UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549





FORM 10-Q





(Mark One)

|x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ---------------------------------------------------------------------------------------

For the quarterly period ended March 29, 2008

or



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

For the transition period from  to

Commission File Number: 333-112714





MICHAEL FOODS, INC.

(Exact name of
registrant as specified in its charter)







|                                                               |  |                                  
|-------------------------------------------------------------- |  | ---------------------------------
|Delaware                                                       |  | 13-4151741                       
|(State or other jurisdiction of incorporation or organization) |  | (IRS Employer Identification No.)
|                                                               | 
|301 Carlson Parkway Suite 400 Minnetonka, Minnesota            |  | 55305                            
|(Address of principal executive offices)                       |  | (Zip Code)                       

(952) 258-4000

(Registrants telephone number, including area code)

None

(Former name, former address and former fiscal year, if changed since last report)





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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Large accelerated filer   ̈    Accelerated filer   ̈    Non-accelerated filer  x    Smaller Reporting Company   ̈

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).     ̈  Yes    x  No



The registrants Common Stock is not publicly traded. The Registrant had 3,000 shares of $0.01 par value common stock outstanding as of May 12,
2008.









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PART IFINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

MICHAEL FOODS, INC.

(A wholly owned subsidiary of M-Foods Holdings, Inc.)

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited, in thousands, except per share data)



|                                                                                                                       |  |               |           |                  |   |          
|---------------------------------------------------------------------------------------------------------------------- |  | ------------- | --------- | ---------------- | - | ---------
|                                                                                                                       |  | March 29,2008 |           | December 29,2007
|ASSETS                                                                                                                 |  |               |           |                  |   |          
|Current Assets                                                                                                         |  |               |           |                  |   |          
|Cash and equivalents                                                                                                   |  | $             | 5,745     |                  | $ | 30,077   
|Accounts receivable, less allowances                                                                                   |  |               | 145,654   |                  |   | 132,922  
|Inventories                                                                                                            |  |               | 126,109   |                  |   | 114,758  
|Prepaid expenses and other                                                                                             |  |               | 15,885    |                  |   | 7,711    
|                                                                                                                       |  |               |           |                  |   |          
|Total Current Assets                                                                                                   |  |               | 293,393   |                  |   | 285,468  
|                                                                                                                       |  |              
|Property, Plant And Equipment                                                                                          |  |               |           |                  |   |          
|Land                                                                                                                   |  |               | 4,258     |                  |   | 4,044    
|Buildings and improvements                                                                                             |  |               | 138,559   |                  |   | 123,839  
|Machinery and equipment                                                                                                |  |               | 342,834   |                  |   | 333,755  
|                                                                                                                       |  |               |           |                  |   |          
|                                                                                                                       |  |               | 485,651   |                  |   | 461,638  
|Less accumulated depreciation                                                                                          |  |               | 237,185   |                  |   | 222,772  
|                                                                                                                       |  |               |           |                  |   |          
|                                                                                                                       |  |               | 248,466   |                  |   | 238,866  
|Other Assets                                                                                                           |  |               |           |                  |   |          
|Goodwill                                                                                                               |  |               | 522,916   |                  |   | 518,264  
|Intangible assets, net                                                                                                 |  |               | 197,961   |                  |   | 201,449  
|Other assets                                                                                                           |  |               | 12,606    |                  |   | 29,814   
|                                                                                                                       |  |               |           |                  |   |          
|                                                                                                                       |  |               | 733,483   |                  |   | 749,527  
|                                                                                                                       |  |               |           |                  |   |          
|                                                                                                                       |  | $             | 1,275,342 |                  | $ | 1,273,861
|                                                                                                                       |  |               |           |                  |   |          
|LIABILITIES AND SHAREHOLDERS EQUITY                                                                                   |  |               |           |                  |   |          
|Current Liabilities                                                                                                    |  |               |           |                  |   |          
|Current maturities of long-term debt                                                                                   |  | $             | 2,171     |                  | $ | 2,479    
|Accounts payable                                                                                                       |  |               | 91,227    |                  |   | 95,419   
|Accrued liabilities                                                                                                    |  |               |           |                  |   |          
|Compensation                                                                                                           |  |               | 9,767     |                  |   | 20,651   
|Customer programs                                                                                                      |  |               | 39,041    |                  |   | 40,094   
|Interest                                                                                                               |  |               | 9,167     |                  |   | 6,276    
|Other                                                                                                                  |  |               | 29,512    |                  |   | 25,968   
|                                                                                                                       |  |               |           |                  |   |          
|Total Current Liabilities                                                                                              |  |               | 180,885   |                  |   | 190,887  
|Long-term debt, less current maturities                                                                                |  |               | 598,514   |                  |   | 599,304  
|Deferred income taxes                                                                                                  |  |               | 97,662    |                  |   | 102,284  
|Other long-term liabilities                                                                                            |  |               | 21,838    |                  |   | 21,297   
|Commitment and contingencies                                                                                           |  |               |          |                  |   |         
|Shareholders Equity                                                                                                   |  |               |           |                  |   |          
|Common stock, $0.01 par value, 3,000 shares authorized, issued and outstanding on March 29, 2008 and December 29,
2007 |  |               |          |                  |   |         
|Additional paid-in capital                                                                                             |  |               | 270,510   |                  |   | 265,819  
|Retained earnings                                                                                                      |  |               | 99,674    |                  |   | 88,393   
|Accumulated other comprehensive income                                                                                 |  |               | 6,259     |                  |   | 5,877    
|                                                                                                                       |  |               |           |                  |   |          
|                                                                                                                       |  |               | 376,443   |                  |   | 360,089  
|                                                                                                                       |  |               |           |                  |   |          
|                                                                                                                       |  | $             | 1,275,342 |                  | $ | 1,273,861
|                                                                                                                       |  |               |           |                  |   |          

The accompanying notes are an integral part of the unaudited condensed consolidated financial
statements.



2



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MICHAEL FOODS, INC.

(A wholly owned subsidiary of M-Foods Holdings, Inc.)

CONDENSED CONSOLIDATED STATEMENTS OF
EARNINGS

For the three months ended March 29, 2008 and March 31, 2007

(Unaudited, in thousands)



|                                             |  |      |         |      |   |        
|-------------------------------------------- |  | ---- | ------- | ---- | - | -------
|                                             |  | 2008 |         | 2007
|Net sales                                    |  | $    | 427,677 |      | $ | 327,931
|Cost of sales                                |  |      | 357,374 |      |   | 271,808
|                                             |  |      |         |      |   |        
|Gross profit                                 |  |      | 70,303  |      |   | 56,123 
|Selling, general and administrative expenses |  |      | 40,604  |      |   | 36,101 
|Plant closing expenses                       |  |      |        |      |   | 185    
|                                             |  |      |         |      |   |        
|Operating profit                             |  |      | 29,699  |      |   | 19,837 
|Interest expense, net                        |  |      | 12,077  |      |   | 13,364 
|                                             |  |      |         |      |   |        
|Earnings before income taxes                 |  |      | 17,622  |      |   | 6,473  
|Income tax expense                           |  |      | 6,341   |      |   | 2,523  
|                                             |  |      |         |      |   |        
|Net earnings                                 |  | $    | 11,281  |      | $ | 3,950  
|                                             |  |      |         |      |   |        

The accompanying notes are an integral part of the unaudited condensed consolidated financial
statements.



3



---

MICHAEL FOODS, INC.

(A wholly owned subsidiary of M-Foods Holdings, Inc.)

CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS

For the three months ended March 29, 2008 and March 31, 2007

(Unaudited, in thousands)



|                                                                  |  |      |         |   |      |   |        |  
|----------------------------------------------------------------- |  | ---- | ------- | - | ---- | - | ------ | -
|                                                                  |  | 2008 |         |   | 2007 |  
|Net cash (used in) provided by operating activities               |  | $    | (8,474  | ) |      | $ | 7,211  |  
|Cash flows from investing activities:                             |  |      |         |   |      |   |        |  
|Capital expenditures                                              |  |      | (6,369  | ) |      |   | (5,846 | )
|Business acquisition                                              |  |      | (8,652  | ) |      |   |       |  
|Other assets                                                      |  |      |        |   |      |   | (98    | )
|                                                                  |  |      |         |   |      |   |        |  
|Net cash used in investing activities                             |  |      | (15,021 | ) |      |   | (5,944 | )
|Cash flows from financing activities:                             |  |      |         |   |      |   |        |  
|Payments on long-term debt                                        |  |      | (791    | ) |      |   | (471   | )
|                                                                  |  |      |         |   |      |   |        |  
|Net cash used in financing activities                             |  |      | (791    | ) |      |   | (471   | )
|Effect of exchange rate changes on cash                           |  |      | (46     | ) |      |   | 23     |  
|                                                                  |  |      |         |   |      |   |        |  
|Net (decrease) increase in cash and equivalents                   |  |      | (24,332 | ) |      |   | 819    |  
|Cash and equivalents at beginning of period                       |  |      | 30,077  |   |      |   | 21,576 |  
|                                                                  |  |      |         |   |      |   |        |  
|Cash and equivalents at end of period                             |  | $    | 5,745   |   |      | $ | 22,395 |  
|                                                                  |  |      |         |   |      |   |        |  
|                                                                  |  |     
|Supplemental disclosures:                                         |  |      |         |   |      |   |        |  
|Non-cash capital investment by parent                             |  | $    | 4,625   |   |      | $ | 4,306  |  
|                                                                  |  |      |         |   |      |   |        |  
|Reclassification of other assets to property, plant and equipment |  | $    | 16,250  |   |      | $ |       |  
|                                                                  |  |      |         |   |      |   |        |  

The accompanying notes are an integral part of the unaudited condensed consolidated financial
statements.



4



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MICHAEL FOODS, INC.

(A wholly owned subsidiary of M-Foods Holdings, Inc.)

(Unaudited)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE ABASIS OF PRESENTATION AND RECENT ACCOUNTING PRONOUNCEMENTS AND SIGNIFICANT ACCOUNTING POLICIES

The accompanying
condensed consolidated financial statements have been prepared in accordance with Regulation S-X of the Securities and Exchange Commission. Certain information and disclosures normally included in financial statements prepared in accordance with
accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations, although management believes that the disclosures are adequate to make the information presented not
misleading.

We utilize a fifty-two/fifty-three week fiscal year ending on the Saturday nearest to December 31 each year. The
quarterly period ended March 29, 2008 was a 13 week period and the quarterly period ended March 31, 2007 was a 13 week period.

In the opinion of management, the unaudited financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the results of operations for the periods indicated. Our results of
operations and cash flows for the period ended March 29, 2008 are not necessarily indicative of the results expected for the full year.

In September 2006, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standard (SFAS) No. 157, Fair Value Measurements (FAS 157). FAS 157 established a
valuation hierarchy for disclosure of the inputs to valuation used to measure fair value. This hierarchy prioritizes the inputs into three broad levels. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or
liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term
of the financial instrument. Level 3 inputs are unobservable inputs based on our own assumptions used to measure assets and liabilities at fair value.

We are exposed to market risks from changes in commodity prices, which may adversely affect our operating results and financial position. When appropriate, we minimize our risks from commodity price fluctuations
through the use of derivative financial instruments. We have classified these financial assets within level 2 of the fair level hierarchy. At March 29, 2008, our financial assets, measured on a recurring basis, are carried at a fair value of
$6,505,000. The implementation of FAS 157 for our financial assets and financial liabilities, effective January 1, 2008, did not have a material impact on our consolidated financial position or results of operations.

The effective date of FAS 157 for nonfinancial assets and nonfinancial liabilities was deferred to fiscal years beginning after November 15, 2008.
We are assessing the impact of FAS 157 for nonfinancial assets and nonfinancial liabilities on our consolidated financial position and results of operations.

Goodwill and Intangible Assets

We recognize the excess cost of an acquired entity over the net amount assigned to assets
acquired, including intangible assets with indefinite lives, and liabilities assumed, as goodwill. Goodwill and intangible assets with indefinite lives (trademarks) are tested for impairment on an annual basis during the fourth quarter, and between
annual tests whenever there is an impairment indicated. Fair values are estimated based on our best assessment of market value compared with the corresponding carrying value of the reporting unit, including goodwill. Impairment losses will be
recognized whenever the implied fair value is less than the carrying value of the related asset.

Each segments share of goodwill was
as follows (in thousands):



|                |  |               |         |                  |   |        
|--------------- |  | ------------- | ------- | ---------------- | - | -------
|                |  | March 29,2008 |         | December 29,2007
|Egg Products    |  | $             | 430,992 |                  | $ | 426,340
|Crystal Farms   |  |               | 32,068  |                  |   | 32,068 
|Potato Products |  |               | 59,856  |                  |   | 59,856 
|                |  |               |         |                  |   |        
|                |  | $             | 522,916 |                  | $ | 518,264
|                |  |               |         |                  |   |        

The $4,652,000 change in goodwill for the Egg Products Division is the result of our purchasing
certain assets of Mr. Bs of Abbotsford, Inc. and related entities on January 11, 2008. The purchase price was $8,652,000 and was financed through



5



---

available cash and was accounted for during the period ended March 29, 2008, using the purchase method in accordance with SFAS Standards No. 141,
Business Combinations. The acquired net assets, which consisted primarily of accounts receivable and property, plant and equipment, were recorded at fair value as of the date of the acquisition.

We recognize an acquired intangible asset apart from goodwill whenever the asset arises from contractual or other legal rights, or whenever it is capable
of being separated or divided from the acquired entity and sold, transferred, licensed, rented, or exchanged, either individually or in combination with a related contract, asset or liability. An intangible asset other than goodwill is amortized
over its estimated useful life unless that life is determined to be indefinite. Straight-line amortization reflects an appropriate allocation of the cost of intangible assets to earnings in proportion to the amount of economic benefit obtained by
the Company in each reporting period. Impairment losses are recognized if the carrying amount of an intangible asset subject to amortization is not recoverable from expected future cash flows, and its carrying amount exceeds its fair value.

Our intangible assets, other than goodwill, were as follows (in thousands):



|                                                                |  |               |         |   |                  |   |         |  
|--------------------------------------------------------------- |  | ------------- | ------- | - | ---------------- | - | ------- | -
|                                                                |  | March 29,2008 |         |   | December 29,2007 |  
|Amortized intangible assets, principally customer relationships |  | $             | 230,215 |   |                  | $ | 229,915 |  
|Accumulated amortization                                        |  |               | (66,379 | ) |                  |   | (62,591 | )
|                                                                |  |               |         |   |                  |   |         |  
|                                                                |  |               | 163,836 |   |                  |   | 167,324 |  
|Indefinite lived intangible assets, trademarks                  |  |               | 34,125  |   |                  |   | 34,125  |  
|                                                                |  |               |         |   |                  |   |         |  
|                                                                |  | $             | 197,961 |   |                  | $ | 201,449 |  
|                                                                |  |               |         |   |                  |   |         |  

Our amortizable intangible assets increased by $300,000 as a result of the closing of our
acquisition of Mr. Bs of Abbotsford, Inc. and related entities.

The aggregate amortization expense was $3,788,000 for the three
months ended March 29, 2008 and was $3,833,000 for the three months ended March 31, 2007. The estimated amortization expense for the years 2008 through 2012 is as follows (in thousands):



|     |  |   |       
|---- |  | - | ------
|2008 |  | $ | 15,424
|2009 |  |   | 15,431
|2010 |  |   | 15,431
|2011 |  |   | 15,338
|2012 |  |   | 15,331

The above amortization expense forecast is an estimate. Actual amounts may change from such
estimated amounts due to additional intangible asset acquisitions, potential impairment, change in estimated remaining useful lives, or other events.

Deferred Financing Costs

Deferred financing costs are included as a component of other assets and are being amortized using
the effective interest rate method over the lives of the respective debt agreements. Our deferred financing costs were as follows (in thousands):



|                         |  |               |         |   |                  |   |         |  
|------------------------ |  | ------------- | ------- | - | ---------------- | - | ------- | -
|                         |  | March 29,2008 |         |   | December 29,2007 |  
|Deferred financing costs |  | $             | 31,597  |   |                  | $ | 31,597  |  
|Accumulated amortization |  |               | (19,664 | ) |                  |   | (18,707 | )
|                         |  |               |         |   |                  |   |         |  
|                         |  | $             | 11,933  |   |                  | $ | 12,890  |  
|                         |  |               |         |   |                  |   |         |  

NOTE BINVENTORIES

Inventories, other than flocks, are stated at the lower of cost (determined on a first-in, first-out basis) or market. Flock inventory represents the cost of purchasing and raising flocks to laying maturity, at which
time their cost is amortized to operations over their expected useful lives of generally 12 to 18 months, assuming no salvage value.



6



---

Inventories consisted of the following (in thousands):



|                                   |  |               |         |                  |   |        
|---------------------------------- |  | ------------- | ------- | ---------------- | - | -------
|                                   |  | March 29,2008 |         | December 29,2007
|Raw materials and supplies         |  | $             | 21,214  |                  | $ | 20,225 
|Work in process and finished goods |  |               | 74,025  |                  |   | 67,340 
|Flocks                             |  |               | 30,870  |                  |   | 27,193 
|                                   |  |               |         |                  |   |        
|                                   |  | $             | 126,109 |                  | $ | 114,758
|                                   |  |               |         |                  |   |        

NOTE CCOMMITMENTS AND CONTINGENCIES

On March 27, 2008, we received a subpoena from the U.S. Department of Justice, through the U.S. Attorney for the Eastern District of Pennsylvania,
requesting documents for the period of January 1, 2002 through March 27, 2008 relating primarily to the pricing, marketing, and sales of our egg products. On the same date one of our subsidiaries received a related subpoena. We are fully
cooperating with the Department of Justice request. We cannot predict what, if any, impact these inquiries and any results from such inquiries could have on our future results of operations.

We are engaged in routine litigation incidental to our business. We believe the ultimate outcome of this litigation will not have a material effect on
our consolidated financial position, liquidity or results of operations.

NOTE DSHAREHOLDERS EQUITY

Additional Paid in Capital

We recorded non-cash
capital contributions from our parent, M-Foods Holdings, Inc. (Holdings) of $4.6 million in the three month period ended March 29, 2008 and $4.3 million in the three month period ended March 31, 2007 related to the tax benefit
the Company receives on Holdings interest deduction due to filing a consolidated Federal tax return with Holdings.

Comprehensive Income

The components of and changes in accumulated other comprehensive income (loss), net of taxes, during the three months ended
March 29, 2008 were as follows (in thousands):



|                                          |  |                 |       |                            |   |       |                |  |   |       |  
|----------------------------------------- |  | --------------- | ----- | -------------------------- | - | ----- | -------------- |  | - | ----- | -
|                                          |  | Cash FlowHedges |       | ForeignCurrencyTranslation |   |       | TotalAOCI/AOCL | 
|Balance at December 29, 2007              |  | $               | 360   |                            | $ | 5,517 |                |  | $ | 5,877 |  
|Foreign currency translation adjustment   |  |                 |      |                            |   | (635  | )              |  |   | (635  | )
|Fair value adjustment of cash flow hedges |  |                 | 1,017 |                            |   |      |                |  |   | 1,017 |  
|                                          |  |                 |       |                            |   |       |                |  |   |       |  
|Balance at March 29, 2008                 |  | $               | 1,377 |                            | $ | 4,882 |                |  | $ | 6,259 |  
|                                          |  |                 |       |                            |   |       |                |  |   |       |  



7



---

Comprehensive income, net of taxes was as follows (in thousands):



|                                                               |  |       |   |  |   |        |  
|-------------------------------------------------------------- |  | ----- | - |  | - | ------ | -
|Net earnings for the three months ended March 29, 2008         |  |       |   |  | $ | 11,281 |  
|Net gains (losses) arising during the period:                  |  |       |   |  |   |        |  
|Fair value adjustment of cash flow hedges                      |  | 1,017 |   |  |   |        |  
|Foreign currency translation adjustment                        |  | (635  | ) |  |   |        |  
|                                                               |  |       |   |  |   |        |  
|Other comprehensive income                                     |  |       |   |  |   | 382    |  
|                                                               |  |       |   |  |   |        |  
|Comprehensive income for the three months ended March 29, 2008 |  |       |   |  | $ | 11,663 |  
|                                                               |  |       |   |  |   |        |  
|                                                               |  |      
|Net earnings for the three months ended March 31, 2007         |  |       |   |  | $ | 3,950  |  
|Net gains (losses) arising during the period:                  |  |       |   |  |   |        |  
|Fair value adjustment of cash flow hedges                      |  | (359  | ) |  |   |        |  
|Foreign currency translation adjustment                        |  | 10    |   |  |   |        |  
|                                                               |  |       |   |  |   |        |  
|Other comprehensive loss                                       |  |       |   |  |   | (349   | )
|                                                               |  |       |   |  |   |        |  
|Comprehensive income for the three months ended March 31, 2007 |  |       |   |  | $ | 3,601  |  
|                                                               |  |       |   |  |   |        |  

NOTE EBUSINESS SEGMENTS

We operate in three reportable segmentsEgg Products, Potato Products and Crystal Farms. Certain financial information on our operating segments is as follows (unaudited, in thousands):



|                                   |  |             |         |                |   |              |  |                         |        |  |       |        |   |  |   |        
|---------------------------------- |  | ----------- | ------- | -------------- | - | ------------ |  | ----------------------- | ------ |  | ----- | ------ | - |  | - | -------
|                                   |  | EggProducts |         | PotatoProducts |   | CrystalFarms |  | Corporate &Eliminations |        |  | Total
|Three months ended March 29, 2008: |  |             |         |                |   |              |  |                         |        |  |       |        |   |  |   |        
|External net sales                 |  | $           | 300,966 |                | $ | 30,250       |  | $                       | 96,461 |  | $     |       |   |  | $ | 427,677
|Intersegment sales                 |  |             | 4,470   |                |   | 5,275        |  |                         |       |  |       | (9,745 | ) |  |   |       
|Operating profit (loss)            |  |             | 26,955  |                |   | 3,932        |  |                         | 2,485  |  |       | (3,673 | ) |  |   | 29,699 
|Depreciation and amortization      |  |             | 16,217  |                |   | 1,679        |  |                         | 1,132  |  |       | 1      |   |  |   | 19,029 
|                                   |  |             |         |                |  
|Three months ended March 31, 2007: |  |             |         |                |   |              |  |                         |        |  |       |        |   |  |   |        
|External net sales                 |  | $           | 229,228 |                | $ | 28,513       |  | $                       | 70,190 |  | $     |       |   |  | $ | 327,931
|Intersegment sales                 |  |             | 3,429   |                |   | 4,932        |  |                         |       |  |       | (8,361 | ) |  |   |       
|Operating profit (loss)            |  |             | 13,774  |                |   | 3,979        |  |                         | 4,437  |  |       | (2,353 | ) |  |   | 19,837 
|Depreciation and amortization      |  |             | 16,358  |                |   | 1,628        |  |                         | 1,083  |  |       | 3      |   |  |   | 19,072 

NOTE FSUPPLEMENTAL GUARANTOR FINANCIAL INFORMATION

Our senior credit agreement and senior subordinated notes have been guaranteed, on a joint and several basis, by us and our 100% owned domestic
subsidiaries. The senior credit agreement is also guaranteed by our parent, M-Foods Holdings, Inc.

The following condensed consolidating
financial information presents our condensed consolidating balance sheets at March 29, 2008 and December 29, 2007, together with our condensed consolidating statements of earnings and cash flows for the three month periods ended
March 29, 2008 and March 31, 2007. These financial statements reflect Michael Foods, Inc. (the parent), the wholly-owned guarantor subsidiaries (on a combined basis), the non-guarantor subsidiary (MFI Food Canada Ltd.), and elimination
entries necessary to combine such entities on a consolidated basis.



8



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Condensed Consolidating Balance Sheets

March 29, 2008

(Unaudited, in thousands)



|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|------------------------------------------ |  | ------ | ------- | - | --------------------- | - | --------- | ----------------------- |  | - | ------------ | - |  | ------------ | -------- | - |  | - | ---------
|                                           |  | Parent |         |   | GuarantorSubsidiaries |   |           | Non-GuarantorSubsidiary |  |   | Eliminations |   |  | Consolidated
|Assets                                     |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Current Assets                             |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Cash and equivalents                       |  | $      | 5,036   |   |                       | $ |          |                         |  | $ | 709          |   |  | $            |         |   |  | $ | 5,745    
|Accounts receivable, less allowances       |  |        | 6,974   |   |                       |   | 150,569   |                         |  |   | 7,270        |   |  |              | (19,159  | ) |  |   | 145,654  
|Inventories                                |  |        |        |   |                       |   | 118,474   |                         |  |   | 7,635        |   |  |              |         |   |  |   | 126,109  
|Prepaid expenses and other                 |  |        | 758     |   |                       |   | 14,962    |                         |  |   | 165          |   |  |              |         |   |  |   | 15,885   
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Total current assets                       |  |        | 12,768  |   |                       |   | 284,005   |                         |  |   | 15,779       |   |  |              | (19,159  | ) |  |   | 293,393  
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Property, Plant and Equipmentnet          |  |        | 13      |   |                       |   | 234,953   |                         |  |   | 13,500       |   |  |              |         |   |  |   | 248,466  
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Other assets:                              |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Goodwill                                   |  |        |        |   |                       |   | 519,890   |                         |  |   | 3,026        |   |  |              |         |   |  |   | 522,916  
|Intangibles and other assets               |  |        | 12,607  |   |                       |   | 210,808   |                         |  |   | 2,410        |   |  |              | (15,258  | ) |  |   | 210,567  
|Investment in subsidiaries                 |  |        | 955,719 |   |                       |   | (5,927    | )                       |  |   |             |   |  |              | (949,792 | ) |  |   |         
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|                                           |  |        | 968,326 |   |                       |   | 724,771   |                         |  |   | 5,436        |   |  |              | (965,050 | ) |  |   | 733,483  
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Total assets                               |  | $      | 981,107 |   |                       | $ | 1,243,729 |                         |  | $ | 34,715       |   |  | $            | (984,209 | ) |  | $ | 1,275,342
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Liabilities and Shareholders Equity       |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Current Liabilities                        |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Current maturities of long-term debt       |  | $      | (4,607  | ) |                       | $ | 5,745     |                         |  | $ | 1,033        |   |  | $            |         |   |  | $ | 2,171    
|Accounts payable                           |  |        | 1,039   |   |                       |   | 98,822    |                         |  |   | 10,525       |   |  |              | (19,159  | ) |  |   | 91,227   
|Accrued liabilities                        |  |        | 22,143  |   |                       |   | 63,942    |                         |  |   | 1,402        |   |  |              |         |   |  |   | 87,487   
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Total current liabilities                  |  |        | 18,575  |   |                       |   | 168,509   |                         |  |   | 12,960       |   |  |              | (19,159  | ) |  |   | 180,885  
|Long-term debt, less current maturities    |  |        | 577,350 |   |                       |   | 14,247    |                         |  |   | 26,316       |   |  |              | (19,399  | ) |  |   | 598,514  
|Deferred income taxes                      |  |        | (13,099 | ) |                       |   | 111,046   |                         |  |   | (415         | ) |  |              | 130      |   |  |   | 97,662   
|Other long-term liabilities                |  |        | 21,838  |   |                       |   |          |                         |  |   |             |   |  |              |         |   |  |   | 21,838   
|Shareholders equity                       |  |        | 376,443 |   |                       |   | 949,927   |                         |  |   | (4,146       | ) |  |              | (945,781 | ) |  |   | 376,443  
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Total liabilities and shareholders equity |  | $      | 981,107 |   |                       | $ | 1,243,729 |                         |  | $ | 34,715       |   |  | $            | (984,209 | ) |  | $ | 1,275,342
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          



9



---

Condensed Consolidating Balance Sheets

December 29, 2007

(In thousands)



|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|------------------------------------------ |  | ------ | ------- | - | --------------------- | - | --------- | ----------------------- |  | - | ------------ | - |  | ------------ | -------- | - |  | - | ---------
|                                           |  | Parent |         |   | GuarantorSubsidiaries |   |           | Non-GuarantorSubsidiary |  |   | Eliminations |   |  | Consolidated
|Assets                                     |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Current Assets                             |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Cash and equivalents                       |  | $      | 28,505  |   |                       | $ |          |                         |  | $ | 1,572        |   |  | $            |         |   |  | $ | 30,077   
|Accounts receivable, less allowances       |  |        | 7,366   |   |                       |   | 136,177   |                         |  |   | 6,654        |   |  |              | (17,275  | ) |  |   | 132,922  
|Inventories                                |  |        |        |   |                       |   | 108,414   |                         |  |   | 6,344        |   |  |              |         |   |  |   | 114,758  
|Prepaid expenses and other                 |  |        | 505     |   |                       |   | 7,134     |                         |  |   | 72           |   |  |              |         |   |  |   | 7,711    
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Total current assets                       |  |        | 36,376  |   |                       |   | 251,725   |                         |  |   | 14,642       |   |  |              | (17,275  | ) |  |   | 285,468  
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Property, Plant and Equipmentnet          |  |        | 14      |   |                       |   | 224,626   |                         |  |   | 14,226       |   |  |              |         |   |  |   | 238,866  
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Other assets:                              |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Goodwill                                   |  |        |        |   |                       |   | 515,238   |                         |  |   | 3,026        |   |  |              |         |   |  |   | 518,264  
|Other assets                               |  |        | 13,563  |   |                       |   | 230,648   |                         |  |   | 2,410        |   |  |              | (15,358  | ) |  |   | 231,263  
|Investment in subsidiaries                 |  |        | 913,370 |   |                       |   | (7,358    | )                       |  |   |             |   |  |              | (906,012 | ) |  |   |         
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|                                           |  |        | 926,933 |   |                       |   | 738,528   |                         |  |   | 5,436        |   |  |              | (921,370 | ) |  |   | 749,527  
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Total assets                               |  | $      | 963,323 |   |                       | $ | 1,214,879 |                         |  | $ | 34,304       |   |  | $            | (938,645 | ) |  | $ | 1,273,861
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Liabilities and Shareholders Equity       |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Current Liabilities                        |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Current maturities of long-term debt       |  | $      | (6,143  | ) |                       | $ | 7,240     |                         |  | $ | 1,382        |   |  | $            |         |   |  | $ | 2,479    
|Accounts payable                           |  |        | 252     |   |                       |   | 102,276   |                         |  |   | 10,166       |   |  |              | (17,275  | ) |  |   | 95,419   
|Accrued liabilities                        |  |        | 18,541  |   |                       |   | 72,873    |                         |  |   | 1,575        |   |  |              |         |   |  |   | 92,989   
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Total current liabilities                  |  |        | 12,650  |   |                       |   | 182,389   |                         |  |   | 13,123       |   |  |              | (17,275  | ) |  |   | 190,887  
|Long-term debt, less current maturities    |  |        | 577,350 |   |                       |   | 14,830    |                         |  |   | 27,358       |   |  |              | (20,234  | ) |  |   | 599,304  
|Deferred income taxes                      |  |        | (8,063  | ) |                       |   | 110,427   |                         |  |   | (215         | ) |  |              | 135      |   |  |   | 102,284  
|Other long-term liabilities                |  |        | 21,297  |   |                       |   |          |                         |  |   |             |   |  |              |         |   |  |   | 21,297   
|Shareholders equity                       |  |        | 360,089 |   |                       |   | 907,233   |                         |  |   | (5,962       | ) |  |              | (901,271 | ) |  |   | 360,089  
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          
|Total liabilities and shareholders equity |  | $      | 963,323 |   |                       | $ | 1,214,879 |                         |  | $ | 34,304       |   |  | $            | (938,645 | ) |  | $ | 1,273,861
|                                           |  |        |         |   |                       |   |           |                         |  |   |              |   |  |              |          |   |  |   |          



10



---

Condensed Consolidating Statements of Earnings

Three months ended March 29, 2008

(Unaudited, in thousands)



|                                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |              |         |   |  |   |        
|--------------------------------------------------------------------------------- |  | ------ | ------- | - | --------------------- | - | ------- | ----------------------- |  | - | ------------ | - |  | ------------ | ------- | - |  | - | -------
|                                                                                  |  | Parent |         |   | GuarantorSubsidiaries |   |         | Non-GuarantorSubsidiary |  |   | Eliminations |   |  | Consolidated
|Net sales                                                                         |  | $      |        |   |                       | $ | 422,615 |                         |  | $ | 16,946       |   |  | $            | (11,884 | ) |  | $ | 427,677
|Cost of sales                                                                     |  |        |        |   |                       |   | 354,896 |                         |  |   | 14,362       |   |  |              | (11,884 | ) |  |   | 357,374
|                                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |              |         |   |  |   |        
|Gross profit                                                                      |  |        |        |   |                       |   | 67,719  |                         |  |   | 2,584        |   |  |              |        |   |  |   | 70,303 
|Selling, general and administrative expenses                                      |  |        | 3,673   |   |                       |   | 38,272  |                         |  |   | 867          |   |  |              | (2,208  | ) |  |   | 40,604 
|                                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |              |         |   |  |   |        
|Operating profit (loss)                                                           |  |        | (3,673  | ) |                       |   | 29,447  |                         |  |   | 1,717        |   |  |              | 2,208   |   |  |   | 29,699 
|Interest expense (income), net                                                    |  |        | 11,610  |   |                       |   | (15     | )                       |  |   | 482          |   |  |              |        |   |  |   | 12,077 
|Other expense (income)                                                            |  |        | (2,208  | ) |                       |   |        |                         |  |   |             |   |  |              | 2,208   |   |  |   |       
|                                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |              |         |   |  |   |        
|Earnings (loss) before equity in earnings (loss) of subsidiaries and income taxes |  |        | (13,075 | ) |                       |   | 29,462  |                         |  |   | 1,235        |   |  |              |        |   |  |   | 17,622 
|Equity in earnings (loss) of subsidiaries                                         |  |        | 21,051  |   |                       |   | 1,430   |                         |  |   |             |   |  |              | (22,481 | ) |  |   |       
|                                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |              |         |   |  |   |        
|Earnings (loss) before income taxes                                               |  |        | 7,976   |   |                       |   | 30,892  |                         |  |   | 1,235        |   |  |              | (22,481 | ) |  |   | 17,622 
|Income tax expense (benefit)                                                      |  |        | (3,305  | ) |                       |   | 9,841   |                         |  |   | (195         | ) |  |              |        |   |  |   | 6,341  
|                                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |              |         |   |  |   |        
|Net earnings (loss)                                                               |  | $      | 11,281  |   |                       | $ | 21,051  |                         |  | $ | 1,430        |   |  | $            | (22,481 | ) |  | $ | 11,281 
|                                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |              |         |   |  |   |        



11



---

Condensed Consolidating Statements of Earnings

Three months ended March 31, 2007

(Unaudited, in thousands)



|                                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |              |         |   |  |   |        
|--------------------------------------------------------------------------------- |  | ------ | ------- | - | --------------------- | - | ------- | ----------------------- |  | - | ------------ | - |  | ------------ | ------- | - |  | - | -------
|                                                                                  |  | Parent |         |   | GuarantorSubsidiaries |   |         | Non-GuarantorSubsidiary |  |   | Eliminations |   |  | Consolidated
|Net sales                                                                         |  | $      |        |   |                       | $ | 326,760 |                         |  | $ | 13,929       |   |  | $            | (12,758 | ) |  | $ | 327,931
|Cost of sales                                                                     |  |        |        |   |                       |   | 271,628 |                         |  |   | 12,938       |   |  |              | (12,758 | ) |  |   | 271,808
|                                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |              |         |   |  |   |        
|Gross profit                                                                      |  |        |        |   |                       |   | 55,132  |                         |  |   | 991          |   |  |              |        |   |  |   | 56,123 
|Selling, general and administrative expenses                                      |  |        | 2,353   |   |                       |   | 34,332  |                         |  |   | 994          |   |  |              | (1,578  | ) |  |   | 36,101 
|Plant closing expenses                                                            |  |        |        |   |                       |   |        |                         |  |   | 185          |   |  |              |        |   |  |   | 185    
|                                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |              |         |   |  |   |        
|Operating profit (loss)                                                           |  |        | (2,353  | ) |                       |   | 20,800  |                         |  |   | (188         | ) |  |              | 1,578   |   |  |   | 19,837 
|Interest expense (income), net                                                    |  |        | 13,048  |   |                       |   | (126    | )                       |  |   | 442          |   |  |              |        |   |  |   | 13,364 
|Other expense (income)                                                            |  |        | (1,578  | ) |                       |   |        |                         |  |   |             |   |  |              | 1,578   |   |  |   |       
|                                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |              |         |   |  |   |        
|Earnings (loss) before equity in earnings (loss) of subsidiaries and income taxes |  |        | (13,823 | ) |                       |   | 20,926  |                         |  |   | (630         | ) |  |              |        |   |  |   | 6,473  
|Equity in earnings (loss) of subsidiaries                                         |  |        | 13,263  |   |                       |   | (628    | )                       |  |   |             |   |  |              | (12,635 | ) |  |   |       
|                                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |              |         |   |  |   |        
|Earnings (loss) before income taxes                                               |  |        | (560    | ) |                       |   | 20,298  |                         |  |   | (630         | ) |  |              | (12,635 | ) |  |   | 6,473  
|Income tax expense (benefit)                                                      |  |        | (4,510  | ) |                       |   | 7,035   |                         |  |   | (2           | ) |  |              |        |   |  |   | 2,523  
|                                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |              |         |   |  |   |        
|Net earnings (loss)                                                               |  | $      | 3,950   |   |                       | $ | 13,263  |                         |  | $ | (628         | ) |  | $            | (12,635 | ) |  | $ | 3,950  
|                                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |              |         |   |  |   |        



12



---

Condensed Consolidating Statements of Cash Flows

Three months ended March 29, 2008

(Unaudited, in thousands)



|                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |   |         |  
|----------------------------------------------------------------- |  | ------ | ------- | - | --------------------- | - | ------- | ----------------------- |  | - | ------------ | - |  | - | ------- | -
|                                                                  |  | Parent |         |   | GuarantorSubsidiaries |   |         | Non-GuarantorSubsidiary |  |   | Consolidated |  
|Net cash (used in) provided by operating activities               |  | $      | (23,704 | ) |                       | $ | 15,508  |                         |  | $ | (278         | ) |  | $ | (8,474  | )
|Cash flows from investing activities:                             |  |        |         |   |                       |   |         |                         |  |   |              |   |  |   |         |  
|Capital expenditures                                              |  |        |        |   |                       |   | (6,082  | )                       |  |   | (287         | ) |  |   | (6,369  | )
|Business acquisition                                              |  |        |        |   |                       |   | (8,652  | )                       |  |   |             |   |  |   | (8,652  | )
|                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |   |         |  
|Net cash used in investing activities                             |  |        |        |   |                       |   | (14,734 | )                       |  |   | (287         | ) |  |   | (15,021 | )
|Cash flows from financing activities:                             |  |        |         |   |                       |   |         |                         |  |   |              |   |  |   |         |  
|Payments on long-term debt                                        |  |        |        |   |                       |   | (539    | )                       |  |   | (252         | ) |  |   | (791    | )
|Investment in subsidiaries                                        |  |        | 235     |   |                       |   | (235    | )                       |  |   |             |   |  |   |        |  
|                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |   |         |  
|Net cash used in financing activities                             |  |        | 235     |   |                       |   | (774    | )                       |  |   | (252         | ) |  |   | (791    | )
|Effect of exchange rate changes on cash                           |  |        |        |   |                       |   |        |                         |  |   | (46          | ) |  |   | (46     | )
|                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |   |         |  
|Net decrease in cash and equivalents                              |  |        | (23,469 | ) |                       |   |        |                         |  |   | (863         | ) |  |   | (24,332 | )
|Cash and equivalents at beginning of period                       |  |        | 28,505  |   |                       |   |        |                         |  |   | 1,572        |   |  |   | 30,077  |  
|                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |   |         |  
|Cash and equivalents at end of period                             |  | $      | 5,036   |   |                       | $ |        |                         |  | $ | 709          |   |  | $ | 5,745   |  
|                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |   |         |  
|Supplemental disclosures:                                         |  |        |         |   |                       |   |         |                         |  |   |              |   |  |   |         |  
|Non-cash capital investment by parent                             |  | $      | 4,625   |   |                       | $ |        |                         |  | $ |             |   |  | $ | 4,625   |  
|                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |   |         |  
|Reclassification of other assets to property, plant and equipment |  | $      |        |   |                       | $ | 16,250  |                         |  | $ |             |   |  | $ | 16,250  |  
|                                                                  |  |        |         |   |                       |   |         |                         |  |   |              |   |  |   |         |  



13



---

Condensed Consolidating Statements of Cash Flows

Three months ended March 31, 2007

(Unaudited, in thousands)



|                                                    |  |        |        |   |                       |   |        |                         |  |   |              |   |  |   |        |  
|--------------------------------------------------- |  | ------ | ------ | - | --------------------- | - | ------ | ----------------------- |  | - | ------------ | - |  | - | ------ | -
|                                                    |  | Parent |        |   | GuarantorSubsidiaries |   |        | Non-GuarantorSubsidiary |  |   | Consolidated |  
|Net cash (used in) provided by operating activities |  | $      | (2,262 | ) |                       | $ | 7,427  |                         |  | $ | 2,046        |   |  | $ | 7,211  |  
|Cash flows from investing activities:               |  |        |        |   |                       |   |        |                         |  |   |              |   |  |   |        |  
|Capital expenditures                                |  |        |       |   |                       |   | (5,725 | )                       |  |   | (121         | ) |  |   | (5,846 | )
|Other assets                                        |  |        |       |   |                       |   | (98    | )                       |  |   |             |   |  |   | (98    | )
|                                                    |  |        |        |   |                       |   |        |                         |  |   |              |   |  |   |        |  
|Net cash used in investing activities               |  |        |       |   |                       |   | (5,823 | )                       |  |   | (121         | ) |  |   | (5,944 | )
|Cash flows from financing activities:               |  |        |        |   |                       |   |        |                         |  |   |              |   |  |   |        |  
|Payments on long-term debt                          |  |        |       |   |                       |   |       |                         |  |   | (471         | ) |  |   | (471   | )
|Investment in subsidiaries                          |  |        | 1,491  |   |                       |   | (1,604 | )                       |  |   | 113          |   |  |   |       |  
|                                                    |  |        |        |   |                       |   |        |                         |  |   |              |   |  |   |        |  
|Net cash provided by (used in) financing activities |  |        | 1,491  |   |                       |   | (1,604 | )                       |  |   | (358         | ) |  |   | (471   | )
|Effect of exchange rate changes on cash             |  |        |       |   |                       |   |       |                         |  |   | 23           |   |  |   | 23     |  
|                                                    |  |        |        |   |                       |   |        |                         |  |   |              |   |  |   |        |  
|Net (decrease) increase in cash and equivalents     |  |        | (771   | ) |                       |   |       |                         |  |   | 1,590        |   |  |   | 819    |  
|Cash and equivalents at beginning of period         |  |        | 20,727 |   |                       |   |       |                         |  |   | 849          |   |  |   | 21,576 |  
|                                                    |  |        |        |   |                       |   |        |                         |  |   |              |   |  |   |        |  
|Cash and equivalents at end of period               |  | $      | 19,956 |   |                       | $ |       |                         |  | $ | 2,439        |   |  | $ | 22,395 |  
|                                                    |  |        |        |   |                       |   |        |                         |  |   |              |   |  |   |        |  
|Supplemental disclosures:                           |  |        |        |   |                       |   |        |                         |  |   |              |   |  |   |        |  
|Non-cash capital investment by parent               |  | $      | 4,306  |   |                       | $ |       |                         |  | $ |             |   |  | $ | 4,306  |  
|                                                    |  |        |        |   |                       |   |        |                         |  |   |              |   |  |   |        |  



14



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ITEM 2 MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

General

We are a producer and distributor of
specialty egg products to the foodservice, retail and food ingredient markets. We are also a producer and distributor of refrigerated potato products to the foodservice and retail grocery markets. Additionally, we distribute refrigerated food items,
primarily cheese and other dairy products, to the retail grocery market, predominantly in the central United States. We focus our growth efforts on the specialty sectors within our food categories and strive to be a market leader in product
innovation and low-cost production. We have a strategic focus on value-added processing of food products which is designed to capitalize on key food industry trends, such as (i) the desire for improved safety and convenience, (ii) the
focus by foodservice operators on reducing labor and waste, and (iii) the growing trend toward food consumption away from home. We believe our operational scale, product breadth and geographic scope make us an attractive and important strategic
partner for our larger customers.

Commodities and Product Pricing

The principal market risks to which we are exposed that may adversely affect our results of operations and financial position include changes in future commodity prices. We seek to minimize or manage these market
risks through normal operating and financing activities and with commodity contracts, where practicable. We do not trade or use instruments with the objective of earning financial gains on the commodity price, nor do we use instruments where we do
not have underlying exposures.

The profit margins we earn on many of our products are sensitive to changes in commodity prices. Generally,
70-75% of the Egg Products Divisions annual net sales come from higher value-added egg products, such as extended shelf-life liquid and precooked products, with the remainder coming from products mainly used in the food ingredients market, or
shell eggs. Gross profit margins for higher value-added egg products are generally less sensitive to commodity price fluctuations, such as grains used for hen feed and certain externally sourced eggs, than are other egg products or shell eggs;
however, we are unable to adjust product pricing for these products as quickly as we are for other egg products and shell eggs when our costs change. Margins for our food ingredient egg products and shell eggs are more commodity price-sensitive than
are higher value-added product sales. Gross profit from shell eggs is primarily dependent upon the relationship between shell egg prices and the cost of feed, both of which can fluctuate significantly. Shell egg pricing, which is generally
indicative of the price trend for external eggs we purchase to convert into liquid, and which often foretells market pricing for an array of egg products, was approximately 50.3% higher in the first quarter of 2008 than in the comparable 2007 period
(as measured by Urner Barry Publications). Feed costs, determined largely by corn and soybean meal prices, increased approximately 38% year-over-year in the 2008 period.

Crystal Farms derives approximately 90% of its net sales from refrigerated products produced by others, thereby somewhat reducing the effects of commodity price swings. However, a majority of those sales represents
cheese and butter, and the costs for both fluctuate with national dairy markets. Time lags between cost changes for these lines and wholesale/retail pricing changes can result in significant margin expansion or compression. The national cheese
market exhibited continued strength in the first quarter of 2008, with block cheese prices up 41% year-over-year. Apart from sales of refrigerated products, the balance of Crystal Farms sales are mainly from shell eggs, some of which are
produced by the Egg Products Division, sold on a distribution, or non-commodity, basis.

The Potato Products Division purchases
approximately 90% to 95% of its raw potatoes from contract producers under fixed price annual contracts. The remainder is purchased at market prices to satisfy short-term production requirements or to take advantage of market prices when they are
lower than contracted prices. Moderate variations in the purchase price of raw materials or the selling price per pound of finished products can have a significant effect on the Potato Products Divisions operating results.

Results of Operations

Readers are directed to
Note EBusiness Segments for data on the unaudited financial results of our business segments for the three month period ended March 29, 2008.

Three Months Ended March 29, 2008 as Compared to Three Months Ended March 31, 2007

Net
Sales.Net sales for the three months ended March 29, 2008 increased $99.8 million, or 30%, to $427.7 million from $327.9 million for the three months ended March 31, 2007. The increased sales reflected increased volumes and higher
market-related pricing.



15



---

Egg Products Division Net Sales.Egg Products Division external net sales for the three months
ended March 29, 2008 increased $71.8 million, or 31%, to $301.0 million from $229.2 million for the three months ended March 31, 2007. External net sales in 2008 increased for all of our egg product categories as compared to 2007. Pricing
increased in all categories, reflecting the continued strength of egg markets and significantly higher corn and soybean meal markets, resulting in higher market-related pricing. Volume rose in 2008 for most of our egg products categories, with short
shelf-life liquid items showing a decline. Growth was particularly driven by unit volume gains in extended shelf-life liquid and pre-cooked egg products. Overall, the divisions unit sales increased by 3% in 2008 as compared to 2007.

Crystal Farms Net Sales.Crystal Farms external net sales for the three months ended March 29, 2008 increased $26.3 million,
or 37%, to $96.5 million from $70.2 million for the three months ended March 31, 2007. This increase was due primarily to pricing actions taken as a result of significantly higher cheese costs, along with the growth of a national private label
cheese account. The core branded cheese business volume growth was 2.5% year-over-year. Shell egg sales increased 43% in 2008 due to sharply higher market prices despite lower volumes. Unit sales for distributed products (excluding shell eggs)
increased 14% in 2008 as compared to 2007, primarily reflecting significant growth in the private label cheese category.

Potato
Products Division Net Sales.Potato Products Division external net sales for the three months ended March 29, 2008 increased $1.7 million, or 6%, to $30.2 million from $28.5 million for the three months ended March 31, 2007. The
divisions unit sales increased 5% in 2008, as compared to 2007 levels, led by strong retail unit sales. Pricing in 2008 was steady with 2007 levels.

Gross Profit.Gross profit for the three months ended March 29, 2008 increased $14.2 million, or 25%, to $70.3 million from $56.1 million for the three months ended March 31, 2007. Our gross profit
margin decreased to 16.4% in 2008 as compared to 17.1% in 2007. The lower gross profit margin reflected a decreased gross profit margin in the Crystal Farms Division, reflecting increased cheese costs which we were unable to fully pass-through to
our customers in a timely manner. Offsetting this gross margin pressure was a favorable gross margin contribution from food ingredient egg products and shell eggs compared to margins from these products in 2007. We also experienced a decreased gross
profit margin within the foodservice egg products lines reflecting increased grain costs which we were unable to fully pass-through to our customers in a timely manner. Additionally, we experienced increases in energy, packaging and diesel costs,
which we were not able to fully offset with selective price increases.

Selling, General and Administrative Expenses.Selling,
general and administrative expenses for the three months ended March 29, 2008 increased $4.5 million, or 12%, to $40.6 million from $36.1 million for the three months ended March 31, 2007. The increase was due to increases in broker
commissions, other selling and marketing costs and legal costs incurred in 2008, as compared to 2007.

Plant Closing Expenses.During the first quarter of 2007, we closed our egg products plant in St. Marys, Ontario and recorded $0.2 million of employee termination costs.

Operating Profit.Operating profit for the three months ended March 29, 2008 increased $9.9 million, or approximately 50%, to $29.7 million from $19.8 million for the three months ended March 31,
2007, due to the increased gross profits discussed above.

Egg Products Division Operating Profit.Egg Products Division operating
profit for the three months ended March 29, 2008 increased $13.2 million, or 96%, to $27.0 million from $13.8 million for the three months ended March 31, 2007. Operating profits for foodservice egg products decreased reflecting higher egg
costs due to higher grain costs which we were unable to fully pass-through to our customers in a timely manner. Offsetting that decline, operating profits improved for food ingredient egg products and shell eggs as a result of favorable market
conditions, pricing execution and record high Urner Barry markets. Operating profits also increased for retail egg products as a result of strong volume growth.

Crystal Farms Operating Profit.Crystal Farms operating profit for the three months ended March 29, 2008 decreased $1.9 million, or 43%, to $2.5 million from $4.4 million for the three months ended
March 31, 2007. Operating profits for our key product line, branded cheese, decreased significantly in 2008, as compared to 2007, due to continued high cheese costs which we were unable to fully pass-through to our customers in a timely manner.

Potato Products Division Operating Profit.Potato Products Division operating profit for the three months ended March 29, 2008
decreased slightly to $3.9 million, compared to $4.0 million for the three months ended March 31, 2007. The decrease in operating profit reflects increased raw material and manufacturing costs. Those cost increases were largely offset by good
unit volume growth, particularly for our retail potato products in 2008.

Interest Expense and Income Taxes.Net interest expense
decreased by approximately $1.3 million in the 2008 period compared to the 2007 period, reflecting reduced interest rates and a reduction in interest due to a $50 million voluntary debt repayment in the fourth quarter of 2007. Our effective tax rate
on earnings before income taxes was 36.0% in the 2008 period



16



---

compared to 39.0% in the 2007 period. The effective rate was affected by the amount of permanent differences between book and taxable income, including the
qualified production activities deduction created by The American Jobs Creation Act of 2004. Additionally, the rate for 2008 was affected by improved results in one of our foreign subsidiaries impacting the valuation allowance against their
deferred tax assets.

Liquidity and Capital Resources

Historically, we have financed our liquidity requirements through internally generated funds, senior bank borrowings and the issuance of other indebtedness. We believe such sources remain viable financing alternatives
to meet our anticipated needs. Our investments in acquisitions, joint ventures and capital expenditures have been a significant use of capital. We plan to continue to invest in advanced production facilities to maintain our competitive position.

Cash flow used by operating activities was $8.5 million for the three months ended March 29, 2008, compared to cash flows provided by
operating activities of $7.2 million in the 2007 period, reflecting higher working capital needs in the 2008 period, primarily in accounts receivable and inventories. Our cash flows used in investing activities increased to $15 million for the three
months ended March 29, 2008 from $5.9 million for the 2007 period, mainly due to our use of $8.7 million of available cash to acquire the assets of Mr. Bs of Abbotsford, Inc. and related entities in January 2008. Cash flows used in
financing activities included payments on long-term debt.

We continue to have substantial annual cash interest expense. Our senior credit
facility requires us to meet a minimum interest coverage ratio and a maximum leverage ratio. In addition, the senior credit facility and the indenture relating to the 8% senior subordinated notes due 2013 contain certain restrictive covenants which,
among other things, limit the incurrence of additional indebtedness, investments, dividends, transactions with affiliates, asset sales, acquisitions, mergers and consolidations, prepayments of other indebtedness, liens and encumbrances and other
matters customarily restricted in these agreements. Our failure to comply with these covenants could result in an event of default, which if not cured or waived could have a material adverse effect on our results of operations, financial position
and cash flow. In general, the debt covenants limit our discretion in the operation of our businesses. We were in compliance with all of the covenants under the senior credit facility and the indenture as of March 29, 2008.

The following is a calculation of our minimum interest coverage and maximum leverage ratios under our senior credit facility for the twelve-month periods
ended March 29, 2008 and March 31, 2007. The terms and related calculations are defined in our senior credit facility, which agreement and amendments thereto were included as Exhibit 10.1 of our registration statement on Form S-4
(Registration No. 333-112714) as filed with the Commission on February 11, 2004, as Exhibit 10.33 to our current report on Form 8-K as filed with the Commission on September 22, 2004 and as Exhibit 10.1 to our current report on Form
8-K as filed with the Commission on May 18, 2005.



|                                                                                                      |  |                           |         |   |               |   |         |  
|----------------------------------------------------------------------------------------------------- |  | ------------------------- | ------- | - | ------------- | - | ------- | -
|                                                                                                      |  | Twelve Months Ended       |        
|                                                                                                      |  | March 29,2008             |         |   | March 31,2007 |  
|                                                                                                      |  | (Unaudited, in Thousands) |        
|Calculation of Interest Coverage Ratio:                                                               |  |                           |         |   |               |   |         |  
|Consolidated EBITDA (1)                                                                               |  | $                         | 185,809 |   |               | $ | 180,704 |  
|Consolidated Cash Interest Expense (2)                                                                |  |                           | 48,183  |   |               |   | 53,170  |  
|Actual Interest Coverage Ratio (Ratio of consolidated EBITDA to consolidated interest expense)        |  |                           | 3.86x   |   |               |   | 3.40x   |  
|Minimum Permitted Interest Coverage Ratio                                                             |  |                           | 2.75x   |   |               |   | 2.50x   |  
|Calculation of Leverage Ratio:                                                                        |  |                           |         |   |               |   |         |  
|Funded Indebtedness (3)                                                                               |  | $                         | 612,919 |   |               | $ | 657,716 |  
|Less: Cash and equivalents                                                                            |  |                           | (5,745  | ) |               |   | (22,395 | )
|                                                                                                      |  |                           |         |   |               |   |         |  
|                                                                                                      |  |                           | 607,174 |   |               |   | 635,321 |  
|Consolidated EBITDA (1)                                                                               |  |                           | 185,809 |   |               |   | 180,704 |  
|Actual Leverage Ratio (Ratio of funded indebtedness less cash and equivalents to consolidated EBITDA) |  |                           | 3.27x   |   |               |   | 3.52x   |  
|Maximum Permitted Leverage Ratio                                                                      |  |                           | 4.50x   |   |               |   | 5.00x   |  



|(1) | Consolidated EBITDA (earnings before interest expense, taxes, depreciation and amortization) is defined in our senior credit facility as follows:
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------



17



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|                                                                                       |  |                           |         |               |   |        
|-------------------------------------------------------------------------------------- |  | ------------------------- | ------- | ------------- | - | -------
|                                                                                       |  | Twelve Months Ended      
|                                                                                       |  | March 29,2008             |         | March 31,2007
|                                                                                       |  | (Unaudited, in Thousands)
|Net earnings                                                                           |  | $                         | 34,896  |               | $ | 18,986 
|Interest expense, excluding amortization of debt issuance costs                        |  |                           | 46,715  |               |   | 51,804 
|Amortization of debt issuance costs                                                    |  |                           | 4,376   |               |   | 5,378  
|Income tax expense                                                                     |  |                           | 19,209  |               |   | 16,447 
|Depreciation and amortization                                                          |  |                           | 75,000  |               |   | 75,092 
|Equity sponsor management fee                                                          |  |                           | 1,773   |               |   | 1,787  
|Expenses related to industrial revenue bonds guaranteed by certain of our subsidiaries |  |                           | 984     |               |   | 993    
|Other (a)                                                                              |  |                           | 3,456   |               |   | 10,501 
|                                                                                       |  |                           |         |               |   |        
|                                                                                       |  |                           | 186,409 |               |   | 180,988
|Less: Unrealized gains on swap contracts                                               |  |                           | 600     |               |   | 284    
|                                                                                       |  |                           |         |               |   |        
|Consolidated EBITDA, as defined in our senior credit facility                          |  | $                         | 185,809 |               | $ | 180,704
|                                                                                       |  |                           |         |               |   |        



|(a) | Other reflects the following:
|--- | -----------------------------



|                                                                             |  |                           |       |               |   |       
|---------------------------------------------------------------------------- |  | ------------------------- | ----- | ------------- | - | ------
|                                                                             |  | Twelve Months Ended      
|                                                                             |  | March 29,2008             |       | March 31,2007
|                                                                             |  | (Unaudited, in Thousands)
|Equity in losses of unconsolidated subsidiaries                              |  | $                         |      |               | $ | 2,597 
|Losses from the disposition of assets not in the ordinary course of business |  |                           | 1,293 |               |   | 2,979 
|Non-cash compensation                                                        |  |                           | 1,570 |               |   | 1,892 
|Letter of credit fees                                                        |  |                           | 142   |               |   | 138   
|Other non-recurring charges                                                  |  |                           | 451   |               |   | 2,895 
|                                                                             |  |                           |       |               |   |       
|                                                                             |  | $                         | 3,456 |               | $ | 10,501
|                                                                             |  |                           |       |               |   |       



|(2) | Consolidated cash interest expense, as calculated in our senior credit facility, was as follows:
|--- | ------------------------------------------------------------------------------------------------



|                                           |  |                           |        |   |               |   |        |  
|------------------------------------------ |  | ------------------------- | ------ | - | ------------- | - | ------ | -
|                                           |  | Twelve Months Ended       |       
|                                           |  | March 29,2008             |        |   | March 31,2007 |  
|                                           |  | (Unaudited, in Thousands) |       
|Interest expense, net                      |  | $                         | 51,203 |   |               | $ | 56,653 |  
|Interest income                            |  |                           | 1,356  |   |               |   | 1,895  |  
|                                           |  |                           |        |   |               |   |        |  
|Gross interest expense                     |  |                           | 52,559 |   |               |   | 58,548 |  
|Minus: Amortization of debt issuance costs |  |                           | (4,376 | ) |               |   | (5,378 | )
|                                           |  |                           |        |   |               |   |        |  
|Consolidated cash interest expense         |  | $                         | 48,183 |   |               | $ | 53,170 |  
|                                           |  |                           |        |   |               |   |        |  



|(3) | Funded Indebtedness was as follows:
|--- | -----------------------------------



|                                                                                          |  |                           |         |               |   |        
|----------------------------------------------------------------------------------------- |  | ------------------------- | ------- | ------------- | - | -------
|                                                                                          |  | March 29,2008             |         | March 31,2007
|                                                                                          |  | (Unaudited, in Thousands)
|Term loan facility                                                                        |  | $                         | 427,300 |               | $ | 477,300
|8% senior subordinated notes                                                              |  |                           | 150,000 |               |   | 150,000
|Insurance bonds                                                                           |  |                           | 470     |               |   | 404    
|Guarantee obligations (see debt guarantees described below)                               |  |                           | 20,426  |               |   | 15,648 
|Capital leases                                                                            |  |                           | 5,250   |               |   | 5,477  
|Standby letters of credit (primarily with our casualty insurance carrier, Liberty Mutual) |  |                           | 6,724   |               |   | 6,461  
|Funded indebtedness of Trilogy Egg Products, Inc.                                         |  |                           | 2,699   |               |   | 2,376  
|Other                                                                                     |  |                           | 50      |               |   | 50     
|                                                                                          |  |                           |         |               |   |        
|                                                                                          |  | $                         | 612,919 |               | $ | 657,716
|                                                                                          |  |                           |         |               |   |        



18



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We use EBITDA as a measurement of our financial results because we believe it is indicative of the
relative strength of our operating performance, it is used to determine incentive compensation levels and it is a key measurement contained in the financial covenants of our senior indebtedness.

As of March 29, 2008, approximately $427.3 million was outstanding under the senior credit facility, and additional capacity of approximately $6.7
million was used under our $100 million revolving line of credit for outstanding letters of credit. The weighted average interest rate for our borrowings under the senior credit facility was approximately 6.7% at March 29, 2008. Given our
business trends and cash flow forecast, we do not anticipate any use of the revolving line of credit in the near future, except for letters of credit purposes. However, it is possible that one or more acquisitions could arise, which could result in
much, or all, of the revolving line of credit being utilized at some point.

We have guaranteed, through our Waldbaum subsidiary, the
repayment of certain industrial revenue bonds used for the expansion of the wastewater treatment facilities of three municipalities where we have food processing facilities. In May 2007, a $6.0 million bond financing was completed by one of the
three municipalities, the City of Wakefield, Nebraska, at an annual interest rate of 8.22%, with such proceeds to be used for the completion of construction of the wastewater treatment facility. The wastewater treatment facility became operational
in early 2008. We have guaranteed the principal and interest payments related to these bonds, which mature September 15, 2017. These bonds, along with the original $10.25 million guaranteed in September 2005, are included in current maturities
of long-term debt and long-term debt. The remaining principal balance for all guaranteed bonds at March 29, 2008 was approximately $20.4 million.

Our parent, M-Foods Holdings, Inc., has outstanding 9.75% senior discount notes due October 1, 2013. The accreted balance of these notes as of March 29, 2008 was $140.1 million. As a wholly-owned subsidiary
of M-Foods Holdings, Inc., we are responsible for servicing these notes.

Our ability to make payments on and to refinance our debt,
including the notes and to fund planned capital expenditures will depend on our ability to generate sufficient cash in the future. This, to some extent, is subject to general economic, financial, competitive and other factors that are beyond our
control. We believe that, based on current levels of operations, we will be able to meet our debt service obligations when due. Significant assumptions underlie this belief, including, among other things, that we will continue to be successful in
implementing our business strategy and that there will be no material adverse developments in our business, liquidity or capital requirements. If our future cash flows from operations and other capital resources are insufficient to pay our
obligations as they mature or to fund our liquidity needs, we may be forced to reduce or delay our business activities and capital expenditures, sell assets, obtain additional debt or equity capital or restructure or refinance all or a portion of
our debt, including the senior subordinated notes, on or before maturity. We cannot assure our investors that we would be able to accomplish any of these alternatives on a timely basis or on satisfactory terms, if at all. In addition, the terms of
our existing and future indebtedness, including the senior subordinated notes and our senior credit facility, may limit our ability to pursue any of these alternatives.

We invested approximately $6.4 million in capital expenditures in the three months ended March 29, 2008. We plan to spend an amount comparable to recent historical averages on capital expenditures for 2008.
Spending will focus on expanding capacity for higher value-added egg products, maintaining existing production facilities (in particular notable spending at the Northern Star plant), replacing tractors and trailers, and upgrading information
technology systems, among other projects. This spending is expected to be funded largely from operating cash flows. We expect these investments to improve manufacturing efficiencies, customer service and product quality.

Our longer-term planning is focused on growing our sales, earnings and cash flows primarily by focusing on our existing business lines through expanding
product offerings, increasing production capacity for value-added products and broadening customer bases. We believe our financial resources are sufficient to meet the working capital and capital spending necessary to execute our longer-term plans.
In executing these plans, we expect to reduce debt over the coming years. However, possible significant acquisition activity could result in us seeking additional financing resources, which we would expect would be available to us if they are
sought.

Subject to market conditions and other factors, we and/or our subsidiaries, affiliates and/or significant direct or indirect
shareholders from time to time may repurchase or purchase, as the case may be, all or a portion of our senior subordinated notes, in privately negotiated or open market transactions, by tender offer or otherwise. No assurance can be given as to
whether or when, or at what prices, such repurchases or purchases may occur. Any such repurchases by us and/or our subsidiaries would be limited by certain restrictions found in our credit agreement and in the indenture governing the subordinated
notes.

Seasonality

Our consolidated
quarterly operating results are affected by the seasonal fluctuations of our net sales and operating profits. Specifically, egg prices typically rise seasonally in the first and fourth quarters of the year due to increased demand



19



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during holiday periods. Consequently, net sales in the Egg Products Division may increase in the first and fourth quarters. Operating profits from the Potato
Products Division are less seasonal, but tend to be higher in the second half of the year coinciding with the potato harvest and incremental consumer demand. Generally, Crystal Farms has higher net sales and operating profits in the fourth quarter,
coinciding with incremental consumer demand during the holiday season.

Forward-looking Statements

Certain items in this Form 10-Q may be forward-looking statements. Such forward-looking statements are subject to numerous risks and uncertainties,
including variances in the demand for our products due to consumer, industry and broad economic developments, as well as variances in the costs to produce such products, including normal volatility in egg, feed, cheese, and butter costs. Our actual
financial results could differ materially from the results estimated by, forecasted by, or implied by us in such forward-looking statements. Forward-looking statements contained in this Form 10-Q speak only as of the date hereof. We disclaim any
obligation or understanding to publicly release updates to, or revisions of, forward-looking statements to reflect changes in our expectations or events, conditions or circumstances on which any such statement is made.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There was no material change in our market risk during the three months ended March 29, 2008. For additional information regarding our market risk, please refer to Item 7A, Quantitative and Qualitative
Disclosures About Market Risk, in our Annual Report on Form 10-K for the year ended December 29, 2007.

ITEM 4. CONTROLS AND PROCEDURES

a. Evaluation of disclosure controls and procedures.

Our management evaluated, with the participation of our principal executive and principal financial officers, the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934, as amended (the Exchange Act), as of March 29, 2008. Based on these evaluations, our principal executive and principal financial officer concluded that our disclosure controls and
procedures were effective as of March 29, 2008.

b. Changes in internal controls

There were no changes in our internal controls over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred
during the quarter ended March 29, 2008, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART IIOTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

On March 27, 2008, we received a subpoena from the U.S. Department of Justice, through the U.S. Attorney for the Eastern District of Pennsylvania,
requesting documents for the period of January 1, 2002 through March 27, 2008 relating primarily to the pricing, marketing, and sales of our egg products. On the same date one of our subsidiaries received a related subpoena. We are fully
cooperating with the Department of Justice request. We cannot predict what, if any, impact these inquiries and any results from such inquiries could have on our future results of operations.

ITEM 1A. RISK FACTORS

Readers are directed to our Form
10-K for the year ended December 29, 2007, Item 1A, for a discussion of Risk Factors. We do not believe there have been any material changes to our Risk Factors since that filing.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

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

None.



20



---

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

EXHIBIT INDEX



|            |  |                                                                                                                                         
|----------- |  | ----------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description                                                                                                                             
|10.45       |  | Employment Agreement dated as of April 9, 2008, by and among Michael Foods, Inc., Thomas J. Jagiela and Michael Foods Investors, LLC    
|            | 
|10.46       |  | Senior Management Unit Subscription Agreement dated as of April 9, 2008, by and among Michael Foods Investors, LLC and Thomas J. Jagiela
|            | 
|10.47       |  | Thomas J. Jagiela Indemnity Agreement                                                                                                   
|            | 
|10.48       |  | Second Amendment to Michael Foods Investors, LLC Amended and Restated Limited Liability Company Agreement                               
|            | 
|10.49       |  | Second Amendment to Michael Foods Investors, LLC Securityholders Agreement                                                              
|            | 
|10.50       |  | Amendment No. 1 to M-Foods Holdings, Inc. Amended and Restated 2003 Stock Option Plan                                                   
|            | 
|31.1        |  | Certification of Chief Executive Officer                                                                                                
|            | 
|31.2        |  | Certification of Chief Financial Officer                                                                                                



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SIGNATURES

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



|                   |  |                     |  |                                                                     
|------------------ |  | ------------------- |  | --------------------------------------------------------------------
|                   |  | MICHAEL FOODS, INC.
|                   |  |                    
|Date: May 12, 2008 |  | By:                 |  | /s/ David S. Johnson                                                
|                   |  |                     |  | David S. Johnson (Chief Executive Officer and President)            
|                   |  |                    
|                   |  | By:                 |  | /s/ Mark W. Westphal                                                
|                   |  |                     |  | Mark W. Westphal (Chief Financial Officer and Senior Vice President)



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