As used in this Quarterly Report, the terms "we," "us," "our," and "Company" mean Jammin Java Corp., unless otherwise indicated. This information should be read in conjunction with the interim unaudited financial statements and the notes thereto included in this Quarterly Report on Form 10-Q, and the audited financial statements and notes thereto and Part II, Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations contained in our Annual Report on Form 10-K for the year ended January 31, 2012.

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains "forward-looking statements" as defined in Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended, which involve risks and uncertainties, as well as assumptions that, if they never materialize or prove incorrect, could cause the results of Jammin Java Corp. (the "Company," "Jammin Java", "we", "us" or "our" ) to differ materially and adversely from those expressed or implied by such forward-looking statements. Such forward-looking statements include any statements, predictions and expectations regarding our earnings, revenue, sales and operations, operating expenses, anticipated cash needs, capital requirements and capital expenditures, needs for additional financing, use of working capital, plans for future products, services and distribution channels, anticipated growth strategies, planned capital raises, ability to attract and maintain distributors and customers, sources of net revenue, anticipated trends and challenges in our business and the markets in which we operate, the impact of economic and industry conditions on our customers and our business, customer demand, our competitive position, the outcome of any litigation against us, critical accounting policies, the impact of recent accounting pronouncements, the time-frame in which we expect to file tax returns, statements pertaining to financial items, plans, strategies, expectations or objectives of management for future operations, our financial condition or prospects, and any other statement that is not historical fact. Forward-looking statements are often identified by the use of words such as "may," "might," "will," "intend," "should," "could," "can," "would," "continue," "expect," "believe," "anticipate," "estimate," "predict," "potential," "plan," "seek" and similar expressions and variations or the negativities of these terms or other comparable terminology. These forward-looking statements are based on the beliefs and assumptions of our management based upon information currently available to management. Such forward looking statements are subject to risks, uncertainties and other factors that could cause actual results and the timing of certain events to differ materially and adversely from future results expressed or implied from such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those identified under "Risk Factors" in our Annual Report on Form 10-K for the year ended January 31, 2012 (the "2012 Form 10-K") filed with the Securities and Exchange Commission (the "SEC"). Such forward-looking statements speak only as of the date of this report. We undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements for any reason except as otherwise required by law.

Business Overview

Overview

Jammin Java, doing business as Marley Coffee, is a United States-based company that provides sustainably grown, ethically- farmed and artisan roasted gourmet coffee through multiple United States and international distribution channels. We intend to develop a significant share of these markets and achieve a leadership position by capitalizing on the global recognition of the Marley brand name. Through a licensing agreement, the Company has the worldwide right to use certain intellectual property rights in and to the late reggae performer, Robert Nesta Marley, professionally known as Bob Marley, including the name "Marley Coffee" and reasonably similar variations thereof.

The Company markets the name "Marley Coffee" within the U.S. (including its territories and possessions) Canada, Mexico and the nations of the Caribbean Sea to sell coffee in any form or derivation through any distribution channel. The Company also has the right to distribute tea and instant coffee products.

Critical Accounting Policies

The unaudited interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America which require us to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the unaudited financial statements and revenues and expenses during the periods reported. Actual results could differ from those estimates. Information with respect to our critical accounting policies which we believe could have the most significant effect on our reported results and require subjective or complex judgments by management is contained on pages 16 and 17 in Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations, of our Annual Report on Form 10-K for the year ended January 31, 2012. We believe that for the six months ended July 31, 2012, there have been no material changes to this information.

Recent Accounting Pronouncements

For the three month period ended July 31, 2012, there were no accounting standards or interpretations issued that are expected to have a material impact on our financial position, operations or cash flows.

Revenue Channels

We believe the key to our growth is a multichannel distribution and sales strategy. Since August 2011, we have been introducing a wide variety of coffee products through multiple distribution channels using the Marley Coffee brand name. The main channels of revenue for the Company are now and are expected to continue to be United States and international grocery retail, online retail, office coffee services (OCS), foodservice, vending and automated retailing. Within these channels, we have transitioned from a company that only provided 12 oz whole bean bags of coffee to a mix of products. Today, the Company offers Marley Coffee Organic Ground and Marley Coffee Jamaica Blue Mountain® Ground coffees; compostable Single-Serve Pods for Bunn and other pod-based home and office brewers; Marley Coffee RealCup™; compatible cartridges for use in most models of Keurig's popular K-Cup brewing system; and 2.5 oz frac packs and 2lbs bags mainly used for food service.

Geographically, we initially focused on retail grocery sales and marketing on West Coast and Southwest portions of the United States and Western Canada. During the past few months, we have expanded distributor relationships in the Midwest and Northeast regions of the United States. We expect our ongoing discussions with retailers will enable us to place our products in more chains throughout the year and we continue to seek to expand our product placement with grocery retailers and distributors throughout the United States and internationally.

During the six months ended July 31, 2012, we added two additional revenue channels: Marley Coffee branded vending solutions and Marley Coffee branded Bike Cafés.

Branded Vending & Foodservice. In April 2012, during the National Automatic Merchandising Association (NAMA) OneShow annual trade show, we announced that AVT, Inc. ("AVT") and Seaga Manufacturing, Inc., both leading developers of vending and self-service retail equipment, would create Marley Coffee branded coffee vending machines.

AVT's Marley Coffee-branded machines are designed to target college campuses, traditional retail locations, high-density traffic areas such as theaters and hotels, and traditional foodservice vendors. Several large retailers have already inquired about these new vending machines and we expect to begin seeing revenue from sales of AVT machines this fiscal year.

Seaga will create two Marley Coffee branded vending solutions for the OCS, vending and foodservice marketplaces: one designed for larger, high traffic environments; and another, an automatic table-top vending machine for small and medium traffic locations. National Coffee Service & Vending ("NCS&V"), a current Marley Coffee sales agent for office coffee service, will also continue distribute the Marley Coffee branded vending solutions for the OCS.

Marley Coffee BikeCaffe Mobile Franchise Concept. Also at the April 2012 NAMA OneShow, we announced the Marley Coffee branded BikeCaffe Coffee Bike. BikeCaffes, found in select cities in the U.S. and Europe, is a new approach to serving coffee to customers. The three-wheeled, geared bikes are full-service cafes that can roll from location to location, leaving little carbon footprint. Bike Caffe franchises are available to Marley Coffee branded bikes that will sell coffee drinks exclusively featuring Marley Coffee beans.

RESULTS OF OPERATIONS AND FINANCIAL CONDITION

Comparison of the Three Months Ended July 31, 2012 and 2011

Sales Revenue. Sales revenue for the three months ended July 31, 2012 was $559,485, an increase of $515,743, as compared with sales revenue of $43,742 for the three months ended July 31, 2011. Sales revenue increased as a result of the Company's continued maturation from its development stage.

Cost of Sales. Cost of sales for the three months ended July 31, 2012 was $492,728, an increase of $446,437 as compared to $46,291 for the three months ended July 31, 2011. The increase in the cost of sales correlated with the Company's revenue growth.

Compensation and Benefit Expenses. Compensation and benefits for the three months ended July 31, 2012, were $635,066 as compared to $-0- for the three months ended July 31, 2011. The increase was a result of stock compensation expenses associated with options granted and payroll that was not in effect in 2011.

Selling and Marketing Expenses. Selling and marketing expenses for the three months ended July 31, 2012, were $124,994, an increase of $74,641, as compared to $50,353 for the three months ended July 31, 2011. The increase was principally the result of marketing expenses related to the ramping up of sales operations.

General and Administrative Expenses. General and administrative expenses for the three months ended July 31, 2012, were $277,712, a decrease of $154,447, as compared to $432,159 in expenses for the three months ended July 31, 2011. The decrease was principally the result of decreased legal fees.

Net Loss. We incurred a net loss of $986,232 for the three months ended July 31, 2012, compared to $484,160 for the three months ended July 31, 2011. The principal reason for the increased net loss was an increase in expenses related to operating and expanding the business including professional fees, payroll, selling expenses, stock compensation expenses associated with options granted, professional fees and corporate reporting expenses.

RESULTS OF OPERATIONS AND FINANCIAL CONDITION

Comparison of the Six Months Ended July 31, 2012 and 2011

Sales Revenue. Sales revenue for the six months ended July 31, 2012 was $869,099, an increase of $797,402 , as compared with sales revenue of $71,697 for the six months ended July 31, 2011. Sales revenue increased as a result of the Company's continued maturation from its development stage.

Cost of Sales. Cost of sales for the six months ended July 31, 2012 was $727,261, an increase of $657,786 as compared to $69,475 for the six months ended July 31, 2011. The increase in the cost of sales correlated with the Company's revenue growth.

Compensation and Benefit Expenses. Compensation and benefits for the six months ended July 31, 2012, were $1,210,729 as compared to $-0- for the six months ended July 31, 2011. The increase was a result of stock compensation expenses associated with options granted and payroll that was not in effect in 2011.

Selling and Marketing Expenses. Selling and marketing expenses for the six months ended July 31, 2012, were $302,772, an increase of $232,549, as compared to $70,223 for the six months ended July 31, 2011. The increase was principally the result of marketing expenses related to the ramping up of sales operations.

General and Administrative Expenses. General and administrative expenses for the six months ended July 31, 2012, were $493,772, a decrease of $104,305, as compared to $598,077 in expenses for the six months ended July 31, 2011. The decrease was principally the result of decreased legal fees.

Net Loss. We incurred a net loss of $1,880,411 for the six months ended July 31, 2012, compared to $665,211 for the six months ended July 31, 2011. The principal reason for the increased net loss was an increase in expenses related to operating and expanding the business including professional fees, payroll, selling expenses, stock compensation expenses associated with options granted, professional fees and corporate reporting expenses.

LIQUIDITY AND CAPITAL RESOURCES

Since our inception, we have financed our operations primarily through the issuance of our common stock.

The following table presents details of our working capital and cash and cash equivalents:

                   July 31, 2012       July 31, 2011       Increase / (Decrease)
Working Capital   $       (19,315 )   $     1,961,156     $             (1980,471 )
Cash              $       301,551     $     1,836,007     $            (1,534,456 )

At July 31, 2012, we had total assets of $1,794,033 and total liabilities of $933,897. Our current sources of liquidity include our existing cash and cash equivalents, cash from operations, amounts under our Credit Agreement, described below, and funds generated as a result of the sale of our shares of common stock under the investment and securities purchase agreements with Fairhills Capital Offshore, Ltd., as described below.

For the six months ended July 31, 2012, although we generated sales of $869,099, we had a net loss of $1,880,411. During the next 12 months, we estimate our funding requirements to be $1,400,000 consisting of $300,000 in selling and marketing expenses and $1,100,000 in general and administrative expenses. Notwithstanding the sources of liquidity described above, we believe that the Company will require additional funding to continue our business operations for the next 12 months. We have not yet generated net income through the sale of our products and thus make no assurances that net income will be generated in the future.

From time to time, we may attempt to raise capital through either equity or debt offerings. Our capital requirements will depend on many factors, including, among other things, the rate at which our business grows, with corresponding demands for working capital and expansion capacity. We could be required, or may elect, to seek additional funding through public or private equity, debt financing or bank financing. However, a credit facility, or additional funds through public or private equity or other debt financing, may not be available on terms acceptable to us or at all, or that any such financing activity would not be dilutive to our stockholders. Without additional funds and/or increased revenues, we may not have enough cash or financial resources to operate for the next twelve months.

Our ability to meet our obligations in the ordinary course of business is dependent upon our ability to sell our products directly to end-users and through distributors, establish profitable operations through increased sales and decreased expenses, and obtain additional funds when needed.

There can be no assurance that we will be able to increase sales, reduce expenses, or obtain additional financing, if necessary, at a level to meet our current obligations. As a result, the opinion we have received from our independent registered public accounting firm on our January 31, 2012 consolidated financial statements contains an explanatory paragraph stating that there is a substantial doubt regarding our ability to continue as a going concern.

Cash Flows



                                                     Six Months Ended
                                             July 31, 2012       July 31, 2011
Net cash used in operating activities       $      (738,819 )   $      (564,906 )
Net cash used in investing activities       $       (14,764 )   $        (5,000 )
Net cash provided by financing activities   $       219,256     $     2,403,446

Operating Activities

Compared to the corresponding period in 2011, net cash used in operating activities increased by approximately $173,913 for the six month period ended July 31, 2012. The increase was primarily due to our net loss of $1,880,411; and higher utilization of cash resources for payment of operating liabilities such as accounts payable, pre-paid expenses and other current assets and other current liabilities. The impact of such increase was partially offset by an increase of $350,833 in accounts receivable; $996,181 of stock compensation expenses; and an increase in accounts payable of $411,334.

Investing Activities

Compared to the corresponding period in fiscal 2011, net cash used in investing activities increased by approximately $9,764 due primarily from the purchase of computer equipment.

Financing Activities

Compared to the corresponding period in fiscal 2011, net cash provided by financing activities decreased by approximately $2,184,190 for the six months July 31, 2011 primarily because the Company's capital-raising activities decreased in 2012.

Contractual and Other Obligations

Credit Agreement

On July 19, 2012 we entered into a credit agreement with TCA Global Credit Master Fund, LP, a Cayman Islands limited partnership ("TCA"), effective June 29, 2012 (the "Credit Agreement"), pursuant to which TCA agreed to loan the Company up to $2 million, based on the amount of eligible accounts receivable the Company provided to secure the repayment of the amounts borrowed under the Credit Agreement. As of July 19, 2012, we borrowed $350,000 pursuant to the Credit Agreement, evidenced by a revolving note, the repayment of which is secured by a security interest in substantially all of our assets in favor of TCA. The revolving note bears interest at the rate of 12% per annum (18% per annum upon a default) and is due and payable on July 18, 2013. Upon an event of default under the Credit Agreement or the revolving note, TCA may convert all or any portion of the outstanding principal, interest and all other amounts due under the revolving note into shares of our common stock at a conversion price equal to 85% of its lowest daily volume weighted average price during the five
(5) trading days immediately prior to the conversion date, in each case subject to TCA not being able to beneficially own more than 4.99% of outstanding common stock upon any conversion. We may prepay the revolving note, in whole or in part, provided, that we pay TCA an amount equal to the then outstanding amount of such note plus 5% for repayments up until 180 days following July 19, 2012, and the then outstanding amount of the revolving note plus 2.5% for repayments subsequent to 180 days following July 19,2012.

We also agreed to pay TCA various fees during the term of the Credit Agreement. In total, we paid $52,575 in fees, expenses and closing costs in connection with the Closing and as such, netted $297,425 in connection with the execution of the Credit Agreement. We also agreed to pay TCA a fee of $100,000, payable in shares of our common stock, initially equal to 588,235 shares of common stock (the "Fee Facility Shares"). The number of Fee Facility Shares are adjusted upon the earlier of (i) the date that all Fee Facility Shares are sold; or (ii) 12 months after July 19, 2012, such that the total value realized by TCA in connection with the sale of the Fee Facility Shares is equal to $100,000. Additionally, in the event that TCA determines in its sole discretion, at any time that the Facility Fee Shares are not likely to be monetized for at least $100,000, TCA can request that we redeem the Fee Facility Shares then held by TCA for six (6) equal monthly payments totaling in aggregate $100,000 minus the total value received by TCA through the sale of such Fee Facility Shares. These shares were subsequently issued in August 2012. The Fee Facility fee has been included in deferred financing costs and is amortized over the term of the loan.

During the term of the Credit Agreement, we are prohibited from (i) incurring any indebtedness (other than in connection with the Credit Agreement or as otherwise approved by TCA); (ii) making any new investments, creating any encumbrances on our assets, permitting a change in control of the Company, issuing any shares of common stock (other than as otherwise approved by TCA and/or in connection with the issuance of up to 15% of our issued and outstanding common stock towards employee stock option plans or acquisitions); and (iii) affecting any transactions with affiliates of the Company or undertaking certain other actions as described in the Credit Agreement, except in the usual course of business.

Investment and Securities Purchase Agreements with Fairhills Capital

On August 1, 2012, we entered into an Investment Agreement (the "Investment Agreement") with Fairhills Capital Offshore, Ltd., a Cayman Islands company ("Fairhills") which provides that we may, from time to time, consistent with the provisions with Investment Agreement deliver a notice to Fairhills stating the dollar amount of securities that we intend to sell to Fairhills on a date specified. We shall be entitled to put to Fairhills the number of shares of our common stock equal to a maximum of 200% of the average daily volume of our common stock for the 10 trading days prior to such notice (the "Put Amount"). The purchase price per share to be paid by Fairhills for each put amount shall be calculated at a 20% discount to the average of the three lowest bid prices during the 10 trading days immediately prior to Fairhills' receipt of such notice. We are only able to put shares to Fairhills beginning on the trading day after a registration statement is declared effective as to our the common stock to be subject to the put, and ends 36 months after such date, unless earlier terminated in accordance with the Investment Agreement. We have the right, pursuant to the terms of the Investment Agreement to put up to an aggregate of $2 million of common stock to Fairhills; however, Fairhills will not be obligated to purchase shares if Fairhills' total number of shares beneficially held at the time of a put would exceed 4.99%. We are not permitted put shares to Fairhills unless there we have an effective Registration Statement to cover the resale of the shares of our common stock.

In connection with the Investment Agreement, we have entered into a Registration Rights Agreement with Fairhills which provides that we shall use commercially reasonable efforts to (i) file a Registration Statement on Form S-1 covering the resale of the shares of common stock subject to the Investment Agreement within 21 days of the date of the Investment Agreement (the "Fairhills Registration Statement and (ii) have the Registration Statement declared effective by the SEC within 120 calendar days after the date of the Registration Rights Agreement.

In addition to the Investment Agreement, on August 1, 2012, we entered into a Securities Purchase Agreement with Fairhills whereby we agreed to sell Fairhills 625,000 shares of our common stock (the "SPA Shares") for an aggregate of $75,000, $0.12 per share, in two closings of 312,500 shares each (the "Securities Purchase Agreement"). In connection with the Securities Purchase Agreement, we are required to file a Registration Statement on Form S-1 (the "SPA Registration Statement") within 30 days after the first closing August 31, 2012. The first closing occurred on August 1, 2012 and the second closing is scheduled to occur on the date that the Company files an amendment to the SPA Registration Statement in response to the initial SEC comments on the SPA Registration Statement. In addition to agreeing to registering the SPA Shares sold pursuant to the Securities Purchase Agreement, we agreed to provide Fairhills price protection for the SPA Shares and to issue Fairhills additional shares of common stock of the Company on the earlier of the (a) the effectiveness of the SPA Registration Statement; and (b) such time as the SPA Shares can be sold pursuant to Rule 144 of the Securities Act of 1933, as amended, such that the total value of the SPA Shares and any additional shares issuable on such date total $75,000 in value, based on a 20% discount to the then trading price of the Company's common stock.

In connection with the Securities Purchase Agreement, we are required to file the SPA Registration Statement on Form S-1 within 30 days after the first closing August 31, 2012 or we could be held liable for liquidated damages in an amount equal to 1% of the aggregate amount invested by Fairhills for each 30-day period or pro-rata period following such filing deadline, provided that such damages shall cease to accrue on the 180th day following the first closing. There is another deadline relating to when the SPA Registration Statement becomes effective with the SEC and similar liquidated damages imposed upon us to the extent Fairhills is precluded from selling shares of our common stock registered under the SPA Registration Statement.

New Trademark Agreement Relating to the "Marley Coffee Trademarks/Termination of Obligation to Issue Additional Shares to MCL

On September 13, 2012, we entered into a license agreement effective August 7, 2012 (the "Fifty Six Hope Road Trademark License Agreement") with Fifty Six Hope Road Music Limited, a Bahamas international business company ("Fifty Six Hope Road"). Pursuant to the Fifty Six Hope Road Trademark License Agreement, Fifty Six Hope Road granted to us a worldwide, exclusive, non-transferable license to utilize the "Marley Coffee" trademarks (the "Trademarks") in connection with (i) the manufacturing, advertising, promotion, sale offering for sale and distribution of coffee in all its forms and derivations, regardless of portions, sizes or packaging (the "Exclusive Licensed Products") and (ii) coffee roasting services, coffee production services, and coffee sales, supply, distribution and support services, provided that we may not open retail coffee houses under the Trademarks. In addition, Fifty Six Hope Road granted us the right to use the Trademarks on advertising and promotional materials that pertain solely to the sale of coffee cups, coffee mugs, coffee glasses, saucers, milk steamers, machines for brewing coffee, espresso and/or cappuccino, grinders, water treatment products, tea products, chocolate products, and ready-to-use (instant) coffee products (the "Non-Exclusive Licensed Products", and together with the Exclusive Licensed Products, the "Licensed Products"). Licensed Products may be sold by us pursuant to the Fifty Six Hope Road Trademark License Agreement through all channels of distribution, provided that, subject to certain exceptions, we cannot sell the Licensed Products by direct marketing methods (other than the Company's website), including television, infomercials or direct mail without the prior written consent of Fifty Six Hope Road. In consideration for the foregoing licenses, we agreed to pay royalties to Fifty Six Hope Road in an amount equal to 3% of the net sales of all Licensed Products. In addition, such royalty payments are to be deferred during the first 20 months of the term of the License Agreement, and such deferred payments shall be paid on a quarterly-basis thereafter.

The Fifty Six Hope Road Trademark License Agreement superseded and replaced the . . .