U.S. Securities and Exchange Commission’s rules and forms and to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our chief executive officer and chief financial officer, as appropriate to allow timely decisions regarding required disclosure.

(b) Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act, during our most recently completed fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings.

We are currently not involved in any litigation that we believe could have a material adverse effect on our financial condition or results of operations. There is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our company or any of our subsidiaries, threatened against or affecting our company, our common stock, any of our subsidiaries or of our companies or our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect.

Item 1A. Risk Factors.

Smaller reporting companies are not required to provide the information required by this item.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

During the period between ~~February~~May 1, 2019 and ~~June 14,~~September 9, 2019 the Company ~~did not issue any~~issued 125,000 shares of its Common ~~Stock.~~Stock to a consultant as compensation for financial advisory services.

Item 3. Defaults upon Senior Securities.

There has been no default in payment of principal, interest, sinking or purchase fund installment, or any other material default, with respect to any indebtedness of the Company.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

There is no other information required to be disclosed under this item which was not previously disclosed.

Item 6. Exhibits.

Exhibit No.		Description

31.1		Certification of Principal Executive Officer, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 302 of 2002*

31.2		Certification of Principal Financial Officer, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 302 of 2002*

32.1		Certification of Principal Executive Officer, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*

32.2		Certification of Principal Financial Officer, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*

101.INS		XBRL Instance Document**
101.SCH		XBRL Taxonomy Extension Schema Document**
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document**
101.DEF		XBRL Taxonomy Extension Definition Linkbase Document**
101.LAB		XBRL Taxonomy Extension Label Linkbase Document**
101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document**

* Filed herewith.

** Furnished herewith.

SIGNATURES

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

	MAMAMANCINI’S HOLDINGS, INC.

Date: ~~June 14,~~September 12, 2019	By:	/s/ Carl Wolf
	Name:	Carl Wolf
	Title:	Chief Executive Officer
		(Principal Executive Officer)