Business Context and Reporting Period
This Form 8-K was filed by MamaMancini's Holdings, Inc. (trading as MMMB on NASDAQ) on December 23, 2021, with the earliest event reported on that date. The filing details the entry into material definitive agreements and the subsequent completion of acquisitions on December 29, 2021.
Key Financial Metrics and Transaction Details
The Company acquired two related gourmet food manufacturers, T&L Creative Salads, Inc. and Olive Branch, LLC, for a combined purchase price of $14.0 million. The payment structure consisted of:
- Cash at Closing: $11.0 million
- Deferred Consideration: $3.0 million in a four-year note payable to the principals of T&L.
To fund the cash portion, the Company utilized existing cash on hand and secured a new $7.5 million long-term acquisition note from M&T Bank. The filing does not provide specific revenue, profit, cash flow, or margin data for the reporting period.
Material Changes and New Obligations
The primary material change is the expansion of the Company's asset base through the acquisition of T&L and OB. Concurrently, the Company created a direct financial obligation via a Multiple Disbursement Term Loan with M&T Bank:
- Principal Amount: $7,500,000
- Term: 60-month amortization period
- Maturity Date: December 29, 2026
- Interest Rate: Variable rate based on one-day SOFR plus a margin ranging from 3.12% to 4.12%, contingent on the Company's Senior Funded Debt/EBITDA ratio.
Management Commentary and Operational Impact
Anthony Morello, Jr. will remain as CEO of T&L Acquisition Corp., the wholly-owned subsidiary formed to acquire the target companies. The proceeds from the M&T Bank loan were utilized specifically to partially fund these acquisitions. The filing incorporates by reference the full Asset Purchase Agreements for detailed terms.
Investor Verification Checklist
- Verify the integration progress of T&L Creative Salads and Olive Branch into MamaMancini's operations.
- Monitor the Company's Senior Funded Debt/EBITDA ratio to determine the applicable interest rate margin on the new $7.5 million loan.
- Review the full text of Exhibits 2.1 and 2.2 for specific covenants and conditions within the Asset Purchase Agreements.
- Assess the impact of the $3.0 million deferred note on future cash flow obligations.