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Item 1A. Risk Factors

2023-03-17 compared with 2023-03-17 · 418 added, 451 removed, 97 unchanged (90% of the section changed)

investment in our common stock is subject to risks inherent in our business.

Before making an investment decision, you should carefully

consider the risks and uncertainties described below together with all of the other information included in this report.

to the risks and uncertainties described below, other risks and uncertainties not currently known to us or that we currently deem to

be immaterial also may materially and adversely affect our business, financial condition and results of operations.

The value or market

price of our common stock could decline due to any of these identified or other risks, and you could lose all of your investment.

Before making an investment decision, you should

carefully consider the risks and uncertainties described below together with all of the other information included in this report.

In addition to the risks and uncertainties described below, other risks and uncertainties not currently known to us or that we

currently deem to be immaterial also may materially and adversely affect our business, financial condition and results of operations.

The value or market price of our common stock could decline due to any of these identified or other risks, and you could lose

all of your investment.

affecting our Company

our business is highly dependent upon a single commodity, coffee, any decrease in demand for coffee could materially adversely affect

our revenues and profitability.

our business is highly dependent upon a single commodity, coffee, any decrease in demand for coffee could materially adversely

affect our revenues and profitability.

Our business is centered on essentially one commodity:

Our operations have primarily

focused on the following areas of the coffee industry:

Our operations have

primarily focused on the following areas of the coffee industry:

roasting, blending, packaging and distribution of private label coffee;

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type, number and location of competing products.

we rely on a single commodity, any decrease in demand for coffee would harm our business more than if we had more diversified product

offerings and could materially adversely affect our revenues and operating results.

global conditions, including economic uncertainty, may negatively impact our financial results .

Global conditions, dislocations

in the financial markets, any negative financial impacts affecting United States as a result of tax reform or changes to existing trade

agreements or tax conventions, may adversely impact our business.

In addition, the global macroeconomic environment could be negatively

affected by, among other things, COVID-19 or other pandemics or epidemics, instability in global economic markets, increased U.S.

tariffs and trade disputes with other countries, instability in the global credit markets, supply chain weaknesses, instability in the

geopolitical environment as a result of the withdrawal of the United Kingdom from the European Union, the ongoing conflict between Russian

and Ukraine and other political tensions, and foreign governmental debt concerns.

Such challenges have caused, and may continue to cause,

uncertainty and instability in local economies and in global financial markets.

we rely on a single commodity, any decrease in demand for coffee would harm our business more than if we had more diversified

product offerings and could materially adversely affect our revenues and operating results.

COVID-19 pandemic has, and may continue to have, an adverse impact on our business, financial condition and results of operations.

business, financial condition and results of operations have been and are expected to continue to be adversely affected by the COVID-19

The COVID-19 pandemic has affected nearly all regions of the world, and preventative measures taken to contain or mitigate

the outbreak have caused, and are continuing to cause, business slowdown or shutdown in affected areas.

This has and could continue to

negatively affect the global economy, including reduced consumer spending and disruption of global supply chains.

We cannot predict the

degree to which our business, financial condition and results of operations will be affected by the COVID-19 pandemic, but the effects

could be material.

addition to the factors above, the COVID-19 pandemic has subjected our business to additional risk, including, but not limited to:

to our green coffee supplier partners and vendors, including through the effects of facility closures, reductions in operating hours,

labor shortages, and changes in operating procedures;

to our own distribution and general office facilities and operations, including through the effects of facility closures, reductions

in operating hours, labor shortages, and changes in operating procedures, including for additional cleaning and disinfection procedures;

or reduced operations of cafes, restaurants and food service stores and reductions in consumer traffic, which may adversely affect

our Private Label Coffee and Branded Coffee channels;

The World Health Organization declared the novel coronavirus (COVID-19), first identified in Wuhan, China, a pandemic

in March 2020.

Our business, financial condition and results of operations have been and are expected to continue to be adversely

affected by the COVID-19 pandemic.

The COVID-19 pandemic has affected nearly all regions of the world, and preventative measures

taken to contain or mitigate the outbreak have caused, and are continuing to cause, business slowdown or shutdown in affected

This has and could continue to negatively affect the global economy, including reduced consumer spending and disruption

of global supply chains.

We cannot predict the degree to which our business, financial condition and results of operations will

be affected by the COVID-19 pandemic, but the effects could be material.

addition to the factors above, the COVID-19 pandemic has subjected our business to additional risk, including, but not limited

to our green coffee supplier partners and vendors, including through the effects of facility closures, reductions in operating

hours, labor shortages, and changes in operating procedures;

to our own distribution and general office facilities and operations, including through the effects of facility closures,

reductions in operating hours, labor shortages, and changes in operating procedures, including for additional cleaning and

disinfection procedures;

or reduced operations of cafes, restaurants and food service stores and reductions in consumer traffic, which may adversely

affects our Private Label Coffee and Branded Coffee channels;

performance of customers in our wholesale channel, which may result in reduction or cancellation of future orders;

in consumer spending due to macroeconomic conditions caused by the COVID-19 pandemic, including decreased disposable income and increased

unemployment, which may result in decreased sales in all of our channels.

in consumer spending due to macroeconomic conditions caused by the COVID-19 pandemic, including decreased disposable income

and increased unemployment, which may result in decreased sales in all of our channels.

this time, we cannot assess the ultimate economic impact of the COVID-19 pandemic on our business, operations or financial performance,

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and requirements relating to the pandemic, nor can we predict the long-term effects of governmental and public responses to changing

The extent to which the COVID-19 pandemic will impact our operations, liquidity or financial results in subsequent periods

is uncertain, but such impact could be material.

If the COVID-19 pandemic becomes prolonged, and/or more severe, it could exacerbate

the negative impacts on our business and results of operations and may also heighten many of the other risks described in this section

entitled “Risk Factors.”

we are unable to geographically expand our branded and private label products, our growth will be impeded which could result in reduced

sales and profitability.

Our business strategy emphasizes, among other things, geographic expansion of our branded and private

label products as opportunities arise.

The extent to which the COVID-19 pandemic will impact our operations, liquidity or financial results in subsequent

periods is uncertain, but such impact could be material.

If the COVID-19 pandemic becomes prolonged, and/or more severe, it could

exacerbate the negative impacts on our business and results of operations and may also heighten many of the other risks described

in this section entitled “Risk Factors.”

we are unable to geographically expand our branded and private label products, our growth will be impeded which could result in

reduced sales and profitability.

Our business strategy emphasizes, among other things, geographic expansion of our branded

and private label products as opportunities arise.

We may not be able to implement successfully this portion of our business strategy.

to implement this portion of our business strategy is dependent on our ability to:

Our ability to implement this portion of our business strategy is dependent on our ability to:

our products on a national scale;

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growth in administrative overhead and distribution costs likely to result from the planned expansion of our distribution channels.

sales and profitability may be adversely affected if we fail to successfully expand the geographic distribution of our branded and private

label products.

In addition, our expenses could increase and our profits could decrease as we implement our growth strategy.

our hedging policy is not effective, we may not be able to control our coffee costs, we may be forced to pay greater than market value

for green coffee and our profitability may be reduced.

The supply and price of coffee beans are subject to volatility and are

influenced by numerous factors which are beyond our control.

We have used and expect to continue to use to a lesser extent short-term

coffee futures and options contracts for the purpose of hedging the effects of changing green coffee prices.

In addition, we have acquired

and expect to continue to acquire to a lesser extent futures contracts with longer terms, generally three to four months, for the purpose

of guaranteeing an adequate supply of green coffee.

Realized and unrealized gains or losses on options and futures contracts are reflected

in our cost of sales.

Gains on options and futures contracts reduce our cost of sales and losses on options and futures contracts increase

our cost of sales.

sales and profitability may be adversely affected if we fail to successfully expand the geographic distribution of our branded

and private label products.

In addition, our expenses could increase and our profits could decrease as we implement our growth

our hedging policy is not effective, we may not be able to control our coffee costs, we may be forced to pay greater than market

value for green coffee and our profitability may be reduced.

The supply and price of coffee beans are subject to volatility

and are influenced by numerous factors which are beyond our control.

We have used and expect to continue to use to a lesser extent

short-term coffee futures and options contracts for the purpose of hedging the effects of changing green coffee prices.

we have acquired and expect to continue to acquire to a lesser extent futures contracts with longer terms, generally three to

four months, for the purpose of guaranteeing an adequate supply of green coffee.

Realized and unrealized gains or losses on options

and futures contracts are reflected in our cost of sales.

Gains on options and futures contracts reduce our cost of sales and

losses on options and futures contracts increase our cost of sales.

use of these derivative financial instruments has generally enabled us to mitigate the effect of changing prices.

However, no strategy

can entirely eliminate pricing risks and we generally remain exposed to losses on futures contracts when prices decline significantly

in a short period of time, and we would generally remain exposed to supply risk in the event of non-performance by the counterparties

in any one of our physical contracts.

Historically, we generally have been able to pass green coffee price increases through to customers,

thereby maintaining our gross profits, however, we may not be able to pass price increases through to our customers in the future.

to properly design and implement an effective hedging strategy may materially adversely affect our business and operating results.

the hedges that we enter do not adequately offset the risks of coffee bean price volatility or our hedging results in losses, our cost

of sales may increase, resulting in a decrease in profitability or an increase in losses.

Although we have had net gains on options and

futures contracts in the past, we have incurred losses on options and futures contracts during some reporting periods.

In these cases,

our cost of sales has increased, resulting in a decrease in our profitability or an increase in losses.

Such losses have and could in

the future materially increase our cost of sales and materially decrease our profitability or increase losses and adversely affect our

strategy can entirely eliminate pricing risks and we generally remain exposed to losses on futures contracts when prices decline

significantly in a short period of time, and we would generally remain exposed to supply risk in the event of non-performance

by the counterparties in any one of our physical contracts.

Historically, we generally have been able to pass green coffee price

increases through to customers, thereby maintaining our gross profits, however, we may not be able to pass price increases through

to our customers in the future.

Failure to properly design and implement an effective hedging strategy may materially adversely

affect our business and operating results.

If the hedges that we enter do not adequately offset the risks of coffee bean price

volatility or our hedging results in losses, our cost of sales may increase, resulting in a decrease in profitability or an increase

Although we have had net gains on options and futures contracts in the past, we have incurred losses on options and

futures contracts during some reporting periods.

In these cases, our cost of sales has increased, resulting in a decrease in our

profitability or an increase in losses.

Such losses have and could in the future materially increase our cost of sales and materially

decrease our profitability or increase losses and adversely affect our stock price.

inability to successfully implement our strategy of growth through selective acquisitions, licensing arrangements and other strategic

alliances, including joint ventures, could materially affect our revenues and profitability.

Part of our growth strategy utilizes

the selective acquisition of coffee companies, the selective acquisition or licensing of additional coffee brands and other strategic

alliances including joint ventures, presents risks that could result in increased expenditures and could materially adversely affect

our revenues and profitability, including:

acquisitions, licensing arrangements or other strategic alliances may divert our management’s attention from our existing operations;

Part of our growth strategy

utilizes the selective acquisition of coffee companies, the selective acquisition or licensing of additional coffee brands and

other strategic alliances including joint ventures, presents risks that could result in increased expenditures and could materially

adversely affect our revenues and profitability, including:

acquisitions, licensing arrangements or other strategic alliances may divert our management’s attention from our existing

may not be able to successfully integrate any acquired coffee companies or new coffee brands into our existing business;

may not be able to manage the contingent risks associated with the past operations of, and other unanticipated problems arising in,

any acquired coffee company;

may not be able to manage the contingent risks associated with the past operations of, and other unanticipated problems arising

in, any acquired coffee company;

may not be able to control unanticipated costs associated with such acquisitions, licensing arrangements or strategic alliances.

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as they arise.

However, we have not reached any new agreements or arrangements with respect to any such acquisition, licensing opportunity

or strategic alliance (other than those described herein) at this time and we may not be able to consummate any acquisitions, licensing

arrangements or strategic alliances on terms favorable to us or at all.

The failure to consummate any such acquisitions, licensing arrangements

or strategic alliances may reduce our growth and expansion.

In addition, if these acquisitions, licensing opportunities or strategic

alliances are not successful, our earnings could be materially adversely affected by increased expenses and decreased revenues.

However, we have not reached any new agreements or arrangements with respect to any such acquisition, licensing

opportunity or strategic alliance (other than those described herein) at this time and we may not be able to consummate any acquisitions,

licensing arrangements or strategic alliances on terms favorable to us or at all.

The failure to consummate any such acquisitions,

licensing arrangements or strategic alliances may reduce our growth and expansion.

In addition, if these acquisitions, licensing

opportunities or strategic alliances are not successful, our earnings could be materially adversely affected by increased expenses

and decreased revenues.

revenues and profitability could be adversely affected if our joint ventures or acquisitions are not successful.

We have historically

utilized joint ventures and acquisitions to grow our business and we intend to continue to seek opportunities for new joint ventures

and acquisitions that will be complimentary to our business.

While we believe that our joint ventures will be successful, losses in our

joint ventures or any future joint ventures would hurt our profitability.

In addition, we generally will not be in a position to exercise

sole decision-making authority regarding our joint ventures.

Investments in joint ventures may under certain circumstances, involve risks

not present when a third party is not involved, including the possibility that joint venture partners might become bankrupt or fail to

fund their share of the required capital contributions.

Joint venture partners may have business interests, strategies or goals that

are inconsistent with our business interests, strategies or goals and may be, in cases where we have a minority interest, in a position

to take actions contrary to our policies, strategies or objectives.

Any disputes that may arise between us and our joint venture partners

may result in litigation or arbitration that could increase our expenses and could prevent our officers and/or directors from focusing

their time and effort exclusively on our business strategies.

In addition, we may in certain circumstances be liable for the actions

of our third-party joint venture partners.

historically utilized joint ventures and acquisitions to grow our business and we intend to continue to seek opportunities for

new joint ventures and acquisitions that will be complimentary to our business.

While we believe that our joint ventures will

be successful, losses in our joint ventures or any future joint ventures would hurt our profitability.

In addition, we generally

will not be in a position to exercise sole decision-making authority regarding our joint ventures.

Investments in joint ventures

may under certain circumstances, involve risks not present when a third party is not involved, including the possibility that

joint venture partners might become bankrupt or fail to fund their share of the required capital contributions.

Joint venture

partners may have business interests, strategies or goals that are inconsistent with our business interests, strategies or goals

and may be, in cases where we have a minority interest, in a position to take actions contrary to our policies, strategies or

Any disputes that may arise between us and our joint venture partners may result in litigation or arbitration that

could increase our expenses and could prevent our officers and/or directors from focusing their time and effort exclusively on

our business strategies.

In addition, we may in certain circumstances be liable for the actions of our third-party joint venture

including strategic investments or alliances entail numerous risks, which may include:

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loss of any of our key customers, could negatively affect our revenues and decrease our earnings.

No one customer accounted for

greater than 10% of our net sales during our 2021 fiscal year.

We generally do not enter long-term contracts with most of our customers,

but we do enter into one and two year agreements with most our key customers on our private label business.

Accordingly, some of our

customers can stop purchasing our products at any time without penalty and are free to purchase products from our competitors.

of, or reduction in sales to any of our other customers to which we sell a significant amount of our products or any material adverse

change in the financial condition of such customers would negatively affect our revenues and decrease our earnings.

No one customer accounted

for greater than 10% of our net sales during our 2020 fiscal year.

We generally do not enter long-term contracts with most of

our customers, but we do enter into one and two year agreements with most our key customers on our private label business.

some of our customers can stop purchasing our products at any time without penalty and are free to purchase products from our

The loss of, or reduction in sales to any of our other customers to which we sell a significant amount of our products

or any material adverse change in the financial condition of such customers would negatively affect our revenues and decrease

our earnings.

we lose our key personnel, including Andrew Gordon and David Gordon, our revenues and profitability could suffer.

depends to a large degree upon the services of Andrew Gordon, our President, Chief Executive Officer, Chief Financial Officer and Treasurer,

and David Gordon, our Executive Vice President – Operations and Secretary.

We also depend to a large degree on the expertise of

our coffee roasters.

success depends to a large degree upon the services of Andrew Gordon, our President, Chief Executive Officer, Chief Financial

Officer and Treasurer, and David Gordon, our Executive Vice President – Operations and Secretary.

We also depend to a large

degree on the expertise of our coffee roasters.

We do not have employment contracts with our coffee roasters.

Our ability to source and purchase a sufficient supply

of high quality coffee beans and to roast coffee beans consistent with our quality standards could suffer if we lose the services of

any of these individuals.

As a result, our business and operating results would be adversely affected.

We may not be successful in obtaining

and retaining a replacement for either Andrew Gordon or David Gordon if they elect to stop working for us.

In addition, we do not have

key-person insurance on the lives of Andrew Gordon or David Gordon.

our goodwill, indefinitely lived intangible assets, or amortizable intangible assets become impaired, then we could be required to record

a significant charge to earnings.

GAAP requires us to test for goodwill and indefinite lived intangible asset impairment at least

In addition, we review our goodwill, indefinitely lived intangible assets, and amortizable intangible assets for impairment

when events or changes in circumstances indicate the carrying value may not be recoverable.

Factors that may be considered a change in

circumstances indicating that the carrying value of our goodwill, indefinite lived intangible assets, or amortizable intangible assets

may not be recoverable include declines in stock price, market capitalization or cash flows, and slower growth rates in our industry.

The results of our review showed an impairment for the years ended October 31, 2021.

We recorded impairment of two

of our trademarks totaling $1,080,000 as the carrying amount of these trademarks exceeded the respective fair values on the test date,

which was determined using a relief from royalty method.

indebtedness may adversely affect our ability to obtain additional funds and may increase our vulnerability to economic or business downturns.

Our ability to source

and purchase a sufficient supply of high quality coffee beans and to roast coffee beans consistent with our quality standards

could suffer if we lose the services of any of these individuals.

As a result, our business and operating results would be adversely

We may not be successful in obtaining and retaining a replacement for either Andrew Gordon or David Gordon if they elect

to stop working for us.

In addition, we do not have key-person insurance on the lives of Andrew Gordon or David Gordon.

indebtedness may adversely affect our ability to obtain additional funds and may increase our vulnerability to economic or business

From time to time, we utilize borrowings under our credit facility in connection with operations.

Outstanding debt could have

important negative consequences to the holders of our securities, including the following:

debt could have important negative consequences to the holders of our securities, including the following:

domestic and global economic conditions;

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have increased vulnerability to adverse general economic and coffee industry conditions;

may be vulnerable to higher interest rates because interest expense on borrowings under our revolving line of credit is based on

variable rates;

may be vulnerable to higher interest rates because interest expense on borrowings under our revolving line of credit is based

on variable rates;

may be subject to covenants that could restrict our operations.

ability to make payments on our indebtedness and to fund our operations depends on our ability to generate cash in the future.

operating performance is subject to market conditions and business factors that are beyond our control.

If we are unable to make payments

on our debt, we may have to reduce or delay capital expenditures, sell assets, seek additional capital or restructure or refinance our

Our future operating performance is subject to market conditions and business factors that are beyond our control.

If we are unable

to make payments on our debt, we may have to reduce or delay capital expenditures, sell assets, seek additional capital or restructure

or refinance our debt.

credit facility contains covenants that place annual restrictions on our operations, including covenants relating to debt restrictions,

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restrictions (common stock and preferred stock), dividend restrictions and restrictions on intercompany transactions.

The credit facility

also requires that we maintain a minimum working capital at all times.

There can be no assurance that we will be in compliance with all

covenants in the future or that we will be able to modify the terms of the credit facility should that become necessary.

Failure to comply

with any of these covenants and restrictions would result in an event of default under the loan agreement.

we fail to promote, enhance and maintain our brands, the value of our brands could decrease and our revenues and profitability could

be adversely affected.

facility also requires that we maintain a minimum working capital at all times.

There can be no assurance that we will be in compliance

with all covenants in the future or that we will be able to modify the terms of the credit facility should that become necessary.

Failure to comply with any of these covenants and restrictions would result in an event of default under the loan agreement.

received a loan under the Paycheck Protection Program of the CARES Act, and all or a portion of the loan may not be forgivable.

In July, 2020, we received a $634,400 loan (the “PPP Loan”) pursuant to the Paycheck Protection Program of

the CARES Act.

The receipt of the funds, and the forgiveness of the PPP Loan is dependent on us having initially qualified for

the loan and qualifying for the forgiveness of such loan based on our adherence to the forgiveness criteria.

In June 2020, the

United States Congress passed the Payroll Protection Program Flexibility Act that made several significant changes to PPP Loan

provisions, including providing greater flexibility for loan forgiveness.

We are using the proceeds from the PPP Loan to fund

payroll costs in accordance with the relevant terms and conditions of the CARES Act.

We are following the government guidelines

and tracking costs to insure 100% forgiveness of the PPP Loan.

To the extent the PPP Loan is not forgiven, we will be required

to repay that portion at an interest rate of 1% over a period of two years.

If the conditions outlined in the loan program are

adhered to by us, all or part of such loan could be forgiven.

However, we cannot provide any assurance that we will be eligible

for loan forgiveness or that any amount of the PPP Loan will ultimately be forgiven.

we fail to promote, enhance and maintain our brands, the value of our brands could decrease and our revenues and profitability

could be adversely affected.

We believe that promoting and enhancing our brands is critical to our success.

If our brand-building strategy

is unsuccessful, these expenses may never be recovered, and we may be unable to increase awareness of our brands or protect the value

of our brands.

If we are unable to achieve these goals, our revenues and ability to implement our business strategy could be adversely

success in promoting and enhancing our brands will also depend on our ability to provide customers with high quality products and service.

Although we take measures to ensure that we sell only fresh roasted coffee, we have no control over our roasted coffee products once

they are purchased by our customers.

Accordingly, wholesale customers may store our coffee for longer periods of time or resell our coffee

without our consent, in each case, potentially affecting the quality of the coffee prepared from our products.

Although we believe we

are less susceptible to quality control problems than many of our competitors because our products are processed in-house under strict

quality control guidelines which have been in place for more than 40 years, if consumers do not perceive our products and service to

be of high quality, then the value of our brands may be diminished and, consequently, our operating results and ability to implement

our business strategy may be adversely affected.

If our brand-building

strategy is unsuccessful, these expenses may never be recovered, and we may be unable to increase awareness of our brands or protect

the value of our brands.

If we are unable to achieve these goals, our revenues and ability to implement our business strategy

could be adversely affected.

success in promoting and enhancing our brands will also depend on our ability to provide customers with high quality products

Although we take measures to ensure that we sell only fresh roasted coffee, we have no control over our roasted coffee

products once they are purchased by our customers.

Accordingly, wholesale customers may store our coffee for longer periods of

time or resell our coffee without our consent, in each case, potentially affecting the quality of the coffee prepared from our

Although we believe we are less susceptible to quality control problems than many of our competitors because our products

are processed in-house under strict quality control guidelines which have been in place for more than 40 years, if consumers do

not perceive our products and service to be of high quality, then the value of our brands may be diminished and, consequently,

our operating results and ability to implement our business strategy may be adversely affected.

roasting methods are not proprietary, so competitors may be able to duplicate them, which could harm our competitive position.

competitive position is weakened, our revenues and profitability could be materially adversely affected .

our roasting methods essential to the flavor and richness of our roasted coffee and, therefore, essential to our brands of coffee.

we do not hold any patents for our roasting methods, it may be difficult for us to prevent competitors from copying our roasting methods

if such methods become known.

If our competitors copy our roasting methods, the value of our coffee brands may be diminished, and we

may lose customers to our competitors.

In addition, competitors may be able to develop roasting methods that are more advanced than our

roasting methods, which may also harm our competitive position.

If our competitive position is weakened, our revenues and profitability could be materially adversely affected .

We consider our roasting methods essential to the flavor and richness of our roasted coffee and, therefore, essential

to our brands of coffee.

Because we do not hold any patents for our roasting methods, it may be difficult for us to prevent competitors

from copying our roasting methods if such methods become known.

If our competitors copy our roasting methods, the value of our

coffee brands may be diminished, and we may lose customers to our competitors.

In addition, competitors may be able to develop

roasting methods that are more advanced than our roasting methods, which may also harm our competitive position.

success of our brand also depends in part on our intellectual property.

We rely on a combination of trademarks, copyrights, service marks,

trade secrets and similar rights to protect our intellectual property.

The success of our growth strategy depends on our continued ability

to use our existing trademarks and service marks in order to increase brand awareness and further develop our brand in both domestic

and international markets.

If our efforts to protect our intellectual property are not adequate, or if any third party misappropriates

or infringes on our intellectual property, the value of our brand may be harmed, which could have a material adverse effect on our business.

We may become engaged in litigation to protect our intellectual property, which could result in substantial costs to us as well as diversion

of management attention.

we rely heavily on common carriers to ship our coffee on a daily basis, any disruption in their services or increase in shipping costs

could adversely affect our relationship with our customers, which could result in reduced revenues, increased operating expenses, a loss

of customers or reduced profitability.

We rely on a number of common carriers to deliver coffee to our customers and to deliver

coffee beans to us.

We have no control over these common carriers and the services provided by them may be interrupted as a result of

labor shortages, contract disputes and other factors.

If we experience an interruption in these services, we may be unable to ship our

coffee in a timely manner, which could reduce our revenues and adversely affect our relationship with our customers.

In addition, a delay

in shipping could require us to contract with alternative, and possibly more expensive, common carriers and could cause orders to be

cancelled or receipt of goods to be refused.

Any significant increase in shipping costs could lower our profit margins or force us to

raise prices, which could cause our revenue and profits to suffer.

We rely on a combination of trademarks, copyrights, service

marks, trade secrets and similar rights to protect our intellectual property.

The success of our growth strategy depends on our

continued ability to use our existing trademarks and service marks in order to increase brand awareness and further develop our

brand in both domestic and international markets.

If our efforts to protect our intellectual property are not adequate, or if

any third party misappropriates or infringes on our intellectual property, the value of our brand may be harmed, which could have

a material adverse effect on our business.

We may become engaged in litigation to protect our intellectual property, which could

result in substantial costs to us as well as diversion of management attention.

we rely heavily on common carriers to ship our coffee on a daily basis, any disruption in their services or increase in shipping

costs could adversely affect our relationship with our customers, which could result in reduced revenues, increased operating

expenses, a loss of customers or reduced profitability.

We rely on a number of common carriers to deliver coffee to our

customers and to deliver coffee beans to us.

We have no control over these common carriers and the services provided by them may

be interrupted as a result of labor shortages, contract disputes and other factors.

If we experience an interruption in these

services, we may be unable to ship our coffee in a timely manner, which could reduce our revenues and adversely affect our relationship

with our customers.

In addition, a delay in shipping could require us to contract with alternative, and possibly more expensive,

common carriers and could cause orders to be cancelled or receipt of goods to be refused.

Any significant increase in shipping

costs could lower our profit margins or force us to raise prices, which could cause our revenue and profits to suffer.

there was a significant interruption in the operation of our Colorado, Ohio or Massachusetts facilities, we may not have the capacity

to service all of our customers and we may not be able to service our customers in a timely manner, thereby reducing our revenues and

We are dependent on the continued operations of our Colorado, Ohio and Massachusetts coffee roasting and distribution

Our ability to maintain our computer and telecommunications equipment in effective working order and to protect against damage

from fire, natural disaster, power loss, telecommunications failure or similar events.

In addition, growth of our customer base may strain

or exceed the capacity of our systems and lead to degradations in performance or systems failure.

Although we continually review and

consider upgrades to our order fulfillment infrastructure and provide for system redundancies to limit the likelihood of systems overload

or failure, substantial damage to our systems or a systems failure that causes interruptions for a number of days could adversely affect

our business.

Additionally, if we are unsuccessful in updating and expanding our order fulfillment infrastructure, our ability to grow

may be constrained.

As a result, our revenues and earnings could be materially adversely affected.

may be limitations on the effectiveness of our internal controls, and a failure of our control systems to prevent error or fraud may

materially harm our company.

We are required, pursuant to Section 404 of the Sarbanes-Oxley Act, to furnish a report by our management

on, among other things, the effectiveness of our internal control over financial reporting.

This assessment includes disclosure of any

material weaknesses identified by our management in our internal control over financial reporting.

A material weakness is a deficiency,

or combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material

misstatement of annual or interim financial statements will not be prevented or detected on a timely basis.

the year ended October 31, 2021, we identified inappropriate system access controls over the financial reporting system and we determined

that we lacked adequate controls with respect to identifying and accounting for material contracts.

In January 2023, we determined that we made certain errors in the presentation

of net sales and cost of sales in our consolidated statements of operations in our financial statements during the fiscal year ended October

The effect of these errors was to overstate net sales and cost of sales for the reported period.

We therefore found it necessary

to restate our previously filed annual financial statements for the fiscal year ended October 31, 2020.

The errors and the required restatement

had no effect on our net income or earnings per share or other items in the consolidated statement of operations as of any reporting date

and had no impact on our consolidated balance sheets, consolidated statements of changes in stockholders’ equity, or consolidated

statements of cash flows.

a result, we determined that there was an overstatement of net sales and cost of sales in the consolidated statement of operations of

approximately $8.3 million in our financial statements during the fiscal year ended October 31, 2020.

This was due to inadequate design

and implementation of controls to evaluate and monitor the presentation and compliance with accounting principles generally accepted in

the United States of America related to the statement of operations.

Accordingly, management has determined that this control deficiency

constituted a material weakness and, as a result, as part of the restatement, management concluded that, as of October 31, 2020, our internal

control over financial reporting was not effective.

internal control over financial reporting is necessary for us to provide reliable and timely financial reports and, together with adequate

disclosure controls and procedures, are designed to reasonably detect and prevent fraud.

Any failure to implement required new or improved

controls, or difficulties encountered in their implementation could cause us to fail to meet our reporting obligations.

Undetected material

weaknesses in our internal control over financial reporting could lead to financial statement restatements and require us to incur the

expense of remediation.

to service all of our customers and we may not be able to service our customers in a timely manner, thereby reducing our revenues

and earnings.

We are dependent on the continued operations of our Colorado, Ohio and Massachusetts coffee roasting and

distribution facilities.

Our ability to maintain our computer and telecommunications equipment in effective working order and

to protect against damage from fire, natural disaster, power loss, telecommunications failure or similar events.

growth of our customer base may strain or exceed the capacity of our systems and lead to degradations in performance or systems

Although we continually review and consider upgrades to our order fulfillment infrastructure and provide for system redundancies

to limit the likelihood of systems overload or failure, substantial damage to our systems or a systems failure that causes interruptions

for a number of days could adversely affect our business.

Additionally, if we are unsuccessful in updating and expanding our order

fulfillment infrastructure, our ability to grow may be constrained.

As a result, our revenues and earnings could be materially

adversely affected.

may be limitations on the effectiveness of our internal controls, and a failure of our control systems to prevent error or fraud

may materially harm our company.

We are required, pursuant to Section 404 of the Sarbanes-Oxley Act, to furnish a report

by our management on, among other things, the effectiveness of our internal control over financial reporting.

This assessment

includes disclosure of any material weaknesses identified by our management in our internal control over financial reporting.

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting such

that there is a reasonable possibility that a material misstatement of annual or interim financial statements will not be prevented

or detected on a timely basis.

of October 31, 2020, we have identified material weaknesses in our internal control over financial reporting related to the accounting

for stock-based compensation awards and an overstatement in inventory levels and the valuation of inventory at one of our subsidiaries.

If our steps are insufficient to successfully remediate these material weaknesses and otherwise maintain an effective system of

internal control over financial reporting, the reliability of our financial reporting, investor confidence in us and the value

of our common stock could be adversely affected.

as described under “Explanatory Note” above, in January 2023, we determined that we made certain errors in the

presentation of net sales and cost of sales in our consolidated statements of operations in our financial statements during the

fiscal years ended October 31, 2020 and 2019.

The effect of these errors was to overstate net sales and cost of sales for the

reported period.

We therefore found it necessary to restate our previously filed annual financial statements for the fiscal years

ended October 31, 2020 and 2019.

The errors and the required restatement had no effect on our net income (loss) or earnings (loss)

per share or other items in the consolidated statement of operations as of any reporting date and had no impact on our consolidated

balance sheets, consolidated statements of changes in stockholders’ equity, or consolidated statements of cash

a result, we determined that there was an overstatement of net sales and cost of sales in the consolidated statement of operations

of approximately $8.3 million and $9.9 million in our financial statements during the fiscal years ended October 31, 2020 and 2019, respectively.

due to inadequate design and implementation of controls to evaluate and monitor the presentation and compliance with accounting

principles generally accepted in the United States of America related to the statement of operations.

Accordingly, management has

determined that this control deficiency constituted a material weakness and, as a result, as part of the restatement, management

concluded that, as of October 31, 2020, our internal control over financial reporting was not effective.

internal control over financial reporting is necessary for us to provide reliable and timely financial reports and, together with

adequate disclosure controls and procedures, are designed to reasonably detect and prevent fraud.

Any failure to implement required

new or improved controls, or difficulties encountered in their implementation could cause us to fail to meet our reporting obligations.

Undetected material weaknesses in our internal control over financial reporting could lead to financial statement restatements

and require us to incur the expense of remediation.

we do not expect that disclosure controls or internal control over financial reporting will prevent all error and all fraud.

system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s

objectives will be met.

Further, the design of a control system must reflect the fact that there are resource constraints and the benefits

of controls must be considered relative to their costs.

Because of the inherent limitations in all control systems, no evaluation of

controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.

Failure of our control

systems to detect or prevent error or fraud could materially adversely impact us.

remediation efforts may not enable us to avoid a material weakness in our internal control over financial reporting in the future.

of the foregoing occurrences, should they come to pass, could negatively impact the public perception of our company, which could have

a negative impact on our stock price.

control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control

system’s objectives will be met.

Further, the design of a control system must reflect the fact that there are resource constraints

and the benefits of controls must be considered relative to their costs.

Because of the inherent limitations in all control systems,

no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.

Failure of our control systems to detect or prevent error or fraud could materially adversely impact us.

remediation efforts may not enable us to avoid a material weakness in our internal control over financial reporting

in the future.

Any of the foregoing occurrences, should they come to pass, could negatively impact the public perception of our

company, which could have a negative impact on our stock price.

failure of our suppliers or customers to adhere to the quality standards that we set for our products could lead to investigations, litigation,

write-offs, recalls or boycotts of our products, which could damage our reputation and our brand, increase our costs, and otherwise adversely

affect our business.

Unfavorable allegations, government investigations and legal actions surrounding our products and/or our business

could harm our reputation, impair our ability to grow or sustain our business, and adversely affect our business, financial condition

and operating results.

We do not control the operations of our suppliers or customers and we cannot guarantee that our suppliers

or customers will comply with applicable laws and regulations or operate in a legal, ethical and responsible manner.

Additionally, it

is possible that we may not be able to identify noncompliance by our suppliers or customers notwithstanding any precautionary measures

we implement.

Violation of applicable laws and regulations by our suppliers or customers, or their failure to operate in a legal, ethical

or responsible manner, could expose us to legal risks, cause us to violate laws and regulations and reduce demand for our products if,

as a result of such violation or failure, we attract negative publicity.

In addition, the failure of our suppliers and customers to adhere

to the quality standards that we set for our products could lead to government investigations, litigation, write-offs and recalls, which

could damage our reputation and our brand, increase our costs, and otherwise adversely affect our business.

write-offs, recalls or boycotts of our products, which could damage our reputation and our brand, increase our costs, and otherwise

adversely affect our business.

Unfavorable allegations, government investigations and legal actions surrounding our products and/or

our business could harm our reputation, impair our ability to grow or sustain our business, and adversely affect our business,

financial condition and operating results.

We do not control the operations of our suppliers or customers and we cannot

guarantee that our suppliers or customers will comply with applicable laws and regulations or operate in a legal, ethical and

responsible manner.

Additionally, it is possible that we may not be able to identify noncompliance by our suppliers or customers

notwithstanding any precautionary measures we implement.

Violation of applicable laws and regulations by our suppliers or customers,

or their failure to operate in a legal, ethical or responsible manner, could expose us to legal risks, cause us to violate laws

and regulations and reduce demand for our products if, as a result of such violation or failure, we attract negative publicity.

In addition, the failure of our suppliers and customers to adhere to the quality standards that we set for our products could

lead to government investigations, litigation, write-offs and recalls, which could damage our reputation and our brand, increase

our costs, and otherwise adversely affect our business.

rely on our reputation for offering great value, superior service and a broad assortment of high-quality, safe products.

subject to unfavorable allegations, government investigations or legal actions involving our products or us, such circumstances could

harm our reputation and our brand and adversely affect our business, financial condition and operating results.

If this negative impact

is significant, our ability to grow or sustain our business could be jeopardized.

disclosed further herein, we have been named as a defendant in one class action lawsuit, and we have agreed to indemnify a client named

in another class action lawsuit, alleging that our products were mislabeled and thus violate consumer protection and false advertising

statutes, among others.

These lawsuits, which generally allege that our coffee products do not make the number of servings as stated

on the label, are affecting the entire coffee industry and numerous similar lawsuits have been filed against numerous private label coffee

manufacturers and retailers.

publicity surrounding product matters, including publicity about other retailers, may harm our reputation and affect the demand for our

In addition, if more stringent laws or regulations are adopted in the future, we may have difficulty complying with the new

requirements imposed by such laws and regulations, and in turn, our business, financial condition, and operating results could be adversely

Moreover, regardless of whether any such changes are adopted, we may become subject to claims or governmental investigations

alleging violations of applicable laws and regulations.

Any such matter may subject us to fines, penalties, and/or litigation.

of these results could negatively affect our business, financial condition, and operating results and impair our ability to grow or sustain

our business.

become subject to unfavorable allegations, government investigations or legal actions involving our products or us, such circumstances

could harm our reputation and our brand and adversely affect our business, financial condition and operating results.

negative impact is significant, our ability to grow or sustain our business could be jeopardized.

disclosed further herein, we have been named as a defendant in one class action lawsuit, and we have agreed to indemnify a client

named in another class action lawsuit, alleging that our products were mislabeled and thus violate consumer protection and false

advertising statutes, among others.

These lawsuits, which generally allege that our coffee products do not make the number of

servings as stated on the label, are affecting the entire coffee industry and numerous similar lawsuits have been filed against

numerous private label coffee manufacturers and retailers.

publicity surrounding product matters, including publicity about other retailers, may harm our reputation and affect the demand

for our products.

In addition, if more stringent laws or regulations are adopted in the future, we may have difficulty complying

with the new requirements imposed by such laws and regulations, and in turn, our business, financial condition, and operating

results could be adversely affected.

Moreover, regardless of whether any such changes are adopted, we may become subject to claims

or governmental investigations alleging violations of applicable laws and regulations.

Any such matter may subject us to fines,

penalties, and/or litigation.

Any one of these results could negatively affect our business, financial condition, and operating

results and impair our ability to grow or sustain our business.

related to the coffee industry

in the cost of high quality Arabica or Robusta coffee beans could reduce our gross margin and profit.

Green coffee is our largest

single cost of sales.

Green coffee is

our largest single cost of sales.

Coffee is a traded commodity and, in general, its price can fluctuate depending on:

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currency fluctuations;

in our supply chain;

regulations and restrictions between coffee-producing countries and the United States.

the cost of wholesale green coffee increases due to any of these factors, our margins could decrease and our profitability could suffer

the cost of wholesale green coffee increases due to any of these factors, our margins could decrease and our profitability could

suffer accordingly.

It is expected that coffee prices will remain volatile in the coming years.

Although we have historically attempted to raise

the selling prices of our products in response to increases in the price of wholesale green coffee, when wholesale green coffee prices

increase rapidly or to significantly higher than normal levels, we are not always able to pass the price increases through to our customers

on a timely basis, if at all, which adversely affects our operating margins and cash flow.

We may not be able to recover any future increases

in the cost of wholesale green coffee.

Even if we are able to recover future increases, our operating margins and results of operations

may still be materially and adversely affected by time delays in the implementation of price increases.

in the supply of green coffee could result in a deterioration of our relationship with our customers, decreased revenues or could impair

our ability to grow our business.

Green coffee is a commodity and its supply is subject to volatility beyond our control.

is affected by many factors in the coffee growing countries including weather, pest damage, economic conditions, acts of terrorism, as

well as efforts by coffee growers to expand or form cartels or associations.

In addition, the political situation in many of the Arabica

coffee growing regions, including Africa, Indonesia, and Central and South America, can be unstable, and such instability could affect

our ability to purchase coffee from those regions.

If Arabica coffee beans from a region become unavailable or prohibitively expensive,

we could be forced to discontinue particular coffee types and blends or substitute coffee beans from other regions in our blends.

substitutions and changes in our coffee product lines could lead to cost increases, customer alienation and fluctuations in our gross

Although we have historically

attempted to raise the selling prices of our products in response to increases in the price of wholesale green coffee, when wholesale

green coffee prices increase rapidly or to significantly higher than normal levels, we are not always able to pass the price increases

through to our customers on a timely basis, if at all, which adversely affects our operating margins and cash flow.

be able to recover any future increases in the cost of wholesale green coffee.

Even if we are able to recover future increases,

our operating margins and results of operations may still be materially and adversely affected by time delays in the implementation

of price increases.

in the supply of green coffee could result in a deterioration of our relationship with our customers, decreased revenues or could

impair our ability to grow our business.

Green coffee is a commodity and its supply is subject to volatility beyond our

Supply is affected by many factors in the coffee growing countries including weather, pest damage, economic conditions,

acts of terrorism, as well as efforts by coffee growers to expand or form cartels or associations.

In addition, the political

situation in many of the Arabica coffee growing regions, including Africa, Indonesia, and Central and South America, can be unstable,

and such instability could affect our ability to purchase coffee from those regions.

If Arabica coffee beans from a region become

unavailable or prohibitively expensive, we could be forced to discontinue particular coffee types and blends or substitute coffee

beans from other regions in our blends.

Frequent substitutions and changes in our coffee product lines could lead to cost increases,

customer alienation and fluctuations in our gross margins.

of the Arabica coffee beans of the quality we purchase do not trade directly on the commodity markets.

Rather, we purchase the high-end

Arabica coffee beans that we use on a negotiated basis.

We depend on our relationships with coffee brokers, exporters and growers for

the supply of our primary raw material, high quality Arabica coffee beans.

If any of our relationships with coffee brokers, exporters

or growers deteriorate, we may be unable to procure a sufficient quantity of high quality coffee beans at prices acceptable to us or

In such case, we may not be able to fulfill the demand of our existing customers, supply new retail stores or expand other channels

of distribution.

A raw material shortage could result in a deterioration of our relationship with our customers, decreased revenues or

could impair our ability to expand our business.

in shipping costs, long lead times, supply shortages, and supply changes could disrupt our supply chain and factors such as wage rate

increases and inflation can have a material adverse effect on our business, financial condition, and operating results.

experience supply delays and shortages due to a variety of macroeconomic factors, including disruptions on the global supply chain as

a result of the ongoing COVID-19 pandemic.

The ongoing COVID-19 pandemic has resulted in significant disruption to the operations of

certain suppliers and the related transportation of their goods to the United States that are parts of our global supply chain.

been able to make alternative delivery arrangements for limited quantities of goods, at increased cost.

we have not yet experienced material shortages in supply as a result of these disruptions and our alternative delivery arrangements,

if they were to be prolonged or expanded in scope, there could be resulting supply shortages that could impact our ability to deliver

our products to our customers.

Accordingly, such supply shortages and delivery limitations could have and material adverse effect on

our business, financial condition, results of operations, and cash flows.

increases in compensation, wage pressure, and other expenses for our employees and the employees of our suppliers, may adversely affect

our profitability.

These cost increases may be the result of inflationary pressures that could further reduce our sales or profitability.

Increases in other operating costs, including changes in energy prices and lease and utility costs, may increase our cost of products

sold or selling, general, and administrative expenses.

Our competitive price model and pricing pressures in the industry may inhibit

our ability to reflect these increased costs in the prices of our products, in which case such increased costs could have a material

adverse effect on our business, financial condition, and results of operations.

severe weather patterns may increase commodity costs, damage our facilities and disrupt our production capabilities and supply chain.

There is increasing concern that a gradual increase in global average temperatures due to increased concentration of carbon dioxide

and other greenhouse gases in the atmosphere have caused and will continue to cause significant changes in weather patterns around the

globe and an increase in the frequency and severity of extreme weather events.

Major weather phenomena are dramatically affecting coffee

growing countries.

The wet and dry seasons are becoming unpredictable in timing and duration, causing improper development of the coffee

Decreased agricultural productivity in certain regions as a result of changing weather patterns may affect the quality, limit

the availability or increase the cost of key agricultural commodities, which are important ingredients for our business.

Increased frequency

or duration of extreme weather conditions could damage our facilities, impair production capabilities, disrupt our supply chain or impact

demand for our products.

As a result, the effects of climate change could have a long-term adverse impact on our business and results

of operations.

coffee industry is highly competitive and if we cannot compete successfully, we may lose our customers or experience reduced sales and

profitability.

The coffee markets in which we do business are highly competitive and competition in these markets could become

increasingly more intense due to the increasing popularity and growth of the coffee industry.

The industry in which we compete is particularly

sensitive to price pressure, as well as quality, reputation and viability for wholesale and brand loyalty for retail.

To the extent that

one or more of our competitors becomes more successful with respect to any key competitive factor, our ability to attract and retain

customers could be materially adversely affected.

Our private label and branded coffee products compete with other manufacturers of private

label coffee and branded coffees.

Rather, we purchase the

high-end Arabica coffee beans that we use on a negotiated basis.

We depend on our relationships with coffee brokers, exporters

and growers for the supply of our primary raw material, high quality Arabica coffee beans.

If any of our relationships with coffee

brokers, exporters or growers deteriorate, we may be unable to procure a sufficient quantity of high quality coffee beans at prices

acceptable to us or at all.

In such case, we may not be able to fulfill the demand of our existing customers, supply new retail

stores or expand other channels of distribution.

A raw material shortage could result in a deterioration of our relationship with

our customers, decreased revenues or could impair our ability to expand our business.

coffee industry is highly competitive and if we cannot compete successfully, we may lose our customers or experience reduced sales

and profitability.

The coffee markets in which we do business are highly competitive and competition in these markets

could become increasingly more intense due to the increasing popularity and growth of the coffee industry.

The industry in which

we compete is particularly sensitive to price pressure, as well as quality, reputation and viability for wholesale and brand loyalty

To the extent that one or more of our competitors becomes more successful with respect to any key competitive factor,

our ability to attract and retain customers could be materially adversely affected.

Our private label and branded coffee products

compete with other manufacturers of private label coffee and branded coffees.

These competitors, such as Kraft Foods, Inc.

(owner of the Maxwell House brand), and J.M.

(owner of the Folgers and Café Bustelo brands), have much greater financial, marketing, distribution, management and other resources

than we do for marketing, promotions and geographic and market expansion.

In addition, there are a growing number of specialty coffee

companies who provide specialty green coffee and roasted coffee for retail sale.

If we are unable to compete successfully against existing

and new competitors, we may lose our customers or experience reduced sales and profitability.

of the Maxwell House brand), and J.M.

(owner of the Folgers and Café Bustelo brands), have much greater financial,

marketing, distribution, management and other resources than we do for marketing, promotions and geographic and market expansion.

In addition, there are a growing number of specialty coffee companies who provide specialty green coffee and roasted coffee for

If we are unable to compete successfully against existing and new competitors, we may lose our customers or experience

reduced sales and profitability.

coffee, we face exposure to other commodity cost fluctuations, which could impair our profitability.

In addition to the increase

in coffee costs discussed in the risk factor above, we are exposed to cost fluctuation in other commodities, including, in particular,

steel, natural gas and gasoline.

In addition, an increase in the cost of fuel could indirectly lead to higher electricity costs, transportation

costs and other commodity costs.

Much like coffee costs, the costs of these commodities depend on various factors beyond our control,

including economic and political conditions, foreign currency fluctuations, and global weather patterns.

To the extent we are unable

to pass along such costs to our customers through price increases, our margins and profitability will decrease.

In addition to the

increase in coffee costs discussed in the risk factor above, we are exposed to cost fluctuation in other commodities, including,

in particular, steel, natural gas and gasoline.

In addition, an increase in the cost of fuel could indirectly lead to higher electricity

costs, transportation costs and other commodity costs.

Much like coffee costs, the costs of these commodities depend on various

factors beyond our control, including economic and political conditions, foreign currency fluctuations, and global weather patterns.

To the extent we are unable to pass along such costs to our customers through price increases, our margins and profitability will

public or medical opinion about caffeine may harm our business.

Coffee contains caffeine and other active compounds, the health

effects of some of which are not fully understood.

A number of research studies conclude or suggest that excessive consumption of caffeine

may lead to increased heart rate, nausea and vomiting, restlessness and anxiety, depression, headaches, tremors, sleeplessness and other

adverse health effects.

An unfavorable report on the health effects of caffeine or other compounds present in coffee could significantly

reduce the demand for coffee, which could harm our business and reduce our sales and profits.

In addition, we could become subject to

litigation relating to the existence of such compounds in our coffee;

litigation that could be costly and could divert management attention.

Coffee contains caffeine and other active compounds, the

health effects of some of which are not fully understood.

A number of research studies conclude or suggest that excessive consumption

of caffeine may lead to increased heart rate, nausea and vomiting, restlessness and anxiety, depression, headaches, tremors, sleeplessness

and other adverse health effects.

An unfavorable report on the health effects of caffeine or other compounds present in coffee

could significantly reduce the demand for coffee, which could harm our business and reduce our sales and profits.

we could become subject to litigation relating to the existence of such compounds in our coffee;

litigation that could be costly

and could divert management attention.

related to our common stock

operating results may fluctuate significantly, which makes our results of operations difficult to predict and could cause our results

of operations to fall short of expectations.

Our operating results may fluctuate from quarter to quarter and year to year as

a result of a number of factors, many of which are outside of our control.

These fluctuations could be caused by a number of factors

operating results may fluctuate significantly, which makes our results of operations difficult to predict and could cause our

results of operations to fall short of expectations.

Our operating results may fluctuate from quarter to quarter and year

to year as a result of a number of factors, many of which are outside of our control.

These fluctuations could be caused by a

number of factors including:

in purchase prices and supply of green coffee;

6 unchanged sentences

should not be relied upon as indicators of future performance.

Accordingly, our operating results in future quarters may be below market

expectations.

Accordingly, our operating results in future quarters may be below

market expectations.

In this event, the price of our common stock may decline.

Gordon family has the ability to influence action requiring stockholder approval.

Members of the Gordon family, including Andrew

Gordon, our President, Chief Executive Officer, Chief Financial Officer and Treasurer, and David Gordon, our Executive Vice President

and Secretary, own, in the aggregate, approximately 15.3% of our outstanding shares of common stock.

As a result, the Gordon family is

able to influence the actions that require stockholder approval, including:

Members of the Gordon family, including

Andrew Gordon, our President, Chief Executive Officer, Chief Financial Officer and Treasurer, and David Gordon, our Executive

Vice President and Secretary, own, in the aggregate, approximately 15.3% of our outstanding shares of common stock.

the Gordon family is able to influence the actions that require stockholder approval, including:

election of a majority of our directors;

2 unchanged sentences

a result, our other stockholders may have reduced influence over matters submitted for stockholder approval.

In addition, the Gordon

family’s influence could preclude any unsolicited acquisition of us and consequently materially adversely affect the price of our

common stock.

In addition, the

Gordon family’s influence could preclude any unsolicited acquisition of us and consequently materially adversely affect

the price of our common stock.

market price of our common stock has been volatile over the year and may continue to be volatile.

The market price and trading

volume of our common stock has been volatile over the past year and it may continue to be volatile.

Over the past year, our common stock

has traded as low as $3.60 and as high as $6.48 per share.

We cannot predict the price at which our common stock will trade in the future

and it may decline.

The price at which our common stock trades may fluctuate significantly and may be influenced by many factors, including

our financial results, developments generally affecting the coffee industry, general economic, industry and market conditions, the depth

and liquidity of the market for our common stock, fluctuations in coffee prices, investor perceptions of our business, reports by industry

analysts, negative announcements by our customers, competitors or suppliers regarding their own performances, and the impact of other

“Risk Factors” discussed in this Annual Report.

in our articles of incorporation, bylaws and of Nevada law have anti-takeover effects that could prevent a change in control that could

be beneficial to our stockholders, which could depress the market price of shares of our common stock.

Our articles of incorporation,

bylaws and Nevada corporate law contain provisions that could delay, defer or prevent a change in control of us or our management that

could be beneficial to our stockholders.

These provisions could also discourage proxy contests and make it more difficult for our stockholders

to elect directors and take other corporate actions.

These provisions might also discourage a potential acquisition proposal or tender

offer, even if the acquisition proposal or tender offer is at a price above the then current market price for shares of our common stock.

The market price and

trading volume of our common stock has been volatile over the past year and it may continue to be volatile.

Over the past year,

our common stock has traded as low as $1.76 and as high as $5.37 per share.

We cannot predict the price at which our common stock

will trade in the future and it may decline.

The price at which our common stock trades may fluctuate significantly and may be

influenced by many factors, including our financial results, developments generally affecting the coffee industry, general economic,

industry and market conditions, the depth and liquidity of the market for our common stock, fluctuations in coffee prices, investor

perceptions of our business, reports by industry analysts, negative announcements by our customers, competitors or suppliers regarding

their own performances, and the impact of other “Risk Factors” discussed in this Annual Report.

in our articles of incorporation, bylaws and of Nevada law have anti-takeover effects that could prevent a change in control that

could be beneficial to our stockholders, which could depress the market price of shares of our common stock.

of incorporation, bylaws and Nevada corporate law contain provisions that could delay, defer or prevent a change in control of

us or our management that could be beneficial to our stockholders.

These provisions could also discourage proxy contests and make

it more difficult for our stockholders to elect directors and take other corporate actions.

These provisions might also discourage

a potential acquisition proposal or tender offer, even if the acquisition proposal or tender offer is at a price above the then

current market price for shares of our common stock.

These provisions:

2 unchanged sentences

the right of our stockholders to call a special meeting of stockholders;

our board of directors to issue preferred stock and to determine the rights and preferences of those shares, which would be senior

to our common stock, without prior stockholder approval;

amendments to our articles of incorporation to be approved by the holders of at least eighty percent of our outstanding shares of

common stock;

our board of directors to issue preferred stock and to determine the rights and preferences of those shares, which would be

senior to our common stock, without prior stockholder approval;

amendments to our articles of incorporation to be approved by the holders of at least eighty percent of our outstanding shares

of common stock;

classified board of directors with three-year staggered terms, which may delay the ability of stockholders to change the membership

of a majority of our board of directors;

a prohibition on stockholder action by written consent, thereby only permitting stockholder action to be taken at an annual or special

meeting of our stockholders.

a prohibition on stockholder action by written consent, thereby only permitting stockholder action to be taken at an annual

or special meeting of our stockholders.

are also subject to certain anti-takeover provisions under Nevada law.

Under Nevada law, a corporation may not, in general, engage in

a business combination with any “interested stockholder” for two (2) years after the date the person first became an interested

stockholder, unless the combination meets all of the requirements of our articles of incorporation and (i) the purchase of shares by

the interested stockholder is approved by our board of directors before that date or (ii) the combination is approved by our board of

directors and, at or after that time, the combination is approved at an annual or special meeting of our stockholders, and not by written

consent, by the affirmative vote of the holders of stock representing at least sixty percent (60%) of our outstanding voting power not

beneficially owned by the interested stockholder or the affiliates or associates of the interested stockholder.

Under Nevada law, a corporation may not, in general, engage

in a business combination with any “interested stockholder” for two (2) years after the date the person first became

an interested stockholder, unless the combination meets all of the requirements of our articles of incorporation and (i) the purchase

of shares by the interested stockholder is approved by our board of directors before that date or (ii) the combination is approved

by our board of directors and, at or after that time, the combination is approved at an annual or special meeting of our stockholders,

and not by written consent, by the affirmative vote of the holders of stock representing at least sixty percent (60%) of our outstanding

voting power not beneficially owned by the interested stockholder or the affiliates or associates of the interested stockholder.

STAFF COMMENTS

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-K/A

Item 1A. Risk Factors