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Item 1A. Risk Factors

2025-01-31 compared with 2024-02-09 · 192 added, 304 removed, 267 unchanged (65% of the section changed)

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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.

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

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

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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:

business is centered on essentially one commodity:

Our operations have primarily focused on the following areas of the coffee

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

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

global economic conditions and adverse developments with respect to financial institutions and associated liquidity risk could adversely

affect our business, financial condition and stock price.

global credit and financial markets are currently, and have from time to time experienced extreme volatility and disruptions, including

severely diminished liquidity and credit availability, rising interest and inflation rates, declines in consumer confidence, declines

in economic growth, increases in unemployment rates and uncertainty about economic stability.

The financial markets and the global economy

may also be adversely affected by the current or anticipated impact of military conflict, including the ongoing conflict between Russia

and Ukraine, terrorism or other geopolitical events.

Sanctions imposed by the United States and other countries in response to such conflicts,

including the one in Ukraine, may also adversely impact the financial markets and the global economy, and any economic countermeasures

by the affected countries or others could exacerbate market and economic instability.

There can be no assurance that future credit and

financial market instability and a deterioration in confidence in economic conditions will not occur.

Our general business strategy may

be adversely affected by any such economic downturn, liquidity shortages, volatile business environment or continued unpredictable and

unstable market conditions.

If the equity and credit markets deteriorate, or if adverse developments are experienced by financial institutions,

it may cause short-term liquidity risk and also make any necessary debt or equity financing more difficult, more costly, more onerous

with respect to financial and operating covenants and more dilutive.

Failure to secure any necessary financing in a timely manner and

on favorable terms could have a material adverse effect on our growth strategy, financial performance and stock price and could require

us to delay or abandon clinical development plans.

In addition, there is a risk that one or more of our current service providers, financial

institutions, manufacturers and other partners may be adversely affected by the foregoing risks, which could directly affect our ability

to attain our operating goals on schedule and on budget.

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

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sales and profitability.

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

label products as opportunities arise.

business strategy emphasizes, among other things, the geographic expansion of our branded and private label products as opportunities

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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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.

supply and price of coffee beans are subject to volatility and are influenced by numerous factors which are beyond our control.

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.

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

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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:

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;

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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.

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 also 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.

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 2023 fiscal year.

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

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

our competitors.

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.

had one customer that accounted for greater than 10% of our net sales during our 2024 fiscal year.

We generally do not enter long-term

contracts with most of our customers.

Accordingly, some of our customers can stop purchasing our products at any time without penalty

and are free to purchase products from our competitors.

The loss of, or reduction in sales to any of our 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.

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 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 indefinite lived intangible asset impairment at least annually.

In addition, we

review our 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 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.

Depending on the results of our review, we could be required

to record a significant charge to earnings in our consolidated financial statements during the period in which any impairment of our

indefinite lived intangible assets or amortizable intangible assets were determined, negatively impacting our results of operations.

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.

coming due at June 30, 2024.

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.

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 downturns.

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

All amounts under this line of credit will

become due on June 30, 2025.

There is no assurance that it will be renewed.

Outstanding debt could have important negative

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

domestic and global economic conditions;

Outstanding debt could have significant negative consequences

to the holders of our securities, including the following:

portion of our cash flow from operations will be needed to pay debt service and will not be available to fund future operations;

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

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

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

credit facility contains covenants that place annual restrictions on our operations, including covenants relating to fixed charge coverage

ratio, debt to tangible net worth and net worth.

The Company as of October 31, 2023 has failed to comply with one of these covenants

and resulted in an event of default under the loan agreement.

The lender has various defenses that it can apply against the Company,

which includes up to and calling the line of credit.

There is no guarantee that the lender will not issue a waiver or not call the line

substantial doubt about our ability to continue as a going concern.

The Company’s line of credit is maturing on June 30, 2024 and

in addition there are certain financial covenants that the Company are in violation with the lender.

The Company has not received a waiver

from the lender.

The lender has reserved its right to exercise its rights and remedies at any time at its sole discretion.

The uncertainties

surrounding the ability to receive a waiver and extending its line of credit when it becomes due raise substantial doubt as to whether

existing cash and cash equivalents will be sufficient to meet its obligations as they become due within twelve months from the date the

consolidated financial statements were issued.

Our audited consolidated financial statements do not include any adjustments for the recovery

and classification of assets or the amounts and classification of liabilities that might be necessary should we be unable to continue

as a going concern.

If we are unable to continue as a going concern, our shareholders would likely lose some or all of their investment

in our securities.

There can be no assurance that we will be able to extend our line of credit

or complete any financing transaction in a timely manner or on acceptable terms or otherwise.

If we are not successful to extend our line

of credit or to raise additional cash, we may be forced to suspend or curtail planned programs, or cease operations altogether.

can be no assurance that we will be able to extend our line of credit or complete any financing transaction in a timely manner or on

acceptable terms or otherwise.

If we are not successful to extend our line of credit or to raise additional cash, we may be forced to

suspend or curtail planned programs or cease operations altogether.

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

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 affected.

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

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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.

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.

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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.

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 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 earnings.

We are dependent on the continued operations of our Colorado and Massachusetts coffee roasting and distribution facilities.

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.

our revenues and earnings could be materially adversely affected.

are dependent on the continued operations of our Colorado and Massachusetts coffee roasting and distribution facilities.

Our operations

depend on 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.

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.

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

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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.

During the years ended October 31, 2020, 2021 and 2022, we identified material weaknesses in our

financial reporting, as set forth in Item 9A.

Controls and Procedures.

As of the date of this Annual Report, these material weaknesses

have not been remediated.

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

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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.

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.

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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

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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.

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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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

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

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.

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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..

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

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

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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.

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

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

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.

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.

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.

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.

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.

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.

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.

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

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

that could be costly and could divert management attention.

Related to our Common Stock

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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 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;

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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 21.2% of our outstanding shares of common stock.

As a result, the Gordon family is

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

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 23.1% of our outstanding shares of common stock.

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

election of a majority of our directors;

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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 fiscal year, our common

stock has traded as low as $0.67 and as high as $2.78 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.

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

past fiscal year, our common stock has traded as low as $0.68 and as high as $3.88 per share.

We cannot predict the price at which our

common stock will trade in the future, and the price of our common stock 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.

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.

These provisions:

that directors may only be removed upon a vote of at least eighty percent of the shares outstanding;

advance notice requirements for nominating directors and proposing matters to be voted on by shareholders at shareholder meetings;

advance notice requirements for nominating directors and proposing matters to be voted on by stockholders at stockholder meetings;

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

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

Related to the Merger

of the Merger is subject to a number of conditions and if these conditions are not satisfied or waived, such transactions will not be

obligation and the obligation of Delta to complete the Merger are subject to satisfaction or waiver of a number of conditions, including,

among others:

of the Merger by our stockholders;

of injunctions or certain legal impediments;

for the listing on NASDAQ of Pubco’s ordinary shares to be issued in the Merger;

of the representations and warranties of each of the parties, subject to certain materiality thresholds.

can be no assurance that the conditions to closing set forth in the Merger Agreement will be satisfied or waived or that the Merger itself

will be completed.

to complete the Merger could negatively impact our stock price, future business or operations.

the Merger is not completed, JVA and Delta may be subject to a number of material risks, including the following:

may be required under certain circumstances to pay Delta a termination fee;

price of our common stock may decline to the extent that the relevant current market price reflects a market assumption that the

Merger will be completed;

related to the Merger, such as legal, accounting, certain financial advisory and financial printing fees, must be paid even if the

Merger is not completed.

if the Merger is terminated and either company’s board of directors determines to seek another merger or business combination,

there can be no assurance that it will be able to find a partner on terms as attractive as those provided for in the Merger Agreement.

In addition, while the Merger Agreement is in effect and subject to very narrowly defined exceptions, we are prohibited from soliciting,

initiating or encouraging or entering into certain extraordinary transactions, such as a merger, sale of assets or other business combination,

other than with Delta.

STAFF COMMENTS

CYBERSECURITY

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

Item 1A. Risk Factors