----

----

----

| (Mark One)  |
|------------------|
| x                | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |

| o | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|---|----------------------------------------------------------------------------------------------|

----

----

| Illinois                                                      | 36-3442829                          |
|---------------------------------------------------------------|-------------------------------------|
| (State or Other Jurisdiction ofIncorporation or Organization) | (I.R.S. EmployerIdentification No.) |

| Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 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  o                                              |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data file required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).   Yes  o   No  o  |
| Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.                                                                                                        |
| Large accelerated filer o                                                                                                                                                                                                                                                                                                                                                                                                                                       | Accelerated filer o | Non-accelerated filer  o | Smaller reporting company x |

|  Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   Yes  o   No  x |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                       |
| As of March 31, 2011, the issuer had 16,443,809 shares of common stock, no par value, outstanding.                                                                         |

----

----

|                       |                                                                                         |   | Page(s) |
|----------------------------|----------------------------------------------------------------------------------------------|--------|---------|
| PART I —             | FINANCIAL INFORMATION                                                                        |   |    |
|                       |                                                                                         |   |    |
| ITEM 1.                    | FINANCIAL STATEMENTS.                                                                        |   | 3       |
|                       |                                                                                         |   |    |
| ITEM 2.                    | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. |   | 20      |
|                       |                                                                                         |   |    |
| ITEM 3.                    | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.                                  |   | 22      |
|                       |                                                                                         |   |    |
| ITEM 4.                    | CONTROLS AND PROCEDURES.                                                                     |   | 22      |
|                       |                                                                                         |   |    |
|                       |                                                                                         |   |    |
| PART II —            | OTHER INFORMATION                                                                            |   |    |
|                       |                                                                                         |   |    |
| ITEM 1.                    | LEGAL PROCEEDINGS.                                                                           |   | 22      |
|                       |                                                                                         |   |    |
|    ITEM 1A. | RISK FACTORS.                                                                                |   | 22      |
|                       |                                                                                         |   |    |
| ITEM 2.                    | UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.                                 |   | 23      |
|                       |                                                                                         |   |    |
| ITEM 3.                    | DEFAULTS UPON SENIOR SECURITIES.                                                             |   | 23      |
|                       |                                                                                         |   |    |
| ITEM 4.                    | REMOVED AND RESERVED.                                                                        |   | 23      |
|                       |                                                                                         |   |    |
| ITEM 5.                    | OTHER INFORMATION.                                                                           |   | 23      |
|                       |                                                                                         |   |    |
| ITEM 6.                    | EXHIBITS.                                                                                    |   | 24      |
|                       |                                                                                         |   |    |
|                       |                                                                                         |   |    |
| SIGNATURES                 |                                                                                         |   | 25      |
|                       |                                                                                         |   |    |
| EXHIBIT INDEX              |                                                                                         |   | 26      |

----

|                                                                                                                                                                                                                                                                                         |   | (Unaudited) |             |   |         |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------|------------------|--------|--------------|--------|
|                                                                                                                                                                                                                                                                                         |   | March 31,   |             |   | December 31, |   |
|                                                                                                                                                                                                                                                                                         |   | 2011        |             |   | 2010         |   |   | 2010 |   |
| ASSETS                                                                                                                                                                                                                                                                                       |   |        |             |   |         |   |   |   |   |
|                                                                                                                                                                                                                                                                                         |   |        |             |   |         |   |   |   |   |
| Current assets                                                                                                                                                                                                                                                                               |   |        |             |   |         |   |   |   |   |
| Cash and cash equivalents                                                                                                                                                                                                                                                                    |   | $           | 2,075,791        |   |         | $      | 652,177 |   |   | $ | 3,229,939 |   |
| Investments                                                                                                                                                                                                                                                                                  |   |        | 1,314,382        |   |         |   | 4,397,781 |   |   |   | 1,079,232 |   |
| Certificates of deposits in financial institutions                                                                                                                                                                                                                                           |   |        | 250,000          |   |         |   | 550,000 |   |   |   | 250,000 |   |
| Inventories                                                                                                                                                                                                                                                                                  |   |        | 4,752,054        |   |         |   | 3,869,825 |   |   |   | 3,985,374 |   |
| Accounts receivable, net of allowance for doubtful accounts and discounts                                                                                                                                                                                                                    |   |        | 8,346,560        |   |         |   | 7,726,348 |   |   |   | 6,793,276 |   |
| Prepaid expenses and other current assets                                                                                                                                                                                                                                                    |   |        | 126,919          |   |         |   | 38,447 |   |   |   | 158,315 |   |
| Other receivables                                                                                                                                                                                                                                                                            |   |        | 74,879           |   |         |   | 49,081 |   |   |   | 104,680 |   |
| Deferred income taxes                                                                                                                                                                                                                                                                        |   |        | 368,176          |   |         |   | 303,431 |   |   |   | 328,470 |   |
| Refundable income taxes                                                                                                                                                                                                                                                                      |   |        | ---              |   |         |   | 476,915 |   |   |   | 906,748 |   |
| Total current assets                                                                                                                                                                                                                                                                         |   |        | 17,308,761       |   |         |   | 18,064,005 |   |   |   | 16,836,034 |   |
|                                                                                                                                                                                                                                                                                         |   |        |             |   |         |   |   |   |   |   |   |   |
| Property and equipment, net                                                                                                                                                                                                                                                                  |   |        | 15,129,655       |   |         |   | 14,481,822 |   |   |   | 15,152,713 |   |
|                                                                                                                                                                                                                                                                                         |   |        |             |   |         |   |   |   |   |   |   |   |
| Intangible assets                                                                                                                                                                                                                                                                            |   |        |             |   |         |   |   |   |   |   |   |   |
| Goodwill and other non amortizable brand assets                                                                                                                                                                                                                                              |   |        | 14,068,091       |   |         |   | 13,806,091 |   |   |   | 14,068,091 |   |
| Other intangible assets, net of accumulated amortization of $2,500,066 and $1,773,968 at March 31, 2011 and 2010 and $2,304,107 at December 31, 2010, respectively                                                                                                                           |   |        | 5,805,934        |   |         |   | 6,083,670 |   |   |   | 6,001,893 |   |
| Total intangible assets                                                                                                                                                                                                                                                                      |   |        | 19,874,025       |   |         |   | 19,889,761 |   |   |   | 20,069,984 |   |
|                                                                                                                                                                                                                                                                                         |   |        |             |   |         |   |   |   |   |   |   |   |
| Other assets                                                                                                                                                                                                                                                                                 |   |        | ---              |   |         |   | 500,000 |   |   |   | --- |   |
|                                                                                                                                                                                                                                                                                         |   |        |             |   |         |   |   |   |   |   |   |   |
| Total assets                                                                                                                                                                                                                                                                                 |   | $           | 52,312,441       |   |         | $      | 52,935,588 |   |   | $ | 52,058,731 |   |
|                                                                                                                                                                                                                                                                                         |   |        |             |   |         |   |   |   |   |   |   |   |
| LIABILITIES AND STOCKHOLDERS' EQUITY                                                                                                                                                                                                                                                         |   |        |             |   |         |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                                                                                         |   |        |             |   |         |   |   |   |   |   |   |   |
| Current liabilities                                                                                                                                                                                                                                                                          |   |        |             |   |         |   |   |   |   |   |   |   |
| Checks written in excess of bank balances                                                                                                                                                                                                                                                    |   | $           | 1,067,073        |   |         | $      | 533,458 |   |   | $ | 1,341,210 |   |
| Current maturities of notes payable                                                                                                                                                                                                                                                          |   |        | 2,364,774        |   |         |   | 4,733,354 |   |   |   | 2,851,610 |   |
| Accounts payable                                                                                                                                                                                                                                                                             |   |        | 3,781,059        |   |         |   | 3,116,627 |   |   |   | 4,183,481 |   |
| Accrued expenses                                                                                                                                                                                                                                                                             |   |        | 595,841          |   |         |   | 637,263 |   |   |   | 509,459 |   |
| Accrued income taxes                                                                                                                                                                                                                                                                         |   |        | 430,246          |   |         |   | --- |   |   |   | --- |   |
| Total current liabilities                                                                                                                                                                                                                                                                    |   |        | 8,238,993        |   |         |   | 9,020,702 |   |   |   | 8,885,760 |   |
|                                                                                                                                                                                                                                                                                         |   |        |             |   |         |   |   |   |   |   |   |   |
| Notes payable                                                                                                                                                                                                                                                                                |   |        | 5,995,558        |   |         |   | 6,502,222 |   |   |   | 6,122,225 |   |
|                                                                                                                                                                                                                                                                                         |   |        |             |   |         |   |   |   |   |   |   |   |
| Deferred income taxes                                                                                                                                                                                                                                                                        |   |        | 3,332,473        |   |         |   | 3,318,273 |   |   |   | 3,401,728 |   |
| Total liabilities                                                                                                                                                                                                                                                                            |   |        | 17,567,024       |   |         |   | 18,841,197 |   |   |   | 18,409,713 |   |
|                                                                                                                                                                                                                                                                                         |   |        |             |   |         |   |   |   |   |   |   |   |
| Stockholders' equity                                                                                                                                                                                                                                                                         |   |        |             |   |         |   |   |   |   |   |   |   |
| Common stock, no par value; 20,000,000 shares authorized; 17,273,776 shares issued; 16,443,809 shares outstanding at March 31, 2011; 17,273,776 shares issued; 16,754,572 shares outstanding at March 31, 2010; 17,273,776 shares issued; 16,536,657 shares outstanding at December 31, 2010 |   |        | 6,509,267        |   |         |   | 6,509,267 |   |   |   | 6,509,267 |   |
| Paid-in-capital                                                                                                                                                                                                                                                                              |   |        | 2,032,516        |   |         |   | 1,992,257 |   |   |   | 2,032,516 |   |
| Treasury stock, at cost                                                                                                                                                                                                                                                                      |   |        | ( 7,271,836 | )      |         |   | ( 4,182,190 | ) |   |   | ( 6,425,546 | ) |
| Retained earnings                                                                                                                                                                                                                                                                            |   |        | 33,501,646       |   |         |   | 29,722,098 |   |   |   | 31,575,875 |   |
| Accumulated other comprehensive income (loss), net of taxes                                                                                                                                                                                                                                  |   |        | ( 26,176    | )      |         |   | 52,959 |   |   |   | ( 43,094 | ) |
| Total stockholders' equity                                                                                                                                                                                                                                                                   |   |        | 34,745,417       |   |         |   | 34,094,391 |   |   |   | 33,649,018 |   |
|                                                                                                                                                                                                                                                                                         |   |        |             |   |         |   |   |   |   |   |   |   |
| Total liabilities and stockholders' equity                                                                                                                                                                                                                                                   |   | $           | 52,312,441       |   |         | $      | 52,935,588 |   |   | $ | 52,058,731 |   |

----

|                                    |   | (Unaudited) |             |   |         |   |          |   |   |
|-----------------------------------------|--------|-------------|------------------|--------|--------------|--------|---------------|--------|--------|
|                                    |   | March 31    |             |   | December 31, |   |
|                                    |   | 2011        |             |   | 2010         |   |          | 2010   |   |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |
| Sales                                   |   | $           | 19,047,266       |   |         |   |          |   | $      | 15,964,159 |   |   |   |   |   | $ | 63,543,445 |   |   |   |   |
| Less: discounts and allowances          |   |        | ( 1,743,363 | )      |         |   |          |   |   | ( 1,075,013 | ) |   |   |   |   |   | ( 5,043,552 | ) |   |   |   |
| Net Sales                               |   |        | 17,303,903       |   |         |   | 17,303,903    |   |   |   | 14,889,146 |   |   |   | 14,889,146 |   |   |   | 58,499,893 |   |   |   | 58,499,893 |   |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cost of goods sold                      |   |        |             |   |         |   | 9,651,272     |   |   |   |   |   |   |   | 8,076,612 |   |   |   |   |   |   |   | 36,926,973 |   |
| Depreciation expense                    |   |        |             |   |         |   | 376,513       |   |   |   |   |   |   |   | 403,375 |   |   |   |   |   |   |   | 1,393,745 |   |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total cost of goods sold                |   |        |             |   |         |   | 10,027,785    |   |   |   |   |   |   |   | 8,479,987 |   |   |   |   |   |   |   | 38,320,718 |   |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Gross profit                            |   |        |             |   |         |   | 7,276,118     |   |   |   |   |   |   |   | 6,409,159 |   |   |   |   |   |   |   | 20,179,175 |   |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Selling expenses                        |   |        |             |   |         |   | 2,221,808     |   |   |   |   |   |   |   | 1,994,847 |   |   |   |   |   |   |   | 7,603,098 |   |
| General and administrative              |   |        |             |   |         |   | 1,592,729     |   |   |   |   |   |   |   | 1,490,157 |   |   |   |   |   |   |   | 5,576,908 |   |
| Amortization expense                    |   |        |             |   |         |   | 195,959       |   |   |   |   |   |   |   | 175,760 |   |   |   |   |   |   |   | 724,537 |   |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total Operating Expenses                |   |        |             |   |         |   | 4,010,496     |   |   |   |   |   |   |   | 3,660,764 |   |   |   |   |   |   |   | 13,904,543 |   |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income from operations                  |   |        |             |   |         |   | 3,265,622     |   |   |   |   |   |   |   | 2,748,395 |   |   |   |   |   |   |   | 6,274,632 |   |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other income (expense):                 |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest and dividend income            |   |        |             |   |         |   | 17,593        |   |   |   |   |   |   |   | 54,508 |   |   |   |   |   |   |   | 260,552 |   |
| Rental income                           |   |        |             |   |         |   | ---           |   |   |   |   |   |   |   | 1,235 |   |   |   |   |   |   |   | 11,785 |   |
| Interest expense                        |   |        |             |   |         |   | ( 62,130 | )      |   |   |   |   |   |   | ( 95,942 | ) |   |   |   |   |   |   | ( 350,997 | ) |
| Gain (loss) on sale of investments, net |   |        |             |   |         |   | ( 2,597  | )      |   |   |   |   |   |   | ( 29,259 | ) |   |   |   |   |   |   | 250,480 |   |
| Total other income (expense)            |   |        |             |   |         |   | ( 47,134 | )      |   |   |   |   |   |   | ( 69,458 | ) |   |   |   |   |   |   | 171,820 |   |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Income before provision for             |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|    income taxes          |   |        |             |   |         |   | 3,218,488     |   |   |   |   |   |   |   | 2,678,937 |   |   |   |   |   |   |   | 6,446,452 |   |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Provision for income taxes              |   |        |             |   |         |   | 1,292,717     |   |   |   |   |   |   |   | 910,248 |   |   |   |   |   |   |   | 2,823,986 |   |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income                              |   |        |             |   |         | $      | 1,925,771     |   |   |   |   |   |   | $ | 1,768,689 |   |   |   |   |   |   | $ | 3,622,466 |   |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Basic and diluted earnings              |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| per common share                        |   |        |             |   |         |   | 0.12          |   |   |   |   |   |   |   | 0.11 |   |   |   |   |   |   |   | 0.22 |   |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted average number of              |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|   shares outstanding          |   |        |             |   |         |   | 16,489,954    |   |   |   |   |   |   |   | 16,761,774 |   |   |   |   |   |   |   | 16,663,557 |   |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| COMPREHENSIVE INCOME                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income                              |   |        |             |   |         | $      | 1,925,771     |   |   |   |   |   |   | $ | 1,768,689 |   |   |   |   |   |   | $ | 3,622,466 |   |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other comprehensive income              |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| (loss), net of tax:                     |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Unrealized gains on                     |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| investments (net of tax)                |   |        |             |   |         |   | 15,451        |   |   |   |   |   |   |   | 46,143 |   |   |   |   |   |   |   | 114,297 |   |
| Less reclassification adjustment        |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| for (gains) losses included in          |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| net income (net of taxes)               |   |        |             |   |         |   | 1,467         |   |   |   |   |   |   |   | 17,175 |   |   |   |   |   |   |   | (147,032 | ) |
|                                    |   |        |             |   |         |   |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Comprehensive income                    |   |        |             |   |         | $      | 1,942,689     |   |   |   |   |   |   | $ | 1,832,007 |   |   |   |   |   |   | $ | 3,589,731 |   |

----

|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |
|------------------------------------------------------------------------------|--------|---------------------------|------------|--------|------------------|--------|----------------|----------|--------|--------|---------------|--------|--------|---------|-----------|--------|----------|--------|-----------|---------------|--------|
|                                                                         |   | Common Stock,No Par Value |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      | Accumulated   |   |   |   |   |
|                                                                         |   | 20,000,000 Shares         |       |   | # of Shares |   |           |     |   |   |          |   |   |    |      |   |     |   |      | Other         |   |   |   |   |
|                                                                         |   | Authorized                |       |   | of               |   |           |     |   |   |          |   |   |    |      |   |     |   |      | Comprehensive |   |   |   |   |
|                                                                         |   | # of Shares               |       |   | # of Shares      |   |           | Treasury |   |   | Common        |   |   | Paid In |      |   | Treasury |   |      | Retained      |   |   | Income (Loss), |   |   |   |   |
|                                                                         |   | Issued                    |       |   | Outstanding      |   |           | Stock    |   |   | Stock         |   |   | Capital |      |   | Stock    |   |      | Earnings      |   |   | Net of Tax |   |   | Total |   |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |
| Balances at December 31, 2009                                                |   |                      | 17,273,776 |   |             |   | 16,778,555     |     |   |   | 495,221       |   |   | $       | 6,509,267 |   |     | $      | 1,965,786 |          |   | $ | (3,846,773 | ) |   | $ | 27,953,409 |   |   | $ | (10,359 | ) |   |   | 32,571,330 |   |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Redemption of stock                                                          |   |                      | ---        |   |             |   | ( 252,398 | )        |   |   | 252,398       |   |   |    | ---       |   |     |   | ---       |          |   |   | ( 2,666,288 | ) |   |   | --- |   |   |   | --- |   |   |   | ( 2,666,288 | ) |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Issuance of treasury stock for compensation                                  |   |                      | ---        |   |             |   | 10,500         |     |   |   | ( 10,500 | )      |   |    | ---       |   |     |   | 66,730    |          |   |   | 87,515 |   |   |   | --- |   |   |   | --- |   |   |   | 154,245 |   |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Issuance of treasury stock for Fresh Madeacquisition                         |   |                      | ---        |   |             |   |           |     |   |   |          |   |   |    | ---       |   |     |   |      |          |   |   |   |   |   |   | --- |   |   |   | --- |   |   |   | --- |   |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other comprehensive income (loss):                                           |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Unrealized gains on securities, net oftaxes and reclassification adjustment  |   |                      | ---        |   |             |   | ---            |     |   |   | ---           |   |   |    | ---       |   |     |   | ---       |          |   |   | --- |   |   |   | --- |   |   |   | ( 32,735 | ) |   |   | (32,735 | ) |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income for the year ended December 31, 2010                              |   |                      | ---        |   |             |   | ---            |     |   |   | ---           |   |   |    | ---       |   |     |   | ---       |          |   |   | --- |   |   |   | 3,622,466 |   |   |   | --- |   |   |   | 3,622,466 |   |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balances at December 31, 2010                                                |   |                      | 17,273,776 |   |             |   | 16,536,657     |     |   |   | 737,119       |   |   | $       | 6,509,267 |   |     | $      | 2,032,516 |          |   | $ | (6,425,546 | ) |   | $ | 31,575,875 |   |   | $ | (43,094 | ) |   | $ | 33,649,018 |   |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balances at January 1, 2010                                                  |   |                      | 17,273,776 |   |             |   | 16,778,555     |     |   |   | 495,221       |   |   | $       | 6,509,267 |   |     | $      | 1,965,786 |          |   | $ | (3,846,773 | ) |   | $ | 27,953,409 |   |   | $ | (10,359 | ) |   | $ | (32,571,330 | ) |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Redemption of stock                                                          |   |                      | ---        |   |             |   | (28,365        | )        |   |   | 28,365        |   |   |    | ---       |   |     |   | ---       |          |   |   | (340,105 | ) |   |   | --- |   |   |   | --- |   |   |   | (340,105 | ) |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Issuance of treasury stock for compensation                                  |   |                      | ---        |   |             |   | 4,382          |     |   |   | (4,382        | )      |   |    | ---       |   |     |   | 26,471    |          |   |   | 4,688 |   |   |   | --- |   |   |   | --- |   |   |   | 31,159 |   |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other comprehensive income (loss):                                           |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Unrealized gains on securities, net oftaxes and reclassification adjustment  |   |                      | ---        |   |             |   | ---            |     |   |   | ---           |   |   |    | ---       |   |     |   | ---       |          |   |   | --- |   |   |   | --- |   |   |   | 63,318 |   |   |   | 63,318 |   |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income for the three months ended March 31, 2010                         |   |                      | ---        |   |             |   | ---            |     |   |   | ---           |   |   |    | ---       |   |     |   | ---       |          |   |   | --- |   |   |   | 1,768,689 |   |   |   | --- |   |   |   | 1,768,689 |   |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balances at March 31, 2010                                                   |   |                      | 17,273,776 |   |             |   | 16,754,572     |     |   |   | 519,204       |   |   | $       | 6,509,267 |   |     | $      | 1,992,257 |          |   | $ | (4,182,190 | ) |   | $ | 29,722,098 |   |   | $ | 52,959 |   |   | $ | 34,094,391 |   |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balances at January 1, 2011                                                  |   |                      | 17,273,776 |   |             |   | 16,536,657     |     |   |   | 737,119       |   |   | $       | 6,509,267 |   |     | $      | 2,032,516 |          |   | $ | (6,425,546 | ) |   | $ | 31,575,875 |   |   | $ | (43,094 | ) |   | $ | 33,649,018 |   |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Redemption of stock                                                          |   |                      | ---        |   |             |   | (92,848        | )        |   |   | 92,848        |   |   |    | ---       |   |     |   | ---       |          |   |   | (846,290 | ) |   |   | --- |   |   |   | --- |   |   |   | (846,290 | ) |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other comprehensive income (loss):                                           |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Unrealized gains on securities, net of taxes and reclassification adjustment |   |                      | ---        |   |             |   | ---            |     |   |   | ---           |   |   |    | ---       |   |     |   | ---       |          |   |   | --- |   |   |   | --- |   |   |   | 16,918 |   |   |   | 16,918 |   |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income for the three months ended March 31, 2011                         |   |                      | ---        |   |             |   | ---            |     |   |   | ---           |   |   |    | ---       |   |     |   | ---       |          |   |   | --- |   |   |   | 1,925,771 |   |   |   | --- |   |   |   | 1,925,771 |   |
|                                                                         |   |                      |       |   |             |   |           |     |   |   |          |   |   |    |      |   |     |   |      |          |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balances at March 31, 2011                                                   |   |                      | 17,273,776 |   |             |   | 16,443,809     |     |   |   | 829,967       |   |   | $       | 6,509,267 |   |     | $      | 2,032,516 |          |   | $ | (7,271,836 | ) |   | $ | 33,501,646 |   |   | $ | (26,176 | ) |   | $ | 34,745,417 |   |

----

|                                                      |   | (Unaudited) |             |   |     |   |
|-----------------------------------------------------------|--------|-------------|------------------|--------|----------|--------|
|                                                      |   | March 31,   |             |   | December |   |
|                                                      |   | 2011        |             |   | 2010     |   |   | 2010 |   |
|                                                      |   |        |             |   |     |   |   |   |   |
| Cash flows from operating activities:                     |   |        |             |   |     |   |   |   |   |
| Net income                                                |   | $           | 1,925,771        |   |     | $      | 1,768,689 |   |   | $ | 3,622,466 |   |
| Adjustments to reconcile net income to net                |   |        |             |   |     |   |   |   |   |   |   |   |
| cash flows from operating activities, net of acquisition: |   |        |             |   |     |   |   |   |   |   |   |   |
| Depreciation and amortization                             |   |        | 572,472          |   |     |   | 579,135 |   |   |   | 2,118,282 |   |
| Loss (Gain) on sale of investments, net                   |   |        | 2,597            |   |     |   | 29,259 |   |   |   | ( 250,480 | ) |
| Deferred income taxes                                     |   |        | ( 119,129   | )      |     |   | ( 222,915 | ) |   |   | ( 96,918 | ) |
| Treasury stock issued for compensation                    |   |        | ---              |   |     |   | 31,159 |   |   |   | 154,245 |   |
| Increase in allowance for doubtful accounts               |   |        | 20,000           |   |     |   | --- |   |   |   | 17,754 |   |
| (Increase) decrease in operating assets:                  |   |        |             |   |     |   |   |   |   |   |   |   |
| Accounts receivable                                       |   |        | ( 1,573,284 | )      |     |   | ( 1,726,610 | ) |   |   | ( 811,292 | ) |
| Other receivables                                         |   |        | 29,801           |   |     |   | 677 |   |   |   | ( 54,922 | ) |
| Inventories                                               |   |        | ( 766,680   | )      |     |   | ( 572,849 | ) |   |   | ( 682,398 | ) |
| Refundable income taxes                                   |   |        | 906,748          |   |     |   | 832,063 |   |   |   | 402,230 |   |
| Prepaid expenses and other current assets                 |   |        | 31,396           |   |     |   | 2,250 |   |   |   | ( 117,618 | ) |
| Increase (decrease) in operating liabilities:             |   |        |             |   |     |   |   |   |   |   |   |   |
| Accounts payable                                          |   |        | ( 402,422   | )      |     |   | 352,627 |   |   |   | 1,419,479 |   |
| Accrued expenses                                          |   |        | 86,382           |   |     |   | 22,919 |   |   |   | ( 104,885 | ) |
| Income taxes payable                                      |   |        | 430,246          |   |     |   | --- |   |   |   | --- |   |
| Net cash provided by operating activities                 |   |        | 1,143,898        |   |     |   | 1,096,404 |   |   |   | 5,615,943 |   |
|                                                      |   |        |             |   |     |   |   |   |   |   |   |   |
| Cash flows from investing activities:                     |   |        |             |   |     |   |   |   |   |   |   |   |
| Purchases of investments                                  |   |        | ( 445,049   | )      |     |   | ( 356,498 | ) |   |   | ( 2,161,552 | ) |
| Proceeds from sale of investments                         |   |        | 234,388          |   |     |   | 531,455 |   |   |   | 5,669,158 |   |
| Proceeds from redemption of certificates of deposit       |   |        | ---              |   |     |   |   |   |   |   | 402,005 |   |
| Purchases of property and equipment                       |   |        | ( 353,455   | )      |     |   | ( 603,015 | ) |   |   | ( 2,229,274 | ) |
| Acquisition of the assets of First Juice                  |   |        | ---              |   |     |   | --- |   |   |   | ( 270,000 | ) |
| Net cash provided by (used in) investing activities       |   |        | ( 564,116   | )      |     |   | ( 428,058 | ) |   |   | 1,410,337 |   |
|                                                      |   |        |             |   |     |   |   |   |   |   |   |   |
| Cash flows from financing activities:                     |   |        |             |   |     |   |   |   |   |   |   |   |
| Proceeds of note payable                                  |   |        | ---              |   |     |   | --- |   |   |   | 250,000 |   |
| Checks written in excess of bank balances                 |   |        | ( 274,137   | )      |     |   | 190,482 |   |   |   | 998,234 |   |
| Purchases of treasury stock                               |   |        | ( 846,290   | )      |     |   | ( 340,105 | ) |   |   | ( 2,666,288 | ) |
| Repayment of notes payable                                |   |        | ( 613,503   | )      |     |   | ( 496,953 | ) |   |   | ( 3,008,694 | ) |
| Net cash used in financing activities                     |   |        | ( 1,733,930 | )      |     |   | ( 646,576 | ) |   |   | ( 4,426,748 | ) |
|                                                      |   |        |             |   |     |   |   |   |   |   |   |   |
| Net (decrease) increase in cash and cash equivalents      |   |        | ( 1,154,148 | )      |     |   | 21,770 |   |   |   | 2,599,532 |   |
|                                                      |   |        |             |   |     |   |   |   |   |   |   |   |
| Cash and cash equivalents at the beginning of the period  |   |        | 3,229,939        |   |     |   | 630,407 |   |   |   | 630,407 |   |
|                                                      |   |        |             |   |     |   |   |   |   |   |   |   |
| Cash and cash equivalents at the end of the period        |   | $           | 2,075,791        |   |     | $      | 652,177 |   |   | $ | 3,229,939 |   |

----

----

| Category                   |   | Years        |
|----------------------------|--------|--------------|
| Buildings and improvements |   | 31 and 39    |
| Machinery and equipment    |   | 5 – 12 |
| Office equipment           |   | 5 – 7  |
| Vehicles                   |   | 5            |

----

| Category                                              |   | Years  |
|-------------------------------------------------------|--------|--------|
| Recipes                                               |   | 4      |
| Customer lists and other customer related intangibles |   | 7-10   |
| Lease agreement                                       |   | 7      |
| Trade names                                           |   | 15     |
| Formula                                               |   | 10     |
| Customer relationships                                |   | 12     |
|                                                  |   |   |

----

----

| Trade names                                                                                           |   | $      | 268,000 |   |
|-------------------------------------------------------------------------------------------------------|--------|--------|---------|--------|
| Other current assets                                                                                  |   |   | 6,000   |   |
| Customer lists                                                                                        |   |   | 199,000 |   |
| Fixed assets                                                                                          |   |   | 35,000  |   |
| Non-compete agreement                                                                                 |   |   | -0-     |   |
| Non amortizable goodwill and brand asset                                                              |   |   | 262,000 |   |
|        Total fair value of assets acquired and liabilities assumed |   | $      | 770,000 |   |

|                                                  |   | March 31, 2011 |      |   | March 31, 2010           |   |      | December 31, 2010 |   |
|-------------------------------------------------------|--------|----------------|-----------|--------|--------------------------|--------|-----------|-------------------|--------|
|                                                  |   | Cost           |      |   | Accumulated Amortization |   |      | Cost              |   |   | Accumulated Amortization |   |   | Cost |   |   | Accumulated Amortization |   |
| Recipes                                               |   | $              | 43,600    |   |                     | $      | 43,600    |              |   | $ | 43,600 |   |   | $ | 43,600 |   |   | $ | 43,600 |   |   | $ | 43,600 |   |
| Customer lists and other customer related intangibles |   |           | 4,504,200 |   |                     |   | 1,166,160 |              |   |   | 4,305,200 |   |   |   | 695,568 |   |   |   | 4,504,200 |   |   |   | 1,039,323 |   |
| Lease acquisition                                     |   |           | 87,200    |   |                     |   | 81,750    |              |   |   | 87,200 |   |   |   | 70,590 |   |   |   | 87,200 |   |   |   | 79,941 |   |
| Customer relationship                                 |   |           | 985,000   |   |                     |   | 383,056   |              |   |   | 985,000 |   |   |   | 300,972 |   |   |   | 985,000 |   |   |   | 362,526 |   |
| Trade names                                           |   |           | 2,248,000 |   |                     |   | 621,100   |              |   |   | 1,980,000 |   |   |   | 484,000 |   |   |   | 2,248,000 |   |   |   | 585,267 |   |
| Formula                                               |   |           | 438,000   |   |                     |   | 204,400   |              |   |   | 438,000 |   |   |   | 160,600 |   |   |   | 438,000 |   |   |   | 193,450 |   |
|                                                  |   | $              | 8,306,000 |   |                     | $      | 2,500,066 |              |   | $ | 7,857,638 |   |   | $ | 1,773,968 |   |   | $ | 8,306,000 |   |   | $ | 2,304,107 |   |

----

| 2012                                                                                                                                                       |   | $      | 780,200   |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|-----------|--------|
| 2013                                                                                                                                                       |   |   | 760,317   |   |
| 2014                                                                                                                                                       |   |   | 714,192   |   |
|                          2015 |   |   | 711,367   |   |
| 2016                                                                                                                                                       |   |   | 711,367   |   |
| Thereafter                                                                                                                                                 |   |   | 2,128,491 |   |
|                                                                                                                                                       |   | $      | 5,805,934 |   |

| March 31, 2011       |   | Cost   |      |   | UnrealizedGains |   |   | UnrealizedLosses |   |   | FairValue     |   |
|----------------------|--------|--------|-----------|--------|-----------------|--------|--------|------------------|--------|--------|---------------|--------|
|                 |   |   |      |   |            |   |   |             |   |   |          |   |
| Equities             |   | $      | 261,472   |   |            | $      | 6,227  |             |   | $      | ( 37,440 | )      |   | $ | 230,259 |   |
| Mutual Funds         |   |   | 103,346   |   |            |   | 1,902  |             |   |   | ( 798    | )      |   |   | 104,450 |   |
| Preferred Securities |   |   | 203,514   |   |            |   | ---    |             |   |   | ( 12,984 | )      |   |   | 190,530 |   |
| Corporate Bonds      |   |   | 792,379   |   |            |   | 3,941  |             |   |   | ( 7,177  | )      |   |   | 789,143 |   |
| Total                |   | $      | 1,360,711 |   |            | $      | 12,070 |             |   | $      | ( 58,399 | )      |   | $ | 1,314,382 |   |

| March 31, 2010                |   | Cost   |      |   | UnrealizedGains |   |    | UnrealizedLosses |   |   | FairValue      |   |
|-------------------------------|--------|--------|-----------|--------|-----------------|--------|---------|------------------|--------|--------|----------------|--------|
|                          |   |   |      |   |            |   |    |             |   |   |           |   |
| Equities                      |   | $      | 1,278,619 |   |            | $      | 190,688 |             |   | $      | ( 120,631 | )      |   | $ | 1,348,676 |   |
| Mutual Funds                  |   |   | 228,746   |   |            |   | 6,781   |             |   |   | ( 4,326   | )      |   |   | 231,201 |   |
| Preferred Securities          |   |   | 388,705   |   |            |   | 7,450   |             |   |   | ( 63,703  | )      |   |   | 332,452 |   |
| Corporate Bonds               |   |   | 1,595,713 |   |            |   | 84,119  |             |   |   | ( 6,877   | )      |   |   | 1,672,955 |   |
| Government Agency Obligations |   |   | 815,778   |   |            |   | 3,433   |             |   |   | ( 6,714   | )      |   |   | 812,497 |   |
| Total                         |   | $      | 4,307,561 |   |            | $      | 292,471 |             |   | $      | ( 202,251 | )      |   | $ | 4,397,781 |   |

| December 31, 2010    |   | Cost   |      |   | UnrealizedGains |   |    | UnrealizedLosses |   |   | FairValue     |   |
|----------------------|--------|--------|-----------|--------|-----------------|--------|---------|------------------|--------|--------|---------------|--------|
|                 |   |   |      |   |            |   |    |             |   |   |          |   |
| Equities             |   | $      | 225,573   |   |            | $      | 16,173  |             |   | $      | ( 68,974 | )      |   | $ | 172,772 |   |
| Mutual Funds         |   |   | 202,108   |   |            |   | 4,661   |             |   |   | ( 2,017  | )      |   |   | 204,752 |   |
| Preferred Securities |   |   | 228,514   |   |            |   | — |             |   |   | ( 18,329 | )      |   |   | 210,185 |   |
| Corporate Bonds      |   |   | 496,451   |   |            |   | 843     |             |   |   | ( 5,771  | )      |   |   | 491,523 |   |
| Total                |   | $      | 1,152,646 |   |            | $      | 21,677  |             |   | $      | ( 95,091 | )      |   | $ | 1,079,232 |   |

----

|                 |   | Less Than 12 Months |    |   | 12 Months or Greater |   |          | Total      |   |
|----------------------|--------|---------------------|---------|--------|----------------------|--------|---------------|------------|--------|
| March 31, 2011       |   | Fair Value          |    |   | Unrealized Losses    |   |          | Fair Value |   |   | Unrealized Losses |   |   | Fair Value |   |   | Unrealized Losses |   |
|                 |   |                |    |   |                 |   |          |       |   |   |   |   |   |   |   |   |   |   |
| Equities             |   | $                   | 163,063 |   |                 | $      | ( 7,801  | )          |   | $ | 25,270 |   |   | $ | ( 29,639 | ) |   | $ | 188,333 |   |   | $ | ( 37,440 | ) |
| Mutual Funds         |   |                | 20,124  |   |                 |   | ( 680    | )          |   |   | 5,824 |   |   |   | ( 118 | ) |   |   | 25,948 |   |   |   | ( 798 | ) |
| Preferred Securities |   |                | ---     |   |                 |   | ---           |       |   |   | 190,530 |   |   |   | ( 12,984 | ) |   |   | 190,530 |   |   |   | ( 12,984 | ) |
| Corporate Bonds      |   |                | 409,750 |   |                 |   | ( 7,177  | )          |   |   | --- |   |   |   | --- |   |   |   | 409,750 |   |   |   | ( 7,177 | ) |
|                 |   | $                   | 592,937 |   |                 | $      | ( 15,658 | )          |   | $ | 221,624 |   |   | $ | ( 42,741 | ) |   | $ | 814,561 |   |   | $ | ( 58,399 | ) |

|                               |   | Less Than 12 Months |    |   | 12 Months or Greater |   |          | Total      |   |
|------------------------------------|--------|---------------------|---------|--------|----------------------|--------|---------------|------------|--------|
| March 31, 2010                     |   | Fair Value          |    |   | Unrealized Losses    |   |          | Fair Value |   |   | Unrealized Losses |   |   | Fair Value |   |   | Unrealized Losses |   |
|                               |   |                |    |   |                 |   |          |       |   |   |   |   |   |   |   |   |   |   |
| Equities                           |   | $                   | 79,393  |   |                 | $      | ( 29,937 | )          |   | $ | 205,060 |   |   | $ | ( 90,694 | ) |   | $ | 284,453 |   |   | $ | ( 120,631 | ) |
| Mutual Funds                       |   |                | 414     |   |                 |   | ( 4      | )          |   |   | 26,034 |   |   |   | ( 4,322 | ) |   |   | 26,448 |   |   |   | ( 4,326 | ) |
| Preferred Securities               |   |                | ---     |   |                 |   | ---           |       |   |   | 310,252 |   |   |   | ( 63,703 | ) |   |   | 310,252 |   |   |   | ( 63,703 | ) |
| Corporate Bonds                    |   |                | 164,144 |   |                 |   | ( 5,510  | )          |   |   | 103,645 |   |   |   | ( 1,367 | ) |   |   | 267,789 |   |   |   | ( 6,877 | ) |
| Government Agency Obligations |   |                | 479,469 |   |                 |   | ( 5,563  | )          |   |   | 85,376 |   |   |   | ( 1,151 | ) |   |   | 564,845 |   |   |   | ( 6,714 | ) |
|                               |   | $                   | 723,420 |   |                 | $      | ( 41,014 | )          |   | $ | 730,367 |   |   | $ | ( 161,237 | ) |   | $ | 1,453,787 |   |   | $ | (202,251 | ) |

|                 |   | Less Than 12 Months |    |   | 12 Months or Greater |   |                                       | Total      |   |
|----------------------|--------|---------------------|---------|--------|----------------------|--------|--------------------------------------------|------------|--------|
| December 31, 2010    |   | Fair Value          |    |   | Unrealized Losses    |   |                                       | Fair Value |   |   | Unrealized Losses |   |   | Fair Value |   |   | Unrealized Losses |   |
|                 |   |                |    |   |                 |   |                                       |       |   |   |   |   |   |   |   |   |   |   |
| Equities             |   | $                   | 48,202  |   |                 | $      | (    11,675            | )          |   | $ | 101,467 |   |   | $ | (     57,299 | ) |   | $ | 149,669 |   |   | $ | (   68,974) | ) |
| Mutual Funds         |   |                | — |   |                 |   | —                                    |       |   |   | 85,061 |   |   |   | (       2,017 | ) |   |   | 85,061 |   |   |   | (     2,017) | ) |
| Preferred Securities |   |                | — |   |                 |   | —                                    |       |   |   | 210,185 |   |   |   | (     18,329 | ) |   |   | 210,185 |   |   |   | (   18,329) | ) |
| Corporate Bonds      |   |                | 146,710 |   |                 |   | (      2,296 | )          |   |   | 122,532 |   |   |   | (       3,475 | ) |   |   | 269,242 |   |   |   | (     5,771) | ) |
|                 |   | $                   | 194,912 |   |                 | $      | (    13,971            | )          |   | $ | 519,245 |   |   | $ | (     81,120 | ) |   | $ | 714,157 |   |   | $ | (   95,091) | ) |

----

|                |   | March 31, |      | December 31, |
|---------------------|--------|-----------|-----------|--------------|
|                |   | 2011      |      |         | 2010 |   |   | 2010 |
| Finished goods      |   | $         | 1,959,323 |         |   | $ | 1,287,500 |   | $ |       1,636,988 |
| Production supplies |   |      | 1,637,602 |         |   |   | 1,571,096 |   |   |  1,527,064  |
| Raw materials       |   |      | 1,155,129 |         |   |   | 1,011,229 |   |   |  821,322  |
| Total inventories   |   | $         | 4,752,054 |         |   | $ | 3,869,825 |   | $ |      3,985,374 |

|                          |   |      |       |         |
|-------------------------------|--------|-----------|------------|--------------|
|                          |   | March 31, |       | December 31, |
|                          |   | 2011      |       |         | 2010 |   | 2010 |
| Land                          |   | $         | 1,178,160  |         |   | $ | 1,178,160 |   | $       1,178,160 |
| Buildings and improvements    |   |      | 11,367,274 |         |   |   | 10,684,220 |   | 11,328,860 |
| Machinery and equipment       |   |      | 14,006,251 |         |   |   | 12,677,396 |   | 13,713,649 |
| Vehicles                      |   |      | 1,073,745  |         |   |   | 961,245 |   | 976,745 |
| Office equipment              |   |      | 374,564    |         |   |   | 276,427 |   | 352,135 |
| Construction in process       |   |      | ---        |         |   |   | 207,830 |   | 96,990 |
|                          |   |      | 27,999,994 |         |   |   | 25,985,278 |   | 27,646,539 |
| Less accumulated depreciation |   |      | 12,870,339 |         |   |   | 11,503,456 |   | 12,493,826 |
| Total property and equipment  |   | $         | 15,129,655 |         |   | $ | 14,481,822 |   | $     15,152,713 |

----

|                              |   |      |    |         |
|-----------------------------------|--------|-----------|---------|--------------|
|                              |   | March 31, |    | December 31, |
|                              |   | 2011      |    |         | 2010 |   | 2010 |
| Accrued payroll and payroll taxes |   | $         | 320,531 |         |   | $ | 298,246 |   | 181,274 |
| Accrued property tax              |   |      | 203,933 |         |   |   | 222,537 |   | 273,876 |
| Other                             |   |      | 71,377  |         |   |   | 116,480 |   | 54,309 |
|                              |   | $         | 595,841 |         |   | $ | 637,263 |   | 509,459 |

|                                                                                                                                                                                                                                                                                                                                                                           |   | March 31, |      | December 31, |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------|-----------|--------------|
|                                                                                                                                                                                                                                                                                                                                                                           |   | 2011      |      |         | 2010 |   | 2010 |
|                                                                                                                                                                                                                                                                                                                                                                           |   |      |      |         |   |   |   |
| Note payable to Private Bank in monthly installments of $42,222, plus variable interest rate, currently at 2.761%, with a balloon payment of $5,066,667 due February 6, 2014.  Collateralized by substantially all assets of the Company.                                                                                                                            |   | $         | 6,502,222 |         |   | $ | 7,008,889 |   | 6,628,889 |
|                                                                                                                                                                                                                                                                                                                                                                           |   |      |      |         |   |   |   |   |   |
| Line of credit with Private Bank at variable interest rate, currently at 2.761%.  The agreement has been extended with terms allowing borrowings up to $2.0 million, maturing on May 31, 2011.  The Company is in the process of negotiating a renewal of this facility at maturity.  Collateralized by substantially all assets of the Company. |   |      | ---       |         |   |   | 500,000 |   | — |
|                                                                                                                                                                                                                                                                                                                                                                           |   |      |      |         |   |   |   |   |   |
| Line of credit with Morgan Stanley for borrowings up to $2.8 million at variable interest rate, currently at 3.01% due on demand.  Collateralized by investments with a fair value of $1,077,323, cash and CD’s totaling $1,711,934 at March 31, 2011.                                                                                                    |   |      | 1,858,110 |         |   |   | 2,484,522 |   | 2,344,946 |
|                                                                                                                                                                                                                                                                                                                                                                           |   |      |      |         |   |   |   |   |   |
| Notes payable to Ilya Mandel & Michael Edelson, subordinated to Private Bank, payable in quarterly installments of $341,875, plus interest at the floating rate per annum (3.25% at March 31, 2010).  This balance was paid in full during August, 2010.                                                                                                         |   |      | ---       |         |   |   | 1,242,165 |   | — |
| Total notes payable                                                                                                                                                                                                                                                                                                                                                            |   |      | 8,360,332 |         |   |   | 11,235,576 |   | 8,973,835 |
| Less current maturities                                                                                                                                                                                                                                                                                                                                                        |   |      | 2,364,774 |         |   |   | 4,733,354 |   | 2,851,610 |
| Total long-term portion                                                                                                                                                                                                                                                                                                                                                        |   | $         | 5,995,558 |         |   | $ | 6,502,222 |   | 6,122,225 |

----

| For the Period Ended March 31, |   |   |
|--------------------------------|--------|--------|
|                           |   |   |   |
| 2012                           |   | $      | 2,364,774 |   |
| 2013                           |   |   | 506,664 |   |
| 2014                           |   |   | 5,488,894 |   |
| Total                          |   | $      | 8,360,332 |   |

|                       |   | For the Three Months Ended |                              | For the Year Ended |
|----------------------------|--------|----------------------------|-----------------------------------|--------------------|
|                       |   | March 31,                  |                              | December 31,       |
|                       |   | 2011                       |                              |               | 2010 |   | 2010 |
| Current:                   |   |                       |                              |               |   |   |   |
| Federal                    |   | $                          | 1,005,605                         |               |   | $ | 916,582 |   | 2,269,819 |
| State and local            |   |                       | 406,241                           |               |   |   | 216,581 |   | 651,085 |
| Total current              |   |                       | 1,411,846                         |               |   |   | 1,133,163 |   | 2,920,904 |
| Deferred                   |   |                       | (    119,129) |               |   |   | (    222,915) |   | (        96,918) |
| Provision for income taxes |   | $                          | 1,292,717                         |               |   | $ | 910,248 |   | 2,823,986 |

|                                                           |   |                       |                             | For the Year |
|----------------------------------------------------------------|--------|----------------------------|----------------------------------|--------------|
|                                                           |   | For the Three Months Ended |                             | Ended        |
|                                                           |   | March 31,                  |                             | December 31, |
|                                                           |   | 2011                       |                             |         | 2010 |   | 2010 |
| Federal income tax expense computed at the statutory rate |   | $                          | 1,094,286                        |         |   | $ | 910,838 |   |  $     2,180,228 |
| State and local tax expense, net                               |   |                       | 305,756                          |         |   |   | 128,589 |   | 651,085 |
| Permanent differences                                          |   |                       | (    58,415) |         |   |   | (    129,179) |   | (     117,247) |
| Tax credits and other                                          |   |                       | (48,910)                         |         |   |   | --- |   | 109,920 |
| Provision for income taxes                                     |   | $                          | 1,292,717                        |         |   | $ | 910,248 |   | $     2,823,986 |

----

|                                                                               |   |      |        |         |
|------------------------------------------------------------------------------------|--------|-----------|-------------|--------------|
|                                                                               |   | March 31, |        | December 31, |
|                                                                               |   | 2011      |        |         | 2010 |   | 2010 |
| Non-current deferred tax assets (liabilities) arising from:Temporary differences - |   |      |        |         |   |   |   |
| Accumulated depreciation and amortization from purchase accounting adjustments     |   | $         | (3,604,041) |         |   | $ | (3,655,289) |   | $   (3,673,296) |
| Capital loss carry-forwards                                                        |   |      | 271,568     |         |   |   | 337,016 |   | 271,568 |
| Total non-current net deferred tax liabilities                                     |   |      | (3,332,473) |         |   |   | (3,318,273) |   | (3,401,728) |
|  Current deferred tax assets arising from:                                    |   |      |        |         |   |   |   |   |   |
| Unrealized losses on investments                                                   |   |      | 24,384      |         |   |   | (37,261) |   | 30,320 |
| Impairment of investments                                                          |   |      | ---         |         |   |   | 59,003 |   | 4,232 |
| Inventory                                                                          |   |      | 212,089     |         |   |   | 163,979 |   | 168,875 |
| Allowance for doubtful accounts and discounts                                      |   |      | 131,703     |         |   |   | 117,710 |   | 125,043 |
| Total current deferred tax assets                                                  |   |      | 368,176     |         |   |   | 303,431 |   | 328,470 |
|  Net deferred tax liability                                                   |   | $         | (2,964,297) |         |   | $ | (3,014,842) |   | $   (3,073,258) |

|         |   |                       |    | For the Year |
|--------------|--------|----------------------------|---------|--------------|
|         |   | For the Three Months Ended |    | Ended        |
|         |   | March 31,                  |    | December 31, |
|         |   | 2011                       |    |         | 2010 |   | 2010 |
| Interest     |   | $                          | 58,624  |         |   | $ | 106,643 |   | $         375,347 |
| Income taxes |   | $                          | 200,000 |         |   | $ | 301,100 |   | $      2,824,824 |

----

----

----

----

----

----

| Period                                   |   | (a) TotalNumbers ofShares (or Units)Purchased |   | (b) Average Price Paid per Share (or Unit) |   | (c) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs* |   | (d) Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs* |
|------------------------------------------|--------|-----------------------------------------------|--------|--------------------------------------------|--------|--------------------------------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------|
| Jan. 1, 2011 to Jan. 31, 2011       |   | 32,007                                        |   | 9.19                                       |   | 32,007                                                                                           |   | 265,595                                                                                                                      |
| Feb. 1, 2011 to Feb. 28, 2011  |   | 23,341                                        |   | 9.21                                       |   | 23,341                                                                                           |   | 242,254                                                                                                                      |
| March 1, 2011 to March 31, 2011          |   | 37,500                                        |   | 8.79                                       |   | 37,500                                                                                           |   | 204,754                                                                                                                      |
| Total                               |   | 92,848                                        |   | 9.06                                       |   | 92,848                                                                                           |   | 204,754                                                                                                                      |

----

| ExhibitNumber |   | Description of Document                                                                                                                                                 |
|---------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|          |   |                                                                                                                                                                    |
| 31.1          |   |  Officer’s Certificate Pursuant to 15 U.S.C. 7241, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                |
|          |   |                                                                                                                                                                    |
| 31.2          |   |  Officer’s Certificate Pursuant to 15 U.S.C. 7241, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                |
|          |   |                                                                                                                                                                    |
| 32.1          |   |  Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.      |
|          |   |                                                                                                                                                                    |
| 32.2          |   |  Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|          |   |                                                                                                                                                                    |
| 99.1          |   |  Press Release dated May 12, 2011.                                                                                                                                 |

----

|                                     | LIFEWAY FOODS, INC. |                                                                 |
|------------------------------------------|---------------------|----------------------------------------------------------------------|
|                                     |  (Registrant)  |                                                                 |
|                                     |                |                                                                 |
|                                     |                |                                                                 |   |
| Date:  May 16,  2011 | By:                 |  /s/ Julie Smolyansky                                      |   |
|                                     |                |  Julie Smolyansky                                               |   |
|                                     |                |  Chief Executive Officer, President and Director      |   |
|                                     |                |                                                                 |   |
|                                     |                |                                                                 |   |
|                                     |                |                                                                 |   |
|                                     |                |                                                                 |   |
|                                     |                |                                                                 |   |
|                                     |                |                                                                 |   |
| Date: May 16, 2011                  | By:                 |  /s/ Edward P. Smolyansky                                       |   |
|                                     |                |  Edward P. Smolyansky                                           |   |
|                                     |                |  Chief Financial and Accounting Officer and Treasurer |   |
|                                     |                |                                                                 |   |
|                                     |                |                                                                 |   |
|                                     |                |                                                                 |   |
|                                     |                |                                                                 |   |

----

| ExhibitNumber |   | Description of Document                                                                                                                                                      |
|---------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|          |   |                                                                                                                                                                         |
| 31.1          |   |  Officer’s Certificate Pursuant to 15 U.S.C. 7241, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                     |
|          |   |                                                                                                                                                                         |
| 31.2          |   |  Officer’s Certificate Pursuant to 15 U.S.C. 7241, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                                     |
|          |   |                                                                                                                                                                         |
| 32.1          |   |  Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|          |   |                                                                                                                                                                         |
| 32.2          |   |  Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.           |
|          |   |                                                                                                                                                                         |
| 99.1          |   |  Press Release dated May 12, 2011.                                                                                                                                 |

----