What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2022-03-17 compared with 2021-09-13 · 196 added, 248 removed, 247 unchanged (64% of the section changed)

2 unchanged sentences

CONSOLIDATED BALANCE SHEETS

July 31, 2021

31, 2022 AND OCTOBER 31, 2021

January 31, 2022

October 31, 2021

CURRENT ASSETS:

Cash and cash equivalents

Accounts receivable, net of allowances of $ 144,000 for 2021 and 2020

Due from broker

Prepaid expenses and other current assets

1 unchanged sentence

TOTAL CURRENT ASSETS

Buildings, machinery and equipment, at cost, net of accumulated depreciation of $ 8,068,230 and $ 7,610,864 for 2021 and 2020, respectively

Building machinery and equipment, net

Customer list and relationships, net of accumulated amortization of $ 247,819 and $ 237,131 for 2022 and 2021, respectively

2 unchanged sentences

Equity method investments

Deferred income tax asset

Investment - other

Deferred income tax asset - net

Right of Use Asset

4 unchanged sentences

Line of credit – current portion

Lease liability – current portion

Note payable – current portion

Due to broker

Note payable – current portion

Lease liability – current portion

Dividend payable

Income taxes payable

TOTAL CURRENT LIABILITIES

Deferred income tax liabilities

Line of credit net of current portion

Lease liability net of current portion

Note payable net of current portion

Lease liabilities

Note payable – long term

Deferred compensation payable

TOTAL LIABILITIES

Commitments and Contingencies (see Note 8)

Commitments and Contingencies

STOCKHOLDERS’ EQUITY:

13 unchanged sentences

Stockholders’ Equity

Non-controlling interest

TOTAL STOCKHOLDERS’ EQUITY

Noncontrolling interest

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

2 unchanged sentences

CONSOLIDATED STATEMENTS OF OPERATIONS

AND THREE MONTHS ENDED JULY 31, 2021 AND 2020

Nine Months Ended

Three Months Ended

COST OF SALES

MONTHS ENDED JANUARY 31, 2022 AND 2021

COST OF SALES (which includes purchases of approximately $ 1.2

million and $ 0.7 million in fiscal years 2022 and 2021, respectively, from a related party)

OPERATING EXPENSES:

1 unchanged sentence

Officers’ salaries

INCOME (LOSS) FROM OPERATIONS

INCOME FROM OPERATIONS

OTHER INCOME (EXPENSE):

Interest income

Loss from equity method investment

Loss from equity method investments

Interest expense

INCOME (LOSS) BEFORE PROVISION (BENEFIT) FOR INCOME TAXES AND NON-CONTROLLING INTEREST IN SUBSIDIARY

Provision for (benefit) from income taxes

NET INCOME (LOSS) BEFORE NON-CONTROLLING INTEREST IN SUBSIDIARY

Net (income) loss attributable to the non-controlling interest

NET INCOME (LOSS) ATTRIBUTABLE TO COFFEE HOLDING CO., INC.

$ ( 127,051 )

Basic and diluted earnings (loss) per share

INCOME BEFORE PROVISION FOR INCOME TAXES AND NON-CONTROLLING INTEREST IN SUBSIDIARY

Provision for income taxes

NET INCOME BEFORE NON-CONTROLLING INTEREST IN SUBSIDIARY

Net income attributable to the non-controlling interest in subsidiary

NET INCOME ATTRIBUTABLE TO COFFEE HOLDING CO., INC.

Basic and diluted earnings earnings per share

Weighted average common shares outstanding:

3 unchanged sentences

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

AND NINE MONTHS ENDED JULY 31, 2021 AND 2020

MONTHS ENDED JANUARY 31, 2022 AND 2021

Treasury Stock

4 unchanged sentences

Stock Compensation

Income from non-Controlling Interest

Non-Controlling Interest

Balance, January 31, 2021

$ ( 4,633,560 )

Stock Compensation

Income from non-Controlling Interest

Balance, April 30, 2020

$ ( 4,633,560 )

Stock Compensation

Loss from non-Controlling Interest

Balance, July 31, 2020

$ ( 4,633,560 )

Balance, October 31, 2021

1 unchanged sentence

Stock Compensation

Income from non-Controlling Interest

Balance, January 31, 2021

$ ( 4,633,560 )

Stock Compensation

Loss from non-Controlling Interest

Balance, April 30, 2021

$ ( 4,633,560 )

Dividend to common shareholders

Non-Controlling Interest

Balance, January 3l, 2022

$ ( 4,633,560 )

Income (loss)

from non-Controlling Interest

(loss) from non-Controlling Interest

July 31, 2021

Notes to Condensed Consolidated Financial Statements

1 unchanged sentence

CONSOLIDATED STATEMENTS OF CASH FLOWS

MONTHS ENDED JULY 31, 2021 AND 2020

MONTHS ENDED JANUARY 31, 2022 AND 2021

OPERATING ACTIVITIES:

Adjustments to reconcile net income to net cash provided by operating activities:

Adjustments to reconcile net income to net cash (used in) provided by operating activities:

Depreciation and amortization

Stock-based compensation

Unrealized (gain) loss on commodities

Unrealized loss (gain) on commodities

Loss on equity method investments

Amortization of right of use asset

Amortization of right to use asset

Deferred income taxes

3 unchanged sentences

Prepaid and refundable income taxes

Lease liability

Deposits and other assets

Accounts payable and accrued expenses

( 1,897,340 )

Deposits and other assets

Change in lease liability

Income taxes payable

Net cash provided by operating activities

INVESTING ACTIVITIES:

Purchases of building, machinery and equipment

Net cash (used in) provided by operating activities

( 1,233,464 )

INVESTING ACTIVITIES:

Purchases of machinery and equipment

Net cash used in investing activities

( 1,491,233 )

FINANCING ACTIVITIES:

Advances under bank line of credit

Proceeds from PPP loan

Principal payments on note payable

1 unchanged sentence

( 2,845,000 )

( 4,512,050 )

Net cash used in financing activities

( 1,300,605 )

Net cash provided by (used in) financing activities

( 2,845,336 )

5 unchanged sentences

CONSOLIDATED STATEMENTS OF CASH FLOWS

MONTHS ENDED JULY 31, 2021 AND 2020

MONTHS ENDED JANUARY 31, 2022 AND 2021

SUPPLEMENTAL DISCLOSURE OF CASH FLOW DATA:

1 unchanged sentence

Income taxes paid

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

Initial recognition of operating lease right of use asset

Initial recognition of operating lease liabilities

Termination of operating lease right of use asset

Termination of operating lease liability

Machinery and equipment acquired through financing

Notes to Condensed Consolidated Financial Statements

12 unchanged sentences

coffee roasted, blended, packaged and sold under the specifications and names of others, including supermarkets

that want to have their own brand name of coffee to compete with national brands;

that want to have their own brand name on coffee to compete with national brands;

coffee roasted and blended to the Company’s own specifications and packaged and sold under the Company’s

eight proprietary and licensed brand names in different segments of the market.

Company’s wholesale green coffee sales are included in the “green” revenue stream, and the Company’s private

label and branded coffee sales are included in the “packaged revenue stream” and are primarily to customers that are located

throughout the United States with limited sales in Canada and certain countries in Asia.

Such customers include supermarkets, wholesalers,

and individually-owned and multi-unit retailers.

The Company’s unprocessed green coffee, which includes over 90 specialty coffee

offerings, is sold primarily to specialty gourmet roasters and to coffee shop operators in the United States with limited sales in Australia,

Canada, England and China.

Company’s private label and branded coffee sales are primarily to customers that are located throughout the United States with

limited sales in Canada and certain countries in Asia.

Such customers include supermarkets, wholesalers, and individually-owned and multi-unit

The Company’s unprocessed green coffee, which includes over 90 specialty coffee offerings, is sold primarily to specialty

gourmet roasters and to coffee shop operators in the United States with limited sales in Australia, Canada, England and China.

Company’s wholesale green, private label, and branded coffee product categories generate revenues and cost of sales individually

11 unchanged sentences

and transport restrictions, mandated closures and stay-at-home orders, and created significant disruption of the financial markets.

continuing impact on the Company’s business, including the decrease in the Company’s sales, the length and impact of stay-at-home

orders and/or regional quarantines, labor shortages and employment trends, disruptions to supply chains, including the Company’s

ability to obtain products from global suppliers, higher operating costs, the form and impact of economic stimulus and general overall

economic instability, has contributed to and may continue to have a material adverse effect on the Company’s business, results

of operations, financial condition and cash flows.

continuing impact on the Company’s business, including the decrease in our sales, the length and impact of stay-at-home orders

and/or regional quarantines, labor shortages and employment trends, disruptions to supply chains, including its ability to obtain products

from global suppliers, higher operating costs, the form and impact of economic stimulus and general overall economic instability, has

contributed to and may continue to have a material adverse effect on the Company’s business, results of operations, financial condition

and cash flows.

At this time the full impact could not be determined.

1 unchanged sentence

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

2 - BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES :

2 - BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICY :

Company’s fiscal year ends on October 31, of each calendar year.

The accompanying interim condensed consolidated financial statements

are unaudited and have been prepared on substantially the same basis as our annual consolidated financial statements for the fiscal year

ended October 31, 2020.

In the opinion of the Company’s management, these interim condensed consolidated financial statements reflect

all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of our financial position,

results of operations and cash flows for the periods presented.

The preparation of financial statements in conformity with generally

accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities

and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts

of revenue and expenses during the reporting periods.

Actual results could differ from these estimates.

The October 31, 2020 year-end

condensed consolidated balance sheet data in this document was derived from audited consolidated financial statements.

These condensed

consolidated financial statements and notes included in this quarterly report on Form 10-Q does not include all disclosures required

generally accepted accounting principles (“U.S.

GAAP”) and should be read in conjunction with the Company’s

audited consolidated financial statements as of and for the year ended October 31, 2020 and notes thereto included in the Company’s

fiscal 2020 Annual Report on Form 10-K, filed with the Securities and Exchange Commission (“SEC”) on February 16,

2021 (the “2020 10-K”).

The results of operations and cash flows for the interim periods included in these condensed consolidated

financial statements are not necessarily indicative of the results to be expected for any future period or the entire fiscal year.

The accompanying interim condensed consolidated financial

statements are unaudited and have been prepared on substantially the same basis as our annual consolidated financial statements for

the fiscal year ended October 31, 2021.

In the opinion of the Company’s management, these interim condensed consolidated

financial statements reflect all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair

statement of our financial position, results of operations and cash flows for the periods presented.

The preparation of financial

statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that

affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the

condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods.

results could differ from these estimates.

The October 31, 2021 year-end condensed consolidated balance sheet data in this document

was derived from audited consolidated financial statements.

These condensed consolidated financial statements and notes included in

this quarterly report on Form 10-Q does not include all disclosures required by U.S.

generally accepted accounting principles

GAAP”) and should be read in conjunction with the Company’s audited consolidated financial statements as of

and for the year ended October 31, 2021 and notes thereto included in the Company’s fiscal 2021 Annual Report on Form 10-K,

filed with the Securities and Exchange Commission (“SEC”) on January 31, 2022 (the “2021 10-K”).

of operations and cash flows for the interim periods included in these condensed consolidated financial statements are not

necessarily indicative of the results to be expected for any future period or the entire fiscal year.

condensed consolidated financial statements include the accounts of the Company, the Company’s subsidiaries, Organic Products Trading

3 unchanged sentences

The Company owns a 60 % equity interest in GCC.

All inter-company transactions and balances have been eliminated in consolidation.

Accounting Policies

All significant inter-company transactions and balances have been eliminated in consolidation.

Accounting Policy

significant accounting policies used in the preparation of these condensed consolidated financial statements are disclosed in our 2021

10-K, and there have been no changes to the Company’s significant accounting policies during the three and nine months ended July

10-K, and there have been no changes to the Company’s significant accounting policies during the three months ended January 31,

Company recognizes revenue in accordance with the five-step model as prescribed by the Financial Accounting Standards Board (“FASB”)

10 unchanged sentences

2 - BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICY (cont’d):

following table presents revenues by stream for the nine and three months ended July 31, 2021 and 2020.

following table presents revenues by product line in the three months ended January 31, 2022 and 2021

SCHEDULE OF REVENUE

Nine Months Ended

July 31, 2021

Nine Months Ended

July 31, 2020

January 31, 2022

January 31, 2021

3 - INVENTORIES :

at July 31, 2021 and October 31, 2020 consisted of the following:

at January 31, 2022 and October 31, 2021 consisted of the following:

SCHEDULE OF INVENTORIES

January 31, 2022

October 31, 2021

Packed coffee

Roasters and parts

Packaging supplies

HOLDING CO., INC.

10 unchanged sentences

at fair value in the condensed consolidated financial statements with current recognition of gains and losses on such positions.

Company’s accounting for options and futures contracts may impact earnings volatility in any particular period.

Company has open position contracts held by the broker, which are summarized as follows:

SCHEDULE OF CONTRACTS HELD BY BROKER

Option Contracts

$ ( 191,637 )

$ ( 164,475 )

Future Contracts

Total Commodities

$ ( 136,756 )

$ ( 452,325 )

Company’s accounting for options and futures contracts may increase earnings volatility in any particular period.

We record all

open contract positions on our consolidated balance sheets at fair value in the due from and due to broker line items and typically do

not offset these assets and liabilities.

Company classifies its options and future contracts as trading securities and accordingly, unrealized holding gains and losses are included

in the statement of operations as a component of cost of sales and not reflected as a net amount as a separate component of stockholders’

Company recorded realized and unrealized gains and losses, on these contracts as follows:

in earnings and not reflected as a net amount as a separate component of stockholders’ equity.

Company recorded realized and unrealized gains and losses respectively, on these contracts as follows:

SCHEDULE OF REALIZED AND UNREALIZED GAINS AND LOSSES ON CONTRACTS

Months Ended July 31,

realized gains

realized losses

Months Ended July 31,

realized gains

realized losses

Three Months Ended January 31,

Gross realized gains

Gross realized losses

Unrealized gain (loss)

$ ( 123,545 )

HOLDING CO., INC.

9 unchanged sentences

the new agreement, among other things:

(i) provides for a new maturity date of March 31, 2022 and (ii) decreases the interest rate per

annum to LIBOR plus 1.75 % (with such interest rate not to be lower than 3.50 % ).

All other terms of the A&R Loan Agreement and A&R

Loan Facility remain the same.

(i) provided for a new maturity date of March

31, 2022 and (ii) decreased the interest

rate per annum to LIBOR plus 1.75 %

(with such interest rate not to be lower than 3.50 %).

All other terms of the A&R Loan Agreement and A&R Loan Facility remain substantially the same.

On March 17, 2022, the Company

reached an agreement for a new loan modification agreement and credit facility which extended the maturity date to June 29, 2022.

other terms of the A&R Loan Agreement and A&R Loan Facility remain the same.

of the A&R Loan Facility and A&R Loan Agreement contains covenants, subject to certain exceptions, that place annual restrictions

2 unchanged sentences

and preferred stock), and restrictions on intercompany transactions.

The Company was in compliance with all covenants as of July 31,

The Company was in compliance with all covenants as of January 31,

2022 and October 31, 2021.

The outstanding balance on the Company’s lines of credit were $ 2,500,000 and $ 3,796,822 as of July 31,

2021 and October 31, 2020, respectively.

outstanding balance on the Company’s lines of credit were $ 5,400,850

and $ 3,800,850

as of January 31, 2022 and October 31, 2021,

respectively.

6 - INCOME TAXES :

7 unchanged sentences

deferred tax assets and liabilities.

of July 31, 2021 and October 31, 2020, the Company did no t have any unrecognized tax benefits or open tax positions.

of January 31, 2022 and October 31, 2021, the Company did no t have any unrecognized tax benefits or open tax positions.

The Company’s

practice is to recognize interest and/or penalties related to income tax matters in income tax expense.

As of July 31, 2021 and October

As of January 31, 2022 and October

31, 2021, the Company had no accrued interest or penalties related to income taxes.

2 unchanged sentences

Company files a U.S.

federal income tax return and California, Colorado, Connecticut, Idaho, Kansas, Louisiana, Montana, Massachusetts,

Michigan, New Jersey, New York, New York City, Oregon, Rhode Island, South Carolina, Tennessee, Virginia, and Texas state tax returns.

The Company’s federal income tax return is no longer subject to examination by the federal taxing authority for the years before

The Company’s California, Colorado and New Jersey income tax returns are no longer subject to examination by their

respective taxing authorities for the years before fiscal 2017.

The Company’s Oregon and New York income tax returns are no longer

subject to examination by their respective taxing authorities for the years before fiscal 2017.

federal income tax return and California, Colorado, Connecticut, Idaho, Kansas, Michigan, New Jersey, New York,

New York City, Virginia, Texas, Rhode Island, South Carolina, and Oregon state tax returns.

The Company’s federal income tax return

is no longer subject to examination by the federal taxing authority for years before fiscal 2018.

The Company’s California, Colorado

and New Jersey and Texas income tax returns are no longer subject to examination by their respective taxing authorities for the years

before fiscal 2018.

The Company’s Oregon, New York, Kansas, South Carolina, Rhode Island, Connecticut and Michigan income tax returns

are no longer subject to examination by their respective taxing authorities for the years before fiscal 2018.

HOLDING CO., INC.

8 unchanged sentences

effect of common shares issuable upon exercise of potential sources of dilution.

weighted average common shares outstanding used in the computation of basic and diluted earnings per share were 5,708,599 and 5,569,349

for the three and nine months ended July 31, 2021 and 2020, respectively.

The Company has granted 1,000,000 options which have not been

included in the calculation of diluted earnings per share due to their anti-dilutive nature.

weighted average common shares outstanding used in the computation of basic and diluted earnings per share were 5,708,599

for the three months ended January 31, 2022 and

The Company had granted 1,000,000

options in the second quarter of 2019, which

have not been included in the calculation of diluted earnings per share due to these options being out of the money.

8 - COMMITMENTS AND CONTINGENCIES :

ACTION COMPLAINTS

ACTION COMPLAINT

Company was named as a defendant in a putative class action lawsuit filed in the United States District Court for the Northern District

of Illinois on or about December 21, 2020.

The plaintiffs, Eileen Brodsky and Rhonda Diamond, purporting to represent a class of individuals

who purchased coffee products at Aldi, Inc.

(“Aldi”), a supermarket chain, generally allege that Aldi sold private label

coffee products manufactured by the Company and another coffee roasting company, which falsely described the number of cups of coffee

that could be made from the amount of product purchased.

Aldi and Pan American are also named as defendants in the action.

The complaint

asserts a variety of claims under New York and California consumer protection laws, and seeks unspecified monetary damages, including

disgorgement and restitution, as well as other forms of relief including class certification, declaratory and injunctive relief, attorneys’

fees, and interest.

The Company believes the allegations in the complaint are wholly without merit and that the claims asserted are legally

deficient, and the company intends to vigorously defend the action.

The Company has filed a motion to dismiss, and the plaintiff has

sought leave to file an amended complaint.

At this time, the Company is unable to predict the ultimate outcome of this lawsuit.

of Illinois (the “Court”) on or about December 21, 2020.

The plaintiffs, Eileen Brodsky and Rhonda Diamond, purported to

represent a class of individuals who purchased coffee products at Aldi, Inc.

(“Aldi”), a supermarket chain, generally allege

that Aldi sold private label coffee products manufactured by us and by Pan American Coffee Co., LLC (“Pan American”), which

falsely described the number of cups of coffee that could be made from the amount of product purchased.

Aldi and Pan American were also

named as defendants in the action.

The complaint asserted a variety of claims under New York and California consumer protection laws,

and sought unspecified monetary damages, including disgorgement and restitution, as well as other forms of relief including class certification,

declaratory and injunctive relief, attorneys’ fees, and interest.

On September 28, 2021, the Court entered an order granting the

Company’s motion to dismiss with prejudice (the “Dismissal Order”).

In the Dismissal Order, the Court stated that no

reasonable coffee drinker would be deceived by the Company’s packaging.

The plaintiffs filed an appeal with the 7 th

Circuit Court of Appeals (the “Appeal”).

After the Appeal was filed, the Company and the plaintiffs’ settled the matter

during mediation in late January 2022 and the Appeal was dismissed.

significant customer of the Company was named as a defendant in a putative class action lawsuit filed in the United States District Court

for the District of Massachusetts on or about February 2, 2021, concerning the labeling on private label coffee productions we sold to

the customer.

The plaintiff, David Cohen, purporting to represent a class of individuals who purchased coffee products from our customer,

generally allege that the customer sold private label coffee products manufactured by the Company which falsely described the number

of cups of coffee that could be made from the amount of product purchased.

The Company is not named as a defendant in the action, but

has agreed to indemnify the customer for the costs and expenses incurred in defending the lawsuit and for any liability the customer

may suffer as a result.

The complaint asserts a variety of claims under Massachusetts consumer protection laws, and seeks unspecified

monetary damages as well as other forms of relief including class certification, declaratory and injunctive relief, attorneys’

fees, and interest.

The Company believes the allegations in the complaint are wholly without merit and that the claims asserted are legally

deficient, and intends to vigorously support the customer in defending the action.

As of the filing of this Form 10-Q, the Company is

unable to predict the ultimate outcome of this lawsuit.

for the District of Massachusetts (the “Massachusetts District Court”) on or about February 2, 2021, concerning the

labeling on private label coffee productions we sold to the customer.

The plaintiff, David Cohen, purporting to represent a class of

individuals who purchased coffee products from our customer, generally allege that the customer sold private label coffee products manufactured

by the Company which falsely described the number of cups of coffee that could be made from the amount of product purchased.

is not named as a defendant in the action, but has agreed to indemnify the customer for the costs and expenses incurred in defending

the lawsuit and for any liability the customer may suffer as a result.

The complaint asserts a variety of claims under Massachusetts

consumer protection laws, and seeks unspecified monetary damages as well as other forms of relief including class certification, declaratory

and injunctive relief, attorneys’ fees, and interest.

The Company believes the allegations in the complaint are wholly without

merit and that the claims asserted are legally deficient, and intends to vigorously support the customer in defending the action.

On February 28, 2022, the Company and the plaintiff, in his individual capacity and not on behalf of a presumptive class, resolved

the matter in principle and have reported the agreement in principle to the Massachusetts District Court.

The parties are presently negotiating

the final details of a settlement agreement to finalize the settlement.

HOLDING CO., INC.

1 unchanged sentence

8 - COMMITMENTS AND CONTINGENCIES (cont’d):

ACTION COMPLAINTS (cont’d)

number of lawsuits similar to those above have been filed in recent years against coffee sellers in the industry in which the Company

Many of these lawsuits have yet to be finally adjudicated.

The Company believes the lawsuits filed against it are without merit.

Company has a 401(k) Retirement Plan, which covers all the full time employees who have completed one year of service and have reached

their 21 st birthday.

The Company matches 100% of the aggregate salary reduction contribution up to the first 3% of compensation

and 50% of aggregate contribution of the next 2% of compensation.

Contributions to the plan aggregated $ 16,031 and $ 72,558 for the three

months ended January 31, 2022 and for the year ended October 31, 2021, respectively.

following summarizes the Company’s operating leases:

SCHEDULE OF OPERATING LEASES

July 31, 2021

Right-of-use operating lease assets

2 unchanged sentences

Total lease liability

amortization of the right-of-use asset for the nine and three months ended July 31, 2021 was $ 321,921 and $ 95,766 , respectively.

July 31, 2021

Average remaining lease term

Discount rate

amortization of the right-of-use asset for the three months ended January 31, 2022 and 2021was $ 102,681 and $ 112,587 , respectively.

Weighted average remaining lease term

Weighted average discount rate

of lease liabilities by year for our operating leases are as follows:

SCHEDULE OF MINIMUM FUTURE LEASE PAYMENTS

2021 (remaining three months)

Total lease payments

imputed interest

( 1,282,398 )

Present value of operating lease liabilities

aggregate cash payments under these leasing agreements was $ 442,118 for the nine months ended July 31, 2021.

June 2021, the Company purchased a facility in Colorado for $ 900,321 that it was previously leasing.

1 unchanged sentence

wrote off the carrying value of the right-of-use asset and lease liability associated with this facility of $ 242,888 .

September 2021, the Company extended its headquarters lease in Staten Island, New York through September 2036.

As a result, on the date

of the modification the Company increased its right-of-use asset and lease liability by $ 2,025,316 as of October 31, 2021.

HOLDING CO., INC.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

9 - ECONOMIC DEPENDENCY :

Approximately

21 % and 23 % of the Company’s sales were derived from six customers during the three and nine months ended July 31, 2021, respectively.

These customers also accounted for approximately $ 1,297,343 of the Company’s accounts receivable balance at July 31, 2021.

Approximately

21 % and 23 % of the Company’s sales were derived from six customers during the three and nine months ended July 31, 2020, respectively.

These customers also accounted for approximately $ 1,907,000 of the Company’s accounts receivable balance at July 31, 2020.

Concentration

of credit risk with respect to other trade receivables is limited due to the short payment terms generally extended by the Company, by

ongoing credit evaluations of customers, and by maintaining an allowance for doubtful accounts that management believes will adequately

provide for credit losses.

Approximately

50 % and 34 % of the Company’s purchases were from six vendors for the three and nine months ended July 31, 2021, respectively.

vendors accounted for approximately $ 718,000 of the Company’s accounts payable at July 31, 2021.

Approximately 23 % and 26 % of the

Company’s purchases were from six vendors for the three and nine months ended July 31, 2020, respectively.

These vendors accounted

for approximately $ 508,000 of the Company’s accounts payable at July 31, 2020.

Management does not believe the loss of any one

vendor would have a material adverse effect of the Company’s operations due to the availability of many alternate suppliers.

10 - RELATED PARTY TRANSACTIONS :

1 unchanged sentence

Included in contract labor expense are

expenses incurred from the Partner during the three and nine months ended July 31, 2021 of $ 91,207 and $ 253,932 , respectively and $ 110,369

and $ 307,569 , respectively for the three and nine months ended July 31, 2020, for the processing of finished goods.

These amounts are

reflected in cost of sales in the statement of operations.

expenses incurred from the Partner during the three months ended January 31, 2022 and 2021 of $ 58,434 and $ 74,693 , respectively, for

the processing of finished goods.

employee of one of the top five vendors is a director of the Company.

Purchases from that vendor totaled approximately $ 1,159,000 and

$ 2,451,000 for the three and nine months ended July 31, 2021, respectively and $ 1,461,000 and $ 4,466,000 for the three and nine months

ended July 31, 2020, respectively.

These amounts are reflected in cost of sales in the statement of operations.

The corresponding accounts

payable balance to this vendor was $ 50,500 at July 31, 2021 and October 31, 2020.

$ 734,000 for the three months ended January 31, 2022 and 2021 respectively.

The corresponding accounts payable balance to this vendor

was approximately $ 4,000 and $ 199,000 at January 31, 2022 and 2021, respectively.

January 2005, the Company established the “Coffee Holding Co., Inc.

6 unchanged sentences

The deferred compensation payable represents

the liability due to an officer of the Company.

The assets are included in the Deposits and other assets in the accompanying balance

The deferred compensation asset and liability at July 31, 2021 and October 31, 2020 were $ 304,335 and $ 276,548 , respectively.

HOLDING CO., INC.

TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

the liability due to the Chief Executive Officer of the Company.

The assets were $301,976 and $311,872 at January 31, 2022 and October

31, 2021, respectively, and are included in the Deposits and other assets in the accompanying balance sheets.

The deferred compensation

liability at January 31, 2022 and October 31, 2021 were $301,976 and $311,872, respectively.

11 - STOCKHOLDERS’ EQUITY :

2 unchanged sentences

the last-in, first-out method.

The Company did not purchase any shares during the three and nine months ended July 31, 2021 and the

year ended October 31, 2020.

The Company did not purchase any shares during the three months ended January 31, 2022 and the year

ended October 31, 2021.

The Company has an incentive stock plan, the 2013 Equity Compensation Plan (the “2013 Plan”), and on April

2019, has granted stock options to employees, officers and non-employee directors from the 2013 Plan.

Options granted under the 2013

Plan may be Incentive Stock Options or Nonqualified Stock Options, as determined by the Administrator at the time of grant.

January 31, 2021, the Board of Directors approved 1,000,000 options.

As of July 31, 2021 all options are outstanding.

Company recorded $ 189,768 and $ 569,305 of stock-based compensation for the three and nine months ended July 31, 2021 and $ 189,769 and

$ 678,709 for the three and nine months ended July 31, 2020, respectively.

remaining unamortized stock compensation expense as of July 31, 2021 was approximately $ 595,589 , which will be expensed over a weighted

average period of nine months.

12 - SUBSEQUENT EVENTS :

Company evaluates events that have occurred after the balance sheet date but before the financial statements are issued.

Based upon the

evaluation, the Company did identify a subsequent event that requires disclosure in the condensed consolidated financial statements.

The Company made an investment of $ 2,500,000

in an entity that holds investments

in the plant-based protein drink manufacturing industry.

19, 2019, has granted 1,000,000 stock options to employees, officers and non-employee directors from the 2013 Plan each with an exercise

price of $ 5.43 .

Options granted under the 2013 Plan may be Incentive Stock Options or Nonqualified Stock Options, as determined by

the Administrator at the time of grant.

No options were granted, forfeited or expired during the three months ended January 31, 2022

or for the year ended October 31, 2021.

Company recorded $ 189,768 of stock-based compensation for the three months ended January 31, 2022 and 2021.

unrecognized stock compensation expense as of January 31, 2022 was approximately $ 216,052 and is expected to be recognized as compensation

expense over the next two quarters.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements