What changed in this filing

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Item 1. Financial Statements

2021-06-14 compared with 2020-12-14 · 712 added, 802 removed, 242 unchanged (86% of the section changed)

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CONSOLIDATED FINANCIAL STATEMENTS

Condensed Consolidated Balance Sheets as of October 31, 2020 (unaudited) and January 31, 2020

Condensed Consolidated Statements of Operations for the Three and Nine Months ended October 31, 2020 and 2019 (unaudited)

Condensed Consolidated Statements of Changes in Stockholders’

Equity (Deficit) for the Period from August 1, 2020 through October 31, 2020 and the Period from August 1, 2019 to October 31, 2019 (unaudited)

Condensed Consolidated Balance Sheets as of April 30, 2021 (unaudited) and January 31, 2021

Condensed Consolidated Statements of Income for the Three Months Ended April 30, 2021 and 2020 (unaudited)

Condensed Consolidated Statements of Changes in Stockholders’

Equity (Deficit) for the Period from February 1, 2020 through October 31, 2020 and the Period from February 1, 2019 to October 31, 2019 (unaudited)

Condensed Consolidated Statements of Cash Flows for the Nine Months Ended October 31, 2020 and 2019 (unaudited)

Equity (Deficit) for the Period from February 1, 2021 through April 30, 2021 (unaudited)

Condensed Consolidated Statements of Cash Flows for the Three Months Ended April 30, 2021 and 2020 (unaudited)

Notes to Condensed Consolidated Financial Statements (unaudited)

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Consolidated Balance Sheets

April 30, 2021

January 31, 2021

Current Assets:

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Prepaid expenses

current assets

Total current assets

Property and equipment, net

Operating lease right of use assets,

Operating lease right of use assets, net

Deferred tax asset, net

Liabilities and Stockholders’

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Operating lease liability

Finance leases

current liabilities

Line of credit –

Finance leases payable

Total current liabilities

Operating lease liability –

Finance leases payable –

Notes payable

- related party

long-term liabilities

Total long-term liabilities

Total Liabilities

Commitments and contingencies

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Series A Preferred stock, $0.00001 par value;

120,000 shares

23,400 issued as of October 31, 2020 and January 31, 2020, 0 and 0 shares outstanding as of October 31, 2020 and

January 31, 2020

120,000 shares authorized;

23,400 issued as of April 30, 2021 and January 31, 2021, 0 and 0 shares outstanding as of April 30, 2021 and January 31, 2021

Preferred stock, $0.00001 par value;

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250,000,000 shares authorized;

34,767,841 and 31,991,241 shares issued and outstanding as of October 31, 2020 and January 31, 2020

35,668,874 and 35,603,731 shares issued and outstanding as of April 30, 2021 and January 31, 2021

Additional paid in capital

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(12,076,904 )

stock, 230,000 shares at cost, respectively

Stockholders’

Liabilities and Stockholders’

Treasury stock, 230,000 shares at cost, respectively

Total Stockholders’

Total Liabilities and Stockholders’

accompanying notes to the condensed consolidated financial statements

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Holdings, Inc.

Consolidated Statements of Operations

the Three Months Ended

the Nine Months Ended

of slotting fees and discounts

Consolidated Statements of Income

For the Three Months Ended

April 30, 2021

April 30, 2020

Sales-net of slotting fees and discounts

Costs of sales

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Research and development

and administrative

operating expenses

from operations

Other expenses

of debt discount

other expenses

income before income tax provision

General and administrative

Total operating expenses

Income from operations

Other income (expenses)

Amortization of debt discount

Total other income (expenses)

Net income before income tax provision

Income tax provision

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Equity (Deficit)

the Period from August 1, 2020 through October 31, 2020

Stockholders’

Balance, August 1, 2020

$ (14,498,141 )

Stock options issued for services

Common stock issued for exercise of

Balance, October 31, 2020

$ (13,763,999 )

the Period from August 1, 2019 through October 31, 2019

Stockholders’

August 1, 2019

$ (16,866,281 )

Stock options issued for services

October 31, 2019

$ (16,457,666 )

accompanying notes to the condensed consolidated financial statements

MamaMancini’s

Holdings, Inc.

Consolidated Statements of Changes in Stockholders’

Equity (Deficit)

the Period from February 1, 2020 through October 31, 2020

Preferred Stock

the Period from February 1, 2021 through April 30, 2021

Series A Preferred Stock

Treasury Stock

Stockholders’

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$ (12,076,904 )

$ (8,309,746 )

Stock options issued for services

Common stock issued for exercise of

Balance, October 31, 2020

Stock options issued exercise of options

Balance, April 30, 2021

$ (11,445,380 )

the Period from February 1, 2019 through October 31, 2019

Preferred Stock

the Period from February 1, 2020 through April 30, 2020

Series A Preferred Stock

Treasury Stock

Stockholders’

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$ (16,144,110 )

$ (1,182,148 )

Stock options issued for services

Common stock issued for services

October 31, 2019

April 30, 2020

$ (15,237,908 )

3 unchanged sentences

Consolidated Statements of Cash Flows

the Nine Months Ended

CASH FLOWS FROM OPERATING

Adjustments to reconcile net income

to net cash provided by operating activities:

For the Three Months Ended

April 30, 2021

April 30, 2020

CASH FLOWS FROM OPERATING ACTIVITIES:

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

Amortization of debt discount

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Amortization of right of use assets

Change in deferred tax asset

Changes in operating assets and liabilities:

Accounts receivable

Other receivable

Prepaid expenses

Accounts payable and accrued expenses

Operating lease

Cash Provided by Operating Activities

CASH FLOWS FROM INVESTING

Operating lease liability

Net Cash Provided by Operating Activities

CASH FLOWS FROM INVESTING ACTIVITIES:

Cash paid for fixed assets

Cash paid for

intangible assets

Cash Used in Investing Activities

CASH FLOWS FROM FINANCING

Repayment of related party notes payable

Proceeds from term loan

Net Cash Used in Investing Activities

CASH FLOWS FROM FINANCING ACTIVITIES:

Repayments of term loan

Proceeds from promissory note

Repayment of promissory note

Borrowings (repayments) of line of credit,

Repayment of capital lease obligations

Borrowings of line of credit, net

Repayment of finance lease obligations

Proceeds from exercise of options

Proceeds from exercise of warrants

Cash Used in Financing Activities

Net Cash Used in Financing Activities

Net Increase in Cash

Cash - Beginning

Cash - End of

SUPPLEMENTARY CASH

FLOW INFORMATION:

Cash - Beginning of Period

Cash - End of Period

SUPPLEMENTARY CASH FLOW INFORMATION:

Cash Paid During the Period for:

SUPPLEMENTARY DISCLOSURE

OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

Operating lease

Finance lease

asset additions

issued for services to be rendered

Acquisition of

software via contract liability

SUPPLEMENTARY DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

Finance lease asset additions

accompanying notes to the condensed consolidated financial statements

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Holdings, Inc.

(the “Company”), (formerly known as Mascot Properties, Inc.) was organized on July 22, 2009 as a Nevada

(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.

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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 frozen products.

The Company’s

products were submitted to the United States Department of Agriculture (the “USDA”) and approved as all natural.

USDA defines all natural as a product that contains no artificial ingredients, coloring ingredients or chemical preservatives

and is minimally processed.

The Company’s customers are located throughout the United States, with large concentrations

in the Northeast and Southeast.

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 frozen products.

The Company’s products

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.

The Company’s customers are located throughout the United States, with large concentrations in the Northeast and Southeast.

2 - Summary of Significant Accounting Policies

of Presentation

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.

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 intercompany balances and transactions have been eliminated in consolidation.

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, 2020 filed on April 23, 2020.

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, 2020 was derived from audited financial statements but

does not include all disclosures required by accounting principles generally accepted in the United States of America.

of operations for the interim periods presented are not necessarily indicative of results for the year ending January 31, 2021.

unaudited interim 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, 2021 filed on April 21, 2021.

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, 2021 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, 2022.

of Consolidation

condensed consolidated financial statements include all accounts of the entities as of the reporting period ending date(s) and

for the reporting period(s).

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.

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 condensed 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.

preparation of 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.

estimates and assumptions impact, among others, the following:

allowance for doubtful accounts, inventory obsolescence and the fair value

of share-based payments.

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.

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.

and Uncertainties

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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

These factors, among others, make it difficult to project the Company’s operating results on a consistent basis.

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.

Company considers all highly liquid instruments purchased with a maturity of three months or less to be cash equivalents.

Company held no cash equivalents at October 31, 2020 and January 31, 2020.

Company minimizes its credit risk associated with cash by periodically evaluating the credit quality of its primary financial

held no cash equivalents at April 30, 2021 and January 31, 2021.

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.

At October 31, 2020, the Company had $1,522,862 in cash

balances that exceed federally insured limits.

At April 30, 2021, the Company had $3,975,358 in cash balances that exceed

federally insured limits.

Receivable and Allowance for Doubtful 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.

As of October 31, 2020 and January 31, 2020, the Company had reserves of $2,000.

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.

As of April 30, 2021 and January

31, 2021, the Company had reserves of $2,000.

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 October 31, 2020 and January 31, 2020:

of the following at April 30, 2021 and January 31, 2021:

April 30, 2021

January 31, 2021

Raw Materials

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and equipment are recorded at cost net of depreciation.

Depreciation expense is computed using straight-line methods over the

estimated useful lives.

Depreciation expense is computed using straight-line methods over the estimated

useful lives.

lives for financial statement reporting of depreciation are:

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

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 consolidated statements of operations.

Company accounts for acquired internal-use software licenses and certain costs within the scope of ASC 350-40, Intangibles

- Goodwill and Other - Internal-Use Software as intangible assets.

Acquired internal-use software licenses are amortized over

the term of the arrangement to the line item within the consolidated statements of operations that reflects the nature of the

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 consolidated statements of operations.

Company accounts for acquired internal-use software licenses and certain costs within the scope of ASC 350-40, Intangibles - Goodwill

and Other - Internal-Use Software as intangible assets.

The Company capitalized $87,639 of costs incurred in the year ended January

31, 2021 to implement cloud computing arrangements.

Acquired internal-use software licenses are amortized over the term of the arrangement

on a straight-line basis to the line item within the consolidated statements of operations that reflects the nature of the license.

Company did not record amortization for the software license since the license has yet to be implemented as of April 30, 2021.

Additionally,

the Company evaluates its accounting for fees paid in an agreement to determine whether it includes a license to internal-use

the Company evaluates its accounting for fees paid in an agreement to determine whether it includes a license to internal-use software.

If the agreement includes a software license, the Company accounts for the software license as an intangible asset.

Acquired software licenses are recognized and measured at cost, which includes the present value of the license obligation if

the license is to be paid for over time.

If the agreement does not include a software license, the Company accounts for the arrangement

as a service contract (hosting arrangement) and hosting costs are generally expensed as incurred.

The Company did not record amortization

for the software license since the license has yet to be implemented as of October 31, 2020.

Acquired software

licenses are recognized and measured at cost, which includes the present value of the license obligation if the license is to be paid

for over time.

If the agreement does not include a software license, the Company accounts for the arrangement as a service contract (hosting

arrangement) and hosting costs are generally expensed as incurred.

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.

(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

Subsequent to the issuance of Topic 842, the FASB clarified the guidance through several ASUs;

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.

February 1, 2019, the Company adopted ASC 842 using the modified retrospective approach and recognized a right of use (“ROU”)

asset and liability in the consolidated balance sheet in the amount of $1,599,830 related to the operating lease for office and

warehouse space.

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:

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.

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.

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:

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.

to apply the recognition requirements in ASC 842 to short-term leases.

record a right of use asset or right of use liability for leases with an asset or liability balance that would be considered

record a right of use asset or right of use liability for leases with an asset or liability balance that would be considered immaterial.

Value of Financial Instruments

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.

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.

and Development

and development is expensed as incurred.

Research and development expenses for the three months ended October 31, 2020 and 2019

were $30,765 and $32,744, respectively.

Research and development expenses for the nine months ended October 31, 2020 and 2019

were $86,103 and $82,579, respectively.

Research and development expenses for the three months ended April 30, 2021 and 2020 were $23,436

and $29,481, respectively.

and Handling Costs

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

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;

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.

2017, the FASB issued additional amendments providing clarification and implementation guidance.

Company adopted this guidance and related amendments as of the first quarter of fiscal 2019, applying the full retrospective transition

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.

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.

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.

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.

Company promotes its products with advertising, consumer incentives and trade promotions.

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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.

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

The Company derives these estimates principally on historical utilization and redemption rates.

does not receive a distinct service in relation to the advertising, consumer incentives and trade promotions.

The Company does not receive

a distinct service in relation to the advertising, consumer incentives and trade promotions.

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.

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

the Three Months Ended

Discounts, Allowances

the Nine Months Ended

Discounts, Allowances

The Company recognizes the related trade receivable when the goods are shipped.

such as slotting fees, sales discounts, promotions and allowances are accounted for as a direct reduction of revenues as follows (see

For the Three Months Ended

April 30, 2021

April 30, 2020

Slotting, Discounts, Promotions and Allowances

Disaggregation

of Revenue from Contracts with Customers.

The following table disaggregates gross revenue by significant geographic area for

the three and nine months ended October 31, 2020 and 2019:

the Three Months Ended

Total revenue

the Nine Months Ended

The following table disaggregates gross revenue by significant geographic area for the

three months ended April 30, 2021 and 2020:

For the Three Months Ended

April 30, 2021

April 30, 2020

Total revenue

of sales represents costs directly related to the production and manufacturing of the Company’s products.

Costs include

product development, freight-in, packaging, and print production costs.

Costs include product

development, freight-in, packaging, and print production 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 October 31, 2020 and 2019 were $314,093 and $517,940 respectively.

Producing and

communicating advertising expenses for the nine months ended October 31, 2020 and 2019 were $984,193 and $1,274,735, respectively.

advertising expenses for the three months ended April 30, 2021 and 2020 were $126,180 and $115,970 respectively.

Company accounts for stock-based compensation in accordance with ASC Topic 718, “

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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.

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.

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.

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 condensed 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.

the three months ended October 31, 2020 and 2019, share-based compensation amounted to $1,460 and $37,914, respectively.

the nine months ended October 31, 2020 and 2019, share-based compensation amounted to $51,435 and $67,857, respectively.

the nine months ended October 31, 2020 and 2019, when computing fair value of share-based payments, the Company has considered

the following variables:

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

The grants are amortized on a straight-line basis over the requisite service periods, which is generally the vesting period.

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 condensed 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.

the three months ended April 30, 2021 and 2020, share-based compensation amounted to $501 and $27,105, respectively.

the three months ended April 30, 2021 and 2020, when computing fair value of share-based payments, the Company has considered the following

April 30, 2021

April 30, 2020

Risk-free interest rate

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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.

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.

expected stock price volatility for the Company’s stock options was estimated using the historical volatilities of the Company’s

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Treasury rates for the applicable periods.

(Loss) Per Share

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

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

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.

following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income attributable

to common stockholders per common share.

the Three Months Ended

Net income attributable

to common stockholders

Effect of dilutive

Diluted net income

Weighted average common shares outstanding - basic

Dilutive securities (a):

Series A Preferred

Weighted average common shares outstanding

and assumed conversion –

Basic net income

per common share

Diluted net income

per common share

(a) - Anti-dilutive

securities excluded:

the Nine Months Ended

Net income attributable

to common stockholders

Effect of dilutive

For the Three Months Ended

April 30, 2021

April 30, 2020

Net income attributable to common stockholders

Effect of dilutive securities:

Diluted net income

2 unchanged sentences

Series A Preferred

Weighted average common shares outstanding

and assumed conversion –

Basic net income

per common share

Diluted net income

per common share

(a) - Anti-dilutive

securities excluded:

Weighted average common shares outstanding and assumed conversion –

Basic net income per common share

Diluted net income per common share

(a) - Anti-dilutive securities excluded:

taxes are provided in accordance with ASC No.

2 unchanged sentences

is recorded for all temporary differences between financial and tax reporting and net operating loss carryforwards.

expense (benefit) results from the net change during the period of deferred tax assets and liabilities.

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.

Deferred tax expense

(benefit) results from the net change during the period of deferred tax assets and liabilities.

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.

As of April 30, 2021 and January 31, 2021, the Company recognized a deferred tax asset of $497,024

and $744,973, respectively, which is included in other long-term assets on the condensed consolidated balance sheets.

regularly evaluates the need for a valuation allowance related to the deferred tax asset.

Company is no longer subject to tax examinations by tax authorities for years prior to 2019.

response to the COVID-19 pandemic, the Coronavirus Aid, Relief and Economic Security Act (“

CARES Act ”) was

signed into law in March 2020.

The CARES Act lifts certain deduction limitations originally imposed by the Tax Cuts and Jobs Act

of 2017 (“

CARES Act ”) was signed

into law in March 2020.

The CARES Act lifts certain deduction limitations originally imposed by the Tax Cuts and Jobs Act of 2017 (“

Tax Act ”).

Corporate taxpayers may carryback net operating losses ( “NOLs ”)

originating between 2018 and 2020 for up to five years, which was not previously allowed under the 2017 Tax Act.

The CARES Act

also eliminates the 80% of taxable income limitations by allowing corporate entities to fully utilize NOL carryforwards to offset

taxable income in 2018, 2019 or 2020.

Taxpayers may generally deduct interest up to the sum of 50% of adjusted taxable income

plus business interest income (30% limit under the 2017 Tax Act) for 2019 and 2020.

The CARES Act allows taxpayers with alternative

minimum tax credits to claim a refund in 2020 for the entire amount of the credits instead of recovering the credits through refunds

over a period of years, as originally enacted by the 2017 Tax Act.

addition, the CARES Act raises the corporate charitable deduction limit to 25% of taxable income and makes qualified improvement

property generally eligible for 15-year cost-recovery and 100% bonus depreciation.

The enactment of the CARES Act did not result

in any material adjustments to the income tax provision.

Corporate taxpayers may carryback net operating losses ( “NOLs ”) originating between 2018 and

2020 for up to five years, which was not previously allowed under the 2017 Tax Act.

The CARES Act also eliminates the 80% of taxable

income limitations by allowing corporate entities to fully utilize NOL carryforwards to offset taxable income in 2019, 2020 or 2021.

Taxpayers may generally deduct interest up to the sum of 50% of adjusted taxable income plus business interest income (30% limit under

the 2017 Tax Act) for 2019 and 2020.

The CARES Act allows taxpayers with alternative minimum tax credits to claim a refund in 2020 for

the entire amount of the credits instead of recovering the credits through refunds over a period of years, as originally enacted by the

2017 Tax Act.

addition, the CARES Act raises the corporate charitable deduction limit to 25% of taxable income and makes qualified improvement property

generally eligible for 15-year cost-recovery and 100% bonus depreciation.

The enactment of the CARES Act did not result in any material

adjustments to the income tax provision.

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

1 unchanged sentence

(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;

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);

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;

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) 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.

Accounting Pronouncements

October 2016, the FASB issued ASU 2016-16, “Income Taxes (Topic 740):

Intra-Entity Transfers of Assets Other than Inventory”,

which eliminates the exception that prohibits the recognition of current and deferred income tax effects for intra-entity

transfers of assets other than inventory until the asset has been sold to an outside party.

The updated guidance is effective

for annual periods beginning after December 15, 2019, including interim periods within those fiscal years.

Early adoption of the

update is permitted.

The adoption of the new standard did not have a significant impact on the Company’s condensed consolidated

financial statements.

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.

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 adoption of the new standard did not have a significant impact on the Company’s condensed consolidated

financial statements.

August 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)

ASU 2018-15, “Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is

a Service Contract”

The amendments in this update align the requirements for capitalizing implementation costs incurred

in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop

or obtain internal-use software.

The Company adopted this guidance on February 1, 2020 on a prospective basis.

the adoption of ASU 2018-15 on February 1, 2020, the Company evaluates upfront costs including implementation, set-up or other

costs (collectively, implementation costs) for hosting arrangements under the internal-use software framework.

Costs related to

preliminary project activities and post implementation activities are expensed as incurred, whereas costs incurred in the development

stage are generally capitalized.

Capitalized implementation costs are amortized on a straight-line basis over the expected term

of the hosting arrangement, which includes consideration of the non-cancellable contractual term and reasonably certain renewals.

December 2019, the FASB issued authoritative guidance intended to simplify the accounting for income taxes (ASU 2019-12, “

1 unchanged sentence

Simplifying the Accounting for Income Taxes ”).

This guidance eliminates certain exceptions to the

general approach to the income tax accounting model and adds new guidance to reduce the complexity in accounting for income taxes.

This guidance is effective for annual periods after December 15, 2020, including interim periods within those annual periods.

The Company is currently evaluating the potential impact of this guidance on its condensed consolidated financial statements.

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.

This guidance eliminates certain exceptions to the general

approach to the income tax accounting model and adds new guidance to reduce the complexity in accounting for income taxes.

This guidance

is effective for annual periods after December 15, 2020, including interim periods within those annual periods.

The adoption of the new

standard did not have a significant impact on the Company’s condensed consolidated financial statements.

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.

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

to October 31, 2020, warrant holders exercised 823,890 warrants at $1.50 per share into 823,890 shares of common stock.

received aggregate proceeds of $1,124,724 upon exercise.

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.

3 - Property and Equipment:

and equipment on October 31, 2020 and January 31, 2020 are as follows:

and equipment on April 30, 2021 and January 31, 2021 are as follows:

April 30, 2021

January 31, 2021

Machinery and Equipment

1 unchanged sentence

Leasehold Improvements

expense charged to income for the three months ended October 31, 2020 and 2019 amounted to $170,031 and $124,953, respectively.

Depreciation expense charged to income for the nine months ended October 31, 2020 and 2019 amounted to $489,109 and $495,005,

respectively.

4 - Investment in Meatball Obsession, LLC

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.

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

Company’s ownership interest in MO has decreased due to dilution.

At October 31, 2020 and January 31, 2020, the Company’s

ownership interest in MO was 0% and 12%, respectively.

As of December 31, 2019, MO had wound down and ceased operations.

accounts were transitioned to the Company as a part of the wind down.

Accumulated Depreciation

expense charged to income for the three months ended April 30, 2021 and 2020 amounted to $183,761 and $159,793, respectively.

4 - Related Party Transactions

Obsession, LLC

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

the three months ended October 31, 2020 and 2019, the Company generated approximately $0 and $20,474 in revenues from MO, respectively.

For the nine months ended October 31, 2020 and 2019, the Company generated approximately $0 and $53,723 in revenues from MO, respectively.

of October 31, 2020 and January 31, 2020, the Company had a receivable of $0 and $1,604 due from MO, respectively.

D’Agostino and Tom Toto, two directors of the Company, are affiliates of WWS, Inc.

the three months ended October 31, 2020 and 2019, the Company recorded $6,000 and $12,000 in commission expense from WWS, Inc.

generated sales, respectively.

For the nine months ended October 31, 2020 and 2019, the Company recorded $30,000 and $36,000 in

commission expense from WWS, Inc.

generated sales, respectively.

Payable –

Related Party

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 October 31, 2020 and January 31, 2020, the outstanding principal balance of the notes was $0 and $109,844,

respectively.

Company received advances from the CEO of the Company which bear interest at 8%.

The advances were due on January 2024.

31, 2020 and January 31, 2020, there was $0 and $400,000 of principal outstanding, respectively.

Company received advances from an entity 100% owned by the CEO of the Company, which bear interest at 8%.

The advances were due

on January 2024.

At October 31, 2020 and January 31, 2020, there was $0 and $132,000 of principal outstanding, respectively.

the three months ended October 31, 2020 and 2019, the Company recorded interest expense of $0 and $11,775, respectively, related

to the above related party notes payable.

For the nine months ended October 31, 2020 and 2019, the Company recorded interest expense

of $23,550 and $34,544, respectively, related to the above related party notes payable.

At October 31, 2020 and January 31, 2020,

there was $0 and $2,863, respectively, of accrued interest on the above related party notes.

the three months ended April 30, 2021 and 2020, the Company recorded $12,000 in commission expense from WWS, Inc.

generated sales.

Related Party Transactions

the three months ended October 31, 2020 and 2019, the Company reimbursed an entity 100% owned by the CEO of the Company for certain

investor relation conference expenses totaling $0 and $0, respectively.

During the nine months ended October 31, 2020 and 2019,

the Company reimbursed an entity 100% owned by the CEO of the Company for certain investor relation conference expenses totaling

$14,570 and $15,722, respectively.

the nine months ended October 31, 2020, members of the board of directors and the CEO exercised 940,807 warrants with exercise

price of $1 in exchange for 940,807 shares of common stock.

the three months ended April 30, 2021 and 2020, the Company reimbursed an entity 100% owned by the CEO of the Company for certain investor

relation conference expenses totaling $4,517 and $14,570, respectively.

5 - Loan and Security Agreement

January 4, 2019, the Company 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 $0 and $17,864 as of October 31, 2020

and January 31, 2020, respectively.

The outstanding balance on the term loan was $0 and $441,663 as of October 31, 2020 and January

31, 2020, respectively.

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.

On January 29, 2020, the facility was amended to increase the total available balance to $4.0

January 4, 2019, the Company 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 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 $0 as of April 30, 2021 and January 31, 2021.

The outstanding

balance on the term loan was $0 as of April 30, 2021 and January 31, 2021.

January 4, 2019, the Company has arranged a $3.5 million working capital line of credit with M&T Bank at LIBOR plus four points with

a two-year expiration.

On January 29, 2020, the facility was amended to increase the total available balance to $4.0 million as well

as extend the maturity date to June 30, 2022.

On June 11, 2021, the facility was amended to increase the total available balance to

$4.5 million as well as extend the maturity date to June 30, 2023.

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 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 $650,000 and $2,997,348

as of October 31, 2020 and January 31, 2020, respectively.

maturities of all debt (excluding debt discount discussed above in Note 6) are as follows:

For the Twelve Months Ending October 31,

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 $0 as of April 30, 2021 and January 31, 2021.

the three months ended April 30, 2021 and 2020, the Company paid total interest of $0 and $43,080 to M&T Bank for the above agreements,

respectively.

Promissory Note

April 21, 2020, the Company entered into a term note with its principal bank, M&T, with a principal amount of $330,000 pursuant

to the Paycheck Protection Program (“

PPP Term Note ”) under the Coronavirus Aid, Relief, and Economic Security

Act (the “

April 21, 2020, the Company entered into a term note with its principal bank, M&T, with a principal amount of $330,505 pursuant to

the Paycheck Protection Program (“

PPP Term Note ”) under the Coronavirus Aid, Relief, and Economic Security Act (the

CARES Act ”).

The PPP Loan is evidenced by a promissory note.

The PPP Term Note bears interest at

a fixed annual rate of 1.00%, with the first six months of interest deferred.

The Company returned the $330,505 received from

the Paycheck Protection Program on May 6, 2020, inclusive of interest.

The PPP Term Note bears interest at a fixed annual rate

of 1.00%, with the first six months of interest deferred.

The Company returned the $330,505 received from the Paycheck Protection Program

on May 6, 2020, inclusive of interest.

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.

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.

March 1, 2021, the Company amended its existing lease with the landlord for a new premise with a greater square footage.

Upon cancellation

of the existing lease, the Company wrote-off the net right of use asset and corresponding lease liability of $22,870.

The Company recorded

a right of use asset and related liability of $347,585 for the new space which will be occupied over a 60-month period.

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.

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

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

components of lease expense were as follows:

For the Three Months

April 30, 2021

April 30, 2020

Finance lease

Depreciation of assets

Interest on lease liabilities

Operating leases

Short-term lease

Total net lease cost

balance sheet information related to leases was as follows:

April 30, 2021

January 31, 2021

Operating leases:

Operating lease ROU assets

Current operating lease liabilities, included in current liabilities

Noncurrent 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

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

For the Three Months Ended April 30, 2021

For the Three Months Ended April 30, 2020

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows from operating leases

Financing cash flows from finance leases

ROU assets obtained in exchange for lease liabilities:

Operating leases

Finance leases

Weighted average remaining lease term (in years):

Operating leases

Finance leases

Weighted average discount rate:

Operating leases

Finance leases

Total future minimum payments required under the lease obligations

as of April 30, 2021 are as follows:

For the Twelve Months Ending January 31,

2022 (Remaining)

Total lease payments

amounts representing interest

Total lease obligations

8 - Concentrations

the nine months ended October 31, 2020, the Company earned revenues from two customers representing approximately 45% and 11%

of gross sales.

As of October 31, 2020, these two customers represented approximately 30% and 11% of total gross outstanding receivables,

the three months ended April 30, 2021, the Company earned revenues from three customers representing approximately 31%, 19% and 11% of

As of April 30, 2021, these three customers represented approximately 33%, 14% and 16% of total gross outstanding receivables,

respectively.

During the nine months ended October 31, 2019, the Company earned revenues from three customers representing approximately

During the three months ended April 30, 2020, the Company earned revenues from three customers representing approximately

44%, 10% and 10% of gross sales.

As of October 31, 2019, these three customers represented approximately 41%, 14% and 6% of total

gross outstanding receivables, respectively.

As of April 30, 2020, these three customers represented approximately 40%, 16% and 9% of total gross

outstanding receivables, respectively.

9 - Stockholders’

2 unchanged sentences

Outstanding –

January 31, 2021

Exercisable –

1 unchanged sentence

Forfeited/Cancelled

October 31, 2020

Outstanding –

April 30, 2021

Exercisable –

April 30, 2021

Life (in years)

1 unchanged sentence

Exercise Price

October 31, 2020, the total intrinsic value of options outstanding and exercisable was $1,131,611 and $1,121,523, respectively.

June 2020, two employees exercised a total of 12,000 options at an exercise price of $0.60 per share for aggregate proceeds of

No options were exercised during the

nine months ended October 31, 2019.

the nine months ended October 31, 2020, the Company issued to 7,500 options to an employee.

The options have an exercise price

of $1.16 per share, a term of 5 years, and 2-year vesting.

The options have an aggregated fair value of approximately $7,617 that

was calculated using the Black-Scholes option-pricing model based on the assumptions discussed above in Note 2.

the nine months ended October 31, 2020 and 2019, the Company recognized share-based compensation related to options of an aggregate

of $51,435 and $49,975, respectively.

At October 31, 2020, unrecognized share-based compensation was $3,393.

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

January 31, 2020

Exercisable –

January 31, 2020

Forfeited/Cancelled

October 31, 2020

the nine months ended October 31, 2020, warrant holders exercised a total of 2,807,843 warrants and the Company issued 2,764,600

shares of common stock as a result of these exercises and received gross proceeds of $2,735,697.

Of the 2,807,843 exercised warrants,

80,000 warrants were exercised on a cashless basis by Spartan Capital and the Company issued 36,757 shares of common stock.

October 31, 2020, the total intrinsic value of warrants outstanding and exercisable was $1,804,528 and $1,804,528 , respectively.

April 30, 2021, the total intrinsic value of options outstanding and exercisable was $1,588,091 and $1,584,241, respectively.

the three months ended April 30, 2021, six employees exercised a total of 84,000 options at an average exercise price of $0.86 per share

for aggregate proceeds of $19,080.

No options were exercised

during the three months ended April 30, 2020.

the three months ended April 30, 2021 and 2020, the Company recognized share-based compensation related to options of an aggregate of

$501 and $27,105, respectively.

At April 30, 2021, unrecognized share-based compensation was $1,432.

10 - Commitments and Contingencies

Company maintains insurance for both property damage and business interruption relating to catastrophic events, such as fires.

recoveries received for property damage and business interruption in excess of the net book value of damaged assets, clean-up and demolition

costs, and post-event costs are recognized as income in the period received or committed when all contingencies associated with the recoveries

are resolved.

Gains on insurance recoveries related to business interruption are recorded within “Cost of sales”

gains or losses related to property damage are recorded within “Other income (expense)”

on the condensed consolidated statements

December 7, 2020, the Company experienced a fire at its plant in a spiral oven.

The spiral oven was rebuilt and was fully put back into

service in late February 2021.

The estimated loss is approximately $656,700 which includes loss of business, the rebuild of the spiral

oven, additional expenses to clean plant and lost material and packaging.

During the three months ended April 30, 2021, the Company received

$67,426 relating to business interruption insurance which was recorded as a component of costs of sales on the condensed consolidated

statement of income.

The Company received the remaining amount of proceeds for the property damage claim, resulting in other income of

This amount was offset by repairs and maintenance expense of $12,475 as well as the costs of additions and parts of the oven

and roof totaling $47,669.

The insurance claim remains open in order for the Company to review for additional business income losses.

Claims and Assessments

time to time, the Company may become involved in various lawsuits and legal proceedings, which arise in the ordinary course of

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.

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.

and Royalty Agreements

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”).

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.

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.

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

3 unchanged sentences

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

and 1% of Net Sales in excess of $20,000,000 of Net Sales for each Agreement year.

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

2% of Net Sales from $2,500,000 up to $20,000,000 of Net Sales for each Agreement year;

of Net Sales in excess of $20,000,000 of Net Sales for each Agreement year.

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

Agreement Year

to be Paid with

Respect to Such

Agreement Year

1 st and 2 nd

3 rd and 4 th

5 th , 6 th and 7 th

8 th and 9 th

Company incurred $111,568 and $98,656 of royalty expenses for the three months ended October 31, 2020 and 2019, respectively.

The Company incurred $399,013 and $319,502 of royalty expenses for the nine months ended October 31, 2020 and 2019, respectively.

Royalty expenses are included in general and administrative expenses on the condensed consolidated statement of operations.

10 th and thereafter

Company incurred $148,436 and $161,627 of royalty expenses for the three months ended April 30, 2021 and 2020, respectively.

expenses are included in general and administrative expenses on the condensed consolidated statement of operations.

with Placement Agents and Finders

1 unchanged sentence

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.

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

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

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.

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.

Pursuant to the Spartan Advisory Agreement, 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.

Company entered into an Advisory Agreement with Spartan effective June 1, 2019 (the “Advisory Agreement”).

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”).

The advisory agreement

was terminated according to its terms on March 31, 2020.

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.

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”).

The advisory agreement was terminated according to its terms

on March 31, 2020.

Company entered into an Advisory Agreement with B.

4 unchanged sentences

Pursuant to the agreement, the Company shall pay to B.

Riley a non-refundable fee of $175,000 upon delivery

of a fairness opinion in the event a transaction has value over $50 million ($125,000 if a transaction has a value less than $50

In addition, additional fees may be paid to B.

Riley a non-refundable fee of $175,000 upon delivery of a fairness

opinion in the event a transaction has value over $50 million ($125,000 if a transaction has a value less than $50 million).

additional fees may be paid to B.

Riley based on the terms of the agreement and transactions consummated.

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 potential purchasers or targets, (iii) soliciting proposals from purchasers or targets, (iv) assisting the Company

with strategic introductions and negotiations, (v) evaluating proposals, and (vi) other financial advisory and investment banking

services (collectively, the “B.

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 potential purchasers or targets,

(iii) soliciting proposals from purchasers or targets, (iv) assisting the Company with strategic introductions and negotiations, (v)

evaluating proposals, and (vi) other financial advisory and investment banking services (collectively, the “B.

Riley Advisory Services”).

Subsequent Events

Company has evaluated subsequent events through the date the financial statements were available to be issued.

Based on this evaluation,

the Company has identified the following reportable subsequent events other than those disclosed elsewhere in these financials.

to October 31, 2020, warrant holders exercised 823,890 warrants at $1.50 per share into 823,890 shares of common stock.

received aggregate proceeds of $1,124,724 upon exercise.

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

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.

of Operations for the Three Months ended October 31, 2020 and 2019

following table sets forth the summary statements of operations for the three months ended October 31, 2020 and 2019:

Sales - Net of Slotting

Fees and Discounts

Impact on Previously Issued Financial Statements

During the audit for the year ended January

31, 2021, the

Company identified and recorded a prior period adjustment related to promotion expenses that should have been recorded in the year

ended January 31, 2021 as an offset to revenue as discussed in the Company’s revenue recognition policy instead of general

and administrative expenses as originally recorded.

In accordance with the guidance provided by the

SEC’s Staff Accounting Bulletin 99, Materiality and Staff Accounting Bulletin No.

108, Considering the Effects of

Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements the Company determined that previously

issued financial statements for the three months ended April 30, 2020 should be revised to reflect the correction of these errors.

impact on the the three months ended April 30,2020, was reflected as an adjustment of $265,978 which resulted in a decrease in Sales

net of slotting fees and corresponding decrease in General and administrative expenses.

a result of the aforementioned correction of accounting errors, the relevant financial statements have been revised as follows:

For the three months ended April 30, 2020

As Previously Reported

Statement of Income

Sales –

net of slotting fees and discounts

General and administrative expenses

Operating expenses

$ (2,338,201 )

$ (2,397,352 )

Other Expenses

the three months ended October 31, 2020 and 2019, the Company reported net income of $734,142 and $408,615, respectively.

change in net income between the three months ended October 31, 2020 and 2019 was primarily attributable to an increase in sales

of 7% and an increase in gross profit (32% of sales as discussed below) and in addition to a decrease in interest expense and

only a modest decrease in operating expenses (24% of sales as discussed below).

Sales, net of slotting fees and discounts increased by approximately 7% to $9,898,991 during the three months ended October

31, 2020, from $9,267,036 during the three months ended October 31, 2019.

During the three months ended October 31, 2020, the

Company was able to increase its sales through new customers as well as its existing customer base.

The effect of COVID-19 slowed

new placements in the third quarter and are expected to resume in the fourth quarter.

The gross profit margin was 32% for the three months ended October 31, 2020 compared to 31% for the three months ended

October 31, 2019.

Gross margin increased due to plant operating efficiencies.

Operating expenses decreased by 2% during the three months ended October 31, 2020, as compared to the three months

ended October 31, 2019.

Operating expenses decreased as a percentage of sales from 26% in three months ended October 31, 2019

to 24% in three months ended October 31, 2020.

The $59,151 change in total operating expenses is primarily attributable to the

following increases in operating expenses:

and freight of $111,881 due to increased sales and slightly lower freight costs over the prior year,

and related expenses of $64,609 due to the addition of a Senior Executive in February 2020,

expense of $55,865 directly related to increased sales, and

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

and promotion of $203,847 due to lower promotional expenses for merchandising, offset by higher spending on a Sirius Radio

Campaign, and

fees of $34,153 due to a decrease in investor relations activities in comparison to the prior year.

Other expenses decreased by $41,999 to $52,986 for the three months ended October 31, 2020 as compared to $94,985

during the three months ended October 31, 2019.

For three months ended October 31, 2020, other expenses consisted of $45,822 in

interest expense incurred on the Company’s financing arrangements.

In addition, the Company recorded $7,164 of amortization

expense related to the debt discount.

For three months ended October 31, 2019, other expenses consisted of $89,635 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.

of Operations for the Nine Months ended October 31, 2020 and 2019

following table sets forth the summary statements of operations for the nine months ended October 31, 2020 and 2019:

Sales - Net of Slotting

Fees and Discounts

Income from operations

Basic and diluted income per share

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

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 STATEMENS”

AND “RISK FACTORS”

PRIOR COMPANY FILINGS AND THOSE INCLUDED ELSEWHERE IN THIS REPORT.

of Operations for the Three Months ended April 30, 2021 and 2020

following table sets forth the summary statements of operations for the three months ended April 30, 2021 and 2020:

Three Months Ended

April 30, 2021

April 30, 2020

Sales - Net of Slotting Fees and Discounts

Operating Expenses

1 unchanged sentence

$ (2,485,668 )

Other Expenses

the nine months ended October 31, 2020 and 2019, the Company reported net income of $2,380,111 and $1,122,589, respectively.

change in net income between the nine months ended October 31, 2020 and 2019 was primarily attributable to an increase in sales

of 27% and stable gross profit (32% of sales as discussed below) in addition to a decrease in interest expense offset by increases

in operating expenses (24% of sales, a 2% decrease from the prior year, as discussed below).

Sales, net of slotting fees and discounts increased by approximately 27% to $31,384,394 during the nine months ended October

31, 2020, from $24,731,305 during the nine months ended October 31, 2019.

During the nine months ended October 31, 2020, the Company

was able to increase its sales through new customers as well as its existing customer base.

COVID-19 had the effect of, consumer

hoarding of food and increasing inventory build at retailers in the first quarter of the year but slowed new placements in the

third quarter.

The Company expects new placements to revert back to normal levels in the fourth quarter of this fiscal year.

The gross profit margin was 32% for the nine months ended October 31, 2020 compared to 32% for the nine months ended

October 31, 2019.

Gross margins remained the same as a percentage of sales, due to short term higher beef raw material prices,

offset by higher plant operations efficiency.

Operating expenses increased by 15% during the nine months ended October 31, 2020, as compared to the nine months

ended October 31, 2019.

Operating expenses decreased as a percentage of sales from 26% in 2019 to 24% in 2020.

The $967,869 increase

in total operating expenses is primarily attributable to the following increases in operating expenses:

and freight of $503,432 due to increased sales and change of customer mix;

expense of $263,760 directly related to increased sales;

and related expenses of $221,653 due to the addition of a Senior Executive in February 2020;

fees of $107,453 due to an increase in investor relations and investment banking activities;

expenses of $79,511 due to the increase in sales.

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

and promotion of $289,041 due to lower promotional expenses for merchandising activity related to higher sales, and increased

spending on a Sirius Radio advertising campaign;

show and travel expenses of $65,609 due to reduced need for travel and the elimination of in person trade shows due to COVID-19.

Other expenses decreased by $121,783 to $189,736 for the nine months ended October 31, 2020 as compared to $311,519

during the nine months ended October 31, 2019.

For nine months ended October 31, 2020, other expenses consisted of $171,872 in

interest expense incurred on the Company’s financing arrangements.

In addition, the Company recorded $17,864 of amortization

expense related to the debt discount.

For nine months ended October 31, 2019, other expenses consisted of $293,531 in interest

expense incurred on the Company’s financing arrangements.

In addition, the Company recorded $17,988 of amortization expense

related to the debt discount.

Other Income (Expenses)

Income Tax Provision

the three months ended April 30, 2021 and 2020, the Company reported a net income of $631,524 and $906,202, respectively.

in net income between the three months ended April 30, 2021 and 2020 was mainly the result of a decrease in gross profit of $117,269

(discussed below) and the income tax provision of $247,949 recorded during the three months ended April 30, 2021 compared to $0 during

the three months ended April 30, 2020.

net of slotting fees and discounts decreased by approximately 5% to $10,313,400 during the three months ended April 30, 2021, from

$10,834,941 during the three months ended April 30, 2020.

The decrease was mainly attributable to the prior year’s increase in

sales due to inventory stocking of major national accounts during the early stages of the COVID-19 pandemic.

The gross profit margin was 32% for the three months ended April 30, 2021 compared to 32% for the three months ended

April 30, 2020.

Operating expenses increased by less than 1% during the three months ended April 30, 2021, as compared to the three

months ended April 30, 2020.

Operating expenses increased as a percentage of sales to 24% in 2021 compared to 23% in 2020.

increase in total operating expenses is primarily attributable to the following increases in operating expenses:

and related expenses of $66,568 due to bonuses paid to executives;

fees of $23,972 due to the increase in the number of directors and increase in compensation to each director;

expense of $23,580 due to an increase in costs of coverage of the director and officer policies and an increase in umbrella policy.

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

fees of $77,089 due to reduced consulting and investment banker expenses;

compensation decreased by $26,604 due to a decrease in awards and vesting during the current period.

Income (Expenses):

Other income (expenses) increased by $97,026 to income of $27,274 for the three months ended April 30, 2021

as compared to expenses of $(69,752) during the three months ended April 30, 2020.

For the three months ended April 30, 2021, other income

(expenses) consisted of $(10,430) in interest expense incurred on the Company’s financing arrangements which was offset by the

net insurance proceeds relating to the property damage claim of $37,704.

For three months ended April 30, 2020, other expenses consisted

of $(64,402) 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.

and Capital Resources

following table summarizes total current assets, liabilities and working capital at October 31, 2020 compared to January 31, 2020:

following table summarizes total current assets, liabilities and working capital at April 30, 2021 compared to January 31, 2021:

April 30, 2021

January 31, 2021

Current Assets

1 unchanged sentence

Working Capital

of October 31, 2020, we had working capital of $3,494,259 as compared to a working capital of $1,412,024 as of January 31, 2020,

an increase of $2,082,235.

In addition to the increase in sales and net income, the increase in working capital is primarily attributable

to an increase in cash of $1,399,160, an increase in inventories of $313,870, an increase in prepaid expenses of $38,784, a decrease

in accounts payable and accrued expenses $39,669 and a net decrease of $330,727 in the current portion of lease and debt obligations.

These amounts were offset by a decrease in accounts receivable of $39,975.

cash provided by operating activities for the nine months ended October 31, 2020 and 2019 was $2,518,012 and $975,848, respectively.

Cash provided by operations is primarily attributable to the net income for the nine months ended October 31, 2020 and 2019 of

$2,380,111 and $1,122,589, respectively.

cash used in all investing activities for the nine months ended October 31, 2020 was $320,332 as compared to $163,186 for the

nine months ended October 31, 2019, respectively, to acquire new machinery and equipment and leasehold improvements.

expenditures are attributed to a Plant Expansion Project in progress since mid-2017 to expand plant capacity and efficiency to

meet growing demand.

cash used in all financing activities for the nine months ended October 31, 2020 was $798,520 as compared to $811,497 for the

nine months ended October 31, 2019.

During the nine months ended October 31, 2020, the Company received proceeds of $330,505 from

the Paycheck Protection Program promissory note and proceeds of $2,742,897 from the exercise of options and warrants.

returned the $330,505 received from the Paycheck Protection Program in May 2020.

These cash in-flows were offset by payments on

its line of credit of $2,347,348, payments on its term loan of $441,663, payments of $641,844 on the related party loans and $110,562

of April 30, 2021, we had working capital of $5,500,142 as compared to a working capital of $4,834,102 as of January 31, 2021, an increase

The increase in working capital is primarily attributable to an increase in cash of $1,052,796 and an increase in inventory

These amounts were offset by a decrease in accounts receivable of $254,048 and an increase in accounts payable and accrued

expenses of $338,962 and current portion of lease obligations of $21,551.

cash provided by operating activities for the three months ended April 30, 2021 and 2020 was $1,434,768 and $1,195,665, respectively.

The net income for the three months ended April 30, 2021 and 2020 was $631,524 and $906,202, respectively.

cash used in all investing activities for the three months ended April 30, 2021 was $354,394 as compared to $105,616 for the three months

ended April 30, 2020, 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.

cash used in all financing activities for the three months ended April 30, 2021 was $27,578 as compared to $330,296 provided for the

three months ended April 30, 2020.

During the three months ended April 30, 2021, the Company received proceeds of $19,080 from the exercise

These cash in-flows were offset by payments of $46,658 paid for finance lease payments.

During the three months ended April

30, 2020, the Company received proceeds of $330,505 from the Paycheck Protection Program promissory note and the Company’s net

borrowings on its line of credit increased by $150,000 over the prior year comparable period.

The Company returned the $330,505 received

from the Paycheck Protection Program in May 2020.

These cash in-flows were offset by payments on its term loan of $125,001 and $25,208

paid for capital lease payments.

During the nine months ended October 31, 2019, the Company made net borrowings on the line of

credit of $285,314.

These cash in-flows were offset by net payments of term loan of $1,033,336 and $63,475 paid for capital lease

reflected in the accompanying consolidated financial statements, the Company has net income and net cash provided by operations

of $2,380,111 and $2,518,012, respectively, for the nine months ended October 31, 2020.

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 the fiscal year ending January 31, 2021 based on current and

projected levels of operation, the Company may require additional funding to finance growth and achieve its strategic objectives.

If such financing is required, there can be no assurance that financing will be available in amounts or 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.

Because of the rapidly

changing environment in response to COVID-19, the current expectations of the Company may be altered as conditions change.

reflected in the accompanying consolidated financial statements, the Company has net income and net cash provided by operations of $631,524

and $1,434,768, respectively, for the three months ended April 30, 2021.

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 June 14, 2022 based on current and projected levels of operations, the Company

may require additional funding to finance growth and achieve its strategic objectives.

If such financing is required, there can be no

assurance that financing will be available in amounts or 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.

Because of the rapidly changing environment in response to COVID-19, the current expectations

of the Company may be altered as conditions change.

Accounting Pronouncements

October 2016, the FASB issued ASU 2016-16, “Income Taxes (Topic 740):

Intra-Entity Transfers of Assets Other than Inventory”,

which eliminates the exception that prohibits the recognition of current and deferred income tax effects for intra-entity

transfers of assets other than inventory until the asset has been sold to an outside party.

The updated guidance is effective

for annual periods beginning after December 15, 2019, including interim periods within those fiscal years.

Early adoption of the

update is permitted.

The adoption of the new standard did not have a significant impact on the Company’s condensed consolidated

financial statements.

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.

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 adoption of the new standard did not have a significant impact on the Company’s condensed consolidated

financial statements.

August 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)

ASU 2018-15, “Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is

a Service Contract”

The amendments in this update align the requirements for capitalizing implementation costs incurred

in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop

or obtain internal-use software.

The Company adopted this guidance on February 1, 2020 on a prospective basis.

December 2019, the FASB issued authoritative guidance intended to simplify the accounting for income taxes (ASU 2019-12, “

1 unchanged sentence

Simplifying the Accounting for Income Taxes ”).

This guidance eliminates certain exceptions

to the general approach to the income tax accounting model and adds new guidance to reduce the complexity in accounting

for income taxes.

This guidance is effective for annual periods after December 15, 2020, including interim periods within those

annual periods.

The Company is currently evaluating the potential impact of this guidance on its consolidated financial statements.

does not believe that any recently issued, but not yet effective accounting pronouncements, when adopted, will have a material

effect on the accompanying consolidated financial statements.

This guidance eliminates certain exceptions to the general

approach to the income tax accounting model and adds new guidance to reduce the complexity in accounting for income taxes.

This guidance

is effective for annual periods after December 15, 2020, including interim periods within those annual periods.

The adoption of the new

standard did not have a significant impact on the Company’s condensed consolidated financial statements.

does not believe that any recently issued, but not yet effective accounting pronouncements, when adopted, will have a material effect

on the accompanying consolidated financial statements.

Accounting Policies

condensed consolidated financial statements and related public financial information are based on the application of accounting

principles generally accepted in the United States (“GAAP”).

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

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.

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

December 2019, an outbreak of a novel strain of coronavirus (COVID-19) originated in Wuhan, China, and has since spread to a number

of other countries, including the United States.

On March 11, 2020, the World Health Organization characterized COVID-19 as a

In addition, as of the time of the filing of this Annual Report on Form 10-K, several states in the United States, including

New Jersey, where the Company is headquartered, have declared states of emergency, and several countries around the world, including

the United States, have taken steps to restrict travel.

While all of the Company’s operations are located in the United

States, it participates in a global supply chain, and the existence of a worldwide pandemic, the fear associated with COVID-19,

or any pandemic, and the reactions of governments around the world in response to COVID-19, or any, pandemic, to regulate the

flow of labor and products and impede the travel of personnel, may impact its ability to conduct normal business operations, which

could adversely affect the Company’s results of operations and liquidity.

Disruptions to the Company’s supply chain

and business operations, or to its suppliers’

or customers’

supply chains and business operations, could include disruptions

from the closure of supplier and manufacturer facilities, interruptions in the supply of raw materials and components, personnel

absences, or restrictions on the shipment of its suppliers’

or customers’

products, any of which could have adverse

ripple effects on the Company’s manufacturing output and delivery schedule.

If the Company needs to close any of its facilities

or a critical number of our employees become too ill to work, the production ability could be materially adversely affected in

a rapid manner.

Similarly, if the Company’s customers experience adverse business consequences due to COVID-19, or any other

pandemic, demand for its products could also be materially adversely affected in a rapid manner.

Global health concerns, such

as COVID-19, could also result in social, economic, and labor instability in the countries and localities in which the Company

or its suppliers and customers operate.

Any of these uncertainties could have a material adverse effect on the business, financial

condition or results of operations.

In addition, a catastrophic event that results in the destruction or disruption of the Company’s

data centers or its critical business or information technology systems would severely affect the ability to conduct normal business

operations and, as a result, the operating results would be adversely affected.

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

We believe our use of estimates and underlying accounting assumptions adhere to GAAP and are consistently and conservatively

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.

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

While all these significant accounting

policies impact our financial condition and results of operations, we view certain of these policies as critical.

Policies determined

to be critical are those policies that have the most significant impact on our financial statements and require management to use a greater

degree of judgment and estimates.

Actual results may differ from those estimates.

Our management believes that given current facts and

circumstances, it is unlikely that applying any other reasonable judgments or estimate methodologies would cause effect on our consolidated

results of operations, financial position or liquidity for the periods presented in this report.

believe the following critical accounting policies and procedures, among others, affect our more significant judgments and estimates

used in the preparation of our consolidated financial statements:

preparation of 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.

estimates and assumptions impact, among others, the following:

allowance for doubtful accounts, inventory obsolescence and the fair value

of share-based payments.

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.

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

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.

February 1, 2019, the Company adopted ASC 842 using the modified retrospective approach and recognized a right of use (“ROU”)

asset and liability in the consolidated balance sheet in the amount of $1,599,830 related to the operating lease for office and warehouse

Results for the year ended January 31, 2020 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 .

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:

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.

to apply the recognition requirements in ASC 842 to short-term leases.

record a right of use asset or right of use liability for leases with an asset or liability balance that would be considered immaterial.

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;

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.

guidance will significantly enhance comparability of revenue recognition practices across entities, industries, jurisdictions and capital

Additionally, the guidance requires improved disclosures as to the nature, amount, timing and uncertainty of revenue that is

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.

Company adopted this guidance and related amendments as of the first quarter of fiscal 2019, applying the full retrospective transition

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.

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.

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.

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.

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.

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

The grants are amortized on a straight-line basis over the requisite service periods, which is generally the vesting period.

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.

computing fair value of share-based payments, the Company has considered the following variables:

risk-free interest rate assumption is based on the U.S.

Treasury yield for a period consistent with the expected term of the option

in effect at the time of the grant.

Company has not paid any dividends on common stock since its inception and does not anticipate paying dividends on its common stock

in the foreseeable future.

expected option term is computed using the “simplified”

method as permitted under the provisions of Staff Accounting

Bulletin (“SAB”) 110.

term is the life of the grant.

expected volatility was estimated using the historical volatilities of the Company’s common stock.

forfeiture rate is based on the historical forfeiture rate for the Company’s unvested stock options, which was 0%.

incurred for producing and communicating advertising for the Company are charged to operations as incurred.

Balance Sheet Arrangements:

do not have any off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons,

also known as “special purpose entities”

do not have any off-balance sheet arrangements, financings, or other relationships with unconsolidated entities or other persons, also

known as “special purpose entities”

Quantitative and Qualitative Disclosures About Market Risk

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What changed 10-Q

Item 1. Financial Statements