MAMA 10-Q
Mama's Creations, Inc. (MAMA)
10-Q
2026-09-03
For: 2026-07-31
View Original
Added on
September 03, 2026
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarter ended: July 31, 2026
OR
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the Transition Period from ___________ to ____________
Commission File Number: 001-40597
(Exact name of Registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (IRS Employer ID No.) | ||||
(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 | Name of Each Exchange on which registered | ||||||||||||
The | ||||||||||||||
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 o
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files. Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act:
| Large accelerated filer | o | x | |||||||||
| Non-accelerated filer | o | Smaller reporting company | |||||||||
| Emerging Growth Company | |||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x
As of September 2, 2026, there were 47,147,469 shares of the registrant’s common stock outstanding.
TABLE OF CONTENTS
| Page | ||||||||
| Item 5. | ||||||||
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
1
Mama’s Creations, Inc.
Condensed Consolidated Balance Sheets
(In thousands, except share and per share data)
| July 31, 2026 | January 31, 2026 | ||||||||||
| (Unaudited) | |||||||||||
| Assets: | |||||||||||
| Current Assets: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Accounts receivable, net | |||||||||||
| Inventories, net | |||||||||||
| Prepaid expenses and other current assets | |||||||||||
| Total Current Assets | |||||||||||
| Property, plant, and equipment, net | |||||||||||
| Intangible assets, net | |||||||||||
| Goodwill | |||||||||||
| Operating lease right of use assets, net | |||||||||||
| Deposits | |||||||||||
| Total Assets | $ | $ | |||||||||
| Liabilities and Stockholders’ Equity: | |||||||||||
| Liabilities: | |||||||||||
| Current Liabilities: | |||||||||||
| Accounts payable and accrued expenses | $ | $ | |||||||||
Term loan, net of unamortized debt discount of $ | |||||||||||
| Operating lease liabilities | |||||||||||
| Finance leases payable | |||||||||||
| Total Current Liabilities | |||||||||||
| Term loan – net of current | |||||||||||
| Operating lease liabilities – net of current | |||||||||||
| Deferred tax liability | |||||||||||
| Finance leases payable – net of current | |||||||||||
| Total long-term liabilities | |||||||||||
| Total Liabilities | |||||||||||
| Commitments and contingencies (Notes 10 and 11) | |||||||||||
| Stockholders’ Equity: | |||||||||||
Series A Preferred stock, $ | |||||||||||
Series B Preferred stock, $ | |||||||||||
Preferred stock, $ | |||||||||||
Common stock, $ | |||||||||||
| Additional paid-in capital | |||||||||||
| Retained earnings | |||||||||||
Less: Treasury stock, | ( | ( | |||||||||
| Total Stockholders’ Equity | |||||||||||
| Total Liabilities and Stockholders’ Equity | $ | $ | |||||||||
See accompanying notes to the unaudited Condensed Consolidated Financial Statements.
2
Mama’s Creations, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
(in thousands, except per share data)
| For the Three Months Ended July 31, | For the Six Months Ended July 31, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Net sales | $ | $ | $ | $ | |||||||||||||||||||
| Costs of sales | |||||||||||||||||||||||
| Gross profit | |||||||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Research and development | |||||||||||||||||||||||
| Selling, general and administrative expenses | |||||||||||||||||||||||
| Total operating expenses | |||||||||||||||||||||||
| Income from operations | |||||||||||||||||||||||
| Other income (expenses) | |||||||||||||||||||||||
| Interest expense | ( | ( | ( | ( | |||||||||||||||||||
| Interest income | |||||||||||||||||||||||
| Amortization of debt discount | ( | ( | ( | ( | |||||||||||||||||||
| Total other income (expenses) | ( | ( | |||||||||||||||||||||
| Net income before income tax provision | |||||||||||||||||||||||
| Income tax expense | ( | ( | ( | ( | |||||||||||||||||||
| Net income | $ | $ | $ | $ | |||||||||||||||||||
| Net income per common share | |||||||||||||||||||||||
| – basic | $ | $ | $ | $ | |||||||||||||||||||
| – diluted | $ | $ | $ | $ | |||||||||||||||||||
| Weighted average common shares outstanding | |||||||||||||||||||||||
| – basic | |||||||||||||||||||||||
| – diluted | |||||||||||||||||||||||
See accompanying notes to the unaudited Condensed Consolidated Financial Statements.
3
Mama’s Creations, Inc.
Condensed Consolidated Statements of Changes in Stockholders’ Equity
(Unaudited)
(in thousands)
For the Period from February 1, 2026 through July 31, 2026
| Series A Preferred Stock | Series B Preferred Stock | Common Stock | Treasury Stock | Additional Paid-in | Retained | Stockholders’ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Capital | Earnings | Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance, February 1, 2026 | $ | $ | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Issuance of common stock for employee compensation | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income | - | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance, April 30, 2026 | $ | $ | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Exercise of stock options | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net proceeds from issuance of common stock | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income | - | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance, July 31, 2026 | ( | ( | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
4
For the Period from February 1, 2025 through July 31, 2025
| Series A Preferred Stock | Series B Preferred Stock | Common Stock | Treasury Stock | Additional Paid-in | Retained | Stockholders’ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Capital | Earnings | Equity | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance, February 1, 2025 | $ | $ | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income | - | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance, April 30, 2025 | $ | $ | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Stock-based compensation | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Exercise of stock options | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Payment of related party debt | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Net income | - | - | - | - | - | - | - | - | - | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Balance, July 31, 2025 | $ | $ | $ | $ | $ | $ | $ | ( | $ | ( | $ | $ | $ | ||||||||||||||||||||||||||||||||||||||||||||||||||||
See accompanying notes to the unaudited Condensed Consolidated Financial Statements.
5
Mama’s Creations, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(in thousands)
See accompanying notes to the unaudited Condensed Consolidated Financial Statements.
| For the Six Months Ended July 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES: | |||||||||||
| Net income | $ | $ | |||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation | |||||||||||
| Amortization of debt discount | |||||||||||
| Amortization of right of use assets | |||||||||||
| Amortization of intangibles | |||||||||||
| Stock-based compensation | |||||||||||
| Change in deferred tax asset | ( | ( | |||||||||
| Changes in operating assets and liabilities, net of acquisition: | |||||||||||
| Accounts receivable | |||||||||||
| Inventories | ( | ( | |||||||||
| Prepaid expenses and other current assets | |||||||||||
| Accounts payable and accrued expenses | ( | ||||||||||
| Operating lease liability | ( | ( | |||||||||
| Net Cash Provided by Operating Activities | |||||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES: | |||||||||||
| Purchase of fixed assets | ( | ( | |||||||||
| Net Cash Used in Investing Activities | ( | ( | |||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES: | |||||||||||
| Repayment of debt | ( | ( | |||||||||
| Net proceeds from issuance of common stock | |||||||||||
| Repayment of finance lease obligations | ( | ( | |||||||||
| Proceeds from exercise of stock options | |||||||||||
| Net Cash Provided by (Used in) Financing Activities | ( | ||||||||||
| Net Increase in Cash | |||||||||||
| Cash and cash equivalents at beginning of period | |||||||||||
| Cash and cash equivalents at end of period | $ | $ | |||||||||
| SUPPLEMENTARY CASH FLOW INFORMATION: | |||||||||||
| Cash paid during the period for: | |||||||||||
| Income taxes | $ | $ | |||||||||
| Interest | $ | $ | |||||||||
| SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | |||||||||||
| Right-of-use asset and lease liability recognized | $ | $ | |||||||||
| Payment of related party debt | $ | $ | |||||||||
| Write-off of right-of-use asset | $ | $ | |||||||||
| Issuance of common stock for employee compensation | $ | $ | |||||||||
| Receipt of fixed assets for deposits previously paid | $ | $ | |||||||||
6
Mama’s Creations, Inc.
Notes to Condensed Consolidated Financial Statements (Unaudited)
July 31, 2026
Note 1 - Nature of Operations and Basis of Presentation
Nature of Operations
Mama's Creations, Inc. (together with its subsidiaries, the “Company”), (formerly known as MamaMancini's Holdings, Inc. and Mascot Properties, Inc.) was organized on July 22, 2009 as a Nevada corporation. The Company has a fiscal year-end of January 31.
Our subsidiary, MamaMancini’s Inc. (“MamaMancinis”), is a marketer, manufacturer and distributor of meatballs with sauce, grilled, roasted and breaded chicken, sausage and peppers, and other similar meats and sauces. In addition, the Company continues to diversify its product line by introducing new products such as ready-to-heat meals, single-portion pasta and rice bowls, bulk deli, and packaged refrigerated protein products. MamaMancini's products feature many all-natural meals that were submitted to the United States Department of Agriculture (the “USDA”) and approved as all-natural. The USDA defines "all-natural" as a product that contains no artificial ingredients, coloring ingredients or chemical preservatives and is minimally processed.
Our subsidiary, T&L Acquisition Corp., is a premier gourmet food manufacturer based in New York. T&L Acquisition Corp. does business as T&L Creative Salads (“T&L”) and Olive Branch (“OB”) and offers a full line of foods for retail food chains and club stores, delis, bagel stores, caterers and provision distributors. Our Creative Salads brand uses high-quality meats, seafood and vegetables, prepared to meet the standards set forth by the USDA and the Food and Drug Administration ("FDA"). Our Olive Branch brand concentrates on selling olives, olive mixes, and savory products to large retail customers, primarily in pre-packaged containers.
Our subsidiary, Crown 1 Foods, Inc. ("Crown"), based in New York, is a full-service food manufacturer of value-added proteins and premium ready-to-heat meals. Crown focuses on claims-driven protein solutions, including distinctive cuts. Crown also is USDA and Safe Quality Food ("SQF") certified and specializes in artisanal vegetable and grain sides and center plate offerings in bulk as well as single-serve solutions.
Note 2 - Summary of Significant Accounting Policies
Basis of Presentation
The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The Company's financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information. In the opinion of management, all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation have been included. The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that impact the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The results of operations for any interim period are not necessarily indicative of results for the full year.
The accompanying unaudited Condensed Consolidated Financial Statements of the Company have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the "SEC"), including the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in the Company's Consolidated Financial Statements in an annual report on Form 10-K have been condensed or omitted. The Condensed Consolidated Balance Sheet as of January 31, 2026 has been derived from the audited Consolidated Financial Statements as of that date, but does not include all disclosures required for audited annual financial statements. For further information, please refer to and read these interim unaudited Condensed Consolidated Financial Statements in conjunction with the Company's audited Consolidated Financial Statements included in the Company's annual report on Form 10-K for the fiscal year ended January 31, 2026.
Use of Estimates
The preparation of the Condensed Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the Condensed Consolidated Financial Statements and accompanying notes. Such estimates and assumptions impact, among other items, the following: allowance for credit
7
losses, the fair value of stock-based compensation, inventory reserves, impairment of goodwill and intangible assets, and estimates for unrealized returns, discounts, and other variable considerations that are netted against revenue.
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 Condensed 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.
Risks and Uncertainties
The Company operates in an industry that is subject to intense competition and changes in consumer demand. The Company’s operations are subject to significant risks and uncertainties including financial and operational risks and 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 food 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 and Cash Equivalents
The Company considers all highly liquid instruments purchased with an original maturity of three months or less to be cash equivalents. Cash equivalents are carried at amortized cost, which approximates fair value due to their short-term nature. The majority of the Company’s cash and cash equivalents are held at one financial institution, which at July 31, 2026, exceeded insured amounts by approximately $137.6 million. The Company believes it mitigates such risk by having the cash and cash equivalents held by a major financial institution.
Accounts Receivable and Allowance for Credit Losses
Inventories
Inventories by major category are as follows (in thousands):
| July 31, 2026 | January 31, 2026 | ||||||||||
| Raw materials and packaging | $ | $ | |||||||||
| Work in process | |||||||||||
| Finished goods | |||||||||||
| Total | $ | $ | |||||||||
8
Property, Plant and Equipment
Property, plant, and equipment are recorded at cost net of accumulated depreciation. Depreciation expense is computed using the straight-line method over the estimated useful lives of the assets.
Asset lives for financial statement reporting of depreciation expense are:
| Machinery and equipment | |||||
| Furniture and fixtures | |||||
| Leasehold improvements | * | ||||
(*)Amortized on a straight-line basis over the term of the lease or the estimated useful lives, whichever period is shorter.
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.
The Company reviews the recoverability of property, plant and equipment when circumstances indicate that the carrying value of an asset or asset class may not be recoverable. Indicators of impairment could include, among other factors, significant changes in the business environment, the planned closure of a facility, or deterioration in operating cash flows. Considerable management judgment is necessary to evaluate the impact of operating changes and to estimate future cash flows. Expenditures for repairs and maintenance that do not substantially improve or extend the useful life of an asset are expensed as incurred.
Goodwill and Other Intangible Assets
Goodwill
Goodwill represents the excess of the purchase price over the fair values of the underlying net assets of an acquired business. The Company tests goodwill for impairment on an annual basis during the fourth quarter of its fiscal year, or immediately, if conditions indicate that an impairment could exist. The Company evaluates qualitative factors to determine if it is more likely than not that the fair value is less than the carrying value and whether it is necessary to perform goodwill impairment testing.
As of July 31, 2026 and July 31, 2025, there were no
Other Intangible Assets
Other intangible assets consist of trademarks, trade names and customer relationships. Intangible asset lives for financial statement reporting of amortization are:
| Tradenames and trademarks | |||||
| Customer relationships | |||||
Fair Value of Financial Instruments
Fair value is an exit price, representing the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability.
The carrying values of the Company’s short-term financial instruments, such as cash and cash equivalents, accounts receivable, and accounts payable, approximate fair value due to the immediate or short-term maturity of these instruments.
The interest rate on the Company’s line of credit and notes payable has a variable component, which is reflective of the market for such instruments at any given date, and as such the carrying value of the debt approximates its fair value.
Assets and liabilities recorded at fair value are measured using the fair value hierarchy, which prioritizes the inputs used in measuring fair value. The levels of the fair value hierarchy are:
Level 1: observable inputs such as quoted prices in active markets;
9
Level 2: inputs other than quoted prices in active markets that are either directly or indirectly observable; and
Level 3: unobservable inputs for which little or no market data exists, therefore requiring the Company to develop its own assumptions.
Research and Development
Revenue Recognition
The Company recognizes revenue in accordance with Financial Accounting Standards Board ("FASB") Topic 606, Revenue from Contracts with Customers (Topic 606).
The Company’s sales are primarily generated from the sale of finished products to customers. Revenue is recognized when the performance obligation is satisfied, and the promised goods have been transferred. Control transfers when the product is shipped or delivered based upon applicable shipping terms. For each contract, the Company considers the transfer of product to be the performance obligation. Although some payment terms may be extended, generally the Company’s payment terms are approximately 10 -30 days. Accordingly, there are no significant financing components to consider when determining the transaction price. The Company elected to treat shipping and handling activities as fulfillment activities, and the related costs are recorded as selling expenses in selling, general and administrative expenses on the Condensed Consolidated Statements of Operations.
The Company promotes its products with trade incentives and promotions. These programs include discounts, slotting fees, coupons, rebates, in-store display incentives and volume-based incentives. The trade incentives and promotions are recorded as a reduction to the transaction price based on amounts estimated as being due to customers at the end of the period. The Company derives these estimates based on historical experience. The Company does not receive a distinct service in relation to the trade incentives and promotions. The Company’s contracts are all short-term in nature; therefore, there are no
10
Reductions in the transaction price attributable to items such as slotting fees, sales discounts, and allowances are accounted for as a direct reduction of revenues as follows (in thousands):
| For the Three Months Ended | |||||||||||
| July 31, 2026 | July 31, 2025 | ||||||||||
| Gross Sales | $ | $ | |||||||||
| Less: Trade Incentives and Promotions | |||||||||||
| Net Sales | $ | $ | |||||||||
| For the Six Months Ended | |||||||||||
| July 31, 2026 | July 31, 2025 | ||||||||||
| Gross Sales | $ | $ | |||||||||
| Less: Trade Incentives and Promotions | |||||||||||
| Net Sales | $ | $ | |||||||||
Disaggregation of Revenue from Contracts with Customers. The following table disaggregates gross revenue by significant geographic area for the three and six months ended July 31, 2026 and 2025 (in thousands):
| For the Three Months Ended | |||||||||||
| July 31, 2026 | July 31, 2025 | ||||||||||
| Northeast | $ | $ | |||||||||
| Southeast | |||||||||||
| Midwest | |||||||||||
| West | |||||||||||
| Total gross sales | $ | $ | |||||||||
| For the Six Months Ended | |||||||||||
| July 31, 2026 | July 31, 2025 | ||||||||||
| Northeast | $ | $ | |||||||||
| Southeast | |||||||||||
| Midwest | |||||||||||
| West | |||||||||||
| Total gross sales | $ | $ | |||||||||
Costs of Sales
Costs of sales represents costs directly related to the production and manufacturing of the Company’s products.
Advertising
Stock-Based Compensation
The Company provides compensation benefits in the form of performance stock units, restricted stock units, stock options, and warrants. The cost of the stock-based compensation is recorded at fair value on the date of grant and expensed in the Condensed Consolidated Statements of Operations over the requisite service period.
11
The Company has granted performance awards in the form of Performance Stock Units ("PSUs") to certain employees. Each PSU award entitles the participant to earn shares of common stock upon the attainment of certain market conditions and/or certain performance goals over the applicable performance period. The recognition of the compensation expense for the performance stock awards is based upon the probable outcome of the market condition and/or performance conditions and is based on the fair value of the award on the date of grant. To determine the value of PSUs with market conditions for stock-based compensation purposes, the Company used a Monte Carlo simulation valuation model. Forfeitures are recognized when they occur. The Company's performance against the defined goals is reevaluated on a quarterly basis throughout the performance period, and the recognition of the compensation expense is adjusted for subsequent changes in the estimated or actual outcome.
The Company values stock options and warrants using the Black-Scholes option pricing model. Grants of stock-based payment awards issued to non-employees for services rendered have been recorded at the fair value of the stock-based payment, which is the more readily determinable value. The grants are amortized on a straight-line basis over the requisite service period, 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.
The Company has granted restricted stock units ("RSUs") that entitle the participant to earn shares of common stock as long as they continuously provide service to the Company through a given date. The Company values RSUs by multiplying the number of underlying shares of common stock by the closing stock price on the date of the grant, and the related expense is recognized ratably over the vesting period of the awards. 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.
Earnings Per Share
Basic net income per share attributable to common stockholders excludes dilution and is computed by dividing net income during the period by the weighted average number of common shares outstanding during the period. Diluted net income per share reflects potential dilution and is computed by dividing net income attributable to common stockholders by the weighted average number of common shares outstanding during the period, which is increased by the number of additional common shares that would have been outstanding if the potential common shares had been issued. However, if the effect of any additional securities is anti-dilutive (i.e., resulting in a higher net income per share or lower net loss per share), they are excluded from the dilutive net income computation. The dilutive effect of stock options, warrants, and restricted stock is calculated using the treasury stock method.
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The following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income per common share (in thousands, except per share data):
| For the Three Months Ended | |||||||||||
| July 31, 2026 | July 31, 2025 | ||||||||||
| Numerator: | |||||||||||
| Net income | $ | $ | |||||||||
| Effect of dilutive securities: | |||||||||||
| Diluted net income | |||||||||||
| Denominator: | |||||||||||
| Weighted average common shares outstanding – basic | |||||||||||
| Dilutive securities (a): | |||||||||||
| Restricted stock | |||||||||||
| Performance stock units | |||||||||||
| Options | |||||||||||
| Weighted average common shares outstanding and assumed conversion – diluted | |||||||||||
| Basic net income per common share | $ | $ | |||||||||
| Diluted net income per common share | $ | $ | |||||||||
| (a) – Anti-dilutive securities excluded | |||||||||||
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| For the Six Months Ended | |||||||||||
| July 31, 2026 | July 31, 2025 | ||||||||||
| Numerator: | |||||||||||
| Net income attributable to common stockholders | |||||||||||
| Effect of dilutive securities: | |||||||||||
| Diluted net income | $ | $ | |||||||||
| Denominator: | |||||||||||
| Weighted average common shares outstanding – basic | |||||||||||
| Dilutive securities (a): | |||||||||||
| Restricted stock | |||||||||||
| Options | |||||||||||
| Performance stock awards | |||||||||||
| Weighted average common shares outstanding and assumed conversion – diluted | |||||||||||
| Basic net income per common share | $ | $ | |||||||||
| Diluted net income per common share | $ | $ | |||||||||
| (a) – Anti-dilutive securities excluded | |||||||||||
As of July 31, 2026, the Company has approximately 1.7 million performance share units outstanding that are contingently issuable upon achievement of specific performance targets. Because the performance conditions were not met as of the reporting date, these shares were excluded from the calculation of diluted net income per common share.
Income Taxes
The Company’s provision for income tax is comprised of current and deferred income taxes.
Current income taxes are recognized for the estimated taxes payable or refundable for the current fiscal period and are based on the taxable income for the current fiscal period, including adjustments for unrealized tax benefits, changes in tax receivables (payables) that arose in a prior period and recovery of taxes paid in a prior period. Current taxes are measured using tax rates and laws enacted during the period within which the taxable income arose. Current tax assets and liabilities are offset only if the right of offset exists.
Deferred income taxes are recognized for the future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and their respective tax basis. Deferred taxes are measured using enacted tax rates expected to apply in the years in which those temporary differences are expected to be recovered or settled. The effect of a change in tax rates on the deferred tax assets and liabilities is recognized in provision for income taxes on the consolidated statements of operations in the period that includes the enactment date.
Recent Accounting Pronouncements
In November 2024, the FASB issued ASU No. 2024-03, "Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures" (Subtopic 220-40): Disaggregation of Income Statement Expenses." Additionally, in January 2025, the FASB issued ASU No. 2025-01 to clarify the effective date of ASU No. 2024-03. The new guidance aims to enhance disclosures about a public business entity's expenses by providing more specific information about certain costs and expenses at each interim and annual reporting period, enabling investors to better understand the entity’s overall performance, including its cost structure, and assess potential future cash flows. This guidance is effective for fiscal years beginning after December 15, 2026 and interim periods within annual reporting periods beginning after December 15, 2027, on a retrospective or prospective basis, with early adoption permitted. The Company is in the process of evaluating the impact that this guidance will have on the Consolidated Financial Statements and related disclosures.
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In July 2025, the FASB issued ASU No. 2025-05, "Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets ("ASU 2025-05")." ASU 2025-05 provides (1) all entities with a practical expedient and (2) entities other than public business entities with an accounting policy election when estimating credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Topic 606. This authoritative guidance is effective for annual periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods, with early adoption permitted. The Company adopted this ASU during the fiscal year ended January 31, 2026 on a prospective basis. Upon adoption, the Company elected the practical expedient permitted under the ASU. Because the Company is a public business entity, it did not elect the accounting policy option to incorporate post–balance sheet collection activity. The adoption did not have a material impact on the Company’s consolidated financial statements.
In December 2025, the FASB issued ASU 2025-11, "Interim Reporting (Topic 270): Narrow-Scope Improvements," which clarifies interim disclosure requirements by improving the navigability of the required interim disclosures and clarifying when that guidance is applicable. The standard is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is currently evaluating the potential impact the adoption of this standard will have on its consolidated financial statements and disclosures, which is not expected to be material.
Note 3 – Property Plant and Equipment, Net:
Property plant and equipment, net, on July 31, 2026 and January 31, 2026 were as follows (in thousands):
| July 31, 2026 | January 31, 2026 | ||||||||||
| Machinery and Equipment | $ | $ | |||||||||
| Furniture and Fixtures | |||||||||||
| Leasehold Improvements | |||||||||||
| Less: Accumulated Depreciation | |||||||||||
| Total | $ | $ | |||||||||
Depreciation expense was approximately $1.1 million and $2.3 million for the three and six months ended July 31, 2026, respectively, compared to $0.6 million and $1.1 million for the three and six months ended July 31, 2025, respectively.
Note 4 – Intangible Assets, Net
Intangible assets, net, consisted of the following at July 31, 2026 (dollars in thousands):
| Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Weighted Average Remaining Life (years) | ||||||||||||||||||||
| Customer relationships | $ | $ | ( | $ | |||||||||||||||||||
| Tradenames and trademarks | ( | ||||||||||||||||||||||
| Total intangible assets | $ | $ | ( | $ | |||||||||||||||||||
Intangible assets, net consisted of the following at January 31, 2026 (dollars in thousands):
| Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Weighted Average Remaining Life (years) | ||||||||||||||||||||
| Customer relationships | $ | $ | ( | $ | |||||||||||||||||||
| Tradenames and trademarks | ( | ||||||||||||||||||||||
| Total intangible assets | $ | $ | ( | $ | |||||||||||||||||||
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Amortization expense was approximately $440 thousand and $869 thousand for the three and six months ended July 31, 2026, respectively, compared to $381 thousand and $751 thousand for the three and six months ended July 31, 2025, respectively.
We expect the estimated aggregate amortization expense for each of the succeeding fiscal years to be as follows (in thousands):
| 2027 (Remaining) | $ | ||||
| 2028 | |||||
| 2029 | |||||
| 2030 | |||||
| 2031 | |||||
| Total | $ | ||||
Note 5 – Accounts Payable and Accrued Expenses
Accounts payable and accrued expenses are composed of the following (in thousands):
| July 31, 2026 | January 31, 2026 | ||||||||||
| Trade accounts payable | $ | $ | |||||||||
| Accrued promotions | |||||||||||
| Accrued employee compensation | |||||||||||
| Accrued commissions and royalties | |||||||||||
| Other accrued expenses | |||||||||||
| Accrued income taxes | |||||||||||
| Total accounts payable and accrued expenses | $ | $ | |||||||||
Note 6 – Related Party Transactions
Promissory Notes
Upon consummation of the acquisition of the T&L Creative Salads business in December 2021, the Company executed a $3.0 million promissory note with the sellers, which consist of Anthony Morello, Jr., President of Creative Salads and Olive Branch, as well as individuals related to Mr. Morello. The promissory note required annual principal payments of $750 thousand, payable on each anniversary of the closing, together with accrued interest at a rate of three and one-half percent (3.5 %) per annum. As of July 31, and January 31, 2026, there was no 0 7
On June 28, 2023, the Company completed the acquisition of 100 % of Chef Inspirational Foods, LLC, in accordance with the terms of the Membership Interest Purchase Agreement dated June 28, 2023 by and among the Company, Siegel Suffolk Family, LLC, and R&I Loeb Family, LLC (the “Sellers”) for approximately $3.7 million, including approximately $1.0 million in cash at closing and a $2.7 million promissory note (the "CIF Acquisition"). The promissory note required a principal payment of $1.2 million in cash on the first anniversary of the closing date (which was made during the year ended January 31, 2025) and a payment of $1.5 million in common stock of the Company on the second anniversary of the closing date (which was made during the year ended January 31, 2026). As of July 31, 2026 and January 31, 2026, there was no
Lease
The Company leases 20,188 square feet in a fully contained facility in Farmingdale, NY from 148 Allen Blvd LLC for production and distribution of Creative Salads and Olive Branch products. 148 Allen Blvd LLC is owned by Mr. Morello and various individuals related to Mr. Morello. This lease term is through November 30, 2031, with the option to extend the lease for two additional ten-year 20 thousand per month through December 31, 2026, increasing after that date to approximately $24 thousand per month through the end of the initial lease term. The exercise of optional renewal is uncertain and, therefore, excluded from the calculation of the right of use asset. Rent expense and other ancillary charges pursuant to the lease were approximately $83 thousand and $167 thousand for the three
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Note 7 – Loan and Security Agreements
The Company is party to an Amended and Restated Loan and Security Agreement (the “Credit Agreement”) with M&T Bank (“M&T”), which provides an up to $5.5 million working capital line of credit through a maturity date of November 28, 2028. The principal outstanding, if any, bears interest at a variable rate per annum based on the Company’s Senior Funded Debt/EBITDA Ratio (as defined in the Credit Agreement), established with respect to the Company as of the date of any advance under the Credit Agreement as follows: if the Senior Funded Debt/EBITDA ratio is: (i) greater than 2.25 , 3.25 percentage point(s) above the applicable one-day (i.e. overnight) SOFR (as defined); (ii) greater than 1.50 but less than 2.25 , 2.75 percentage points above the one-day SOFR; (iii) less than or equal to 1.50 , 2.25 percentage points above the one-day SOFR. The 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. The Company was in compliance with the covenants as of July 31, 2026 and January 31, 2026. All advances under the line of credit are due upon maturity. There were no no
On October 1, 2025, the Company converted the approximately $5.9 million balance remaining under a non-revolving line of credit with M&T into a promissory note, which is payable in equal monthly principal installments over a 60 -month amortization period (the “Crown Note”). All of the proceeds of the initial draw under the non-revolving line of credit were used to fund a portion of the consideration for the acquisition of the Crown 1 business. The outstanding balance under the Crown Note accrues interest based on the Senior Funded Debt/EBITDA Ratio (as defined in the Crown Note) as follows; if the Senior Funded Debt/EBITDA ratio is: (i) greater than 2.25 , 3.5 percentage point(s) above the applicable Variable Loan Rate; (ii) greater than 1.50 but less than or equal to 2.25 , 3.0 percentage points of the applicable Variable Loan Rate; or (iii) less than or equal to 1.50 , 2.5 percentage points above the applicable Variable Loan Rate; provided that in all events the rate shall not be less than the stated percentage point margin over 0 %. As of July 31, 2026, the outstanding balance and unamortized discount of the Crown Note was approximately $5.0 million and $193 thousand, respectively. As of January 31, 2026, the outstanding balance and unamortized discount of the Crown Note was approximately $5.6 million and $216 thousand, respectively. During the three and six months ended July 31, 2026, the Company incurred interest expense on this note of approximately $77 thousand and $162 thousand, respectively.
Note 8 – Concentrations
Revenues
For the three months ended July 31, 2026, three customers accounted for approximately 39 %, 11 %, and 11 % of gross revenue. For the three months ended July 31, 2025, one customer accounted for approximately 53 % of gross revenue, respectively.
For the six months ended July 31, 2026, two customers accounted for approximately 39 % and 11 % of gross revenue. For the six months ended July 31, 2025, two customers accounted for approximately 44 % and 17 % of gross revenue, respectively.
Receivables
As of July 31, 2026, two customers represented approximately 24 % and 14 % of the total gross outstanding receivables. As of January 31, 2026, two customers represented approximately 35 % and 12 % of total gross outstanding receivables, respectively.
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Note 9 – Stockholders’ Equity
Restricted Stock Units
RSUs generally vest on a graded basis over to four years of service. The terms of the RSUs include vesting provisions based on continued service.
The following is a summary of the Company’s RSU activity:
| Restricted Stock Units | Weighted Average Grant Date Fair Value | ||||||||||
| Non-vested restricted stock units - February 1, 2026 | $ | ||||||||||
| Granted | $ | ||||||||||
| Vested | ( | $ | |||||||||
| Forfeited | ( | $ | |||||||||
| Outstanding – July 31, 2026 | $ | ||||||||||
During the three and six months ended July 31, 2026, the Company recognized stock-based compensation expense related to restricted stock units of an aggregate of approximately $341 thousand and $583 thousand respectively, compared to approximately $184 thousand and $334 thousand for the three and six months ended July 31, 2025, respectively. The restricted stock expense was recorded to selling, general and administrative expenses or costs of sales depending on the nature of the related recipient's expense on the Condensed Consolidated Statements of Operations. As of July 31, 2026, there was unrecognized stock-based compensation expense of approximately $2.5 million related to future vesting of restricted stock units.
Options
The following is a summary of the Company’s option activity:
| Options | Weighted Average Exercise Price | Weighted Average Remaining Contractual Life (in years) | Aggregate Intrinsic Value (in thousands) | ||||||||||||||||||||
| Outstanding – February 1, 2026 | $ | $ | |||||||||||||||||||||
| Granted | $ | ||||||||||||||||||||||
| Exercised | ( | $ | |||||||||||||||||||||
| Expired/forfeited | $ | ||||||||||||||||||||||
| Outstanding – July 31, 2026 | $ | $ | |||||||||||||||||||||
| Exercisable – July 31, 2026 | $ | $ | |||||||||||||||||||||
The Company values stock options using the Black-Scholes option pricing model. The grants are amortized on a straight-line basis over the requisite service period, 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.
For the three and six months ended July 31, 2026, the Company recognized stock-based compensation expense related to options of approximately $18 thousand and $37 thousand respectively, compared to approximately $21 thousand and $43 thousand for the three and six months ended July 31, 2025, respectively. The stock-based compensation expense related to the options is included in selling, general and administrative expenses on the accompanying Condensed Consolidated Statements of Operations. At July 31, 2026, there was unrecognized stock-based compensation expense related to the issuance of options of approximately $73 thousand.
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Performance Stock Units
The following is a summary of the Company's Performance Stock Unit ("PSU") activity:
PSU(a) | Weighted Average Grant Date Fair Value | Weighted Average Remaining Contractual Life (in years) | ||||||||||||||||||
| Outstanding at February 1, 2026 | $ | |||||||||||||||||||
| Granted | $ | |||||||||||||||||||
| Vested | $ | |||||||||||||||||||
| Forfeited | $ | |||||||||||||||||||
| Outstanding at July 31, 2026 | $ | |||||||||||||||||||
(a) The outstanding PSUs for which the vesting period has not ended as of July 31, 2026, at the maximum award level.
During the six months ended July 31, 2026, the Company granted to each of its executive officers and other employees PSUs with an aggregate target payout of 142,824 shares of common stock. Each PSU award is eligible to vest and settle into between 50 % and 150 % of the target shares based on the Company's actual performance against threshold, target, and maximum Adjusted EBITDA. Adjusted EBITDA represents net income before interest expense (income), income tax expense, depreciation and amortization stock-based compensation expense, and any other non-recurring expenses. The PSUs had aggregate target payout values of approximately $2 million on their respective dates of grant. No outstanding PSUs vested in the three and six months ended July 31, 2026. During the three and six months ended July 31, 2026, the Company recognized stock-based compensation expense related to PSUs of approximately $514 thousand and $834 thousand, respectively, compared to approximately $307 thousand and $131 thousand for the three and six months ended July 31, 2025, respectively. The stock-based compensation expense related to the PSUs is included in selling, general and administrative expenses on the accompanying Condensed Consolidated Statements of Operations.
Equity issuances
During the six months ended July 31, 2026, the Company issued 7,200 shares of common stock of the Company, valued at approximately $105 thousand, for employee compensation. All of the issuance were pursuant to awards granted under the 2021 Incentive Stock and Award Plan.
On July 1, 2026, the Company completed the issuance and sale of 5,555,556 shares of common stock at a price to the public of $18.00 per share, resulting in initial gross proceeds of approximately $100 million. The issuance and sales were pursuant to an underwritten public offering led by William Blair & Company, L.L.C., and D.A. Davidson & Co. On July 9, 2026, the underwriters exercised their overallotment option in full, resulting in the issuance of an additional 833,333 shares of common stock for gross proceeds of approximately $15 million. After deducting offering expenses of approximately $6.4 million, the Company received net proceeds of approximately $108.6 million. The Company intends to use the net proceeds from the Offering for working capital and general corporate purposes. The Company may also use a portion of the proceeds for the acquisition of businesses or other assets that the Company believes are complementary to its business, although the Company currently has no agreements or commitments with respect to any such transaction.
The Company recorded the proceeds from the issuances of common stock, net of related issuance costs, as an increase to additional paid-in capital. The issuances of the shares resulted in corresponding increases in cash and cash equivalents.
Note 10 - Commitments and Contingencies
Litigation, Claims and Assessments
From time to time, the Company may become involved in various lawsuits and legal proceedings that 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.
Licensing and Royalty Agreements
On March 1, 2010, the Company was assigned a Development and License agreement, dated January 1, 2009, with Daniel Dougherty (the “License Agreement”). Under the terms of the License Agreement, the royalty rate payable by the
19
Company is 6 % of net sales up to $500 thousand of net sales (as defined in the agreement) for each year under the License Agreement; 4 % of net sales from $500 thousand up to $2.5 million of net sales for each year under the License Agreement; 2 % of net sales from $2.5 million up to $20 million of net sales for each year under the License Agreement; and 1 % of net sales in excess of $20 million of net sales for each year under the License Agreement.
In order to continue exclusivity, the Company must pay a minimum royalty of $125 thousand each year.
The Company incurred approximately $152 thousand and $452 thousand of royalty expenses for the three and six months ended July 31, 2026 respectively, compared to $126 thousand and $483 thousand for the three and six months ended July 31, 2025, respectively. Royalty expenses are included in selling, general and administrative expenses on the Condensed Consolidated Statements of Operations.
Purchase Commitments
In January 2026 the Company entered into one year purchase commitments to buy between approximately 14.5 million and approximately 16.6 million pounds of chicken, to be delivered in equal weekly installments at agreed-upon pricing formulas. We recognize liabilities for contingencies and commitments when a loss is probable and estimable. No such liability was recognized for these arrangements during the period.
Note 11 –Leases
The Company accounts for leases in accordance with ASC 842 “Leases” (“ASC 842”). We determine whether an arrangement is a lease at inception. This determination generally depends on whether the arrangement conveys the right to control the use of an identified fixed asset explicitly or implicitly for a period of time in exchange for consideration.
We have operating leases for offices and other facilities used for our operations. We also have finance leases relating primarily to machinery and equipment. Our leases have remaining lease terms of approximately 0.9 5.3
Supplemental cash flow and other information related to leases was as follows (in thousands):
| July 31, 2026 | July 31, 2025 | ||||||||||
| Cash paid for amounts included in the measurement of lease liabilities | |||||||||||
| Operating cash flows from operating leases | $ | $ | |||||||||
| Financing cash flows from finance leases | $ | $ | |||||||||
The following table shows the weighted-average lease term and weighted-average discount rate for the Company's right-of-use ("ROU") lease assets:
| July 31, 2026 | January 31, 2026 | ||||||||||
| Weighted average remaining lease term (in years) | |||||||||||
| Operating leases | |||||||||||
| Finance leases | |||||||||||
| Weighted average discount rate: | |||||||||||
| Operating leases | % | % | |||||||||
| Finance leases | % | % | |||||||||
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Supplemental balance sheet information related to leases was as follows (in thousands):
| July 31, 2026 | January 31, 2026 | ||||||||||
| Operating Leases | |||||||||||
| Operating lease ROU assets | $ | $ | |||||||||
| Current operating lease liabilities, included in current liabilities | $ | $ | |||||||||
| Non-current operating lease liabilities, included in long-term liabilities | |||||||||||
| Total operating lease liabilities | $ | $ | |||||||||
| Finance Leases | |||||||||||
| Property and equipment at cost | $ | $ | |||||||||
| Accumulated depreciation | ( | ( | |||||||||
| Property and equipment, net | $ | $ | |||||||||
| Current obligations of finance lease liabilities, included in current liabilities | $ | $ | |||||||||
| Finance leases, net of current obligations, included in long-term liabilities | |||||||||||
| Total finance lease liabilities | $ | $ | |||||||||
Maturities of lease liabilities for each of the succeeding fiscal years are as follows (in thousands):
| For the fiscal years ended | Finance Leases | Operating Leases | Total Maturities of Lease Liabilities | |||||||||||
| 2027 (remaining) | $ | $ | $ | |||||||||||
| 2028 | ||||||||||||||
| 2029 | ||||||||||||||
| 2030 | ||||||||||||||
| 2031 | ||||||||||||||
| Thereafter | ||||||||||||||
| Total undiscounted future lease payments | ||||||||||||||
| Less: imputed interest | ( | ( | ( | |||||||||||
| Total present value of future lease liabilities | $ | $ | $ | |||||||||||
Note 12 - Income Tax Provision
The Company’s effective tax rate for the three and six months ended July 31, 2026 was 22.4 % and 22.2 % respectively. Differences from the statutory rate primarily relate to state taxes.
As of July 31, 2026, and January 31, 2026, the net deferred tax liability was approximately $581 thousand and $813 thousand, respectively.
In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon future generation of taxable income during the periods in which temporary differences representing net future deductible amounts become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. There was no
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The Company evaluated the provisions of ASC 740, "Accounting for Income Taxes" related to the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements. ASC 740 prescribes a comprehensive model for how a company should recognize, present, and disclose uncertain positions that the Company has taken or expects to take in its tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. Differences between tax positions taken or expected to be taken in a tax return and the net benefit recognized and measured pursuant to the interpretation are referred to as “unrecognized benefits.” A liability is recognized (or amount of net operating loss carryforward or amount of tax refundable is reduced) for unrecognized tax benefit because it represents an enterprise’s potential future obligation to the taxing authority for a tax position that was not recognized as a result of applying the provisions of ASC 740.
Note 13 - Segment Information
For the three and six months ended July 31, 2026 and July 31, 2025 the Company was managed as a single operating segment. The Chief Executive Officer, who is also the Company’s Chief Operating Decision Maker (“CODM”), reviews financial information on an aggregate basis for purposes of allocating resources and assessing financial performance, as well as for making strategic operational decisions and managing the organization. As such, the Company has one reportable segment. Additionally, all of the Company’s assets are maintained in the United States.
Segment reporting for the three and six months ended July 31, (in thousands):
| For the Three Months Ended | |||||||||||
| July 31, 2026 | July 31, 2025 | ||||||||||
| Net sales | $ | $ | |||||||||
| Costs of sales | |||||||||||
| Gross profit | |||||||||||
Less: (a) | |||||||||||
| Research and development | |||||||||||
Direct Variable Costs (b) | |||||||||||
| Other selling, general, and administrative expenses | |||||||||||
| Total operating expenses | |||||||||||
| Income from operations | |||||||||||
| Interest expense | ( | ( | |||||||||
| Interest income | |||||||||||
| Amortization of debt discount | ( | ( | |||||||||
| Income tax expense | ( | ( | |||||||||
| Segment net income | |||||||||||
| Reconciliation of profit | |||||||||||
| Adjustments and reconciling items | |||||||||||
| Consolidated net income | $ | $ | |||||||||
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| For the Six Months Ended | |||||||||||
| July 31, 2026 | July 31, 2025 | ||||||||||
| Net sales | $ | $ | |||||||||
| Costs of sales | |||||||||||
| Gross profit | |||||||||||
Less: (a) | |||||||||||
| Research and development | |||||||||||
Direct Variable Costs (b) | |||||||||||
| Other selling, general, and administrative expenses | |||||||||||
| Total operating expenses | |||||||||||
| Income from operations | |||||||||||
| Interest expense | ( | ( | |||||||||
| Interest income | |||||||||||
| Amortization of debt discount | ( | ( | |||||||||
| Income tax expense | ( | ( | |||||||||
| Segment net income | |||||||||||
| Reconciliation of profit | |||||||||||
| Adjustments and reconciling items | |||||||||||
| Consolidated net income | $ | $ | |||||||||
(a) The significant expense categories and amounts align with the information that is regularly provided to the Chief Operating Decision Maker.
(b) This category contains commission expenses, royalty expenses, and freight-related expenses.
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following management's discussion and analysis should be read in conjunction with our annual report on Form 10-K for the fiscal year ended January 31, 2026, the Condensed Consolidated Financial Statements and notes thereto contained in this report, as well as our subsequent reports on Form 10-Q and Form 8-K and any amendments to such reports.
Overview
Mama’s Creations, Inc. is a leading marketer, manufacturer, and distributor of fresh deli prepared foods, found in over 12,000 grocery, mass, club and convenience stores nationally. The Company’s broad product portfolio, born from MamaMancini’s rich history in Italian foods, now consists of a variety of high-quality, fresh, clean and easy-to-prepare foods to address the needs of both our consumers and retailers. Our vision is to become a one-stop-shop deli solutions platform, leveraging vertical integration and a diverse family of brands to offer a wide array of prepared foods to meet the changing demands of the modern consumer.
Recent Trends
We continue to monitor commodity costs so that we can purchase ingredients, packaging and other materials required for production. A variety of other factors may impact the cost and availability of raw materials. Although almost all our inputs are sourced domestically and our manufacturing facilities are all in the United States, we continue to expect that recent tariff volatility will have a limited and manageable impact on the Company. We address commodity costs primarily through competitive sourcing procedures and manufacturing and overhead cost control. While certain ingredient costs have recently declined, we continue to face higher fuel and freight expenses as well as rising labor costs, all of which have negatively impacted profitability. The Company looks to offset rising costs through increased efficiencies and price increases to our customers. Market dynamics, promotional incentives, or other factors may cause our pricing actions to lag changes in supply and commodity costs.
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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain statements in this report are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Exchange Act. The forward-looking statements involve substantial risks and uncertainties. All statements, other than statements related to present facts or current conditions or of historical facts, contained in this report, including statements regarding our strategy, future operations, future financial position, future revenues, and projected costs, prospects, plans and objectives of management, are forward-looking statements. Accordingly, these statements involve estimates, assumptions and uncertainties which could cause actual results to differ materially from those expressed in them. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “ongoing,” “plan,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would,” or the negative of these terms or other comparable terminology are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words.
Forward-looking statements are not guarantees of future performance, and our actual results could differ materially from the results discussed in the forward-looking statements. Factors that could cause actual results to differ materially from those in the forward-looking statements include:
•the adequacy of our liquidity to pursue our business objectives;
•reliance on a limited number of customers;
•pricing pressures in the market and lack of control over the pricing of raw materials and freight;
•adverse economic conditions or intense competition;
•entry of new competitors and products;
•adverse federal, state and local government regulation (including, but not limited to, the Food and Drug Administration);
•liability related to the consumption of our products;
•supply chain disruptions due to global economic uncertainty, weather, natural disaster, fire, terrorism, pandemic, strikes, or otherwise;
•loss or retirement of key executives, including prior to identifying a successor;
•ability to secure placement of our products in key retail locations;
•maintenance of quality control;
•ability to timely realize the expected benefits of recent acquisitions and unanticipated or higher than anticipated integration expenses;
•wage and price inflation; and
•issues related to the enforcement of our intellectual property rights.
For more information regarding these risks and uncertainties as well as certain additional risks that we face, you should refer to “Item 1A. Risk Factors” in our most recent Annual Report on Form 10-K, and to subsequent reports filed from time to time with the SEC. We caution you not to place undue reliance on these forward-looking statements, which are current only as of the date on which we issued this report. We do not intend to, and we disclaim any duty or obligation to, update or revise any forward-looking statements to reflect new information or future events or for any other reason.
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Results of Operations for the Three Months Ended July 31, 2026 and 2025
The following table sets forth the summary of the Condensed Consolidated Statements of Operations for the three months ended July 31, 2026 and 2025 (in thousands):
| For the Three Months Ended | |||||||||||
| July 31, 2026 | July 31, 2025 | ||||||||||
| Net sales | $ | 54,582 | $ | 35,203 | |||||||
| Costs of sales | 41,505 | 26,432 | |||||||||
| Gross Profit | 13,077 | 8,771 | |||||||||
| Operating Expenses | 10,085 | 7,071 | |||||||||
| Other Income (expense), net | 312 | (55) | |||||||||
| Income Tax Expense | (739) | (368) | |||||||||
| Net Income | $ | 2,565 | $ | 1,277 | |||||||
For the three months ended July 31, 2026 and 2025, the Company reported net income of approximately $2.6 million and $1.3 million, respectively. The change in net income between the three months ended July 31, 2026 and 2025 is due to the changes in net sales, costs of sales and operating expenses described below.
Net sales: Net Sales increased by approximately 55%, to $54.6 million, during the three months ended July 31, 2026, from $35.2 million during the three months ended July 31, 2025. The increase in sales is primarily due to increased velocities of existing items driven by new marketing and trade programs, the introduction of new products into existing customers, new customers, and the acquisition of the Crown 1 business in September 2025.
Costs of sales: Costs of sales increased by approximately 57%, to $41.5 million, or 76% of Net Sales, during the three months ended July 31, 2026, from $26.4 million, or 75% of Net Sales, during the three months ended July 31, 2025. The increase in costs of sales is due to higher sales, partially offset by increased operational efficiencies resulting from increased overhead, labor and procurement efficiencies.
Gross Profit Margin: The gross profit margin was 24% and 25% of Net Sales for the three months ended July 31, 2026 and 2025, respectively. The year-over-year margin rate change was primarily driven by increased labor and overhead associated with new product launches, as well as increased promotional activity to support new customers and new product introductions.
Operating Expenses: Operating expenses increased approximately $3.0 million during the three months ended July 31, 2026, as compared to the three months ended July 31, 2025. The change in total operating expenses are primarily attributable to the following:
•Payroll and Related Expenses, inclusive of stock-based compensation, increased by approximately $1.3 million, primarily related to new hires and variable compensation arrangements;
•Commission and royalty expenses increased by approximately $0.7 million due to increased sales.
•Freight-related expenses increased by approximately $0.6 million mainly due to increased sales;
•Other operating expenses increased by approximately $0.3 million due to additional software and EDI-related expenses, travel, and office expenses;
•Insurance-related expenses increased by approximately $0.2 million, primarily due to the growth of the Company; and
•Professional fees decreased by approximately $0.1 million, primarily due to lower corporate activity.
Other Income, net: Other income, net increased by approximately $367 thousand, to $312 thousand, for the three months ended July 31, 2026, as compared to an expense of $55 thousand for the three months ended July 31, 2025. The increase is primarily due to higher interest income, which is due to a higher average cash balance in the current year period.
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Results of Operations for the Six Months Ended July 31, 2026 and 2025
The following table sets forth the summary of the Condensed Consolidated Statements of Operations for the six months ended July 31, 2026 and 2025 (in thousands):
| For the Six Months Ended | |||||||||||
| July 31, 2026 | July 31, 2025 | ||||||||||
| Net Sales | $ | 107,348 | $ | 70,458 | |||||||
| Costs of Sales | 81,844 | 52,503 | |||||||||
| Gross Profit | 25,504 | 17,955 | |||||||||
| Operating Expenses | 19,848 | 14,677 | |||||||||
| Other Income (expense), net | 282 | (116) | |||||||||
| Income Tax Expense | (1,316) | (648) | |||||||||
| Net Income | $ | 4,622 | $ | 2,514 | |||||||
For the six months ended July 31, 2026 and 2025, the Company reported net income of approximately $4.6 million and $2.5 million, respectively. The change in net income between the six months ended July 31, 2026 and 2025 is due to the changes in net sales, costs of sales and operating expenses described below.
Net sales: Net Sales increased by approximately 52%, to $107.3 million, during the six months ended July 31, 2026, from $70.5 million during the six months ended July 31, 2025. The increase in sales is primarily due to volume gains, which were driven by new products sold into existing customers, successful trade and marketing promotions, which drove velocity acceleration of existing products, and initial entry into new customers, as well as the acquisition of the Crown 1 business in September 2025.
Costs of sales: Costs of sales increased by approximately 56%, to $81.8 million, or 76% of Net Sales, during the six months ended July 31, 2026, from $52.5 million, or 75% of Net Sales, during the six months ended July 31, 2025. The increase in costs of sales is due to higher sales volume, partially offset by increased operational efficiencies driven by increased overhead, labor, and procurement efficiencies.
Gross Profit Margin: The gross profit margin was 24% and 25% for the six months ended July 31, 2026 and 2025, respectively. The year-over-year margin rate change was driven by increased promotional activity to support new customers and new product introductions as well as increased commodity costs, partially offset by overhead, labor and procurement efficiencies.
Operating Expenses: Operating expenses increased approximately $5.2 million during the six months ended July 31, 2026, as compared to the six months ended July 31, 2025. The change in total operating expenses is primarily attributable to the following:
•Payroll and Related Expenses, inclusive of stock-based compensation, increased by approximately $2.0 million, primarily related to new hires and variable compensation arrangements;
•Freight-related expenses increased by approximately $1.3 million primarily due to increased sales;
•Commission and royalty expenses increased by approximately $0.9 million due to increased sales;
•Other operating expenses increased by approximately $641 thousand due to additional travel, IT, and office expenses;
•Insurance-related expenses increased by approximately $399 thousand, primarily due to the growth of the Company; and
•Advertising expenses decreased by approximately $172 thousand due to new marketing strategies and increased investment in trade promotions.
Other Income, net: Other income, net increased by approximately $398 thousand, to $282 thousand, for the six months ended July 31, 2026, as compared to an expense of $116 thousand for the six months ended July 31, 2025. The increase is primarily due to higher interest income, which is due to a higher cash and cash equivalents balance.
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Liquidity and Capital Resources
We finance our operations with internally generated funds, supplemented by credit arrangements with third parties and, potentially, capital market financing.
Working Capital
The following table summarizes total current assets, liabilities and working capital at July 31, 2026 compared to January 31, 2026 (in thousands):
| July 31, 2026 | January 31, 2026 | Change | |||||||||||||||
| Current Assets | $ | 163,816 | $ | 45,081 | $ | 118,735 | |||||||||||
| Current Liabilities | 23,637 | 20,771 | 2,866 | ||||||||||||||
| Working Capital | $ | 140,179 | $ | 24,310 | $ | 115,869 | |||||||||||
As of July 31, 2026, we had working capital of approximately $140.2 million as compared to working capital of approximately $24.3 million as of January 31, 2026. The increase in working capital is primarily attributable to an increase of cash and cash equivalents of approximately $118.7 million, which was primarily driven by the July 2026 capital raise and cash flows generated from operations.
Cash Flows
The following table summarizes the key components of our cash flows for the six months ended July 31, 2026 and 2025 (in thousands);
| For the Six Months Ended July 31, | |||||||||||
| 2026 | 2025 | ||||||||||
| Net Cash Provided by Operating Activities | $ | 11,896 | $ | 4,334 | |||||||
| Net Cash Used in Investing Activities | (1,089) | (1,053) | |||||||||
| Net Cash Provided by (Used in) Financing Activities | 107,859 | (1,047) | |||||||||
| Net Increase in Cash | 118,666 | 2,234 | |||||||||
| Cash and cash equivalents, beginning of period | 19,951 | 7,150 | |||||||||
| Cash and cash equivalents, end of period | $ | 138,617 | $ | 9,384 | |||||||
Operating activities
Net cash provided by operating activities for the six months ended July 31, 2026 was approximately $11.9 million, which consisted of net income of approximately $4.6 million, non-cash expenses of approximately $5.3 million, and a net positive change in operating assets and liabilities of approximately $1.9 million.
Net cash provided by operating activities for the six months ended July 31, 2025 was approximately $4.3 million, which consisted of net income of approximately $2.5 million, non-cash expenses of approximately $2.9 million, and a net negative change in operating assets and liabilities of approximately $1.0 million.
Investing activities
Net cash used in investing activities for the six months ended July 31, 2026 was approximately $1.1 million and consisted of purchases of fixed assets.
Net cash used in investing activities for the six months ended July 31, 2025 was approximately $1.1 million and consisted of purchases of fixed assets.
Financing activities
Net cash provided by financing activities for the six months ended July 31, 2026 was approximately $107.9 million and primarily consisted of proceeds from the sale of common stock of approximately $108.6 million, net of offering expenses.
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Net cash used in financing activities for the six months ended July 31, 2025 was approximately $1.0 million and consisted of approximately $0.9 million of payments of debt and approximately $0.2 million of payments on finance leases.
Credit Facility & Indebtedness
As of July 31, 2026, we had no borrowings outstanding under the revolving line of credit available under our Credit Agreement and approximately $5.0 million outstanding under our Crown Note with M&T. The Crown Note has a maturity date of October 1, 2030. We also have operating leases for offices and other facilities used for our operations and finance leases comprised primarily of machinery and equipment leases, as discussed in Item 1. Note 11.
Liquidity and Capital Requirements Outlook
Although the expected revenue growth and control of expenses lead management to believe that it is probable that the Company’s cash resources will be sufficient to meet its cash requirements through at least the next twelve months, based on current and projected levels of operations, the Company may require additional funding to finance growth or achieve its strategic objectives. If such financing is required, there can be no assurance that financing will be available in amounts or on terms acceptable to the Company, if at all. In the event funding is not available on reasonable terms, the Company might be required to change its growth strategy and/or seek funding on an alternative basis, but there is no guarantee it will be able to do so.
Critical Accounting Estimates
There have been no material changes to the critical accounting estimates previously described in our Form 10-K for the fiscal year ended January 31, 2026.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
There have been no material changes to our quantitative or qualitative disclosures previously disclosed in Part II, Item 7A, Quantitative and Qualitative Disclosures About Market Risk of our Annual Report on Form 10-K for the fiscal year ended January 31, 2026.
Item 4. Controls and Procedures
Disclosure Controls and Procedures
The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports that we file or submit under the Securities Exchange Act of 1934 (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934), as amended (the “Exchange Act”) is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Our disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in the reports that we file under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, who serve as our principal executive officer and our principal financial officer, respectively, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well-designed and operated, can provide only reasonable assurance of achieving the desired control objectives. Due to the inherent limitations of control systems, not all misstatements may be detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the control. Controls and procedures can only provide reasonable, not absolute, assurance that the above objectives have been met.
As of July 31, 2026, we evaluated, with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective, at the reasonable assurance level, in ensuring that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms and is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.
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Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15, that occurred during our last quarter to which this Quarterly Report relates that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
From time to time, we may be involved in litigation incidental to the conduct of our business. We are currently not involved in any litigation that we believe could have a material effect on our financial condition or results of operations.
Item 1A. Risk Factors.
Other than as set forth below, there have been no material changes to the risk factors previously described in Part I, Item 1A of our Form 10-K for the fiscal year ended January 31, 2026.
We may be unable to successfully integrate the Crown I Carve Out Business into our business or achieve the anticipated benefits or synergies of the Crown I Acquisition.
On September 2, 2025, Crown 1 Foods, Inc., a Nevada corporation and wholly owned subsidiary of the Company, acquired substantially all of the assets of Crown I Enterprises, Inc. (the “Crown I Carve Out Business,” and such acquisition, the “Crown I Acquisition”). Our ability to achieve the anticipated benefits or synergies of the Crown I Acquisition will depend in part upon whether we can integrate the Crown I Carve Out Business into our existing business in an efficient and effective manner. We may not be able to accomplish this integration process successfully.
In addition, any potential unknown liabilities, liabilities that are significantly larger than we currently anticipate, and unforeseen increased expenses or delays associated with the Crown I Acquisition, including cash costs of integration, may exceed what we currently anticipate. Any one of these factors could result in increased costs, decreased benefits, and diversion of management’s attention, which could materially impact our business, financial condition, and results of operations. In addition, even following successful integration, the anticipated benefits or synergies of the Crown I Acquisition may not be realized fully, or at all, or may take longer to realize than expected.
Challenges identifying, completing, or integrating acquisitions could hinder our growth and profitability.
We periodically pursue acquisitions of businesses’ assets as part of our strategy to expand our operations and enhance profitability. This strategy focuses on identifying companies with manufacturing capabilities or product portfolios that complement our existing operations. Although we routinely evaluate potential acquisition opportunities, there is no assurance that we will identify suitable targets, reach agreements on acceptable terms, or successfully integrate any acquisitions we complete.
Our acquisition strategy involves significant risks and uncertainties. Competitive dynamics may increase purchase prices or limit our ability to complete transactions. We may lack the financial resources required for future acquisitions, or we may inaccurately assess a target’s value or fail to identify certain risks and liabilities. Acquisitions can also divert management’s attention from ongoing operations, place additional demands on our personnel, increase our leverage, or dilute existing stockholders.
Even when acquisitions are completed, integration efforts may present substantial challenges. These may include the inability to achieve anticipated financial or operational objectives, increased pressure on our personnel and systems, the need to modify or expand internal processes and workforce, and the impact of amortizing acquired intangible assets, which will reduce future reported earnings. Integration activities may also temporarily affect cash flows or operating results, and create risks related to retaining key employees of the acquired business. Failure to effectively manage these risks could adversely affect our business.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Unregistered Sales of Equity Securities
None.
Issuer Purchases of Equity Securities
During the three months ended July 31, 2026, the Company did not repurchase any shares of its common stock.
Dividends
The terms of the Crown Note restrict the issuance of cash dividends.
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Item 3. Defaults upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Not applicable.
Item 5. Other Information.
Rule 10b5-1 Trading Plans
During the three months ended July 31, 2026, no director or executive officer adopted terminated
Item 6. Exhibits.
Exhibit No. | Description | |||||||
| 3.1 | ||||||||
| 3.2 | ||||||||
| 3.3 | ||||||||
| 3.4 | ||||||||
| 3.5 | ||||||||
| 3.6 | ||||||||
| 10.1* † | ||||||||
| 31.1* | ||||||||
| 31.2* | ||||||||
| 32.1* | ||||||||
| 32.2* | ||||||||
| 101* | Financial statements from the quarterly report on Form 10-Q for the quarter ended July 31, 2026, as filed with the Securities and Exchange Commission, formatted in inline eXtensible Business Reporting Language (iXBRL): (i) Condensed Consolidated Balance Sheets; (ii) Condense Consolidated Statements of Operations, (iii) Condensed Consolidated Statements of Changes in Stockholders’ Equity, (iv) Condensed Consolidated Statements of Cash Flows, (v) Notes to Condensed Consolidated Financial Statements, and (vi) the information set forth in Part II, Item 5 | |||||||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) | |||||||
* Filed herewith.
† Denotes management contract or compensatory arrangement.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| MAMA’S CREATIONS, INC. | ||||||||
Date: September 3, 2026 | By: | /s/ Adam L. Michaels | ||||||
| Name: | Adam L. Michaels | |||||||
| Title: | Chief Executive Officer | |||||||
| (Duly Authorized Officer) | ||||||||
Date: September 3, 2026 | By: | /s/ Anthony Gruber | ||||||
| Name: | Anthony Gruber | |||||||
| Title: | Chief Financial Officer (Principal Financial and Accounting Officer) | |||||||
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