What changed in this filing

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Item 1. Financial Statements

2022-06-14 compared with 2022-03-17 · 159 added, 112 removed, 331 unchanged (45% of the section changed)

2 unchanged sentences

CONSOLIDATED BALANCE SHEETS

31, 2022 AND OCTOBER 31, 2021

January 31, 2022

April 30, 2022

October 31, 2021

CURRENT ASSETS:

Cash and cash equivalents

Accounts receivable, net of allowances of $ 144,000 for 2022 and 2021

Due from broker

Prepaid expenses and other current assets

Due from broker

Prepaid and refundable income taxes

13 unchanged sentences

Line of credit – current portion

Due to broker

Note payable – current portion

Lease liability – current portion

Dividend payable

Note payable – current portion

Due to broker

Income taxes payable

10 unchanged sentences

10,000,000 shares authorized;

Common stock, par value $ .001 per share;

30,000,000 shares authorized, 6,633,930 shares issued for 2022 and 2021;

5,708,599 shares outstanding for 2022 and 2021

Common stock, par value $ .001 per

30,000,000 shares authorized, 6,633,930 shares

issued as of April 30, 2022 and October 31, 2021;

5,708,599 shares

outstanding as of April 30, 2022 and October 31, 2021

Additional paid-in capital

Retained earnings

Treasury stock, 925,331 common shares, at cost for 2022 and 2021

Treasury stock, 925,331

common shares, at cost as of April 30, 2022 and October 31, 2021

( 4,633,560 )

2 unchanged sentences

Stockholders’ Equity

Noncontrolling interest

Non-controlling interest

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY

2 unchanged sentences

CONSOLIDATED STATEMENTS OF OPERATIONS

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)

AND THREE MONTHS ENDED APRIL 30, 2022 AND 2021

Six Months Ended

Three Months Ended

COST OF SALES

OPERATING EXPENSES:

1 unchanged sentence

Officers’ salaries

INCOME FROM OPERATIONS

OTHER INCOME (EXPENSE):

(LOSS) INCOME FROM OPERATIONS

( 1,373,469 )

OTHER (EXPENSE) INCOME

Interest income

Loss from equity method investments

Loss from equity method investment

Interest expense

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

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

( 1,424,671 )

(Benefit) provision for income taxes

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

( 1,038,990 )

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

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

$ ( 368,096 )

Basic and diluted (loss) earnings per share

Weighted average common shares outstanding:

3 unchanged sentences

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY

MONTHS ENDED JANUARY 31, 2022 AND 2021

AND SIX MONTHS ENDED APRIL 30, 2022 AND 2021

Treasury Stock

7 unchanged sentences

$ ( 4,633,560 )

Stock Compensation

Non-Controlling Interest

Balance, April 30, 2021

$ ( 4,633,560 )

Balance, October 31, 2021

3 unchanged sentences

Non-Controlling Interest

Balance, January 3l, 2022

Balance, January 31, 2022

$ ( 4,633,560 )

Stock Compensation

Distribution to non-controlling interest

Non-Controlling Interest

Balance, April 30, 2022

$ ( 4,633,560 )

Notes to Condensed Consolidated Financial Statements

1 unchanged sentence

CONSOLIDATED STATEMENTS OF CASH FLOWS

MONTHS ENDED JANUARY 31, 2022 AND 2021

MONTHS ENDED APRIL 30, 2022 AND 2021

OPERATING ACTIVITIES:

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

Net (loss) income

$ ( 696,464 )

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

Depreciation and amortization

Stock-based compensation

Unrealized loss (gain) on commodities

Unrealized gain on commodities

Loss on equity method investments

Amortization of right to use asset

Write-off of accounts receivable

Write-down of obsolete inventory

Amortization of right of use asset

Deferred income taxes

3 unchanged sentences

Prepaid and refundable income taxes

Lease liability

Deposits and other assets

Accounts payable and accrued expenses

( 2,423,835 )

Deposits and other assets

Change in lease liability

Income taxes payable

7 unchanged sentences

Principal payments on note payable

Payment of dividend

Principal payments under bank line of credit

2 unchanged sentences

( 3,796,829 )

NET INCREASE (DECREASE) IN CASH

NET (DECREASE) INCREASE IN CASH

CASH, BEGINNING OF PERIOD

3 unchanged sentences

CONSOLIDATED STATEMENTS OF CASH FLOWS

MONTHS ENDED JANUARY 31, 2022 AND 2021

MONTHS ENDED APRIL 30, 2022 AND 2021

SUPPLEMENTAL DISCLOSURE OF CASH FLOW DATA:

1 unchanged sentence

Income taxes paid

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES:

Purchase of inventory by non-controlling interest

Initial recognition of operating lease right of use asset

Initial recognition of operating lease liabilities

Notes to Condensed Consolidated Financial Statements

29 unchanged sentences

Thus, the Company considers the three product lines to be one single reporting segment.

Company during the quarter ended April 30, 2022 has begun a restructuring process with its Generations subsidiary.

As part of this restructuring

approximately $ 550,000 of its inventory was sold to the joint venture partner for $ 330,000 in cash and the balance was treated as a distribution

to the non-controlling interest.

As part of the restructuring process, the Company recorded a write-down of obsolete inventory of $ 718,353

and a write-off of accounts receivable of $ 415,096 .

global outbreak of COVID-19 was declared a pandemic by the World Health Organization and a national emergency by the U.S.

12 unchanged sentences

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, 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.

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.

Actual 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

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, 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”).

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.

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

6 unchanged sentences

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 months ended January 31,

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

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 product line in the three months ended January 31, 2022 and 2021

following table presents revenues by stream for the six and three months ended April 30, 2022 and 2021.

SCHEDULE OF REVENUE

January 31, 2022

January 31, 2021

April 30, 2022

April 30, 2021

3 - INVENTORIES :

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

at April 30, 2022 and October 31, 2021 consisted of the following:

SCHEDULE OF INVENTORIES

January 31, 2022

October 31, 2021

Packed coffee

21 unchanged sentences

SCHEDULE OF REALIZED AND UNREALIZED GAINS AND LOSSES ON CONTRACTS

Three Months Ended January 31,

Three Months Ended April 30,

Gross realized gains

Gross realized losses

Unrealized gain (loss)

Unrealized gain

Six Months Ended April 30,

Gross realized gains

Gross realized losses

( 1,257,359 )

Unrealized gain (loss)

HOLDING CO., INC.

10 unchanged sentences

(i) provided for a new maturity date of March

31, 2022 and (ii) decreased the interest

rate per annum to LIBOR plus 1.75 %

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 %).

2 unchanged sentences

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.

facility has been approved for a two year extension and the related documents are currently being prepared.

All 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 January 31,

The Company was in compliance with all covenants as of April 30,

2022 and October 31, 2021.

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.

The outstanding balance on the Company’s lines of credit were $ 5,900,000 and $ 3,800,850 as of April

30, 2022 and October 31, 2021, respectively.

6 - INCOME TAXES :

7 unchanged sentences

deferred tax assets and liabilities.

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

of April 30, 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 January 31, 2022 and October

As of April 30, 2022 and October

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

21 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

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.

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

and three months ended April 30, 2022 and 2021.

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 :

21 unchanged sentences

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 (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.

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

5 unchanged sentences

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.

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.

After the end of the period, the

parties finalized the details of a settlement agreement.

The final settlement amount was immaterial to the Company’s operations

and results of operations.

HOLDING CO., INC.

5 unchanged sentences

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.

Contributions to the plan aggregated $ 35,793 and $ 72,558 for the six

months ended April 30, 2022 and for the year ended October 31, 2021, respectively.

following summarizes the Company’s operating leases:

4 unchanged sentences

Total lease liability

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

amortization of the right-of-use asset for the three months ended April 30, 2022 and 2021 was $ 77,268 and $ 112,587 , respectively.

amortization of the right-of-use asset for the six months ended April 30, 2022 and 2021 was $ 179,949 and $ 226,155 , respectively.

Weighted average remaining lease term

17 unchanged sentences

Included in contract labor expense are

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

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

expenses incurred from the Partner during the three and six months ended April 30, 2022 and 2021 of $ 94,037 and $ 152,471 and $ 74,693

and $ 162,725 , respectively, for the processing of finished goods.

An employee of one of

the top five vendors was a director of the Company.

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

and $ 734,000

for the three and six months ended April 30, 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.

was approximately $ 4,000

and $ 199,000

at April 30, 2022 and 2021, respectively.

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

7 unchanged sentences

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

The assets were $ 302,412 and $ 311,872 at April 30, 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.

liability at April 30, 2022 and October 31, 2021 were $ 302,412 and $ 311,872 , respectively.

11 - STOCKHOLDERS’ EQUITY :

Treasury Stock .

The Company utilizes the cost method of accounting for treasury stock.

The cost of reissued shares is determined under

the last-in, first-out method.

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

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

The cost of reissued shares is determined under the last-in,

first-out method.

The Company did not purchase any shares during the three and six months ended April 30, 2022 and the year ended

October 31, 2021.

Stock Options .

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

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 and six months ended April 30,

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.

Company recorded $ 174,241

and $ 364,009

of stock-based compensation for the three

and six months ended April 30, 2022 and $ 189,769

and $ 379,537

for the three and six months ended April

The unrecognized stock

compensation expense as of April 30, 2022 was approximately $ 41,812 and is expected to be recognized as compensation expense over

the next quarter.

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