BAB, INC. Files 2023 Annual Report on Form 10-K

TL;DR

<b>BAB, INC. has filed its 2023 Form 10-K detailing its fiscal year operations and financial standing.</b>

AI Summary

BAB, INC. (BABB) filed a Annual Report (10-K) with the SEC on February 26, 2024. BAB, INC. filed its 2023 Form 10-K on February 26, 2024, reporting for the fiscal year ended November 30, 2023. The filing covers the period from December 1, 2022, to November 30, 2023. The company's principal business address is 500 Lake Cook Road, Suite 475, Deerfield, IL 60015. BAB, INC. is incorporated in Delaware. The Standard Industrial Classification code for the company is 5812 (RETAIL-EATING PLACES).

Why It Matters

For investors and stakeholders tracking BAB, INC., this filing contains several important signals. This filing provides a comprehensive overview of BAB, INC.'s financial performance and business operations for the fiscal year 2023, which is crucial for investors to assess the company's health and future prospects. As a 10-K filing, it contains detailed financial statements, risk factors, and management's discussion and analysis, offering deep insights into the company's strategic direction and potential challenges.

Risk Assessment

Risk Level: — BAB, INC. shows moderate risk based on this filing. The filing is a standard annual report (10-K) and does not contain immediate red flags or significant negative developments, indicating a routine disclosure.

Analyst Insight

Review the detailed financial statements and risk factors within the 10-K to understand BAB, INC.'s performance and strategic outlook for the upcoming fiscal year.

Key Numbers

• 2023-11-30 — Fiscal Year End (Conformed period of report)
• 2024-02-26 — Filing Date (As of date)
• 000-31555 — SEC File Number (SEC file number)

Key Players & Entities

• BAB, INC. (company) — Filer name
• 2023 (date) — Fiscal year end
• 2024-02-26 (date) — Filing date
• 500 Lake Cook Road, Suite 475, Deerfield, IL 60015 (address) — Business address
• DE (state) — State of incorporation
• 5812 (industry_code) — Standard Industrial Classification

FAQ

Industry Context

BAB, INC. operates within the retail-eating places industry, as indicated by its SIC code 5812.

Regulatory Implications

The filing is made in accordance with the Securities Exchange Act of 1934.

What Investors Should Do

1. Analyze the financial statements for revenue, net income, and other key performance indicators.
2. Review the 'Risk Factors' section for potential challenges and uncertainties.
3. Examine the 'Management's Discussion and Analysis of Financial Condition and Results of Operations' for strategic insights.

Key Dates

• 2024-02-26: 10-K Filing — Annual report filed with the SEC.

Year-Over-Year Comparison

This is the initial filing analyzed for the period ending November 30, 2023. No prior filing data is available for comparison within this context.

Key Financial Figures

• $0.73 — ates as of May 31, 2023; Closing price ($0.73) for said shares in the NASDAQ OTCQB Ma
• $467,000 — me The Company reported net income of $467,000 for fiscal year ended November 30, 2023
• $432,000 — ded November 30, 2023 and net income of $432,000 for fiscal year ended November 30, 2022
• $615,000 — ember 30, 2023 net operating income was $615,000 compared to $608,000 in 2022. Food Ser
• $608,000 — erating income was $615,000 compared to $608,000 in 2022. Food Service Industry Food
• $25,000 — B currently requires a franchise fee of $25,000 on a franchisee's first full production
• $10,000 — duction BAB store. There is currently a $10,000 veterans discount for the franchise fee
• $20,000 — subsequent production stores for BAB is $20,000. MFM currently requires a franchise fee
• $30,000 — M currently requires a franchise fee of $30,000 on a franchisee's first full production
• $3,000 — ue a refund of the preliminary fee less $3,000. If the prospective franchisee submits
• $0.02 — 2023 the Board of Directors declared a $0.02 cash distribution/dividend per share, $
• $0.01 — 2 cash distribution/dividend per share, $0.01 quarterly and $0.01 special, to stockho
• $0.90 — of the Company at an exercise price of $0.90 per one-thousandth of a Preferred Share

Filing Documents

• babs20231130_10k.htm (10-K) — 1000KB
• ex_628325.htm (EX-21.1) — 2KB
• ex_628321.htm (EX-31.1) — 12KB
• ex_628322.htm (EX-31.2) — 12KB
• ex_628323.htm (EX-32.1) — 4KB
• ex_628324.htm (EX-32.2) — 4KB
• img01.jpg (GRAPHIC) — 8KB
• img02.jpg (GRAPHIC) — 5KB
• 0001437749-24-005487.txt (&nbsp;) — 4891KB
• babb-20231130.xsd (EX-101.SCH) — 48KB
• babb-20231130_def.xml (EX-101.DEF) — 290KB
• babb-20231130_lab.xml (EX-101.LAB) — 274KB
• babb-20231130_pre.xml (EX-101.PRE) — 319KB
• babb-20231130_cal.xml (EX-101.CAL) — 49KB
• babs20231130_10k_htm.xml (XML) — 680KB

Business

Business 3 Item 1A.

Risk Factors

Risk Factors 7 Item 1B. Unresolved Staff Comments 7 Item 2.

Properties

Properties 7 Item 3.

Legal Proceedings

Legal Proceedings 7 Item 4. Mine Safety Disclosures 7 PART II Item 5. Market for Registrant ' s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 8 Item 6. Reserved 9 Item 7. Management ' s Discussion and Analysis of Financial Condition and Results of Operations 9 Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 15 Item 8.

Financial Statements and Supplementary Data

Financial Statements and Supplementary Data 16 Item 9. Changes in and Disagreement with Accountants on Accounting and Financial Disclosure 37 Item 9A.

Controls and Procedures

Controls and Procedures 37 Item 9B. Other Information 37 PART III Item 10. Directors, Executive Officers and Corporate Governance 38 Item 11.

Executive Compensation

Executive Compensation 40 Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 42 Item 13. Certain Relationships, Related Transactions and Director Independence 43 Item 14. Principal Accountant Fees and Services 43 PART IV Item 15. Exhibits and Financial Statement Schedules 44 - 2 - PART I

BUSINESS

ITEM 1. BUSINESS BAB, Inc. ("the Company") has three wholly owned subsidiaries: BAB Systems, Inc. ("Systems"), BAB Operations, Inc. ("Operations") and BAB Investments, Inc. ("Investments"). Systems was incorporated on December 2, 1992, and was primarily established to franchise Big Apple Bagels ("BAB") specialty bagel retail stores. My Favorite Muffin ("MFM") was acquired in 1997 and is included as a part of Systems. Brewster's ("Brewster's") was established in 1996 and the coffee is sold in BAB and MFM locations. SweetDuet ("SD") frozen yogurt can be added as an additional brand in a BAB or MFM location. Operations was formed in 1995, primarily to operate Company-owned stores of which there are currently none. The assets of Jacobs Bros. Bagels ("Jacobs Bros.") were acquired in 1999, and any branded wholesale business uses this trademark. Investments was incorporated in 2009 to be used for the purpose of acquisitions. To date there have been no acquisitions. The Company was incorporated under the laws of the State of Delaware on July 12, 2000. The Company currently franchises and licenses bagel and muffin retail units under the BAB, MFM and SD trade names. At November 30, 2023, the Company had 63 franchise units and 4 licensed units in operation in 20 states. There are 5 units under development. The Company's revenues are derived primarily from the ongoing royalties paid to the Company by its franchisees and from receipt of initial franchise fees. Additionally, the Company derives revenue from the sale of licensed products (My Favorite Muffin mix, and Brewster's coffee) to franchisees, licensees and other approved customers. The BAB franchised brand consists of units operating as "Big Apple Bagels," featuring daily baked bagels, flavored cream cheeses, premium coffees, gourmet bagel sandwiches and other related products. BAB units are primarily concentrated in the Midwest and Western United States. The MFM brand consists of units operating as "My Favorite Muffin

RISK FACTORS

ITEM 1A. RISK FACTORS Not required for smaller reporting companies.

UNRESOLVED STAFF COMMENTS

ITEM 1B. UNRESOLVED STAFF COMMENTS Not required for smaller reporting companies.

PROPERTIES

ITEM 2. PROPERTIES The Company's principal executive office, consisting of approximately 5,300 square feet, is located in Deerfield, Illinois and is leased. A lease was signed in June of 2018, effective October 1, 2018, expiring on March 31, 2024 with an option to renew for a 5 year period. On February 15, 2024 the Company signed a lease for the same executive office space in Deerfield, Illinois, consisting of approximately 5,300 square feet. The lease is for a period of 6 years, beginning April 1, 2024 through March 31, 2030 with an option to renew for a 5 year period.

LEGAL PROCEEDINGS

ITEM 3. LEGAL PROCEEDINGS We may be subject to various legal proceedings and claims, either asserted or unasserted, which arise in the ordinary course of business. While the outcome of such proceedings or claims cannot be predicted with certainty, management does not believe that the outcome of any such proceedings or claims will have a material effect on our financial position. We know of no pending or threatened proceeding or claim to which we are or will be a party.

MINE SAFETY DISCLOSURES

ITEM 4. MINE SAFETY DISCLOSURES None - 7 - PART II

MARKET FOR REGISTRANT ' S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

ITEM 5. MARKET FOR REGISTRANT ' S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES The following table sets forth the quarterly high and low reported closing sales prices for the Company's common stock, as reported in the Nasdaq Small Cap Market for the two years ended November 30, 2023 and 2022. The Company's common stock is traded on the NASDAQ OTCQB Marketplace under the symbol "BABB." Year Ended: November 30, 2023 Low High First quarter 0.73 0.92 Second quarter 0.70 0.86 Third quarter 0.69 0.85 Fourth quarter 0.69 0.80 Year Ended: November 30, 2022 Low High First quarter 0.75 0.91 Second quarter 0.82 0.95 Third quarter 0.79 1.00 Fourth quarter 0.68 0.89 As of February 26, 2024, the Company's Common Stock was held by 116 registered holders of record. Registered ownership includes nominees who may hold securities on behalf of multiple beneficial shareholders. The Company estimates that the number of beneficial shareholders of its common stock at February 26, 2024, is approximately 1,062 based upon information provided by a proxy services firm. CASH DISTRIBUTION AND DIVIDEND POLICY On December 11, 2023 the Board of Directors declared a $0.02 cash distribution/dividend per share, $0.01 quarterly and $0.01 special, to stockholders of record as of December 27, 2023 , paid January 16, 2024 . On September 12, 2023 the Board of Directors ("Board") declared a $0.01 distribution/dividend per share to stockholders of record as of September 28, 2023, paid October 18, 2023. On June 6, 2023 the Board declared a $0.01 distribution/dividend per share to stockholders of record as of June 22, 2023, paid on July 11, 2023. On March 13, 2023 the Board declared a $0.01 distribution/dividend per share to stockholders of record as of March 30, 2023, paid on April 19, 2023. On December 07, 2022 the Board declared a $0.02 cash distribution/dividend per share, $0.01 quarterly and $0.01 special, to st

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View this 10-K filing on SEC EDGAR