<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                    FORM 10-Q
     (Mark One)
         [X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                  SECURITIES EXCHANGE ACT OF 1934

                           FOR THE QUARTERLY PERIOD ENDED JULY 3, 2005

                                       OR

         [  ]     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                  SECURITIES EXCHANGE ACT OF 1934
                  For the transition period from ________ to ________

                         Commission file number 1-16699

                              OVERHILL FARMS, INC.
             (Exact name of registrant as specified in its charter)

               NEVADA                                          75-2590292
   (State or other jurisdiction of                            (IRS Employer
   incorporation or organization)                        Identification Number)

       2727 EAST VERNON AVENUE
         VERNON, CALIFORNIA                                       90058
         ------------------                                       -----
(Address of principal executive offices)                       (Zip code)


                                 (323) 582-9977
              (Registrant's telephone number, including area code)

                                 NOT APPLICABLE
      (Former name, former address and former fiscal year, if changed since
                                  last report)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act.). Yes [ ] No [X]

As of July 28, 2005 there were 14,889,197 shares of the issuer's common stock,
$.01 par value, outstanding.


<PAGE>
<TABLE>
<S>     <C>

                                             OVERHILL FARMS, INC.
                                                   FORM 10-Q
                                          QUARTER ENDED JULY 3, 2005

-----------------------------------------------------------------------------------------------------------

                                             TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION
------------------------------
                                                                                                  Page No.
                                                                                                  --------
Item 1.  Financial Statements

         Condensed Balance Sheets as of July 3, 2005 (unaudited) and September 26, 2004               2

         Condensed Statements of Operations for the Three Months Ended July 3, 2005 and
         June 27, 2004 (unaudited)                                                                    4

         Condensed Statements of Operations for the Nine Months Ended July 3, 2005 and
         June 27, 2004 (unaudited)                                                                    5

         Condensed Statements of Cash Flows for the Nine Months Ended July 3, 2005 and
         June 27, 2004 (unaudited)                                                                    6

         Notes to Condensed Financial Statements (unaudited)                                          8

Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations        14

Item 3.  Quantitative and Qualitative Disclosures about Market Risk                                   19

Item 4.  Controls and Procedures                                                                      20

PART II - OTHER INFORMATION
---------------------------

Item 1.  Legal Proceedings                                                                            21

Item 4.  Submission of Matters to a Vote of Security Holders                                          21

Item 6.  Exhibits                                                                                     21

SIGNATURES                                                                                            23

EXHIBITS FILED WITH THIS FORM 10-Q                                                                    24

</TABLE>

<PAGE>
<TABLE>

                                                  PART I - FINANCIAL INFORMATION


ITEM 1.           FINANCIAL STATEMENTS



                                                       OVERHILL FARMS, INC.
                                                     CONDENSED BALANCE SHEETS



                                                              ASSETS

                                                                                       July 3,              September 26,
                                                                                        2005                     2004
                                                                                --------------------     -------------------
                                                                                    (Unaudited)
<S>                                                                             <C>                      <C>
Current assets:
   Cash                                                                         $       1,664,202        $       1,609,417
   Accounts receivable, net of allowance for doubtful accounts of $109,000
     and $125,000, respectively                                                        14,064,103               12,606,122
   Inventories                                                                         11,079,578               11,228,548
   Prepaid expenses and other                                                           1,900,525                1,641,333
   Deferred income taxes                                                                  553,542                  690,380
                                                                                --------------------     -------------------
           Total current assets                                                        29,261,950               27,775,800
                                                                                --------------------     -------------------


Property and equipment, at cost:
   Fixtures and equipment                                                              12,503,731               13,096,349
   Leasehold improvements                                                               9,035,535                9,066,829
   Automotive equipment                                                                    50,854                   52,669
                                                                                --------------------     -------------------
                                                                                       21,590,120               22,215,847
   Less accumulated depreciation                                                       (9,491,028)              (9,597,566)
                                                                                --------------------     -------------------
                                                                                       12,099,092               12,618,281
                                                                                --------------------     -------------------

Other assets:
   Excess of cost over value of net assets acquired                                    12,188,435               12,188,435
   Deferred financing costs, net of accumulated amortization of $366,000 and
     $199,000, respectively                                                               547,021                  710,297
   Deferred income taxes                                                                2,286,384                3,935,242
   Other                                                                                1,889,146                2,321,514
                                                                                --------------------     -------------------
                                                                                       16,910,986               19,155,488
                                                                                --------------------     -------------------

Total assets                                                                    $      58,272,028        $      59,549,569
                                                                                ====================     ===================


                                            The accompanying notes are an integral part
                                             of these condensed financial statements.
</TABLE>
                                                               -2-
<PAGE>
<TABLE>

                                                       OVERHILL FARMS, INC.
                                               CONDENSED BALANCE SHEETS (CONTINUED)



                                          LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT)

                                                                                        July 3,                September 26,
                                                                                         2005                       2004
                                                                                ------------------------    --------------------
                                                                                      (Unaudited)
<S>                                                                             <C>                         <C>
Current liabilities:
   Accounts payable                                                             $        7,884,330          $        7,993,200
   Accrued liabilities                                                                   3,288,790                   2,968,813
   Current maturities of long-term debt                                                     55,402                   3,293,187
                                                                                ------------------------    --------------------
           Total current liabilities                                                    11,228,522                  14,255,200

Long-term debt, less current maturities                                                 46,661,969                  47,775,484
                                                                                ------------------------    --------------------
           Total liabilities                                                            57,890,491                  62,030,684
                                                                                ------------------------    --------------------

Commitments and contingencies                                                                    -                          -

Shareholders' equity (deficit):
   Series A Preferred stock, $0.01 par value, authorized 50,000,000 shares,
     issued and outstanding, 23.57 shares (liquidation preference of $750,000)                   -                           -
   Common stock, $0.01 par value, authorized 100,000,000 shares, issued and
     outstanding 14,889,197 shares at July 3, 2005 and 14,805,556 at
     September 26, 2004                                                                    148,892                     148,056
   Additional paid-in capital                                                            9,695,678                   9,573,562
   Warrants to purchase common stock                                                           400                         400
   Accumulated deficit                                                                  (9,463,433)                (12,203,133)
                                                                                ------------------------    --------------------
           Total shareholders' equity (deficit)                                            381,537                  (2,481,115)
                                                                                ------------------------    --------------------

Total liabilities and shareholders' equity (deficit)                            $       58,272,028          $       59,549,569
                                                                                ========================    ====================


                                            The accompanying notes are an integral part
                                             of these condensed financial statements.
</TABLE>
                                                               -3-
<PAGE>
<TABLE>

                                                       OVERHILL FARMS, INC.
                                                CONDENSED STATEMENTS OF OPERATIONS
                                                            (UNAUDITED)



                                                                                               For the Three Months Ended
                                                                                       --------------------------------------------
                                                                                             July 3,                June 27,
                                                                                              2005                    2004
                                                                                       --------------------    --------------------
<S>                                                                                    <C>                     <C>
Net revenues                                                                           $       42,280,698      $       35,235,833
Cost of sales                                                                                  36,942,392              31,559,376
                                                                                       --------------------    --------------------
Gross profit                                                                                    5,338,306               3,676,457

Selling, general and administrative expenses                                                    2,124,812               1,917,153
                                                                                       --------------------    --------------------

Operating income                                                                                3,213,494               1,759,304

Other expenses:
  Interest expense                                                                             (1,401,608)             (1,430,301)
  Amortization of deferred financing costs                                                        (54,802)                (47,953)
  Other                                                                                           (40,114)                 17,712
                                                                                       --------------------    --------------------

Total other expenses                                                                           (1,496,524)             (1,460,542)
                                                                                       --------------------    --------------------

Income before income taxes                                                                      1,716,970                 298,762

Income tax expense                                                                                639,858                 113,230
                                                                                       --------------------    --------------------

Net income                                                                             $        1,077,112      $          185,532
                                                                                       ====================    ====================

Net income per share:

  Basic                                                                                $              .07      $              .01
                                                                                       ====================    ====================

  Diluted                                                                              $              .07      $              .01
                                                                                       ====================    ====================

Weighted average shares used in computing
net income per share:

  Basic                                                                                        14,889,197              14,805,556
  Diluted                                                                                      15,743,573              15,208,982



                                            The accompanying notes are an integral part
                                             of these condensed financial statements.
</TABLE>
                                                               -4-
<PAGE>
<TABLE>

                                                       OVERHILL FARMS, INC.
                                                CONDENSED STATEMENTS OF OPERATIONS
                                                            (UNAUDITED)



                                                                                                For the Nine Months Ended
                                                                                       --------------------------------------------
                                                                                             July 3,                June 27,
                                                                                              2005                    2004
                                                                                       --------------------    --------------------
<S>                                                                                    <C>                     <C>
Net revenues                                                                           $      125,838,181      $       96,767,349
Cost of sales                                                                                 110,489,465              85,939,228
                                                                                       --------------------    --------------------
Gross profit                                                                                   15,348,716              10,828,121

Selling, general and administrative expenses                                                    5,923,222               6,320,252
                                                                                       --------------------    --------------------

Operating income                                                                                9,425,494               4,507,869

Other expenses:
  Interest expense                                                                             (4,492,623)             (4,659,894)
  Amortization of deferred financing costs                                                       (167,677)               (456,867)
  Debt extinguishment expenses                                                                          -              (2,778,374)
  Other                                                                                          (239,798)                 98,394
                                                                                       --------------------    --------------------

Total other expenses                                                                           (4,900,098)             (7,796,741)
                                                                                       --------------------    --------------------

Income (loss) before income taxes                                                               4,525,396              (3,288,872)

Income tax expense (benefit)                                                                    1,785,696              (1,246,094)
                                                                                       --------------------    --------------------

Net income (loss)                                                                      $        2,739,700      $       (2,042,778)
                                                                                       ====================    ====================

Net income (loss) per share:

  Basic                                                                                $              .18      $             (.14)
                                                                                       ====================    ====================

  Diluted                                                                              $              .18      $             (.14)
                                                                                       ====================    ====================

Weighted average shares used in computing
net income (loss) per share:

  Basic                                                                                        14,832,732              14,805,556
  Diluted                                                                                      15,459,337              14,805,556

                                            The accompanying notes are an integral part
                                             of these condensed financial statements.
</TABLE>
                                                               -5-
<PAGE>
<TABLE>
                                                       OVERHILL FARMS, INC.
                                                CONDENSED STATEMENTS OF CASH FLOWS
                                                            (UNAUDITED)



                                                                                             For the Nine Months Ended
                                                                                    ---------------------------------------------
                                                                                          July 3,                 June 27,
                                                                                           2005                     2004
                                                                                    --------------------     --------------------
<S>                                                                                 <C>                       <C>
Operating Activities:
  Net income (loss)                                                                 $        2,739,700        $       (2,042,778)
  Adjustments to reconcile net income (loss) to net cash
    provided by (used in) operating activities:
     Depreciation and amortization                                                           1,322,930                1,886,501
     Loss on asset disposals                                                                   255,843                        -
     Provision for doubtful accounts                                                            15,681                        -
     Noncash debt extinguishment expenses                                                            -                2,558,374
     Noncash interest expense                                                                  122,952                        -
     Deferred tax benefit (expense)                                                          1,785,696               (1,246,094)
     Changes in:
       Accounts receivable                                                                  (1,473,662)              (2,878,649)
       Inventories                                                                             148,970               (1,882,344)
       Prepaid expenses and other                                                              173,176                 (622,988)
       Accounts payable                                                                       (108,870)               1,361,218
       Accrued liabilities                                                                     311,138                 (277,767)
                                                                                    --------------------     --------------------

Net cash provided by (used in) operating activities                                          5,293,554               (3,144,527)
                                                                                    --------------------     --------------------

Investing Activities:
  Additions to property and equipment                                                         (883,067)                (522,969)
                                                                                    --------------------     --------------------

Net cash used in investing activities                                                         (883,067)                (522,969)
                                                                                    --------------------     --------------------


                                            The accompanying notes are an integral part
                                             of these condensed financial statements.
</TABLE>
                                                               -6-
<PAGE>
<TABLE>

                                                       OVERHILL FARMS, INC.
                                          CONDENSED STATEMENTS OF CASH FLOWS (CONTINUED)
                                                            (UNAUDITED)


                                                                                            For the Nine Months Ended
                                                                                  ------------------ --- -------------------
                                                                                       July 3,                June 27,
                                                                                        2005                    2004
                                                                                  ------------------     -------------------
<S>                                                                               <C>                    <C>
Financing Activities:
  Proceeds from borrowings on long-term debt                                      $               -      $       5,000,000
  Principal payments on long-term debt                                                   (4,351,300)              (522,814)
  Deferred financing costs                                                                   (4,402)              (403,806)
                                                                                  ------------------     -------------------

Net cash (used in) provided by financing activities                                      (4,355,702)             4,073,380
                                                                                  ------------------     -------------------

Net increase in cash                                                                         54,785                405,884
Cash at beginning of period                                                               1,609,417                513,622
                                                                                  ------------------     -------------------

Cash at end of period                                                             $       1,664,202      $         919,506
                                                                                  ==================     ===================

Supplemental Schedule of Cash Flow Information:
   Cash paid during the period for:
     Interest                                                                     $       4,936,360      $       4,513,264
     Income taxes                                                                 $              -       $               -




SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES:

         Due to the refinancing of the Company's debt with Levine Leichtman
Capital Partners II, L.P. ("LLCP") on October 31, 2003, the unamortized balance
of the discount as of September 28, 2003 of $482,001 was charged to expense in
the fiscal quarter ended December 28, 2003.


                                            The accompanying notes are an integral part
                                             of these condensed financial statements.
</TABLE>
                                                               -7-
<PAGE>

                              OVERHILL FARMS, INC.
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                                  JULY 3, 2005
                                   (UNAUDITED)



1.       NATURE OF BUSINESS AND ORGANIZATIONAL MATTERS


         Overhill Farms, Inc. (the "Company" or "Overhill Farms") is a producer
of high-quality entrees, plated meals, meal components, soups, sauces, and
poultry, meat and fish specialties.


2.       BASIS OF PRESENTATION


         Certain prior period amounts have been reclassified to conform to the
current period presentation. The accompanying unaudited condensed financial
statements have been prepared in accordance with generally accepted accounting
principles for interim financial information and with the instructions to Form
10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of
the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary for a
fair presentation have been included. Operating results for the three and nine
months ended July 3, 2005 are not necessarily indicative of the results that may
be expected for the year ending October 2, 2005 or for any other period.


         The condensed balance sheet at September 26, 2004 has been derived from
the audited financial statements at that date but does not include all of the
information and footnotes required by generally accepted accounting principles
in the United States for complete financial statements.


         For further information, refer to the financial statements and
footnotes thereto included in the Company's annual report on Form 10-K for the
year ended September 26, 2004.


3.       RECENT ACCOUNTING PRONOUNCEMENTS


         On December 16, 2004, the Financial Accounting Standards Board ("FASB")
issued Statement of Financial Accounting Standards ("SFAS") No. 123 (revised
2004), "Share-Based Payment" ("SFAS No. 123R")," which is a revision of SFAS No.
123, "Accounting for Stock Based Compensation." SFAS No. 123R supersedes
Accounting Principles Board ("APB") Opinion No. 25, "Accounting for Stock Issued
to Employees," and amends SFAS No. 95 "Statement of Cash Flows." Generally, the
approach in SFAS No. 123R is similar to the approach described in SFAS No. 123.
However, SFAS No. 123R requires all share-based payments to employees, including
grants of employee stock options, to be recognized in the income statement based
on their fair values. Pro forma disclosure is not an alternative.


         SFAS No. 123R must be adopted by the Company at the beginning of the
next fiscal year that begins after June 15, 2005. Early adoption will be
permitted in periods in which financial statements have not yet been issued. The
Company currently expects to adopt SFAS No. 123R in the fiscal quarter ending
January 1, 2006.


         As permitted by SFAS No. 123, the Company currently accounts for
share-based payments to employees using APB Opinion No. 25's intrinsic value
method and, as such, generally recognizes no compensation cost for employee
stock options. Accordingly, adoption of SFAS No. 123R's fair value method will
have a significant impact on the Company's result of operations, although it
will have no impact on the Company's overall financial position. The impact of
adoption of SFAS No. 123R cannot be predicted at this time because it will
depend on the levels of share-based payments granted in the future. However, had
the Company adopted SFAS No. 123R in prior periods, the impact of that standard
would have approximated the impact of SFAS No. 123 as described in the
disclosure of pro forma net income and earning per share in Note 7 to the
Company's condensed financial statements. SFAS No. 123 also requires the
benefits of tax deductions in excess of recognized compensation cost to be
reported as a financing cash flow, rather than as an operating cash flow as
required under current literature. This requirement will reduce net operating
cash flows and increase net financing cash flows in periods after adoption. The
Company cannot estimate what those amounts will be in the future because they
depend on, among other things, when employees exercise stock options. There were
no operating cash flows in prior periods from share-based payments.

                                      -8-
<PAGE>

         In December 2004, the FASB issued FASB Staff Position No. 109-1,
"Application of FASB Statement No. 109 (SFAS 109), Accounting for Income Taxes,
to the Tax Deduction on Qualified Production Activities Provided by the American
Jobs Creation Act of 2004" ("FSP 109-1"). FSP 109-1 clarifies that the
manufacturer's deduction provided for under the American Jobs Creation Act of
2004 (the "Act") should be accounted for as a special deduction in accordance
with SFAS No. 109 and not as a tax rate reduction. The adoption of FSP 109-1
will have no impact on the Company's results of operations or financial position
for fiscal year 2005, as the manufacturer's deduction is not available to the
Company until fiscal year 2006. The Company is currently evaluating the effect
that the manufacturer's deduction will have in subsequent years.


         In November 2004, the FASB issued SFAS No. 151, "Inventory Costs, an
amendment of ARB No. 43, Chapter 4." SFAS No. 151 clarifies that abnormal
inventory costs such as costs of idle facilities, excess freight and handling
costs and wasted materials (spoilage) are required to be recognized as current
period charges. The provisions of SFAS No. 151 are effective for fiscal years
beginning after June 15, 2005. The Company is currently evaluating the impact
that this statement will have on its financial statements.


4.       INVENTORIES


         Inventories are summarized as follows:


                                             July 3,         September 26,
                                              2005               2004
                                         ---------------    ---------------

              Raw ingredients            $    3,508,969     $    3,815,724
              Finished product                6,331,005          5,764,418
              Packaging                       1,239,604          1,648,406
                                         ---------------    ---------------
                                         $   11,079,578     $   11,228,548
                                         ===============    ===============


         A reserve is established for the estimated aged surplus, spoiled or
damaged products, and discontinued inventory items and components. Historically,
the amount of the reserve was determined by analyzing inventory composition,
expected usage, historical and projected sales information, and other factors.
During the quarter ended January 2, 2005, the Company revised its method to
apply reserve estimation percentages to aging categories. The effect of this
change in estimate resulted in one-time higher cost of sales and lower gross
profit of approximately $650,000 and lowered net income by approximately
$370,000 for the three months ended January 2, 2005.


5.       LONG-TERM DEBT


         On October 31, 2003, the Company entered into debt refinancing
arrangements with LLCP and Pleasant Street Investors, LLC ("PSI"). The Company
issued to LLCP a second amended and restated secured senior subordinated note
due October 31, 2006 in the stated principal amount of $28,858,000. The note has
a base interest rate of 13.5%, subject to increase upon the occurrence of any
interest rate event, as defined in the purchase documents, or event of default,
and a maturity date of October 31, 2006.


         PSI has made two term loans to the Company. The senior Term A Loan, in
the principal amount of $17,800,000, has an annual interest rate on the
in-formula portion equal to the greater of 5.5% or the prime rate in effect from
time to time plus 1.5%. The $5,000,000 Term B Loan, which was entirely paid off
at June 30, 2005 in advance of the maturity of the loan, amortized monthly and
initially carried a base interest rate of 12%. The interest rate on the Term A
Loan is, and interest rate on the Term B Loan was, subject to increase upon the
occurrence of any interest rate event, as defined in the loan documents, or
event of default as provided in the notes that evidence those loans. The Term A
Loan and the Term B Loan were to mature on October 31, 2006. The maturity of the
Term B Loan was subsequently amended, as discussed below, and the loan has been
paid off as of June 30, 2005. The prepayment terms of the Term A Loan provides,
and the prepayment terms of the Term B Loan provided, among other things, that
the Company will make mandatory prepayments of annual excess cash flow, if any.


         The amended and restated securities purchase agreement with LLCP and
the amended and restated loan and security agreement with PSI contain various
covenants, including financial covenants covering restrictions on capital
expenditures, minimum EBITDA and net worth levels, and specified debt service


                                      -9-
<PAGE>

and debt to equity ratios. In addition, those agreements prohibit changes in
control, including ownership and certain management personnel, and contain
customary restrictions on incurring indebtedness and liens, making investments,
paying dividends and making loans or advances. The obligations owing by the
Company to PSI and LLCP are secured by liens on substantially all of the
Company's assets.


         On October 6, 2004, the Company executed the fourth amendment to the
existing financing arrangements with PSI and LLCP to amend the financial
covenants and various other provisions. Effective September 26, 2004, the new
amendments to the securities purchase agreement with LLCP and the loan and
securities agreement with PSI eliminated, for the fiscal quarters ended January
2, 2005 and April 3, 2005, the potential for a 2% increase in interest rates
like the increase that occurred on June 27, 2004, and reduced the base rate on
the Term B Loan from 12% to LIBOR plus 7.5%. In exchange, the Company agreed to
increase its payment of principal on the Term B Loan from $69,445 per month to
specified monthly amounts ranging from $254,445 to $274,445. Prior to this
amendment, the Term B Loan was to have a balance of $2.5 million due at maturity
of the loan on October 31, 2006. Under this amendment, the Term B Loan had a
maturity of January 31, 2006. The loan has been paid off as of June 30, 2005.
The increase in cash required for principal repayment was offset, in part, by
savings from the reduction in interest rates.


         To counteract the dilutive effect of the 2005 Stock Plan approved at
the 2005 annual meeting of stockholders, the Company agreed to issue to LLCP
83,641 fully paid and non-assessable shares of common stock subject to terms
specified in the letter agreement dated February 24, 2005 between LLCP and the
Company ("LLCP Letter Agreement"). The LLCP Letter Agreement also provides
restrictions on the purchase price or exercise price of the shares of the
Company's common stock that may be issued pursuant to awards under the 2005
Stock Plan. LLCP agreed in the LLCP Letter Agreement to vote all shares of the
Company's voting capital stock beneficially owned by LLCP in favor of approval
of the 2005 Stock Plan. The fair value of the 83,641 shares of common stock
(based on the closing sale price of a share of the Company's common stock on
February 1, 2005) of $122,952 was expensed as a component of interest expense
during the quarter ended April 3, 2005.


         On May 12, 2005, LLCP and the Company executed an amendment to the LLCP
Letter Agreement. The amendment provided that the Company would issue and
deliver the 83,641 shares to LLCP prior to the Company obtaining stockholder and
stock exchange approval of the 2005 Stock Plan, provided that LLCP would return
the shares if stockholder and stock exchange approval were not obtained. The
Company delivered the shares to LLCP on May 13, 2005. Stockholder approval for
the 2005 Stock Plan was formally obtained at the 2005 annual meeting of
stockholders. The Company obtained final confirmation of American Stock Exchange
listing approval for the shares on May 23, 2005.


         The Company believes, based upon forecasted performance for fiscal year
2005, that it is probable that the Company will be in compliance with all of its
revised financial and other covenant requirements. Accordingly, based upon
projected covenant compliance and as a result of the refinancing of the
obligations described above, all principal amounts payable to LLCP and to PSI,
other than currently scheduled principal payments, have been classified as
long-term liabilities in the accompanying balance sheet as of July 3, 2005. In
the future, the failure of the Company to achieve certain revenue, expense and
profitability levels could result in a violation of the amended financial
covenants under its financing arrangements and could result in acceleration of
maturity of the loans, which could adversely affect the Company's financial
condition, results of operations or cash flows.


6.       PER SHARE DATA


         The Company computes earnings per share ("EPS") pursuant to SFAS No.
128 "Earnings Per Share." Basic EPS is computed based on the weighted average
number of common shares outstanding for the period. Diluted EPS is computed
based on the weighted average number of common shares outstanding for the period
and potentially dilutive common stock equivalents outstanding for the period.

                                      -10-
<PAGE>

         A reconciliation of the numerator and denominator of basic earnings per
share and diluted earnings per share is as follows:


                                                         Three Months Ended
                                                   -----------------------------
                                                      July 3,         June 27,
                                                       2005             2004
                                                   -----------      -----------
Basic EPS Computation:
Numerator:
  Net income                                       $ 1,077,112      $   185,532
Denominator:
  Weighted average common shares outstanding        14,889,197       14,805,556
                                                   -----------      -----------
       Total shares                                 14,889,197       14,805,556
                                                   ===========      ===========
Basic EPS                                          $      0.07      $      0.01
                                                   ===========      ===========

Diluted EPS Computation:
Numerator:
  Net income                                       $ 1,077,112      $   185,532
Denominator:
  Weighted average common shares outstanding        14,889,197       14,805,556
   Incremental shares from assumed conversion
     of preferred stock and exercise of stock
     option and warrants                               854,376          403,426
                                                   -----------      -----------
       Total shares                                 15,743,573       15,208,982
                                                   ===========      ===========
Diluted EPS                                        $      0.07      $      0.01
                                                   ===========      ===========


         For the three months ended June 27, 2004, 472,000 shares attributable
to outstanding stock options were excluded from the computation of diluted EPS
because their inclusion would have been anti-dilutive.

<TABLE>
                                                          Nine Months Ended
                                                   -------------------------------
                                                       July 3,           June 27,
                                                        2005              2004
                                                   -------------     -------------
<S>                                                <C>               <C>
Basic EPS Computation:
Numerator:
  Net income (loss)                                $  2,739,700      $ (2,042,778)
Denominator:
  Weighted average common shares outstanding         14,832,732        14,805,556
                                                   -------------     -------------
       Total shares                                  14,832,732        14,805,556
                                                   =============     =============
Basic EPS                                          $       0.18      $      (0.14)
                                                   =============     =============

Diluted EPS Computation:
Numerator:
  Net income (loss)                                $  2,739,700      $ (2,042,778)
Denominator:
  Weighted average common shares outstanding         14,832,732        14,805,556
   Incremental shares from assumed conversion
     of preferred stock and exercise of stock
     option and warrants                                626,605                --
                                                   -------------     -------------
       Total shares                                  15,459,337        14,805,556
                                                   =============     =============
Diluted EPS                                        $       0.18      $      (0.14)
                                                   =============     =============
</TABLE>

         For the nine months ended July 3, 2005, 189,912 shares attributable to
outstanding out-of-the-money stock options were excluded from the computation of
diluted EPS because their inclusion would have been anti-dilutive. For the nine
months ended June 27, 2004, 672,000 shares attributable to outstanding stock
options, warrants exercisable for 200 shares and 283,076 shares of convertible
preferred stock were excluded from the computation of diluted EPS because their
inclusion would have been anti-dilutive.

                                      -11-
<PAGE>

7.       STOCK OPTIONS


         Under the Company's 2005 Stock Plan ("Plan") the Company's board of
directors or a committee thereof may grant incentive stock options ("ISOs"),
non-qualified stock options ("NQOs") and stock purchase rights ("SPRs") to
employees, consultants and directors of the Company.


         ISOs granted under the Plan must have an exercise price of not less
than 100% of the fair market value of a share of the Company's common stock on
the date the ISO is granted and must be exercised, if at all, within ten years
from the date of grant. In the case of an ISO granted to an optionee who owns
more than 10% of the Company's total voting securities on the date of grant, the
exercise price shall be not less than 110% of the fair market value of a share
of the Company's common stock on the date of grant, and the option period may
not exceed five years. The exercise price of NQOs will be determined by the
committee and may be less than, equal to or greater than the fair market value
of our common stock on the date of the grant.


         Notwithstanding the preceding paragraph, the LLCP Letter Agreement
contains restrictions on the purchase price or exercise price of the shares of
the Company's common stock that may be issued pursuant to awards under the Plan.
Of the 550,000 shares of the Company's common stock reserved for issuance under
the Plan, Plan awards for not less than 50,000 shares must be issued at a price
of not less than $1.50 per share. Plan awards for not less than 50,000 shares
must be issued at a price of not less than $2.00 per share. Plan awards for not
less than 50,000 shares must be issued at a price of not less than $2.50 per
share. The remaining Plan awards must be issued at a price not less than the
fair market value per share at the time of issuance of the Plan awards. Options
may be exercised during a period of time fixed by the committee except that no
option may be exercised more than ten years after the date of grant.


         An aggregate of 550,000 shares of the Company's common stock is
reserved for issuance under the Plan. On February 1, 2005, options to purchase
up to 539,000 shares of the Company's common stock at exercise prices per share
ranging from $1.47 to $2.50 were granted subject to stockholder and other
approvals. Because LLCP and two of the Company's directors who owned in the
aggregate a majority of the Company's outstanding voting common stock each
indicated their separate intentions to vote in favor of the adoption of the Plan
at the Company's 2005 annual meeting of stockholders, the effect of the options
was considered in the diluted earnings per share computation at April 3, 2005.
Stockholder approval for the Plan was formally obtained at the 2005 annual
meeting of stockholders.


         The Company accounts for stock-based awards to employees using the
intrinsic value method as prescribed by APB Opinion No. 25 and provides the pro
forma disclosure provisions of SFAS No. 123. Accordingly, compensation expense
for stock options issued to employees is recorded on the date of grant only if
the current market price of the underlying stock exceeds the exercise price.

         For purposes of pro forma disclosures, the estimated fair value of the
options, based on the Black-Scholes option pricing model, is amortized to
expense over the options' vesting periods. The following is the pro forma
information prepared as if the fair value method under SFAS No. 123, as amended
by SFAS No. 148, had been adopted (in thousands, except per share amounts):

                                      -12-
<PAGE>
<TABLE>
                                                      Three Months Ended           Nine Months Ended
                                                ---------------------------  ---------------------------
                                                July 3, 2005  June 27, 2004  July 3, 2005  June 27, 2004
                                                ------------  -------------  ------------  -------------
<S>                                             <C>             <C>          <C>            <C>
Net income (loss), as reported                  $      1,077    $      186   $      2,740   $     (2,043)

Deduct:  Total stock-based employee
  compensation expense determined under
  fair value based methods for all awards,
  net of related tax effects                    $         --    $       --   $        280   $         --

Pro forma net income (loss)                     $      1,077    $      186   $      2,460   $     (2,043)

Net income (loss) per share
  Basic, as reported                            $       0.07    $     0.01   $       0.18   $      (0.14)
  Basic, pro forma                              $       0.07    $     0.01   $       0.17   $      (0.14)

  Diluted, as reported                          $       0.07    $     0.01   $       0.18   $      (0.14)
  Diluted, pro forma                            $       0.07    $     0.01   $       0.16   $      (0.14)

</TABLE>

8.       INCOME TAXES


         The effective tax rates for the first nine months of fiscal years 2005
and 2004 were based upon the estimated annual effective tax rates of
approximately 39.5% in 2005 and (37.9%) in 2004, respectively. The effective tax
rate for the first nine months of fiscal year 2005 approximated the statutory
rate. The effective tax rate for the first nine months of fiscal year 2004 was
lower than the statutory rate based upon California's limitation on net
operating (benefit) loss carryovers, which permitted only 50% of the net
operating loss to be used in future periods.


         In fiscal year 2004, the Company recorded a $425,000 valuation
allowance against a portion of its deferred tax assets, since it believed that
such assets did not meet the more likely than not criteria to be recoverable
through projected future profitable operations in the foreseeable future. The
valuation allowance will be reviewed in light of the Company's improved
financial performance.


9.       CONTINGENCIES


         LEGAL PROCEEDINGS. From time to time, the Company is involved in
various lawsuits, claims and proceedings related to the conduct of the Company's
business. Management does not believe that the disposition of any pending claims
is likely to adversely affect the Company's financial condition, results of
operations, or cash flows.


         CONCENTRATIONS OF CREDIT RISK. The Company's financial instruments that
are exposed to concentrations of credit risk consist primarily of trade
receivables. The Company performs ongoing credit evaluations of its customers'
financial condition and generally requires no collateral from its customers. The
Company charges off uncollectible accounts at the point in time when no recovery
is expected.


         A significant portion of the Company's total net revenues was derived
from two customers. Panda Restaurant Group and Jenny Craig Products accounted
for approximately 30.0% and 17.8%, respectively, of the Company's revenues for
the nine months ended July 3, 2005. Distributors for Panda Restaurant Group and
Jenny Craig Products accounted for approximately 36.4% and 18.8%, respectively,
of the Company's total accounts receivable balance at July 3, 2005. Panda
Restaurant Group and Jenny Craig Products accounted for approximately 28.8% and
18.9%, respectively, of the Company's revenues for the nine months ended June
27, 2004. Distributors for Panda Restaurant Group and Jenny Craig Products
accounted for approximately 18.0% and 24.1%, respectively, of the Company's
total accounts receivable balance at September 26, 2004. The Company intends to
reduce its reliance on a small concentration of accounts by further expansion
into custom products for retail and foodservice customers nationwide.

                                      -13-
<PAGE>

10.      RECENT DEVELOPMENTS


         On April 21, 2005, the Company engaged Piper Jaffray & Co. as its
financial advisor to assist the Company in identifying and exploring strategic
financial alternatives to improve stockholder value. Piper Jaffray & Co. has
agreed to assist the Company in executing and closing a suitable transaction, if
any, that may be identified and then selected by the Company for execution. The
Company has requested that Piper Jaffray & Co., as part of this engagement,
focus on alternatives to refinance its debt held by LLCP and its affiliate, PSI,
which matures in October 2006. The Company has indicated that any potential
transaction that may be identified and selected for execution could involve the
disposition of both the debt and equity held by LLCP and its affiliate. As of
July 3, 2005, the Company incurred $142,100 of operating expenses in connection
with its strategic financial alternatives review.


ITEM 2.          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                 RESULTS OF OPERATIONS


FORWARD-LOOKING STATEMENTS


         The following discussion and analysis should be read in conjunction
with our condensed financial statements and notes to condensed financial
statements included elsewhere in this document. This report, and our condensed
financial statements and notes to our condensed financial statements, contain
forward-looking statements, which generally include the plans and objectives of
management for future operations, including plans and objectives relating to our
future economic performance and our current beliefs regarding revenues we might
earn if we are successful in implementing our business strategies.


         This report contains forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These forward-looking
statements are based on current expectations or beliefs, including, but not
limited to, statements concerning our operations and financial performance and
condition. For this purpose, statements of historical fact may be deemed to be
forward-looking statements. Forward-looking statements include statements which
are predictive in nature, which depend upon or refer to future events or
conditions, which include words such as "expects," "anticipates," "intends,"
"plans," "believes," "estimates," "projects," "forecasts," "goal," "probable" or
similar expressions. In addition, any statements concerning future financial
performance (including future revenues, earnings or growth rates), ongoing
business strategies or prospects, and possible future company actions, that may
be provided by management, are also forward-looking statements. We caution that
these statements by their nature involve risks and uncertainties, and actual
results may differ materially depending on a variety of important factors,
including, among others:

         o        the impact of competitive products and pricing;

         o        market conditions that may affect the cost of raw materials as
                  well as the markets for our products;

         o        changes in our business environment, including actions of
                  competitors and changes in customer preferences, as well as
                  disruptions to our customers' businesses, such as the Southern
                  California grocery strike that occurred during the period from
                  October 2003 to February 2004;

         o        the occurrence of acts of terrorism, such as the events of
                  September 11, 2001, or acts of war;

         o        changes in governmental laws and regulations, including income
                  taxes; and

         o        other factors as may be discussed in this report and other
                  reports we file with the Securities and Exchange Commission
                  ("Commission"), including those described in Item 7 of our
                  annual report on Form 10-K for the fiscal year ended September
                  26, 2004 under the heading "Risk Factors Related to Our
                  Business and Industry."

OVERVIEW


         Our goal is to be a leading developer and manufacturer of value-added
food products and provider of custom prepared foods. We intend to create
superior value for our stockholders by continuing to execute our growth and
operating strategies. We employ the following corporate strategies:

         o        diversify our customer base, focusing on sectors with
                  attractive growth characteristics, such as foodservice and
                  retail;

         o        invest in and operate efficient production facilities;

         o        provide customer service-oriented distribution;

                                      -14-
<PAGE>

         o        offer a broad range of products to customers in multiple
                  channels of distribution; and

         o        continue to pursue growth through strategic acquisitions and
                  investments.

CRITICAL ACCOUNTING POLICIES

         Management's discussion and analysis of our financial condition and
results of operations is based upon our financial statements, which have been
prepared in accordance with generally accepted accounting principles in the
United States. The preparation of these financial statements requires management
to make estimates and assumptions that affect the amounts reported in the
financial statements and accompanying notes. Actual results could differ from
those estimates. Our significant accounting policies are described in the notes
to the audited financial statements that are included in our 2004 annual report
on Form 10-K for the year ended September 26, 2004. We believe the following
critical accounting policies are related to our more significant estimates and
assumptions used in the preparation of our financial statements.

         CONCENTRATIONS OF CREDIT RISK. Our financial instruments that are
exposed to concentrations of credit risk consist primarily of trade receivables.
We perform ongoing credit evaluations of our customers' financial condition and
generally require no collateral from our customers. A bankruptcy or other
significant financial deterioration of any customers could impact their future
ability to satisfy their receivables with us. Our allowance for doubtful
accounts is calculated based primarily upon historical bad debt experience and
current market conditions. Write-offs, net of recoveries, to the allowance for
doubtful accounts were $5,000 and $0 for the nine months ended July 3, 2005 and
June 27, 2004, respectively.

         A significant portion of our total net revenues was derived from two
customers. Panda Restaurant Group and Jenny Craig Products accounted for
approximately 30.0% and 17.8%, respectively, of our revenues for the nine months
ended July 3, 2005. Distributors for Panda Restaurant Group and Jenny Craig
Products accounted for approximately 36.4% and 18.8%, respectively, of our total
accounts receivable balance at July 3, 2005. Panda Restaurant Group and Jenny
Craig Products accounted for approximately 28.8% and 18.9%, respectively, of our
revenues for the nine months ended June 27, 2004. Distributors for Panda
Restaurant Group and Jenny Craig Products accounted for approximately 18.0% and
24.1%, respectively, of our total accounts receivable balance at September 26,
2004.

         INVENTORIES. Inventories, which include material, labor and
manufacturing overhead, are stated at the lower of cost, which approximates the
first-in, first-out (FIFO) method, or market. We use a standard costing system
to estimate our FIFO cost of inventory at the end of each reporting period.
Historically, standard costs have been materially consistent with actual costs.
We determine the market value of our raw ingredients, finished product and
packaging inventories based upon references to current market prices for such
items as of the end of each reporting period and record a write-down of
inventory standard cost to market, when applicable. We periodically review our
inventory for excess items, and we establish a valuation reserve based upon the
age of specific items in inventory and the expected recovery from the
disposition of the items.

         A reserve is established for the estimated aged surplus, spoiled or
damaged products, and discontinued inventory items and components. Historically,
the amount of the reserve was determined by analyzing inventory composition,
expected usage, historical and projected sales information, and other factors.
During the quarter ended January 2, 2005, we revised our method to apply reserve
estimation percentages to aging categories. The effect of this change in
estimate resulted in one-time higher cost of sales and lower gross profit of
approximately $650,000 and lowered net income by approximately $370,000 for the
three months ended January 2, 2005.

         EXCESS OF COST OVER FAIR VALUE OF NET ASSETS ACQUIRED. We evaluate the
excess of cost over fair value of net assets acquired (goodwill) at least
annually for impairment in accordance with SFAS No. 142. We have one reporting
unit and estimate fair value based on a variety of market factors, including
discounted cash flow analysis, market capitalization, and other market-based
data. No impairment of goodwill was recorded during fiscal year 2004. At July 3,
2005, we had goodwill of $12,188,000. A deterioration of our operating results
and the related cash flow effect could decrease the estimated fair value of our
business and, thus, cause our goodwill to become impaired and cause us to record
a charge against operations in an amount representing the impairment.

         INCOME TAXES. The effective tax rates for the first nine months of
fiscal years 2005 and 2004 were based upon the estimated annual effective tax
rates of approximately 39.5% in 2005 and (37.9%) in 2004, respectively. The
effective tax rate for the first nine months of fiscal year 2005 approximated
the statutory rate. The effective tax rate for the first nine months of fiscal
year 2004 was lower than the statutory rate based upon California's limitation
on net operating (benefit) loss carryovers, which permitted only 50% of the net
operating loss to be used in future periods.

                                      -15-
<PAGE>

         In fiscal year 2004, we recorded a $425,000 valuation allowance against
a portion of our deferred tax assets, since we believed that such assets did not
meet the more likely than not criteria to be recoverable through projected
future profitable operations in the foreseeable future. The valuation allowance
will be reviewed in light of our improved financial performance.


RESULTS OF OPERATIONS


THREE MONTHS ENDED JULY 3, 2005 COMPARED TO THREE MONTHS ENDED JUNE 27, 2004


         While we operate as a single business unit, manufacturing various
products on common production lines, revenues from similar customers are grouped
into the following natural categories for purposes of this discussion: retail,
foodservice and airlines.


         The three months ended July 3, 2005 and June 27, 2004 were each 13-week
periods.


         NET REVENUES. Net revenues for the three months ended July 3, 2005
increased $7,045,000 (20.0%) to $42,281,000 from $35,236,000 for the three
months ended June 27, 2004. Increased sales activity primarily to existing
retail and foodservice customers contributed to the revenue growth.


         Retail net revenues increased $6,819,000 (54.8%) to $19,271,000 for the
three months ended July 3, 2005 as compared to $12,452,000 for the three months
ended June 27, 2004. The increase was predominately due to increased sales to
three national brand customers, one of which became a customer in the third
quarter of 2004. Foodservice net revenues increased $875,000 (5.9%) to
$15,705,000 for the three months ended July 3, 2005 as compared to $14,830,000
for the three months ended June 27, 2004 due to increased production
requirements of an existing customer initiated in the second half of fiscal year
2004. Airline net revenues decreased $649,000 (8.2%) to $7,305,000 for the three
months ended July 3, 2005 as compared to $7,954,000 for the three months ended
June 27, 2004. Sales were negatively affected by a large airline carrier's
decision to offer meals on only long-haul and international flights. The effect
was partially offset by sales generated from the addition of new airline
accounts and improvements in air travel from early fiscal year 2004 levels.


         GROSS PROFIT. Gross profit increased $1,662,000 (45.2%) to $5,338,000
for the three months ended July 3, 2005 as compared to $3,676,000 for the three
months ended June 27, 2004. This increase is attributable to increased net
revenues and an improvement in gross margin as a percentage of net revenues to
12.6% for the three months ended July 3, 2005 from 10.4% for the three months
ended June 27, 2004. Gross margin as a percentage of net revenues improved due
to better leveraging of fixed costs and better pricing of raw material costs.


         SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. Selling, general and
administrative (SG&A) expenses increased by $208,000 (10.9%) to $2,125,000 (5.0%
of net revenues) for the three months ended July 3, 2005 as compared to
$1,917,000 (5.4% of net revenues) for the three months ended June 27, 2004.
$142,100 of the increase was related to costs associated with our exploration of
strategic financial alternatives to improve stockholder value. The remaining
increase in SG&A was largely due to increased payroll costs. SG&A spending is
expected to remain fairly constant, with some anticipated fluctuation in
promotional spending.


         OPERATING INCOME. Operating income increased $1,454,000 (82.7%) to
$3,213,000 for the three months ended July 3, 2005 as compared to $1,759,000 for
the three months ended June 27, 2004 due to revenue growth and improvements in
production and material costs discussed above.


         OTHER EXPENSES. Other expenses increased $36,000 (2.5%) for the three
months ended July 3, 2005 to $1,497,000 as compared to $1,461,000 for the three
months ended June 27, 2004. The increase in other expenses was largely
attributable to the disposition of certain fixed assets during the period.


         NET INCOME (LOSS). The net result for the three months ended July 3,
2005 was net income of $1,077,000 ($.07 per basic and diluted share) as compared
to net income of $186,000 ($.01 per basic and diluted share) for the three
months ended June 27, 2004.


NINE MONTHS ENDED JULY 3, 2005 COMPARED TO NINE MONTHS ENDED JUNE 27, 2004


         The nine months ended July 3, 2005 and June 27, 2004 were 40-week and
39-week periods, respectively.

                                      -16-
<PAGE>

         NET REVENUES. Net revenues for the nine months ended July 3, 2005
increased $29,071,000 (30.0%) to $125,838,000 from $96,767,000 for the nine
months ended June 27, 2004. The increase in net revenues resulted from growth in
all business categories through the continued development of existing accounts
(85% of the increase) and from the addition of new customers (15% of the
increase).


         Retail net revenues increased $21,256,000 (58.6%) to $57,509,000 for
the nine months ended July 3, 2005 as compared to $36,253,000 for the nine
months ended June 27, 2004. The increase was predominately due to increased
sales to three national brand customers, one of which became a customer in the
third quarter of 2004. Foodservice net revenues increased $5,355,000 (13.2%) to
$45,866,000 for the nine months ended July 3, 2005 as compared to $40,511,000
for the nine months ended June 27, 2004 primarily due to increased production
requirements of an existing customer. Airline net revenues increased $2,460,000
(12.3%) to $22,463,000 for the nine months ended July 3, 2005 as compared to
$20,003,000 for the nine months ended June 27, 2004. This was the result of
revenue growth from increased air travel and the addition of new airline
accounts, which more than offset the effect of an existing customer's decision
to offer meals on only long-haul and international flights.


         GROSS PROFIT. Gross profit increased $4,521,000 (41.8%) to $15,349,000
for the nine months ended July 3, 2005 as compared to $10,828,000 for the nine
months ended June 27, 2004. The majority of this increase is attributable to net
revenues increasing $29,071,000. The balance of the increase was the result of
improvement in gross margin as a percentage of net revenues to 12.2% for the
nine months ended July 3, 2005 from 11.2% for the nine months ended June 27,
2004. Gross margin as a percentage of net revenues improved due to better
leveraging of fixed costs and better pricing of raw material costs.


         We modified our estimate for recording inventory reserves during the
first quarter of fiscal year 2005 to apply estimated reserve percentages to
aging categories. The impact of this change in estimate resulted in a one-time
increase to cost of sales and decrease in gross profit of approximately $650,000
or a 0.5% decline in gross profit as a percentage of net revenues.


         SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. SG&A expenses decreased
$397,000 (6.3%) to $5,923,000 (4.7% of net revenues) for the nine months ended
July 3, 2005 as compared to $6,320,000 (6.5% of net revenues) for the nine
months ended June 27, 2004. Demonstration and promotional expenses have declined
from previous levels as a result of a decline in sales to a customer who
required us to pay a portion of those costs. These declines were offset by
$142,100 related to costs associated with our exploration of strategic financial
alternatives to improve stockholder value and increases in insurance costs.
Barring changes in our sales mix, we expect the current level of spending on
demonstrations and promotions to remain constant.


         OPERATING INCOME. Operating income increased $4,917,000 (109.1%) to
$9,425,000 for the nine months ended July 3, 2005 as compared to $4,508,000 for
the nine months ended June 27, 2004 due to revenue growth and improvements in
production costs and SG&A expenses discussed above.


         OTHER EXPENSES. Other expenses decreased $2,897,000 (37.2%) for the
nine months ended July 3, 2005 to $4,900,000 as compared to $7,797,000 for the
nine months ended June 27, 2004. The decrease was attributable to savings
realized from the debt refinancing discussed below. In particular, amortization
costs and interest expense declined $289,000 (63.2%) and $167,000 (3.6%),
respectively, for the nine months ended July 3, 2005 from the nine months ended
June 27, 2004. However, included in other expenses for the nine months ended
June 27, 2004 was a substantially noncash charge of $2,778,000 for debt
extinguishment expenses related to the write-off of deferred financing costs and
debt issue costs in connection with the October 2003 refinancing discussed
below. We expect some interest expense savings in future periods due to the
early pay-off of the Term B Loan on June 30, 2005.


         NET INCOME (LOSS). The net result for the nine months ended July 3,
2005 was net income of $2,740,000 ($.18 per basic and diluted share) as compared
to a net loss of $2,043,000 ($.14 per basic and diluted share) for the nine
months ended June 27, 2004.


LIQUIDITY AND CAPITAL RESOURCES


         Our principal source of liquidity is cash generated from our operating
activities. Our cash and cash equivalents increased $55,000 to $1,664,000 at
July 3, 2005 from $1,609,000 at September 26, 2004.

                                      -17-
<PAGE>

         During the nine months ended July 3, 2005, our operating activities
provided cash of $5,294,000 as compared to a use of cash of $3,145,000 during
the nine months ended June 27, 2004. Cash generated from operations before
working capital changes was $6,243,000. Cash generated from changes in working
capital resulted from a $173,000 decline in prepaid expenses and other, a
$149,000 decline in inventories and a $311,000 increase in accrued liabilities,
reduced by a $1,474,000 increase in accounts receivable and a $109,000 decrease
in accounts payable. As of July 3, 2005, we had working capital of $18,033,000.

         During the nine months ended July 3, 2005, our investing activities
resulted in a use of cash of $883,000 as compared to a use of cash of $523,000
during the nine months ended June 27, 2004. Current year additions to property
and equipment relate to the purchase of new machinery to automate certain
manufacturing processes. Capital expenditures for additional capacity will
likely increase in the fourth quarter of fiscal year 2005.

         During the nine months ended July 3, 2005, our financing activities
resulted in a use of cash of $4,356,000 as compared to cash provided of
$4,073,000 during the nine months ended June 27, 2004. The use of cash during
the current fiscal year resulted from principal payments on our long-term debt
and the early pay-off of the Term B Loan. The cash provided in the nine months
ended June 27, 2004 resulted primarily from new borrowings, net of related
deferred financing costs, in connection with the debt refinancing in October
2003 (as discussed below), offset by principal payments during the period on our
long-term debt.

         On October 31, 2003, we entered into debt refinancing arrangements with
LLCP and PSI. We issued to LLCP a second amended and restated secured senior
subordinated note due October 31, 2006 in the stated principal amount of
$28,858,000. The note has a base interest rate of 13.5%, subject to increase
upon the occurrence of any interest rate event, as defined in the purchase
documents, or event of default, and a maturity date of October 31, 2006.

         PSI has made two term loans to us. The senior Term A Loan, in the
principal amount of $17,800,000, has an annual interest rate on the in-formula
portion equal to the greater of 5.5% or the prime rate in effect from time to
time plus 1.5%. The $5,000,000 Term B Loan, which was entirely paid off at June
30, 2005 in advance of the maturity of the loan, amortized monthly and initially
carried a base interest rate of 12%. The interest rate on the Term A Loan is,
and the interest rate on the Term B Loan was, subject to increase upon the
occurrence of any interest rate event, as defined in the loan documents, or
event of default as provided in the notes that evidence those loans. The Term A
Loan and the Term B Loan were to mature on October 31, 2006. The maturity and
interest rate of the Term B Loan were subsequently amended, as discussed below,
and the loan has been paid off as of June 30, 2005. The prepayment terms of the
Term A Loan provide, and the prepayment terms of the Term B Loan provided, among
other things, that we will make mandatory prepayments of annual excess cash
flow, if any.

         The amended and restated securities purchase agreement with LLCP and
the amended and restated loan and security agreement with PSI contain various
covenants, including financial covenants covering restrictions on capital
expenditures, minimum EBITDA and net worth levels, and specified debt service
and debt to equity ratios. In addition, those agreements prohibit changes in
control, including ownership and certain management personnel, and contain
customary restrictions on incurring indebtedness and liens, making investments,
paying dividends and making loans or advances. The obligations owing by us to
PSI and LLCP are secured by liens on substantially all of our assets.

         On October 6, 2004, we executed the fourth amendment to the existing
financing arrangements with PSI and LLCP to amend the financial covenants and
various other provisions. Effective September 26, 2004, the new amendments to
the securities purchase agreement with LLCP and the loan and securities
agreement with PSI eliminated, for the first and second quarters of fiscal year
2005, the potential for a 2% increase in interest rates like the increase that
occurred on June 7, 2004, and reduced the base rate on the Term B Loan from 12%
to LIBOR plus 7.5%. In exchange, we agreed to increase our payment of principal
on the Term B Loan from $69,445 per month to specified monthly amounts ranging
from $254,445 to $274,445. Prior to this amendment, the Term B Loan was to have
a balance of $2.5 million due at maturity of the loan on October 31, 2006. Under
this amendment, the Term B Loan had a maturity of January 31, 2006. The loan has
been paid off as of June 30, 2005. The increase in cash required for principal
repayment was offset, in part, by savings from the reduction in interest rates.

         To obtain consent for the proposed 2005 Stock Plan, as discussed in our
proxy statement for our 2005 annual meeting of stockholders, we agreed to issue
to LLCP 83,641 fully paid and non-assessable shares of common stock subject to
terms specified in the letter agreement dated February 24, 2005 between LLCP and
us ("LLCP Letter Agreement"). The LLCP Letter Agreement also provides
restrictions on the purchase price or exercise price of the shares of our common
stock that may be issued pursuant to awards under the 2005 Stock Plan. LLCP
agreed in the LLCP Letter Agreement to vote all shares of our voting capital
stock beneficially owned by LLCP in favor of approval of the 2005 Stock Plan.
The fair value of the 83,641 shares of common stock (based on the closing sale
price of a share of our common stock on February 1, 2005) of $122,952 was
expensed as a component of interest expense during the quarter ended April 3,
2005.

                                      -18-
<PAGE>

         On May 12, 2005, LLCP and we executed an amendment to the LLCP Letter
Agreement. The amendment provides that we would issue and deliver the 83,641
shares to LLCP prior to obtaining stockholder and stock exchange approval of the
2005 Stock Plan, provided that LLCP would return the shares if stockholder and
stock exchange approval were not obtained. We delivered the shares to LLCP on
May 13, 2005. Stockholder approval for the 2005 Stock Plan was formally obtained
at the 2005 annual meeting of stockholders. We obtained final confirmation of
American Stock Exchange listing approval for the shares on May 23, 2005.


         We believe, based upon forecasted performance for fiscal year 2005,
that it is probable that we will be in compliance with all of the revised
financial and other covenant requirements. Accordingly, based upon projected
covenant compliance and as a result of the refinancing of the obligations
described above, all principal amounts payable to LLCP and to PSI, other than
currently scheduled principal payments, have been classified as long-term
liabilities in the accompanying balance sheet as July 3, 2005. In the future,
our failure to achieve certain revenue, expense and profitability levels could
result in a violation of the amended financial covenants under our financing
arrangements and could result in acceleration of maturity of the loans, which
could adversely affect our financial condition, results of operations or cash
flows.


         We believe that funds available to us from operations and existing
capital resources will be adequate for our capital requirements for at least the
next twelve months.


         Following is a summary of our contractual obligations at July 3, 2005:

<TABLE>
                                                                  PAYMENTS DUE BY PERIOD
                                                                  ----------------------

                                             REMAINDER OF                                         MORE THAN
 CONTRACTUAL OBLIGATIONS        TOTAL        FISCAL YEAR       2-3 YEARS         4-5 YEARS         5 YEARS
 -----------------------        -----        -----------       ---------         ---------         -------
<S>                          <C>              <C>              <C>              <C>              <C>
Debt maturities              $46,717,371      $     9,652      $46,707,719      $        --      $        --

Contractual obligations       13,717,038          605,956        4,166,713        2,896,124        6,048,245

Open purchase orders          22,853,577       13,527,027        9,326,550               --               --
                             -----------      -----------      -----------      -----------      -----------
Total contractual
   Obligations               $83,287,986      $14,142,635      $60,200,982      $ 2,896,124      $ 6,048,245
                             ===========      ===========      ===========      ===========      ===========
</TABLE>

         During the nine months ended July 3, 2005, we made ten voluntary
principal prepayments on our Term B Loan totaling $2,676,950. The Term B Loan
was entirely paid off at June 30, 2005.


         On April 21, 2005, we engaged Piper Jaffray & Co. as our financial
advisor to assist us in identifying and exploring strategic financial
alternatives to improve stockholder value. Piper Jaffray & Co. has agreed to
assist us in executing and closing a suitable transaction, if any, that may be
identified and then selected by us for execution. We have requested that Piper
Jaffray & Co., as part of this engagement, focus on alternatives to refinance
the debt held by LLCP and its affiliate, PSI, which matures in October 2006. We
have indicated that any potential transaction that may be identified and
selected for execution could involve the disposition of both the debt and equity
held by LLCP and its affiliate. As of July 3, 2005, we have incurred $142,100 of
operating expenses in connection with our strategic financial alternatives
review.


ITEM 3.           QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK


         INTEREST RATE RISK - OBLIGATIONS. We are subject to interest rate risk
on variable interest rate obligations. A hypothetical 10% increase in average
market interest rates would increase by approximately $139,000 annual interest
expense on our debt outstanding as of July 3, 2005. We are also subject to
interest rate risk on our fixed interest rate obligations. Based upon
outstanding amounts of fixed rate obligations as of July 3, 2005, a hypothetical
10% decrease in average market interest rates would increase the fair value of
outstanding fixed rate debt by approximately $236,000.

                                      -19-
<PAGE>

ITEM 4.           CONTROLS AND PROCEDURES


         Our management, including our Chief Executive Officer and Chief
Financial Officer (our principal executive officer and principal financial
officer, respectively), has concluded based on its evaluation as of July 3, 2005
that the design and operation of our "disclosure controls and procedures" (as
defined in Rule 13a-15(e) under the Securities Exchange Act of 1934, as amended
("Exchange Act")) are effective to ensure that information required to be
disclosed by us in the reports filed or submitted by us under the Exchange Act
is recorded, processed, summarized and reported, within the time periods
specified in the Commission's rules and forms, including to ensure that
information required to be disclosed by us in the reports we file or submit
under the Exchange Act is accumulated and communicated to our management,
including our Chief Executive Officer and Chief Financial Officer, as
appropriate to allow timely decisions regarding whether or not disclosure is
required.


         During the quarter ended July 3, 2005, there were no changes in our
"internal controls over financial reporting" (as defined in Rule 13a-15(f) under
the Exchange Act) that have materially affected, or are reasonably likely to
materially affect, our internal controls over financial reporting.


                                      -20-
<PAGE>

                           PART II - OTHER INFORMATION


ITEM 1.           LEGAL PROCEEDINGS


         From time to time, we are involved in various lawsuits, claims and
proceedings related to the conduct of our business. Management does not believe
that the disposition of any pending claims is likely to adversely affect our
financial condition, results of operations, or cash flows.


ITEM 4.           SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS


         On May 18, 2005, we held our 2005 annual meeting of stockholders. The
total number of outstanding votable shares included 14,805,556 shares of common
stock that were entitled to cast one vote per share on each proposal and 23.57
shares of Series A Convertible Preferred Stock that were entitled to cast 12,010
votes per share on each proposal, with all shares being voted together as a
single class.


         Nine nominees were presented for election and elected to our board of
directors at the meeting. The results of the vote for the election of directors
were as follows:



  Nominee                             For              Withheld
  -------                             ---              --------
  James Rudis                         14,551,979       20,520
  John L. Steinbrun                   14,517,829       54,670
  Harold Estes                        14,519,254       53,245
  Geoffrey A. Gerard                  14,519,839       52,660
  John E. McConnaughy, Jr.            14,519,339       53,160
  Alexander Auerbach                  14,518,314       54,185
  Louis J. Giraudo                    14,549,739       22,760
  Alexander Rodetis, Jr.              14,551,339       21,160
  Steven E. Hartman                   14,545,604       26,895


         In addition, the holders of common stock and the holder of Series A
Convertible Preferred Stock voted together on the adoption of the 2005 Stock
Plan. The results of the vote were as follows:


  For                Against           Withheld        Broker Non-Votes
  ---                -------           --------        ----------------
  7,668,722          104,522           20,250          6,779,005


         Accordingly, the nine nominees were elected and the 2005 Stock Plan was
approved by our stockholders.


ITEM 6.           EXHIBITS


   Exhibit

         Number                                      Description
         ------                                      -----------

         10.1     Amendment dated May 12, 2005 to Letter Agreement dated
                  February 24, 2005 between LLCP and OFI regarding 2005 Stock
                  Plan (1)

         10.2     Description of Bonus Programs for Named Executive Officers for
                  Fiscal Year 2005 (2) (#)

         10.3     Description of Employment Arrangement with John L. Steinbrun
                  (2) (#)

         10.4     Summary of Director Compensation (3) (#)

                                      -21-
<PAGE>

         31       Certifications Required by Rule 13a-14(a) of the Securities
                  Exchange Act of 1934, as amended, as Adopted Pursuant to
                  Section 302 of the Sarbanes-Oxley Act of 2002 (4)

         32       Certification of Chief Executive Officer and Chief Financial
                  Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
                  Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (4)
                  ___________

         (#)      Management contract or compensatory plan or arrangement
                  required to be filed pursuant to Item 601(b)(10).

         (1)      Filed as an exhibit to LLCP's Schedule 13D/A No. 9 and
                  incorporated herein by reference.

         (2)      Filed as an exhibit to our Form 8-K for May 18, 2005 and
                  incorporated herein by reference.

         (3)      Filed as an exhibit to our Form 8-K for May 3, 2005 and
                  incorporated herein by reference.

         (4)      Filed herewith.


                                      -22-
<PAGE>

                                   SIGNATURES


         Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.



                                         OVERHILL FARMS, INC.
                                         (REGISTRANT)


Date:    July 28, 2005                   By: /s/  James Rudis
                                             -----------------------------------
                                             James Rudis
                                             Chairman, President and
                                             Chief Executive Officer



Date:    July 28, 2005                   By: /s/  John L. Steinbrun
                                             -----------------------------------
                                             John L. Steinbrun
                                             Senior Vice President,
                                             Chief Financial Officer and Chief
                                             Operating Officer



                                      -23-
<PAGE>


                       EXHIBITS FILED WITH THIS FORM 10-Q


         Number                          Description
         ------                          -----------

         31       Certifications Required by Rule 13a-14(a) of the Securities
                  Exchange Act of 1934, as amended, as Adopted Pursuant to
                  Section 302 of the Sarbanes-Oxley Act of 2002

         32       Certification of Chief Executive Officer and Chief Financial
                  Officer Pursuant to 18 U.S.C. Section 1350, as Adopted
                  Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002


                                      -24-