UNITED
STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): September 8, 2017
MamaMancini’s Holdings, Inc.
(Exact Name of Registrant as Specified in its Charter)
| Nevada | 000-28629 | 27-067116 | ||
|
(State
or Other Jurisdiction
of Incorporation) |
(Commission
File No.) |
(I.R.S.
Employer
Identification No.) |
| 25 Branca Road, East Rutherford, NJ | 07073 | |
| (Address of Principal Executive Offices) | (Zip Code) |
Registrant’s telephone number, including area code: (201) 532-1212
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| [ ] | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| [ ] | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| [ ] | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| [ ] | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
TABLE OF CONTENTS
| Item 1.01 | Entry into a Material Definitive Agreement | |
| Item 9.01 | Financial Statements and Exhibits |
Item 1.01 Entry into a Material Definitive Agreement
Following extensive discussion and due diligence (including a third party valuation of JEFE commissioned by the Company’s Board of Directors), on September 8, 2017, the Company and JEFE executed a Letter of Intent pursuant to which the parties have agreed in principle that, pursuant to the terms detailed in the Letter of Intent and subject to certain additional terms and conditions and the execution of a definitive Merger Agreement and related agreements and documents, JEFE will merge with and into the Company (or a wholly-owned subsidiary thereof). In connection with the merger, the Company will acquire all assets of JEFE which were estimated to be $2,928,825 as of July 31, 2017 The consideration for the transaction will be (a) the extinguishment of the Inter-Company Loan between the parties which was $1,597,518 at July 31, 2017, (b) the assumption by the Company of all JEFE accounts payable and accrued expenses which are estimated to be $2,656,948 at July 31, 2017, (c) assumption by the Company of certain third-party loans to JEFE totaling approximately $782,000 and (d) indemnification of Carl Wolf with respect to his collateralization of a bank loan to JEFE in the amount of approximately $250,000. As a result of the transaction, (i) the Company will become the sole shareholder of JEFE either directly or through a wholly-owned subsidiary and (ii) following the closing, JEFE will be a wholly-owned subsidiary of the Company and its financial statements as of the Closing shall be consolidated with the Consolidated Financial Statements of the Company (collectively, the “Merger Transaction”). No cash will be exchanged in this transaction. The estimated assets of JEFE and Consideration to be paid in connection with the merger transaction are subject to final due diligence by the Company and the audit of JEFE’s financial statements. The parties intend to close the Merger Transaction on or about November 1, 2017.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits:
| Exhibit No. | Description | |
| 99.1 |
MamaMancini’s Holdings, Inc. Press Release Dated August 22, 2017 |
Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
MamaMancini’s Holdings, Inc.
| By: | /s/ Carl Wolf | |
| Name: | Carl Wolf | |
| Title: | Chief Executive Officer |
Dated: September 11, 2017
Exhibit 99.1
MamaMancini’s Signs LOI to Acquire Manufacturing Operations
EAST RUTHERFORD, NJ--(Marketwired - Aug 22, 2017) - MamaMancini’s Holdings, Inc. (the “Company” or “MamaMancini’s”) ( OTCQB : MMMB ), a marketer of specialty pre- prepared, frozen and refrigerated all natural food products (as defined by the United States Department of Agriculture), today announced that it had signed a Letter of Intent (“LOI”) to acquire Joseph Epstein Food Enterprises, Inc. (“JEFE”), a manufacturer of food products, which has been the sole manufacturer of the Company’s products since inception. Under the agreed terms, no cash would be exchanged between the parties. JEFE is presently owned by the Chief Executive Officer and President of the Company, who in the aggregate owns approximately 44% of the Company’s common stock.
The transaction had been under consideration by the Company’s independent Strategic Alternatives Committee of its Board for more than a year. The Company believes that the transaction on a pro- forma basis reduces Cost of Goods Sold and is accretive to the Company both in terms of Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”), (a non-GAAP financial measure) and Net Profit in the range of $1.5 to $2.0 million over the next twelve (12) months.
The transaction locks-in increasing profits consistent with the company’s growth plans, provides the Company with control over the manufacturing of its primary products, simplifies organizational processes and eliminates related-party transactions which historically have contributed to investor confusion.
Under the terms of the Letter of Intent, the transaction would be completed on a non-dilutive basis without any cash or stock passing to the shareholders of JEFE. The principal consideration for the transaction would be the cancellation of approximately $2 million of inter-company debt and the assumption of approximately $2.7 million of accrued expenses accounts payable and outstanding debt.
In considering the transaction, the Strategic Alternatives Committee had obtained an independent professional outside appraisal of JEFE on both a freestanding and combined basis. On a conservative basis, the Committee concluded that the value of JEFE significantly exceeded the consideration the Company would pay pursuant to the terms of the proposed transaction. While the transaction will increase Company debt and reduce net worth in the short term, the Committee and the Board of Directors believed that the benefits of this transaction significantly outweighed these considerations and would bring meaningful value accretion to the Company and its shareholders.
The Company intends to complete this transaction by November 1, 2017 and it is subject to the completion of due diligence (including the receipt of JEFE audited financial statements for a two-year period) and drafting and execution of a definitive merger agreement and related transaction documents.
About MamaMancini’s
MamaMancini’s is a marketer and distributor of a line of beef meatballs and turkey meatballs all with sauce, five cheese stuffed beef and turkey meatballs all with sauce, original beef and turkey meatloaves, chicken parmesan, stuffed peppers and other similar Italian cuisine products. The Company’s sales have been growing on a consistent basis as the Company expands its distribution channel, which includes major retailers and distributors such as Costco, Publix, Shop Rite, Jewel, Save Mart, Lucky’s, Lunds and Byerlys, SuperValu, Safeway, Albertsons, SpartanNash, Bashas, Whole Foods Market, Hy-Vee, Shaw’s, Kings, Roche Bros., Key Foods, Stop & Shop, Giant, Giant Eagle, Foodtown, Randalls, Krogers, Shoppers,, King Kullen, Lowes, Central Market, Weis Markets, Ingles, Food City, The Fresh Market. Sysco, Burris Foods, C&S, and Driscoll Foods. The Company sells a variety of its products on air and on line on QVC, the worlds largest direct to consumer marketer.
Forward Looking Statements
This press release may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. “Forward-looking statements” describe future expectations, plans, results, or strategies and are generally preceded by words such as “may,” “future,” “plan” or “planned,” “will” or “should,” “expected,” “anticipates,” “draft,” “eventually” or “projected.” You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause future circumstances, events, or results to differ materially from those projected in the forward- looking statements, including the risks that actual results may differ materially from those projected in the forward-looking statements as a result of various factors, and other risks identified in the Company’s 10-K for the fiscal year ended January 31, 2017 and other filings made by the Company with the Securities and Exchange Commission.