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<SEC-DOCUMENT>0001116502-08-000970.txt : 20080613
<SEC-HEADER>0001116502-08-000970.hdr.sgml : 20080613
<ACCEPTANCE-DATETIME>20080613161852
ACCESSION NUMBER:		0001116502-08-000970
CONFORMED SUBMISSION TYPE:	10-Q
PUBLIC DOCUMENT COUNT:		4
CONFORMED PERIOD OF REPORT:	20080430
FILED AS OF DATE:		20080613
DATE AS OF CHANGE:		20080613

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			COFFEE HOLDING CO INC
		CENTRAL INDEX KEY:			0001007019
		STANDARD INDUSTRIAL CLASSIFICATION:	BEVERAGES [2080]
		IRS NUMBER:				113860760
		STATE OF INCORPORATION:			NV
		FISCAL YEAR END:			1031

	FILING VALUES:
		FORM TYPE:		10-Q
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-32491
		FILM NUMBER:		08898469

	BUSINESS ADDRESS:	
		STREET 1:		4401 FIRST AVENUE
		STREET 2:		STE 1507
		CITY:			BROOKLYN
		STATE:			NY
		ZIP:			11232
		BUSINESS PHONE:		7188320800

	MAIL ADDRESS:	
		STREET 1:		4401 FIRST AVENUE
		STREET 2:		STE 1507
		CITY:			BROOKLYN
		STATE:			NY
		ZIP:			11232

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	TRANSPACIFIC INTERNATIONAL GROUP CORP
		DATE OF NAME CHANGE:	19960201
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>coffee10q.htm
<DESCRIPTION>QUARTERLY REPORT
<TEXT>
<!doctype html public "-//IETF//DTD HTML//EN">
<HTML>
<HEAD>
<TITLE>COFFEE HOLDING CO</TITLE>
<META NAME="author" CONTENT="Lazar Levine &amp; Felix">
<META NAME="date" CONTENT="06/12/2008">
</HEAD>
<BODY style="line-height:12pt; font-family:Times New Roman; font-size:10pt; color:#000000">
<P style="margin:0px" align=center><BR></P>
<P style="margin-top:0px; margin-bottom:2.2px; padding-bottom:4px; border-bottom:4px solid #000000" align=right>&nbsp;</P>
<P style="margin:0px; padding-top:4px; border-top:1.333px solid #000000" align=right>&nbsp;</P>
<P style="line-height:16pt; margin:0px; font-size:14pt" align=center><B>UNITED STATES</B></P>
<P style="line-height:16pt; margin:0px; font-size:14pt" align=center><B>SECURITIES AND EXCHANGE COMMISSION</B></P>
<P style="margin:0px" align=center><B>Washington, D.C. 20549</B></P>
<P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=center>&#151;&#151;&#151;&#151;&#151;&#151;&#151;</P>
<P style="line-height:16pt; margin:0px; font-size:14pt" align=center><B>FORM 10-Q</B></P>
<P style="margin:0px" align=center>&#151;&#151;&#151;&#151;&#151;&#151;&#151;</P>
<P style="margin:0px" align=center><BR></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=17.2></TD><TD width=607.133></TD></TR>
<TR><TD style="border:1px solid #000000" valign=top width=17.2><P style="margin:0px" align=center><B>X</B></P>
</TD><TD valign=top width=607.133><P style="margin:0px"><B>&nbsp;QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE </B></P>
</TD></TR>
<TR><TD valign=top width=17.2><P>&nbsp;</P></TD><TD valign=top width=607.133><P style="margin:0px"><B>&nbsp;ACT OF 1934</B></P>
</TD></TR>
<TR><TD valign=top colspan=2><P style="margin:0px" align=center>For the quarterly period ended:&nbsp;&nbsp;<B>April 30, 2008</B></P>
</TD></TR>
<TR><TD valign=top colspan=2><P>&nbsp;</P></TD></TR>
<TR><TD valign=top colspan=2><P style="margin:0px" align=center>OR</P>
</TD></TR>
<TR><TD valign=top colspan=2><P>&nbsp;</P></TD></TR>
<TR><TD style="border:1px solid #000000" valign=top width=17.2><P>&nbsp;</P></TD><TD valign=top width=607.133><P style="margin:0px"><B>&nbsp;TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE </B></P>
</TD></TR>
<TR><TD valign=top width=17.2><P>&nbsp;</P></TD><TD valign=top width=607.133><P style="margin:0px"><B>&nbsp;ACT OF 1934</B></P>
</TD></TR>
<TR><TD valign=top colspan=2><P style="margin:0px" align=center>For the transition period from: _____________ to _____________</P>
</TD></TR>
</TABLE>
<P style="margin-top:8.867px; margin-bottom:8.867px" align=center>Commission file number: &nbsp;<B>001-32491</B></P>
<P style="margin:0px" align=center>&#151;&#151;&#151;&#151;&#151;&#151;&#151;</P>
<P style="line-height:18pt; margin:0px; font-size:16pt" align=center><B>Coffee Holding Co., Inc.</B></P>
<P style="line-height:10pt; margin-top:0px; margin-bottom:10.667px; font-size:8pt" align=center><I>(Exact name of registrant as specified in its charter)</I></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=343.867></TD><TD width=294.533></TD></TR>
<TR><TD valign=top width=343.867><P style="margin:0px" align=center><B>Nevada</B></P>
</TD><TD valign=top width=294.533><P style="margin:0px; padding-left:-7.267px" align=center><B>11&#150;2238111</B></P>
</TD></TR>
<TR><TD valign=top width=343.867><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>(<I>State or other jurisdiction of incorporation or organization)</I></P>
</TD><TD valign=top width=294.533><P style="line-height:10pt; margin:0px; padding-left:-7.267px; font-size:8pt" align=center><I>(I.R.S. Employer Identification No.)</I></P>
</TD></TR>
</TABLE>
<P style="margin:0px" align=center><BR></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=343.867></TD><TD width=294.533></TD></TR>
<TR><TD valign=top width=343.867><P style="margin:0px" align=center><B>4401 First Avenue, Brooklyn, New York</B></P>
</TD><TD valign=top width=294.533><P style="margin:0px" align=center><B>11232-0005</B></P>
</TD></TR>
<TR><TD valign=top width=343.867><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><I>(Address of principal executive offices)</I></P>
</TD><TD valign=top width=294.533><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><I>(Zip Code)</I></P>
</TD></TR>
</TABLE>
<P style="margin-top:13.333px; margin-bottom:0px" align=center><B>(718) 832-0800</B></P>
<P style="line-height:10pt; margin-top:0px; margin-bottom:10.667px; font-size:8pt" align=center><I>(Registrant&#146;s telephone number including area code)</I></P>
<P style="margin:0px; padding-left:144px; padding-right:144px" align=center><B>N/A</B></P>
<P style="line-height:10pt; margin:0px; font-size:8pt" align=center><I>(Former name, former address and former fiscal year, if changed from last report)</I></P>
<P style="margin:0px" align=center><BR></P>
<P style="margin-top:0px; margin-bottom:8.867px">Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. &nbsp;Yes&nbsp;<FONT style="font-family:Wingdings">&#253;</FONT>&nbsp;&nbsp;&nbsp;No&nbsp;<FONT style="font-family:Wingdings">&#168;</FONT></P>
<P style="margin-top:0px; margin-bottom:8.867px">Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. &nbsp;See the definitions of &#147;large accelerated filer,&#148; &#147;accelerated filer&#148; and &#147;smaller reporting company&#148; in Rule 12b-2 of the Exchange Act.</P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=202.6></TD><TD width=75></TD><TD width=246.467></TD></TR>
<TR><TD valign=top width=202.6><P style="margin:0px">Large accelerated filer <FONT style="font-family:Wingdings">&#168;</FONT></P>
</TD><TD valign=top width=75><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD valign=top width=246.467><P style="margin:0px">Accelerated filer &nbsp;<FONT style="font-family:Wingdings">&#168;</FONT></P>
</TD></TR>
<TR><TD valign=top width=202.6><P style="margin:0px">Non-accelerated filer &nbsp;<FONT style="font-family:Wingdings">&#168;</FONT></P>
</TD><TD valign=top width=75><P>&nbsp;</P></TD><TD valign=top width=246.467><P style="margin:0px">Smaller reporting company &nbsp;<FONT style="font-family:Wingdings">&#253;</FONT></P>
</TD></TR>
</TABLE>
<P style="margin-top:8.867px; margin-bottom:8.867px">Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). &nbsp;Yes &nbsp;<FONT style="font-family:Wingdings">&#168;</FONT>&nbsp;&nbsp;&nbsp;No&nbsp;<FONT style="font-family:Wingdings">&#253;</FONT></P>
<P style="margin:0px">Indicate the number of shares outstanding of each of the issuer&#146;s classes of common stock as of the latest practicable date:&nbsp;&nbsp;<B>5,463,030 shares of common stock, par value $0.001 per share, outstanding at June 2, 2008</B></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:2.2px; padding-bottom:4px; border-bottom:1.333px solid #000000">&nbsp;</P>
<P style="margin:0px; padding-top:4px; border-top:4px solid #000000">&nbsp;</P>
<P style="margin-top:0px; margin-bottom:14.667px"><BR>
<BR></P>
<HR style="margin-top:9.6px; margin-bottom:9.6px" noshade size=1.333>
<P style="margin:0px; page-break-before:always" align=center><B>COFFEE HOLDING CO., INC.</B></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center><B>TABLE OF CONTENTS</B></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=624></TD></TR>
<TR><TD valign=top width=624><P style="line-height:10pt; margin:0px; font-size:8pt" align=right><B><U>PAGE</U></B></P>
</TD></TR>
<TR><TD valign=top width=624><P style="margin:0px" align=center><B>PART I &#150; FINANCIAL INFORMATION</B></P>
</TD></TR>
<TR><TD valign=top width=624><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=624><P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; text-indent:-62.333px; color:#0000FF"><A HREF="#_Toc201059915"><U>Item 1.</U></A></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; color:#0000FF"><A HREF="#_Toc201059915"><U>Financial Statements</U></A></P>
<P style="margin:0px; padding-left:62.333px; text-indent:554.333px"><A HREF="#_Toc201059915">1</A><FONT style="color:#0000FF"><U></U></FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:96px; text-indent:-32px; color:#0000FF"><A HREF="#_Toc201059916"><U>Condensed Consolidated Balance Sheets<BR>
April&nbsp;30, 2008 (unaudited) and October&nbsp;31, 2007</U></A></P>
<P style="margin:0px; padding-left:96px; text-indent:520.667px"><A HREF="#_Toc201059916">1</A><FONT style="color:#0000FF"><U></U></FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:96px; text-indent:-32px; color:#0000FF"><A HREF="#_Toc201059917"><U>Condensed Consolidated Statements of Operations<BR>
Six and Three Months Ended April&nbsp;30, 2008 and 2007 (unaudited)</U></A></P>
<P style="margin:0px; padding-left:96px; text-indent:520.667px"><A HREF="#_Toc201059917">2</A><FONT style="color:#0000FF"><U></U></FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:96px; text-indent:-32px; color:#0000FF"><A HREF="#_Toc201059918"><U>Condensed Consolidated Statements of Cash Flows<BR>
Six Months Ended April&nbsp;30, 2008 and 2007 (unaudited)</U></A></P>
<P style="margin:0px; padding-left:96px; text-indent:520.667px"><A HREF="#_Toc201059918">3</A><FONT style="color:#0000FF"><U></U></FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:96px; text-indent:-32px; color:#0000FF"><A HREF="#_Toc201059919"><U>Notes to Condensed Consolidated Financial Statements (unaudited)</U></A></P>
<P style="margin:0px; padding-left:96px; text-indent:520.667px"><A HREF="#_Toc201059919">4</A><FONT style="color:#0000FF"><U></U></FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; text-indent:-62.333px; color:#0000FF"><A HREF="#_Toc201059920"><U>Item 2.</U></A></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; color:#0000FF"><A HREF="#_Toc201059920"><U>Management&#146;s Discussion and Analysis of Financial Condition<BR>
and Results of Operations</U></A></P>
<P style="margin:0px; padding-left:62.333px; text-indent:547.667px"><A HREF="#_Toc201059920">11</A><FONT style="color:#0000FF"><U></U></FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; text-indent:-62.333px; color:#0000FF"><A HREF="#_Toc201059921"><U>Item 3.</U></A></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; color:#0000FF"><A HREF="#_Toc201059921"><U>Quantitative and Qualitative Disclosures About Market Risk</U></A></P>
<P style="margin:0px; padding-left:62.333px; text-indent:547.667px"><A HREF="#_Toc201059921">18</A><FONT style="color:#0000FF"><U></U></FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; text-indent:-62.333px; color:#0000FF"><A HREF="#_Toc201059922"><U>Item 4.</U></A></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; color:#0000FF"><A HREF="#_Toc201059922"><U>Controls and Procedures</U></A></P>
<P style="margin:0px; padding-left:62.333px; text-indent:547.667px"><A HREF="#_Toc201059922">18</A><FONT style="color:#0000FF"><U></U></FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center><B>PART II &#150; OTHER INFORMATION</B></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; text-indent:-62.333px; color:#0000FF"><A HREF="#_Toc201059923"><U>Item 1.</U></A></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; color:#0000FF"><A HREF="#_Toc201059923"><U>Legal Proceedings</U></A></P>
<P style="margin:0px; padding-left:62.333px; text-indent:547.667px"><A HREF="#_Toc201059923">19</A><FONT style="color:#0000FF"><U></U></FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; text-indent:-62.333px; color:#0000FF"><A HREF="#_Toc201059924"><U>Item 1A.</U></A></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; color:#0000FF"><A HREF="#_Toc201059924"><U>Risk Factors</U></A></P>
<P style="margin:0px; padding-left:62.333px; text-indent:547.667px"><A HREF="#_Toc201059924">19</A><FONT style="color:#0000FF"><U></U></FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; text-indent:-62.333px; color:#0000FF"><A HREF="#_Toc201059925"><U>Item 2.</U></A></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; color:#0000FF"><A HREF="#_Toc201059925"><U>Unregistered Sales of Equity in Securities and Use of Proceeds</U></A></P>
<P style="margin:0px; padding-left:62.333px; text-indent:547.667px"><A HREF="#_Toc201059925">19</A><FONT style="color:#0000FF"><U></U></FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; text-indent:-62.333px; color:#0000FF"><A HREF="#_Toc201059926"><U>Item 3.</U></A></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; color:#0000FF"><A HREF="#_Toc201059926"><U>Defaults upon Senior Securities</U></A></P>
<P style="margin:0px; padding-left:62.333px; text-indent:547.667px"><A HREF="#_Toc201059926">20</A><FONT style="color:#0000FF"><U></U></FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; text-indent:-62.333px; color:#0000FF"><A HREF="#_Toc201059928"><U>Item 4.</U></A></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; color:#0000FF"><A HREF="#_Toc201059928"><U>Submission of Matters to a Vote of Security Holders</U></A></P>
<P style="margin:0px; padding-left:62.333px; text-indent:547.667px"><A HREF="#_Toc201059928">20</A><FONT style="color:#0000FF"><U></U></FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; text-indent:-62.333px; color:#0000FF"><A HREF="#_Toc201059929"><U>Item 5.</U></A></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; color:#0000FF"><A HREF="#_Toc201059929"><U>Other Information</U></A></P>
<P style="margin:0px; padding-left:62.333px; text-indent:547.667px"><A HREF="#_Toc201059929">20</A><FONT style="color:#0000FF"><U></U></FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; text-indent:-62.333px; color:#0000FF"><A HREF="#_Toc201059930"><U>Item 6.</U></A></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:62.333px; color:#0000FF"><A HREF="#_Toc201059930"><U>Exhibits</U></A></P>
<P style="margin:0px; padding-left:62.333px; text-indent:547.667px"><A HREF="#_Toc201059930">20</A><FONT style="color:#0000FF"><U></U></FONT></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; color:#0000FF"><A HREF="#_Toc201059931"><U>Si<A NAME="_Hlt201059988"></A>gnatures</U></A></P>
<P style="margin:0px; text-indent:610px"><A HREF="#_Toc201059931">21</A><FONT style="color:#0000FF"><U></U></FONT></P>
</TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<A NAME="_Ref3977756"></A><P style="margin:0px"><BR>
<BR></P>
<P style="line-height:13pt; margin:0px; font-size:11pt" align=center>i</P>
<P style="margin:0px"><BR></P>
<HR style="margin-top:9.6px; margin-bottom:9.6px" noshade size=1.333>
<P style="margin-top:0px; margin-bottom:8.867px; page-break-before:always" align=center><B>PART I &#150; FINANCIAL INFORMATION</B></P>
<A NAME="_Toc201059396"></A><A NAME="_Toc201059545"></A><A NAME="_Toc201059915"></A><P style="margin-top:0px; margin-bottom:-16px; padding-left:72px; text-indent:-72px; font-family:Times New Roman Bold"><B>Item 1.</B></P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:72px; font-family:Times New Roman Bold"><B>Financial Statements</B></P>
<P style="margin:0px" align=center><B>COFFEE HOLDING CO., INC.</B></P>
<A NAME="_Toc201059397"></A><A NAME="_Toc201059546"></A><A NAME="_Toc201059916"></A><P style="margin:0px; font-family:Times New Roman Bold" align=center><B>CONDENSED CONSOLIDATED BALANCE SHEETS</B></P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center><B>APRIL 30, 2008 AND OCTOBER 31, 2007</B></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=438.733></TD><TD width=18.067></TD><TD width=7.267></TD><TD width=65></TD><TD width=18.067></TD><TD width=7.267></TD><TD width=65></TD><TD width=4.6></TD></TR>
<TR><TD valign=bottom width=438.733><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>April&nbsp;30,<BR>
2008</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>October&nbsp;31,<BR>
2007</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom colspan=2><P style="margin:0px" align=center><B>(unaudited)</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom colspan=2><P style="margin:0px" align=center>(audited)</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px" align=center><B>- ASSETS -</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px"><B>CURRENT ASSETS:</B></P>
</TD><TD valign=bottom width=18.067><P style="margin-top:0px; margin-bottom:8.867px"><B>&nbsp;</B></P>
</TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P style="margin-top:0px; margin-bottom:8.867px">&nbsp;</P>
</TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:24px; text-indent:-8px">Cash</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P style="margin:0px"><B>$</B></P>
</TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>1,617,413</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P style="margin:0px">$</P>
</TD><TD valign=bottom width=65><P style="margin:0px" align=right>890,649</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:24px; text-indent:-8px">Commodities held at broker</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>832,218</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right>3,468,530</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:24px; text-indent:-8px">Accounts receivable, net of allowance for doubtful accounts of<BR>
$127,464 and $136,781 for 2008 and 2007, respectively</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>5,651,787</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right>7,130,467</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:24px; text-indent:-8px">Inventories</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>4,471,463</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right>4,472,097</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:24px; text-indent:-8px">Prepaid expenses and other current assets</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>346,740</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right>502,240</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:24px; text-indent:-8px">Prepaid and refundable taxes</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>267,462</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right>236,406</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:24px; text-indent:-8px">Deferred income tax asset</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=65><P style="margin:0px" align=right><B>1,331,000</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=65><P style="margin:0px" align=right>279,000</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px">TOTAL CURRENT ASSETS</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>14,518,083</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right>16,979,389</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:8px; text-indent:-8px">Property and equipment, at cost, net of accumulated depreciation<BR>
of $4,731,184 and $4,542,490 for 2008 and 2007, respectively</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>2,953,925</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right>2,651,960</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px">Deposits and other assets</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=65><P style="margin:0px" align=right><B>489,066</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=65><P style="margin:0px" align=right>765,368</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:40px; text-indent:-8px"><B>TOTAL ASSETS</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.267><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=65><P style="margin:0px" align=right><B>17,961,074</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.267><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=65><P style="margin:0px" align=right>20,396,717</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px" align=center><B>- LIABILITIES AND STOCKHOLDERS' EQUITY -</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px"><B>CURRENT LIABILITIES:</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:24px; text-indent:-8px">Accounts payable and accrued expenses</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P style="margin:0px"><B>$</B></P>
</TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>6,326,167</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P style="margin:0px">$</P>
</TD><TD valign=bottom width=65><P style="margin:0px" align=right>6,791,690</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:24px; text-indent:-8px">Line of credit borrowings</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>2,556,762</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right>897,191</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:24px; text-indent:-8px">Income taxes payable</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=65><P style="margin:0px" align=right>&#151;</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=65><P style="margin:0px" align=right>9,161</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px">TOTAL CURRENT LIABILITIES</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>8,882,929</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right>7,698,042</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px">Deferred income tax liabilities</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>27,000</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right>145,000</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px">Deferred compensation payable</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=65><P style="margin:0px" align=right><B>394,020</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=65><P style="margin:0px" align=right>351,332</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px">TOTAL LIABILITIES</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=65><P style="margin:0px" align=right><B>9,303,949</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=65><P style="margin:0px" align=right>8,194,374</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px"><B>MINORITY INTEREST</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right>&#151;</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px"><B>COMMITMENTS AND CONTINGENCIES</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px"><B>STOCKHOLDERS' EQUITY: </B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:24px; text-indent:-8px">Preferred stock, par value $.001 per share; 10,000,000 shares authorized;<BR>
none issued</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right>&#151;</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:24px; text-indent:-8px">Common stock, par value $.001 per share; 30,000,000 shares authorized,<BR>
5,529,830 shares issued; 5,480,216 shares outstanding for 2008 and<BR>
5,514,930 shares outstanding in 2007</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>5,530</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right>5,530</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:24px; text-indent:-8px">Additional paid-in capital</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>7,327,023</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right>7,327,023</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:24px; text-indent:-8px">Retained earnings</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right><B>1,539,986</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P style="margin:0px" align=right>4,946,467</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:24px; text-indent:-8px">Less: Treasury stock, 49,614 and 14,900 common shares,<BR>
at cost for 2008 and 2007, respectively</P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=65><P style="margin:0px" align=right><B>(215,414</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=18.067><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=65><P style="margin:0px" align=right>(76,677</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=438.733><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:40px; text-indent:-8px">TOTAL STOCKHOLDERS&#146; EQUITY </P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=65><P style="margin:0px" align=right><B>8,657,125</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=65><P style="margin:0px" align=right>12,202,343</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD valign=bottom width=7.267><P>&nbsp;</P></TD><TD valign=bottom width=65><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=438.733><P style="margin:0px; padding-left:40px; text-indent:-8px"><B>TOTAL LIABILITIES AND STOCKHOLDERS&#146; EQUITY</B></P>
</TD><TD valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.267><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=65><P style="margin:0px" align=right><B>17,961,074</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=18.067><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.267><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=65><P style="margin:0px" align=right>20,396,717</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center><BR>
<BR></P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center>See notes to Condensed Consolidated Financial Statements.</P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center>1</P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center><BR></P>
<HR style="margin-top:9.6px; margin-bottom:9.6px" noshade size=1.333>
<P style="margin:0px; page-break-before:always" align=center><B>COFFEE HOLDING CO., INC.</B></P>
<A NAME="_Toc201059398"></A><A NAME="_Toc201059547"></A><A NAME="_Toc201059917"></A><P style="margin:0px; font-family:Times New Roman Bold" align=center><B>CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS</B></P>
<P style="margin-top:0px; margin-bottom:13.333px" align=center><B>(Unaudited)</B></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=300.533></TD><TD width=17.6></TD><TD width=7></TD><TD width=63.067></TD><TD width=17.533></TD><TD width=6.933></TD><TD width=63></TD><TD width=17.533></TD><TD width=6.933></TD><TD width=63></TD><TD width=17.533></TD><TD width=6.933></TD><TD width=63></TD><TD width=4.6></TD></TR>
<TR><TD valign=bottom width=300.533><P>&nbsp;</P></TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=5><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>Six Months Ended</B></P>
<P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>April&nbsp;30</B>,</P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=5><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>Three Months Ended</B></P>
<P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>April, 30</B></P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P>&nbsp;</P></TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>2008</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>2007</P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>2008</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>2007</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px"><B>NET SALES</B></P>
</TD><TD valign=bottom width=17.6><P style="margin-top:0px; margin-bottom:8.867px"><B>&nbsp;</B></P>
</TD><TD valign=bottom width=7><P style="margin:0px"><B>$</B></P>
</TD><TD valign=bottom width=63.067><P style="margin:0px" align=right><B>33,131,982</B></P>
</TD><TD valign=bottom width=17.533><P style="margin-top:0px; margin-bottom:8.867px">&nbsp;</P>
</TD><TD valign=bottom width=6.933><P style="margin:0px">$</P>
</TD><TD valign=bottom width=63><P style="margin:0px" align=right>26,829,485</P>
</TD><TD valign=bottom width=17.533><P style="margin-top:0px; margin-bottom:8.867px"><B>&nbsp;</B></P>
</TD><TD valign=bottom width=6.933><P style="margin:0px"><B>$</B></P>
</TD><TD valign=bottom width=63><P style="margin:0px" align=right><B>18,169,441</B></P>
</TD><TD valign=bottom width=17.533><P style="margin-top:0px; margin-bottom:8.867px">&nbsp;</P>
</TD><TD valign=bottom width=6.933><P style="margin:0px">$</P>
</TD><TD valign=bottom width=63><P style="margin:0px" align=right>14,194,373</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P>&nbsp;</P></TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px"><B>COST OF SALES</B></P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63.067><P style="margin:0px" align=right><B>32,925,925</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>22,553,727</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right><B>19,843,502</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>12,087,210</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P>&nbsp;</P></TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px"><B>GROSS PROFIT (LOSS)</B></P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63.067><P style="margin:0px" align=right><B>206,057</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>4,275,758</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right><B>(1,674,061</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>2,107,163</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P>&nbsp;</P></TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px"><B>OPERATING EXPENSES:</B></P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px; padding-left:24px; text-indent:-8px">Selling and administrative</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P style="margin:0px" align=right><B>2,919,356</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>2,877,929</P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right><B>1,540,432</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>1,487,239</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px; padding-left:24px; text-indent:-8px">Writedown of amount due from dissolved joint venture</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right><BR></P>
<P style="margin:0px" align=right>242,000</P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>&#151;</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px; padding-left:24px; text-indent:-8px">Officers&#146; salaries</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63.067><P style="margin:0px" align=right><B>299,700</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>234,449</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right><B>138,323</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>117,437</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px">TOTALS</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63.067><P style="margin:0px" align=right><B>3,219,056</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>3,354,378</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right><B>1,678,755</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>1,604,676</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P>&nbsp;</P></TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px"><B>INCOME (LOSS) FROM OPERATIONS</B></P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63.067><P style="margin:0px" align=right><B>(3,012,999</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>921,380</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right><B>(3,352,816</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>502,487</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P>&nbsp;</P></TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px"><B>OTHER INCOME (EXPENSE)</B></P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px; padding-left:24px; text-indent:-8px">Interest income</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P style="margin:0px" align=right><B>34,328</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>66,576</P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right><B>10,057</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>32,460</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px; padding-left:24px; text-indent:-8px">Dividend income</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P style="margin:0px" align=right><B>9,331</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>&#151;</P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right><B>9,331</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>&#151;</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px; padding-left:24px; text-indent:-8px">Equity in loss from dissolved joint venture</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>(93,939</P>
</TD><TD valign=bottom width=17.533><P style="margin:0px">)</P>
</TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>(30,000</P>
</TD><TD valign=bottom width=4.6><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px; padding-left:24px; text-indent:-8px">Writedown of investment in dissolved joint venture</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right><BR></P>
<P style="margin:0px" align=right>(33,000</P>
</TD><TD valign=bottom width=17.533><P style="margin:0px">)</P>
</TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>&#151;</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px; padding-left:24px; text-indent:-8px">Management fee income</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>12,046</P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>&#151;</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px; padding-left:24px; text-indent:-8px">Impairment loss &#150; leasehold improvements</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>(31,892</P>
</TD><TD valign=bottom width=17.533><P style="margin:0px">)</P>
</TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>(31,892</P>
</TD><TD valign=bottom width=4.6><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px; padding-left:24px; text-indent:-8px">Interest expense</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63.067><P style="margin:0px" align=right><B>(61,432</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>(56,406</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P style="margin:0px">)</P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right><B>(32,426</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>(32,174</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=300.533><P>&nbsp;</P></TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63.067><P style="margin:0px" align=right><B>(17,773</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>(136,615</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P style="margin:0px">)</P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right><B>(13,038</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>(61,606</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px"><B>INCOME (LOSS) BEFORE BENEFIT FROM (PROVISION) FOR INCOME TAX EXPENSE AND MINORITY INTEREST IN SUBSIDIARY</B></P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P style="margin:0px" align=right><B>(3,030,772</B></P>
</TD><TD valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>784,765</P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right><B>(3,365,854</B></P>
</TD><TD valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>440,881</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P>&nbsp;</P></TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px; padding-left:24px; text-indent:-8px">Benefit (provision) for income tax expense</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63.067><P style="margin:0px" align=right><B>1,169,949</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>(140,050</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P style="margin:0px">)</P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right><B>1,312,000</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>(102,200</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=300.533><P>&nbsp;</P></TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px"><B>INCOME (LOSS) BEFORE MINORITY INTEREST</B></P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P style="margin:0px" align=right><B>(1,860,823</B></P>
</TD><TD valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>644,715</P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right><B>(2,053,854</B></P>
</TD><TD valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>338,681</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P>&nbsp;</P></TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px; padding-left:24px; text-indent:-8px">Minority interest in earnings (loss) of subsidiary</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63.067><P style="margin:0px" align=right><B>(1,090</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>3,877</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right><B>9,676</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>207</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P>&nbsp;</P></TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px"><B>NET INCOME (LOSS)</B></P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P style="margin:0px" align=right><B>(1,861,913</B></P>
</TD><TD valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>648,592</P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right><B>(2,044,178</B></P>
</TD><TD valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>338,888</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P>&nbsp;</P></TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px">Retained earnings-beginning</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P style="margin:0px" align=right><B>4,946,467</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>4,009,150</P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right><B>3,584,164</B></P>
</TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P style="margin:0px" align=right>4,318,854</P>
</TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px">Dividend declared</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63.067><P style="margin:0px" align=right><B>(1,544,568</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>&#151;</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63><P style="margin:0px" align=right>&#151;</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px"><B>RETAINED EARNINGS - ENDING</B></P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=63.067><P style="margin:0px" align=right><B>1,539,986</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.933><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=63><P style="margin:0px" align=right>4,657,742</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.933><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=63><P style="margin:0px" align=right><B>1,539,986</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.933><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=63><P style="margin:0px" align=right>4,657,742</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P>&nbsp;</P></TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px">Basic and diluted earnings (loss) per share</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=63.067><P style="margin:0px" align=right><B>(.34</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.933><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=63><P style="margin:0px" align=right>.12</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.933><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=63><P style="margin:0px" align=right><B>(.37</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=17.533><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.933><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=63><P style="margin:0px" align=right>.06</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P>&nbsp;</P></TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px">Weighted average common shares outstanding:</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD valign=bottom width=7><P>&nbsp;</P></TD><TD valign=bottom width=63.067><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=17.533><P>&nbsp;</P></TD><TD valign=bottom width=6.933><P>&nbsp;</P></TD><TD valign=bottom width=63><P>&nbsp;</P></TD><TD valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px; padding-left:24px; text-indent:-8px">Basic</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=63.067><P style="margin:0px" align=right><B>5,497,254</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=63><P style="margin:0px" align=right>5,529,830</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=63><P style="margin:0px" align=right><B>5,497,254</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=63><P style="margin:0px" align=right>5,529,830</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=300.533><P style="margin:0px; padding-left:24px; text-indent:-8px">Diluted</P>
</TD><TD valign=bottom width=17.6><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=63.067><P style="margin:0px" align=right><B>5,497,254</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=63><P style="margin:0px" align=right>5,599,830</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=63><P style="margin:0px" align=right><B>5,497,254</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=17.533><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.933><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=63><P style="margin:0px" align=right><B>5,529,830</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=4.6><P>&nbsp;</P></TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center><BR>
<BR></P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center>See notes to Condensed Consolidated Financial Statements.</P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center>2</P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center><BR></P>
<HR style="margin-top:9.6px; margin-bottom:9.6px" noshade size=1.333>
<P style="margin:0px; page-break-before:always" align=center><B>COFFEE HOLDING CO., INC.</B></P>
<A NAME="_Toc201059399"></A><A NAME="_Toc201059548"></A><A NAME="_Toc201059918"></A><P style="margin:0px; font-family:Times New Roman Bold" align=center><B>CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS</B></P>
<P style="margin:0px" align=center><B>SIX MONTHS ENDED APRIL 30, 2008 AND 2007 </B></P>
<P style="margin-top:0px; margin-bottom:13.333px" align=center><B>(Unaudited)</B></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=406.8></TD><TD width=19.2></TD><TD width=7.733></TD><TD width=79.733></TD><TD width=23.067></TD><TD width=7.733></TD><TD width=74.6></TD><TD width=5.133></TD></TR>
<TR><TD valign=bottom width=406.8><P>&nbsp;</P></TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>2008</B></P>
</TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>2007</P>
</TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px"><B>OPERATING ACTIVITIES:</B></P>
</TD><TD valign=bottom width=19.2><P style="margin-top:0px; margin-bottom:8.867px"><B>&nbsp;</B></P>
</TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P style="margin-top:0px; margin-bottom:8.867px">&nbsp;</P>
</TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:24px; text-indent:-8px">Net (loss) income </P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P style="margin:0px"><B>$</B></P>
</TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>(1,861,913</B></P>
</TD><TD valign=bottom width=23.067><P style="margin:0px"><B>)</B></P>
</TD><TD valign=bottom width=7.733><P style="margin:0px">$</P>
</TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>648,592</P>
</TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:24px; text-indent:-8px">Adjustments to reconcile net income to net<BR>
cash provided by operating activities:</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:40px; text-indent:-8px">Depreciation and amortization</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>262,086</B></P>
</TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>165,478</P>
</TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:40px; text-indent:-8px">Writedown of amount due from dissolved joint venture</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>242,000</P>
</TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:40px; text-indent:-8px">Loss from dissolved joint venture</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>93,939</P>
</TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:40px; text-indent:-8px">Writedown of investment in dissolved joint venture</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>33,000</P>
</TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:40px; text-indent:-8px">Deferred income taxes</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>(1,170,000</B></P>
</TD><TD valign=bottom width=23.067><P style="margin:0px"><B>)</B></P>
</TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>(233,550</P>
</TD><TD valign=bottom width=5.133><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:40px; text-indent:-8px">Impairment loss</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>31,892</P>
</TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:40px; text-indent:-8px">Changes in operating assets and liabilities:</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:56px; text-indent:-8px">Commodities held at broker</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>2,636,312</B></P>
</TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>902,375</P>
</TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:56px; text-indent:-8px">Accounts receivable</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>1,478,680</B></P>
</TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>1,703,288</P>
</TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:56px; text-indent:-8px">Inventories</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>634</B></P>
</TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>(1,039,129</P>
</TD><TD valign=bottom width=5.133><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:56px; text-indent:-8px">Prepaid expenses and other current assets</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>155,500</B></P>
</TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>(416,149</P>
</TD><TD valign=bottom width=5.133><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:56px; text-indent:-8px">Prepaid and refundable income taxes</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>(31,056</B></P>
</TD><TD valign=bottom width=23.067><P style="margin:0px"><B>)</B></P>
</TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>295,293</P>
</TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:56px; text-indent:-8px">Accounts payable and accrued expenses</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>(465,523</B></P>
</TD><TD valign=bottom width=23.067><P style="margin:0px"><B>)</B></P>
</TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>(776,221</P>
</TD><TD valign=bottom width=5.133><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:56px; text-indent:-8px">Due from dissolved joint venture</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>&#151;</B></P>
</TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>(146,372</P>
</TD><TD valign=bottom width=5.133><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:56px; text-indent:-8px">Deposits and other assets</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>20,940</B></P>
</TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>17,898</P>
</TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:56px; text-indent:-8px">Income taxes payable</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=79.733><P style="margin:0px" align=right><B>(9,161</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=23.067><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=74.6><P style="margin:0px" align=right>74,707</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P>&nbsp;</P></TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px"><I>Net cash provided by operating activities</I></P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=79.733><P style="margin:0px" align=right><B>1,016,499</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=23.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=74.6><P style="margin:0px" align=right>1,597,041</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P>&nbsp;</P></TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px"><B>INVESTING ACTIVITIES:</B></P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:24px; text-indent:-8px">Purchases of property and equipment</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=79.733><P style="margin:0px" align=right><B>(267,091</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=23.067><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=74.6><P style="margin:0px" align=right>(188,575</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=5.133><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=406.8><P>&nbsp;</P></TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px"><I>Net cash used in investing activities</I></P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=79.733><P style="margin:0px" align=right><B>(267,091</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=23.067><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=74.6><P style="margin:0px" align=right>(188,575</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=5.133><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=406.8><P>&nbsp;</P></TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px"><B>FINANCING ACTIVITIES:</B></P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:24px; text-indent:-8px">Advances under bank line of credit</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>30,855,020</B></P>
</TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>23,967,150</P>
</TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:24px; text-indent:-8px">Principal payments under bank line of credit</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>(29,195,449</B></P>
</TD><TD valign=bottom width=23.067><P style="margin:0px"><B>)</B></P>
</TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>(24,806,079</P>
</TD><TD valign=bottom width=5.133><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:24px; text-indent:-8px">Payment of dividend</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>(1,544,568</B></P>
</TD><TD valign=bottom width=23.067><P style="margin:0px"><B>)</B></P>
</TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>&#151;</P>
</TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:24px; text-indent:-8px">Purchase of treasury stock</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=79.733><P style="margin:0px" align=right><B>(138,737</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=23.067><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=74.6><P style="margin:0px" align=right>&#151;</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P>&nbsp;</P></TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px"><I>Net cash used in financing activities</I></P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=79.733><P style="margin:0px" align=right><B>(23,734</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=23.067><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=74.6><P style="margin:0px" align=right>(838,929</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=5.133><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=406.8><P>&nbsp;</P></TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px"><B>MINORITY INTEREST</B></P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=79.733><P style="margin:0px" align=right><B>1,090</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=23.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=74.6><P style="margin:0px" align=right>(3,877</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=5.133><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=406.8><P>&nbsp;</P></TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px"><B>NET INCREASE IN CASH</B></P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P style="margin:0px" align=right><B>726,764</B></P>
</TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P style="margin:0px" align=right>565,660</P>
</TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P>&nbsp;</P></TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:24px; text-indent:-8px">Cash, beginning of year</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=79.733><P style="margin:0px" align=right><B>890,649</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=23.067><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=74.6><P style="margin:0px" align=right>1,112,165</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P>&nbsp;</P></TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px"><B>CASH, END OF PERIOD</B></P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.733><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=79.733><P style="margin:0px" align=right><B>1,617,413</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=23.067><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.733><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=74.6><P style="margin:0px" align=right>1,677,825</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P>&nbsp;</P></TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px"><B>SUPPLEMENTAL DISCLOSURE OF CASH FLOW DATA:</B></P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:24px; text-indent:-8px">Interest paid</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.733><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=79.733><P style="margin:0px" align=right><B>58,557</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=23.067><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.733><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=74.6><P style="margin:0px" align=right>43,351</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:24px; text-indent:-8px">Income taxes paid</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.733><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=79.733><P style="margin:0px" align=right><B>12,255</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=23.067><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.733><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=74.6><P style="margin:0px" align=right>&#151;</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P>&nbsp;</P></TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:8px; text-indent:-8px"><B>SUPPLEMENTAL DISCLOSURE OF NON-<BR>
CASH INVESTING ACTIVITIES:</B></P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=79.733><P>&nbsp;</P></TD><TD valign=bottom width=23.067><P>&nbsp;</P></TD><TD valign=bottom width=7.733><P>&nbsp;</P></TD><TD valign=bottom width=74.6><P>&nbsp;</P></TD><TD valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=406.8><P style="margin:0px; padding-left:24px; text-indent:-8px">The Company utilized its deposit for the purchase<BR>
of machinery and equipment</P>
</TD><TD valign=bottom width=19.2><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.733><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=79.733><P style="margin:0px" align=right><B>296,960</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=23.067><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.733><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=74.6><P style="margin:0px" align=right>328,388</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=5.133><P>&nbsp;</P></TD></TR>
</TABLE>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center>See notes to Condensed Consolidated Financial Statements.</P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center>3</P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center><BR></P>
<HR style="margin-top:9.6px; margin-bottom:9.6px" noshade size=1.333>
<P style="margin:0px; page-break-before:always"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px" align=center><B>COFFEE HOLDING CO., INC. AND SUBSIDIARY</B></P>
<A NAME="_Toc201059400"></A><A NAME="_Toc201059549"></A><A NAME="_Toc201059919"></A><P style="margin:0px; font-family:Times New Roman Bold" align=center><B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS</B></P>
<P style="margin:0px" align=center><B>APRIL 30, 2008 AND 2007</B></P>
<P style="margin-top:0px; margin-bottom:13.333px" align=center><B>(Unaudited)</B></P>
<P style="margin-top:0px; margin-bottom:8.867px" align=justify><B>NOTE 1 &nbsp;&#150; &nbsp;BUSINESS ACTIVITIES:</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:67.2px">Coffee Holding Co., Inc. (the &#147;Company&#148;) conducts wholesale coffee operations, including manufacturing, roasting, packaging, marketing and distributing roasted and blended coffees for private labeled accounts and its own brands, and sells green coffee. The Company&#146;s sales are primarily to customers that are located throughout the United States with limited sales in Canada, consisting of supermarkets, wholesalers, gourmet roasters and individually owned and multi-unit retailers.</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:67.2px">The Company owns a 60% interest in Generations Coffee Company, LLC (&#147;GCC&#148;) effective April&nbsp;7, 2006. GCC is in the same business as the Company and had limited operations since it commenced its operations during the quarter ended October&nbsp;31, 2006. The Company also exercises control of GCC. As a result of its 60% interest and control, the financial statements of GCC are consolidated with the Company.</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:67.2px">The Company also owned a 50% interest in Cafe La Rica, LLC (&#147;CLR&#148;) effective March&nbsp;10, 2006. CLR was in the same business as the Company and was being recorded as an investment in joint venture since the Company did not exercise control of CLR. As a result, the financial statements of CLR were not consolidated and was accounted for by the equity method of accounting. Effective October&nbsp;17, 2007 the Company dissolved the joint venture.</P>
<P style="margin-top:0px; margin-bottom:8.867px" align=justify><B>NOTE 2 &nbsp;&#150; &nbsp;BASIS OF PRESENTATION:</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:67.2px">The interim condensed consolidated financial information as of April&nbsp;30, 2008 and for the six and three-month periods ended April&nbsp;30, 2008 and 2007 has been prepared without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the &#147;SEC&#148;). Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although we believe that the disclosures made are adequate to provide for fair presentation. These Financial Statements should be read in conjunction with the Financial Statements and the notes thereto, included in the Company&#146;s Annual Report on Form&nbsp;10-K/A for the fiscal year ended October&nbsp;31, 2007, filed with the SEC on April&nbsp;1, 2008.</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:67.2px">In the opinion of management, all adjustments (which include normal recurring adjustments) necessary to present a fair statement of financial position as of April&nbsp;30, 2008, and results of operations for the six and three months ended April&nbsp;30, 2008 and 2007 and cash flows for the six months ended April&nbsp;30, 2008 and 2007, as applicable, have been made. The results of operations for the six and three months ended April&nbsp;30, 2008 and 2007 are not necessarily indicative of the operating results for the full fiscal year or any future periods.</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:67.2px">The condensed consolidated financial statements include the accounts of the Company and GCC. The equity method of accounting was used to record the Company&#146;s share of the loss in CLR for the six and three months ended April&nbsp;30, 2007. All significant inter-company transactions and balances have been eliminated in consolidation.</P>
<P style="margin-top:0px; margin-bottom:13.333px"><BR></P>
<P style="margin-top:0px; margin-bottom:8.867px" align=justify><BR>
<BR></P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center>4</P>
<P style="margin:0px"><BR></P>
<HR style="margin-top:9.6px; margin-bottom:9.6px" noshade size=1.333>
<P style="margin:0px; page-break-before:always" align=center><B>COFFEE HOLDING CO., INC. AND SUBSIDIARY</B></P>
<P style="margin:0px; font-family:Times New Roman Bold" align=center><B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)</B></P>
<P style="margin:0px" align=center><B>APRIL 30, 2008 AND 2007</B></P>
<P style="margin-top:0px; margin-bottom:13.333px" align=center><B>(Unaudited)</B></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:8.867px" align=justify><B>NOTE 3 &nbsp;&#150; &nbsp;RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS:</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:67.2px">In September&nbsp;2006, the Financial Accounting Standards Board (&#147;FASB&#148;) issued Statement of Financial Accounting Standards (&#147;SFAS&#148;) No.&nbsp;157, Fair Value Measurements, which defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. This statement does not require any new fair value measurements, but provides guidance on how to measure fair value by providing a fair value hierarchy used to classify the source of the information. SFAS No.&nbsp;157 is effective for fiscal years beginning after November&nbsp;15, 2007, and all interim periods within those fiscal years. In February&nbsp;2008, the FASB released FASB Staff Position (FSP FAS 157-2 &#150; Effective Date of FASB Statement No.&nbsp;157) which delays the effective date of SFAS No.&nbsp;157 for all nonfinancial assets and nonfinancial liabilities, excep
t those that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually), to fiscal years beginning after November&nbsp;15, 2008 and interim periods within those fiscal years. The implementation of SFAS No.&nbsp;157 for financial assets and liabilities will be effective November&nbsp;1, 2009 The Company is currently evaluating the impact of adoption of this statement on its financial statements.<A NAME="eolPage58"></A></P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:67.2px">In February&nbsp;2007, the FASB issued SFAS No.&nbsp;159, &#147;The Fair Value Option for Financial Assets and Financial Liabilities.&#148; SFAS No.&nbsp;159 permits entities to choose to measure, on an item-by-item basis, specified financial instruments and certain other items at fair value. Unrealized gains and losses on items for which the fair value option has been elected are required to be reported in earnings at each reporting date. SFAS No.&nbsp;159 is effective for fiscal years beginning after November&nbsp;15, 2007, the provisions of which are required to be applied prospectively. The Company is currently evaluating the impact of adopting SFAS No.&nbsp;159 on its financial statements.</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:67.2px">In December&nbsp;2007, the FASB issued SFAS No.&nbsp;141 (revised 2007), Business Combinations, which replaces SFAS No 141. The statement retains the purchase method of accounting for acquisitions, but requires a number of changes, including changes in the way assets and liabilities are recognized in the purchase accounting. It also changes the recognition of assets acquired and liabilities assumed arising from contingencies, requires the capitalization of in-process research and development at fair value, and requires the expensing of acquisition-related costs as incurred. SFAS No.&nbsp;141R is effective for business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December&nbsp;15, 2008.</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:67.2px">In December&nbsp;2007, the FASB issued SFAS No.&nbsp;160. &#147;Noncontrolling Interests in Consolidated Financial Statements-and Amendment of ARB No.&nbsp;51.&#148; SFAS 160 establishes accounting and reporting standards pertaining to ownership interests in subsidiaries held by parties other than the parent, the amount of net income attributable to the parent and to the noncontrolling interest, changes in a parent&#146;s ownership interest, and the valuation of any retained noncontrolling equity investment when a subsidiary is deconsolidated. This statement also establishes disclosure requirements that clearly identify and distinguish between the interests of the parent and the interests of the noncontrolling owners. SFAS 160 is effective for fiscal years beginning on or after December&nbsp;15, 2008. The adoption of SFAS 160 is not currently expected to have a material effect on the Company&#146;s consolidated financial position, results 
of operations, or cash flows.</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:67.2px">In March&nbsp;2008, the FASB issued SFAS No.&nbsp;161, Disclosures about Derivative Instruments and Hedging Activities. The new standard is intended to improve financial reporting about derivative instruments and hedging activities by requiring enhanced disclosures to enable investors to better understand their effects on an entity&#146;s financial position, financial performance, and cash flows. It is effective for financial statements issued for fiscal years and interim periods beginning after November&nbsp;15, 2008, with early application encouraged. The Company is currently evaluating the impact of adopting SFAS. No.&nbsp;161 on its financial statements.</P>
<P style="margin-top:0px; margin-bottom:8.867px"><BR>
<BR></P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center>5</P>
<P style="margin:0px"><BR></P>
<HR style="margin-top:9.6px; margin-bottom:9.6px" noshade size=1.333>
<P style="margin:0px; page-break-before:always" align=center><B>COFFEE HOLDING CO., INC. AND SUBSIDIARY</B></P>
<P style="margin:0px; font-family:Times New Roman Bold" align=center><B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)</B></P>
<P style="margin:0px" align=center><B>APRIL 30, 2008 AND 2007</B></P>
<P style="margin-top:0px; margin-bottom:13.333px" align=center><B>(Unaudited)</B></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:8.867px" align=justify><B>NOTE 4 &nbsp;&#150; &nbsp;CAF&#201; LA RICA, LLC - JOINT VENTURE</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:67.2px">The following represents condensed financial information of CLR as of April&nbsp;30, 2007 and for the six months then ended.</P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=286.133></TD><TD width=26.8></TD><TD width=11></TD><TD width=78.4></TD><TD width=7.267></TD></TR>
<TR><TD valign=top width=286.133><P style="margin:0px">Current assets</P>
</TD><TD valign=top width=26.8><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD valign=top width=11><P style="margin:0px">$</P>
</TD><TD valign=top width=78.4><P style="margin:0px" align=right>363,828</P>
</TD><TD valign=top width=7.267><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=286.133><P style="margin:0px">Machinery and other assets</P>
</TD><TD valign=top width=26.8><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=11><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=78.4><P style="margin:0px" align=right>448,555</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=top width=7.267><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=286.133><P style="margin:0px; padding-left:40px; text-indent:-8px">Total assets</P>
</TD><TD valign=top width=26.8><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=top width=11><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=top width=78.4><P style="margin:0px" align=right>812,383</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=top width=7.267><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=286.133><P>&nbsp;</P></TD><TD valign=top width=26.8><P>&nbsp;</P></TD><TD valign=top width=11><P>&nbsp;</P></TD><TD valign=top width=78.4><P>&nbsp;</P></TD><TD valign=top width=7.267><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=286.133><P style="margin:0px">Current liabilities</P>
</TD><TD valign=top width=26.8><P>&nbsp;</P></TD><TD valign=top width=11><P style="margin:0px">$</P>
</TD><TD valign=top width=78.4><P style="margin:0px" align=right>643,172</P>
</TD><TD valign=top width=7.267><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=286.133><P style="margin:0px">Other liabilities</P>
</TD><TD valign=top width=26.8><P>&nbsp;</P></TD><TD valign=top width=11><P>&nbsp;</P></TD><TD valign=top width=78.4><P style="margin:0px" align=right>5,889</P>
</TD><TD valign=top width=7.267><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=286.133><P style="margin:0px">Equity</P>
</TD><TD valign=top width=26.8><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=11><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=78.4><P style="margin:0px" align=right>163,322</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=top width=7.267><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=286.133><P>&nbsp;</P></TD><TD valign=top width=26.8><P>&nbsp;</P></TD><TD valign=top width=11><P>&nbsp;</P></TD><TD valign=top width=78.4><P>&nbsp;</P></TD><TD valign=top width=7.267><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=286.133><P style="margin:0px; padding-left:40px; text-indent:-8px">Total liabilities and capital</P>
</TD><TD valign=top width=26.8><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=top width=11><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=top width=78.4><P style="margin:0px" align=right>812,383</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=top width=7.267><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=286.133><P style="margin:0px">Sales</P>
</TD><TD valign=top width=26.8><P>&nbsp;</P></TD><TD valign=top width=11><P style="margin:0px">$</P>
</TD><TD valign=top width=78.4><P style="margin:0px" align=right>344,806</P>
</TD><TD valign=top width=7.267><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=286.133><P>&nbsp;</P></TD><TD valign=top width=26.8><P>&nbsp;</P></TD><TD valign=top width=11><P>&nbsp;</P></TD><TD valign=top width=78.4><P>&nbsp;</P></TD><TD valign=top width=7.267><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=286.133><P style="margin:0px">Expenses</P>
</TD><TD valign=top width=26.8><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=11><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=78.4><P style="margin:0px" align=right>532,684</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=top width=7.267><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=286.133><P>&nbsp;</P></TD><TD valign=top width=26.8><P>&nbsp;</P></TD><TD valign=top width=11><P>&nbsp;</P></TD><TD valign=top width=78.4><P>&nbsp;</P></TD><TD valign=top width=7.267><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=286.133><P style="margin:0px">Net loss</P>
</TD><TD valign=top width=26.8><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=top width=11><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=top width=78.4><P style="margin:0px" align=right>(187,878</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=top width=7.267><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=top width=286.133><P>&nbsp;</P></TD><TD valign=top width=26.8><P>&nbsp;</P></TD><TD valign=top width=11><P>&nbsp;</P></TD><TD valign=top width=78.4><P>&nbsp;</P></TD><TD valign=top width=7.267><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=286.133><P style="margin:0px">Company&#146;s share of net loss</P>
</TD><TD valign=top width=26.8><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=top width=11><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=top width=78.4><P style="margin:0px" align=right>(93,939</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=top width=7.267><P style="margin:0px">)</P>
</TD></TR>
</TABLE>
<P style="margin-top:13.333px; margin-bottom:13.333px; padding-left:67.2px">During the six months ended April&nbsp;30, 2007, the Company wrote-down the amount due from joint venture by $242,000 and wrote-down its investment in joint venture by $33,000 as a result of the Company&#146;s plans to dissolve CLR. CLR was dissolved on October&nbsp;17, 2007, so no condensed financial information is presented as of April&nbsp;30, 2008 and for the six and three months then ended.</P>
<P style="margin-top:0px; margin-bottom:8.867px"><B>NOTE 5 &nbsp;&#150; &nbsp;ACCOUNTS RECEIVABLE:</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:67.2px">Accounts receivable are recorded net of allowances. The allowance for doubtful accounts represents the estimated uncollectible portion of accounts receivable. The reserve for sales discounts represents the estimated discount that customers will take upon payment. The allowances are summarized as follows: </P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=394.667></TD><TD width=27.6></TD><TD width=11.867></TD><TD width=76.6></TD><TD width=27.6></TD><TD width=11.133></TD><TD width=72.4></TD><TD width=2.133></TD></TR>
<TR><TD valign=top width=394.667><P>&nbsp;</P></TD><TD valign=top width=27.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>April&nbsp;30,<BR>
2008 </B></P>
</TD><TD valign=top width=27.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>October&nbsp;31,<BR>
2007</P>
</TD><TD valign=top width=2.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=394.667><P>&nbsp;</P></TD><TD valign=top width=27.6><P>&nbsp;</P></TD><TD valign=top colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>(unaudited)</B></P>
</TD><TD valign=top width=27.6><P>&nbsp;</P></TD><TD valign=top colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>(audited)</P>
</TD><TD valign=top width=2.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=394.667><P style="margin:0px">Allowance for doubtful accounts&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD valign=top width=27.6><P style="margin:0px"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B></P>
</TD><TD valign=top width=11.867><P style="margin:0px"><B>$</B></P>
</TD><TD valign=top width=76.6><P style="margin:0px" align=right><B>92,464</B></P>
</TD><TD valign=top width=27.6><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD valign=top width=11.133><P style="margin:0px">$</P>
</TD><TD valign=top width=72.4><P style="margin:0px" align=right>92,464</P>
</TD><TD valign=top width=2.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=394.667><P style="margin:0px">Reserve for sales discounts</P>
</TD><TD valign=top width=27.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=11.867><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=76.6><P style="margin:0px" align=right><B>35,000</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=top width=27.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=11.133><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=top width=72.4><P style="margin:0px" align=right>44,317</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=top width=2.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=394.667><P style="margin:0px">Totals</P>
</TD><TD valign=top width=27.6><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=top width=11.867><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=top width=76.6><P style="margin:0px" align=right><B>127,464</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=top width=27.6><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=top width=11.133><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=top width=72.4><P style="margin:0px" align=right>136,781</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=top width=2.133><P>&nbsp;</P></TD></TR>
</TABLE>
<P style="margin-top:13.333px; margin-bottom:8.867px" align=justify><B>NOTE 6 &nbsp;&#150; &nbsp;INVENTORIES:</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:67.2px">Inventories consisted of the following: </P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=394.533></TD><TD width=24.733></TD><TD width=9.867></TD><TD width=79.133></TD><TD width=24.733></TD><TD width=9.867></TD><TD width=79.133></TD><TD width=2></TD></TR>
<TR><TD valign=bottom width=394.533><P>&nbsp;</P></TD><TD valign=bottom width=24.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>April&nbsp;30,<BR>
2008</B></P>
</TD><TD valign=bottom width=24.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>October&nbsp;31,<BR>
2007</P>
</TD><TD valign=bottom width=2><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=394.533><P>&nbsp;</P></TD><TD valign=bottom width=24.733><P>&nbsp;</P></TD><TD valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>(unaudited)</B></P>
</TD><TD valign=bottom width=24.733><P>&nbsp;</P></TD><TD valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>(audited)</P>
</TD><TD valign=bottom width=2><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=394.533><P style="margin:0px">Packed coffee</P>
</TD><TD valign=bottom width=24.733><P style="margin:0px"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B></P>
</TD><TD valign=bottom width=9.867><P style="margin:0px"><B>$</B></P>
</TD><TD valign=bottom width=79.133><P style="margin:0px" align=right><B>1,116,636</B></P>
</TD><TD valign=bottom width=24.733><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD valign=bottom width=9.867><P style="margin:0px">$</P>
</TD><TD valign=bottom width=79.133><P style="margin:0px" align=right>1,233,457</P>
</TD><TD valign=bottom width=2><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=394.533><P style="margin:0px">Green coffee</P>
</TD><TD valign=bottom width=24.733><P>&nbsp;</P></TD><TD valign=bottom width=9.867><P>&nbsp;</P></TD><TD valign=bottom width=79.133><P style="margin:0px" align=right><B>2,623,517</B></P>
</TD><TD valign=bottom width=24.733><P>&nbsp;</P></TD><TD valign=bottom width=9.867><P>&nbsp;</P></TD><TD valign=bottom width=79.133><P style="margin:0px" align=right>2,379,212</P>
</TD><TD valign=bottom width=2><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=394.533><P style="margin:0px">Packaging supplies&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD valign=bottom width=24.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=9.867><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=79.133><P style="margin:0px" align=right><B>731,310</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=24.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=9.867><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=79.133><P style="margin:0px" align=right>859,428</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=2><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=394.533><P style="margin:0px">Totals</P>
</TD><TD valign=bottom width=24.733><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=9.867><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=79.133><P style="margin:0px" align=right><B>4,471,463</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=24.733><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=9.867><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=79.133><P style="margin:0px" align=right>4,472,097</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=2><P>&nbsp;</P></TD></TR>
</TABLE>
<P style="margin:0px" align=justify><BR></P>
<P style="margin-top:0px; margin-bottom:6.667px"><BR>
<BR></P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center>6</P>
<P style="margin:0px"><BR></P>
<HR style="margin-top:9.6px; margin-bottom:9.6px" noshade size=1.333>
<P style="margin:0px; page-break-before:always" align=center><B>COFFEE HOLDING CO., INC. AND SUBSIDIARY</B></P>
<P style="margin:0px; font-family:Times New Roman Bold" align=center><B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)</B></P>
<P style="margin:0px" align=center><B>APRIL 30, 2008 AND 2007</B></P>
<P style="margin-top:0px; margin-bottom:13.333px" align=center><B>(Unaudited)</B></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:6.667px"><B>NOTE 7 &nbsp;&#150; &nbsp;HEDGING:</B></P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:67.2px">The Company uses options and futures contracts to partially hedge the effects of fluctuations in the price of green coffee beans. Options and futures contracts are marked to market with current recognition of gains and losses on such positions. The Company&#146;s accounting for options and futures contracts may increase earnings volatility in any particular period. The Company has open position contracts held by the broker which includes primarily cash and commodities for futures and options in the amount of $823,218 and $3,468,530 at April&nbsp;30, 2008 and October&nbsp;31, 2007, respectively, which include unrealized losses of $130,044 at April&nbsp;30, 2008 and unrealized gains of $335,750 at October&nbsp;31, 2007. The Company classifies its options and future contracts as trading securities and accordingly, unrealized holding gains and losses are included in cost of sales and not reflected as a net amount in a separate component of sha
reholders&#146; equity.</P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:67.2px">At April&nbsp;30, 2008 the Company did not have any options. At April&nbsp;30, 2007, the Company held 600 options (generally with terms of two months or less) covering an aggregate of 22,500,000 pounds of green coffee beans at a price of $1.00 to $1,10 per pound including the value of the option. The fair market value of these options, which was obtained from a major financial institution, was $1,338,975 at April&nbsp;30, 2007.</P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:67.2px">The Company acquires futures contracts with longer terms (generally three to four months) primarily for the purpose of guaranteeing an adequate supply of green coffee.</P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:67.2px">At April&nbsp;30, 2008, the Company held 71 futures contracts for the purchase of 2,662,500 pounds of coffee at an average price of $1.37 per pound. The market price of coffee applicable to such contracts was $1.35 per pound at that date.</P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:67.2px">At April&nbsp;30, 2007, the Company held 148 futures contracts for the purchase of 5,550,000 pounds of coffee at an average price of $1.12 per pound. The market price of coffee applicable to such contracts was $1.06 per pound at that date.</P>
<P style="margin-top:0px; margin-bottom:6.667px; padding-left:67.2px">The Company recorded realized and unrealized gains and losses, which are included in cost of sales and due from commodities held at broker for the three and six months ended April&nbsp;30, 2008 and 2007, respectively, on these contracts as follows:</P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=401.067></TD><TD width=22.933></TD><TD width=9.267></TD><TD width=79.867></TD><TD width=27.6></TD><TD width=9.267></TD><TD width=67.867></TD><TD width=6.133></TD></TR>
<TR><TD valign=bottom width=401.067><P>&nbsp;</P></TD><TD valign=bottom width=22.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=5><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>Three Months Ended April&nbsp;30,</B></P>
</TD><TD valign=bottom width=6.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=401.067><P>&nbsp;</P></TD><TD valign=bottom width=22.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>2008</B></P>
</TD><TD valign=bottom width=27.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>2007</P>
</TD><TD valign=bottom width=6.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=401.067><P>&nbsp;</P></TD><TD valign=bottom width=22.933><P>&nbsp;</P></TD><TD valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>(unaudited)</B></P>
</TD><TD valign=bottom width=27.6><P>&nbsp;</P></TD><TD valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>(unaudited)</P>
</TD><TD valign=bottom width=6.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=401.067><P style="margin:0px">Gross realized gains</P>
</TD><TD valign=bottom width=22.933><P style="margin:0px"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B></P>
</TD><TD valign=bottom width=9.267><P style="margin:0px"><B>$</B></P>
</TD><TD valign=bottom width=79.867><P style="margin:0px" align=right><B>658,795</B></P>
</TD><TD valign=bottom width=27.6><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD valign=bottom width=9.267><P style="margin:0px">$</P>
</TD><TD valign=bottom width=67.867><P style="margin:0px" align=right>121,515</P>
</TD><TD valign=bottom width=6.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=401.067><P style="margin:0px">Gross realized losses</P>
</TD><TD valign=bottom width=22.933><P>&nbsp;</P></TD><TD valign=bottom width=9.267><P style="margin:0px"><B>$</B></P>
</TD><TD valign=bottom width=79.867><P style="margin:0px" align=right><B>(2,611,430</B></P>
</TD><TD valign=bottom width=27.6><P style="margin:0px"><B>)</B></P>
</TD><TD valign=bottom width=9.267><P style="margin:0px">$</P>
</TD><TD valign=bottom width=67.867><P style="margin:0px" align=right>(205,211</P>
</TD><TD valign=bottom width=6.133><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=401.067><P style="margin:0px">Net unrealized (losses) gains</P>
</TD><TD valign=bottom width=22.933><P>&nbsp;</P></TD><TD valign=bottom width=9.267><P style="margin:0px"><B>$</B></P>
</TD><TD valign=bottom width=79.867><P style="margin:0px" align=right><B>(130,044</B></P>
</TD><TD valign=bottom width=27.6><P style="margin:0px"><B>)</B></P>
</TD><TD valign=bottom width=9.267><P style="margin:0px">$</P>
</TD><TD valign=bottom width=67.867><P style="margin:0px" align=right>526,159</P>
</TD><TD valign=bottom width=6.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=401.067><P>&nbsp;</P></TD><TD valign=bottom width=22.933><P>&nbsp;</P></TD><TD valign=bottom width=9.267><P>&nbsp;</P></TD><TD valign=bottom width=79.867><P>&nbsp;</P></TD><TD valign=bottom width=27.6><P>&nbsp;</P></TD><TD valign=bottom width=9.267><P>&nbsp;</P></TD><TD valign=bottom width=67.867><P>&nbsp;</P></TD><TD valign=bottom width=6.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=401.067><P>&nbsp;</P></TD><TD valign=bottom width=22.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=6><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>Six Months Ended April&nbsp;30,</B></P>
</TD></TR>
<TR><TD valign=bottom width=401.067><P>&nbsp;</P></TD><TD valign=bottom width=22.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>2008</B></P>
</TD><TD valign=bottom width=27.6><P>&nbsp;</P></TD><TD valign=bottom width=9.267><P>&nbsp;</P></TD><TD valign=bottom width=67.867><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>2007</P>
</TD><TD valign=bottom width=6.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=401.067><P>&nbsp;</P></TD><TD valign=bottom width=22.933><P>&nbsp;</P></TD><TD valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>(unaudited)</B></P>
</TD><TD valign=bottom width=27.6><P>&nbsp;</P></TD><TD style="border-top:1px solid #000000" valign=bottom width=9.267><P>&nbsp;</P></TD><TD style="border-top:1px solid #000000" valign=bottom width=67.867><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>(unaudited)</P>
</TD><TD style="border-top:1px solid #000000" valign=bottom width=6.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=401.067><P style="margin:0px">Gross realized gains</P>
</TD><TD valign=bottom width=22.933><P>&nbsp;</P></TD><TD valign=bottom width=9.267><P style="margin:0px"><B>$</B></P>
</TD><TD valign=bottom width=79.867><P style="margin:0px" align=right><B>1,545,301</B></P>
</TD><TD valign=bottom width=27.6><P>&nbsp;</P></TD><TD valign=bottom width=9.267><P style="margin:0px">$</P>
</TD><TD valign=bottom width=67.867><P style="margin:0px" align=right>806,232</P>
</TD><TD valign=bottom width=6.133><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=401.067><P style="margin:0px">Gross realized losses</P>
</TD><TD valign=bottom width=22.933><P>&nbsp;</P></TD><TD valign=bottom width=9.267><P style="margin:0px"><B>$</B></P>
</TD><TD valign=bottom width=79.867><P style="margin:0px" align=right><B>(2,904,493</B></P>
</TD><TD valign=bottom width=27.6><P style="margin:0px"><B>)</B></P>
</TD><TD valign=bottom width=9.267><P style="margin:0px">$</P>
</TD><TD valign=bottom width=67.867><P style="margin:0px" align=right>(299,612</P>
</TD><TD valign=bottom width=6.133><P style="margin:0px">)</P>
</TD></TR>
<TR><TD valign=bottom width=401.067><P style="margin:0px">Net unrealized (losses) gains&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD valign=bottom width=22.933><P>&nbsp;</P></TD><TD valign=bottom width=9.267><P style="margin:0px"><B>$</B></P>
</TD><TD valign=bottom width=79.867><P style="margin:0px" align=right><B>(130,044</B></P>
</TD><TD valign=bottom width=27.6><P style="margin:0px"><B>)</B></P>
</TD><TD valign=bottom width=9.267><P style="margin:0px">$</P>
</TD><TD valign=bottom width=67.867><P style="margin:0px" align=right>526,159</P>
</TD><TD valign=bottom width=6.133><P>&nbsp;</P></TD></TR>
</TABLE>
<P style="margin-top:7.8px; margin-bottom:6.667px"><BR></P>
<P style="margin-top:7.8px; margin-bottom:6.667px"><BR>
<BR></P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center>7</P>
<P style="margin:0px"><BR></P>
<HR style="margin-top:9.6px; margin-bottom:9.6px" noshade size=1.333>
<P style="margin:0px; page-break-before:always" align=center><B>COFFEE HOLDING CO., INC. AND SUBSIDIARY</B></P>
<P style="margin:0px; font-family:Times New Roman Bold" align=center><B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)</B></P>
<P style="margin:0px" align=center><B>APRIL 30, 2008 AND 2007</B></P>
<P style="margin-top:0px; margin-bottom:13.333px" align=center><B>(Unaudited)</B></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:7.8px; margin-bottom:6.667px"><B>NOTE 8 &nbsp;&#150; &nbsp;LINE OF CREDIT:</B></P>
<P style="margin-top:0px; margin-bottom:13.333px; padding-left:67.2px">The Company has a financing agreement with Merrill Lynch Business Financial Services, Inc. for a line of credit of up to $4,000,000 with a maturity date of October&nbsp;31, 2008. The line of credit is secured by a blanket lien on all the assets of the Company and the personal guarantees of two of the Company&#146;s officer/shareholders, requires monthly interest payments at a rate of LIBOR plus 1.95%, or 4.77% as of April&nbsp;30, 2008 (the rate was LIBOR plus 2.15%, or 6.66%, as of October&nbsp;31, 2007), and requires the Company to comply with various financial covenants. As of October&nbsp;31, 2007, the Company was in compliance with all financial covenants. As of April&nbsp;30, 2008, the Company was in violation of the Fixed Charge Coverage Ratio and the Total Debt to EBITDA Ratio covenants contained in the financing agreement. The Company has received a waiver of its violation of those two financial covenants as of April&nbsp;30, 200
8 from Merrill Lynch. As of April&nbsp;30, 2008 and October&nbsp;31, 2007, the borrowings under the line of credit were $2,556,762 and $897,191, respectively. As of April&nbsp;30, 2008, the Company had $1,443,238 of additional borrowings available under the line of credit agreement.</P>
<P style="margin-top:0px; margin-bottom:6.667px"><B>NOTE 9 &nbsp;&#150; &nbsp;INCOME TAXES:</B></P>
<P style="margin-top:0px; margin-bottom:13.333px; padding-left:67.2px">The Company accounts for<B> </B>income taxes pursuant to the asset and liability method which requires<B> </B>deferred income tax assets and liabilities to be computed for temporary differences between the financial statement and tax bases of assets and liabilities that will result in taxable or deductible amounts in the future based on enacted tax laws and rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. The Company did not record a valuation allowance at April&nbsp;30, 2008 and October&nbsp;31, 2007 since the net deferred tax asset is expected to be realized. The income tax benefit/(provision) represents the actual tax for the period plus or minus the change during the period in deferred tax assets and liabilities. During the six and three months ended April&nbsp;30, 2008
, the Company&#146;s net deferred tax asset increased as a result of the Company&#146;s net operating loss generated during the three and six months ended April&nbsp;30, 2008, and is expected to be realized in the future to reduce future taxable income.</P>
<P style="margin-top:0px; margin-bottom:8.867px"><BR>
<BR></P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center>8</P>
<P style="margin:0px"><BR></P>
<HR style="margin-top:9.6px; margin-bottom:9.6px" noshade size=1.333>
<P style="margin:0px; page-break-before:always" align=center><B>COFFEE HOLDING CO., INC. AND SUBSIDIARY</B></P>
<P style="margin:0px; font-family:Times New Roman Bold" align=center><B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)</B></P>
<P style="margin:0px" align=center><B>APRIL 30, 2008 AND 2007</B></P>
<P style="margin-top:0px; margin-bottom:13.333px" align=center><B>(Unaudited)</B></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:8.867px"><B>NOTE 10 &nbsp;&#150; &nbsp;EARNINGS (LOSS) PER SHARE:</B></P>
<P style="margin-top:0px; margin-bottom:13.333px; padding-left:75.2px">The Company presents &#147;basic&#148; and &#147;diluted&#148; earnings per common share pursuant to the provisions of Statement of Financial Accounting Standards No.&nbsp;128, &#147;Earnings per Share.&#148; Basic earnings (loss) per share is based on the weighted-average number of common shares outstanding and diluted earnings (loss) per share is based on the weighted-average number of common shares outstanding plus all potential dilutive common shares outstanding. The only potential dilutive common shares outstanding pertain to the 70,000 warrants, which were not included in the diluted earnings calculation since the Company incurred a loss for the three and six months ended April&nbsp;30, 2008. The following weighted average number of shares was used for the computation of basic and diluted earnings (loss) per share. </P>
<A NAME="OLE_LINK5"></A><A NAME="OLE_LINK6"></A><A NAME="_Hlk200448359"></A><TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=253.667></TD><TD width=19></TD><TD width=7.6></TD><TD width=65.667></TD><TD width=23.933></TD><TD width=7.6></TD><TD width=60.667></TD><TD width=19></TD><TD width=7.6></TD><TD width=65.667></TD><TD width=23.933></TD><TD width=7.6></TD><TD width=60.667></TD><TD width=1.4></TD></TR>
<TR><TD valign=bottom width=253.667><P>&nbsp;</P></TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=5><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>Six Months Ended<BR>
April&nbsp;30</B>,</P>
</TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=5><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>Three Months Ended<BR>
April, 30</B></P>
</TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=253.667><P>&nbsp;</P></TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>2008</B></P>
</TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>2007</P>
</TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>2008</B></P>
</TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>2007</P>
</TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=253.667><P style="margin:0px">Net Income (Loss)</P>
</TD><TD valign=bottom width=19><P style="margin:0px"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=65.667><P style="margin:0px" align=right><B>(1,861,913</B></P>
</TD><TD valign=bottom width=23.933><P style="margin:0px"><B>)</B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=60.667><P style="margin:0px" align=right>648,592</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=19><P style="margin:0px"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=65.667><P style="margin:0px" align=right><B>(2,044,178</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=23.933><P style="margin:0px"><B>)</B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=60.667><P style="margin:0px" align=right>338,888</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=253.667><P>&nbsp;</P></TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=65.667><P>&nbsp;</P></TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=60.667><P>&nbsp;</P></TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=65.667><P>&nbsp;</P></TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=60.667><P>&nbsp;</P></TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=253.667><P style="margin:0px">BASIC EARNINGS:</P>
</TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=65.667><P>&nbsp;</P></TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=60.667><P>&nbsp;</P></TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=65.667><P>&nbsp;</P></TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=60.667><P>&nbsp;</P></TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=253.667><P style="margin:0px; padding-left:8px; text-indent:-8px">Weighted average number of common<BR>
shares outstanding</P>
</TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=65.667><P style="margin:0px" align=right><B>5,497,254</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=23.933><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=60.667><P style="margin:0px" align=right>5,529,830</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=19><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=65.667><P style="margin:0px" align=right><B>5,497,254</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=23.933><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=60.667><P style="margin:0px" align=right>5,529,830</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=253.667><P>&nbsp;</P></TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=65.667><P>&nbsp;</P></TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=60.667><P>&nbsp;</P></TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=65.667><P>&nbsp;</P></TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=60.667><P>&nbsp;</P></TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=253.667><P style="margin:0px">Basic earnings (loss) per common share</P>
</TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=65.667><P style="margin:0px" align=right><B>(.34</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=23.933><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=60.667><P style="margin:0px" align=right>.12</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=19><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=65.667><P style="margin:0px" align=right><B>(.37</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=23.933><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=60.667><P style="margin:0px" align=right>.06</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=253.667><P>&nbsp;</P></TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=65.667><P>&nbsp;</P></TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=60.667><P>&nbsp;</P></TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=65.667><P>&nbsp;</P></TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=60.667><P>&nbsp;</P></TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=253.667><P style="margin:0px">DILUTED EARNINGS:</P>
</TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=65.667><P>&nbsp;</P></TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=60.667><P>&nbsp;</P></TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=65.667><P>&nbsp;</P></TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=60.667><P>&nbsp;</P></TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=253.667><P style="margin:0px; padding-left:8px; text-indent:-8px">Weighted average number of common<BR>
shares outstanding</P>
</TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=65.667><P style="margin:0px" align=right><B>5,497,254</B></P>
</TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=60.667><P style="margin:0px" align=right>5,529,830</P>
</TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=65.667><P style="margin:0px" align=right><B>5,497,254</B></P>
</TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=60.667><P style="margin:0px" align=right>5,529,830</P>
</TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=253.667><P style="margin:0px">Warrants &#150; common stock equivalents</P>
</TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=65.667><P style="margin:0px" align=right><B>0</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=23.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=60.667><P style="margin:0px" align=right>70,000</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=19><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=65.667><P style="margin:0px" align=right><B>0</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=23.933><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=7.6><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=60.667><P style="margin:0px" align=right>0</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=253.667><P>&nbsp;</P></TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=65.667><P>&nbsp;</P></TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=60.667><P>&nbsp;</P></TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=65.667><P>&nbsp;</P></TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=60.667><P>&nbsp;</P></TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=253.667><P style="margin:0px">Weighted average number of common<BR>
shares outstanding &#150; as adjusted</P>
</TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=65.667><P style="margin:0px" align=right><B>5,497,254</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=23.933><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=60.667><P style="margin:0px" align=right>5,599,830</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=19><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=65.667><P style="margin:0px" align=right><B>5,497,254</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=23.933><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=60.667><P style="margin:0px" align=right>5,529,830</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=253.667><P>&nbsp;</P></TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=65.667><P>&nbsp;</P></TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=60.667><P>&nbsp;</P></TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=65.667><P>&nbsp;</P></TD><TD valign=bottom width=23.933><P>&nbsp;</P></TD><TD valign=bottom width=7.6><P>&nbsp;</P></TD><TD valign=bottom width=60.667><P>&nbsp;</P></TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=253.667><P style="margin:0px">Diluted earnings (loss) per common share</P>
</TD><TD valign=bottom width=19><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=65.667><P style="margin:0px" align=right><B>(.34</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=23.933><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=60.667><P style="margin:0px" align=right>.12</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=19><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=65.667><P style="margin:0px" align=right><B>(.37</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=23.933><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=7.6><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=60.667><P style="margin:0px" align=right>.06</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
</TABLE>
<P style="margin-top:13.333px; margin-bottom:8.867px"><B>NOTE 11 &nbsp;&#150; &nbsp;LEGAL PROCEEDINGS:</B></P>
<P style="margin-top:0px; margin-bottom:13.333px; padding-left:75.2px">The Company is a party to various legal proceedings. In the opinion of management, these actions are routine in nature and will not have a material adverse effect on the Company&#146;s results of operations or financial position in future periods.</P>
<P style="margin-top:0px; margin-bottom:8.867px"><B>NOTE 12 &nbsp;&#150; &nbsp;ECONOMIC DEPENDENCY:</B></P>
<P style="margin-top:0px; margin-bottom:13.333px; padding-left:75.2px">For the six months ended April&nbsp;30, 2008, approximately 34% and 10% of the Company&#146;s sales were derived from two customers. Sales to these customers were approximately $11,500,000 and $3,650,000 and the corresponding accounts receivable from these customers at April&nbsp;30, 2008 were approximately $526,000 and $368,000, respectively.</P>
<P style="margin-top:0px; margin-bottom:13.333px; padding-left:75.2px">For the six months ended April&nbsp;30, 2007, approximately 27% of the Company&#146;s sales were derived from one customer. Sales to this customer were approximately $3,125,000 and the corresponding accounts receivable at April&nbsp;30, 2007 from this customer was approximately $737,000.</P>
<P style="margin-top:0px; margin-bottom:8.867px"><BR>
<BR></P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center>9</P>
<P style="margin:0px"><BR></P>
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<P style="margin:0px; page-break-before:always" align=center><B>COFFEE HOLDING CO., INC. AND SUBSIDIARY</B></P>
<P style="margin:0px; font-family:Times New Roman Bold" align=center><B>NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)</B></P>
<P style="margin:0px" align=center><B>APRIL 30, 2008 AND 2007</B></P>
<P style="margin-top:0px; margin-bottom:13.333px" align=center><B>(Unaudited)</B></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:8.867px"><B>NOTE 12 &nbsp;&#150; &nbsp;ECONOMIC DEPENDENCY: (continued)</B></P>
<P style="margin-top:0px; margin-bottom:13.333px; padding-left:75.2px">For the six months ended April&nbsp;30, 2008, approximately 47% and 10% of the Company&#146;s purchases were from two vendors. Purchases from these vendors were approximately $14,200,000 and $2,700,000 and the corresponding accounts payable to these vendors at April&nbsp;30, 2008 were approximately $1,350,000 and $363,000, respectively.</P>
<P style="margin-top:0px; margin-bottom:13.333px; padding-left:75.2px">For the six months ended April&nbsp;30, 2007, approximately 32% and 13% of the Company&#146;s purchases were from two vendors. Purchases from these vendors were approximately $7,200,000 and $3,000,000 and the corresponding accounts payable to these vendors at April&nbsp;30, 2007 were approximately $966,000 and $298,000, respectively.</P>
<P style="margin-top:0px; margin-bottom:13.333px; padding-left:75.2px">In addition, an employee of one of these vendors is a director of the Company. Purchases from that vendor totaled approximately $14,200,000 and $7,200,000 for the six months ended April&nbsp;30, 2008 and 2007, respectively. The corresponding accounts payable balance to this vendor were approximately $1,350,000 at April&nbsp;30, 2008 and $943,000 at October&nbsp;31, 2007. Management does not believe that the loss of any one vendor would have a material adverse effect of the Company&#146;s operations due to the availability of many alternate suppliers.</P>
<P style="margin-top:0px; margin-bottom:8.867px"><B>NOTE 13 &nbsp;&#150; &nbsp;WARRANTS FOR PURCHASE OF COMMON STOCK:</B></P>
<P style="margin-top:0px; margin-bottom:13.333px; padding-left:75.2px">The Company entered into an agreement with Maxim Group, LLC (&#147;Maxim&#148;) for Maxim to serve as the Company&#146;s financial advisors and lead managing underwriter for a public offering which concluded on June&nbsp;16, 2005 of the Company&#146;s common stock. Subsequently, Maxim and Joseph Stevens &amp; Company, Inc. (&#147;Joseph Stevens&#148;) entered into an agreement pursuant to which Joseph Stevens agreed to act as managing underwriter and Maxim participated in the underwriting syndicate of the offering. The Company also sold to Joseph Stevens and Maxim for $100, warrants to purchase 70,000 shares of common stock at a price of $6.00 per share. The fair value of these warrants were credited to additional paid in capital. The warrants are exercisable for a period of five (5) years and contain provisions for cashless exercise, anti-dilution and piggyback registration rights.</P>
<P style="margin-top:0px; margin-bottom:8.867px"><B>NOTE 14 &nbsp;&#150; &nbsp;TREASURY STOCK AND DIVIDENDS:</B></P>
<P style="margin-top:0px; margin-bottom:13.333px; padding-left:75.2px">The Company utilizes the cost method of accounting for treasury stock. The cost of reissued shares is determined under the Last in, First out method. During the six months ended April&nbsp;30, 2008, the Company purchased 34,714 shares for $138,737.</P>
<P style="margin-top:0px; margin-bottom:13.333px; padding-left:75.2px">The Company declared a 28 cent per share cash dividend, aggregating $1,544,568 on January&nbsp;31, 2008. The dividend was payable to all shareholders of record as of February&nbsp;15, 2008 and was disbursed on February&nbsp;29, 2008.</P>
<P style="margin-top:0px; margin-bottom:8.867px"><BR></P>
<A NAME="_Toc201059401"></A><A NAME="_Toc201059550"></A><A NAME="_Toc201059920"></A><P style="margin-top:0px; margin-bottom:8.867px"><BR>
<BR></P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center>10</P>
<P style="margin:0px"><BR></P>
<HR style="margin-top:9.6px; margin-bottom:9.6px" noshade size=1.333>
<P style="margin:0px; page-break-before:always"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:72px; text-indent:-72px; font-family:Times New Roman Bold"><B>Item 2.</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:72px; font-family:Times New Roman Bold"><B>Management&#146;s Discussion and Analysis of Financial Condition and Results of Operations.</B></P>
<P style="margin-top:0px; margin-bottom:13.333px"><B>Cautionary Note on Forward Looking Statements</B></P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">This report contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. We have based these forward-looking statements on our current expectations and projections about future events, including, among other things:</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:5.533px; padding-left:80px">the impact of rapid or persistent fluctuations in the price of coffee beans;</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:5.533px; padding-left:80px">fluctuations in the supply of coffee beans;</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:5.533px; padding-left:80px">general economic conditions and conditions which affect the market for coffee;</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:5.533px; padding-left:80px">our success in implementing our business strategy or introducing new products;</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:5.533px; padding-left:80px">our ability to attract and retain customers;</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:5.533px; padding-left:80px">our success in expanding our market presence in new geographic regions;</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:5.533px; padding-left:80px">the effects of competition from other coffee manufacturers and other beverage alternatives;</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:5.533px; padding-left:80px">changes in tastes and preferences for, or the consumption of, coffee;</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:5.533px; padding-left:80px">the success of our hedging strategy;</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:80px">our ability to obtain additional financing; and</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:80px">other risks which we identify in future filings with the Securities and Exchange Commission.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px">In some cases, you can identify forward-looking statements by terminology such as &#147;may,&#148; &#147;will,&#148; &#147;should,&#148; &#147;could,&#148; &#147;predict,&#148; &#147;potential,&#148; &#147;continue,&#148; &#147;expect,&#148; &#147;anticipate,&#148; &#147;future,&#148; &#147;intend,&#148; &#147;plan,&#148; &#147;believe,&#148; &#147;estimate&#148; and similar expressions (or the negative of such expressions). Any or all of our forward-looking statements in this annual report and in any other public statements we make may turn out to be wrong. They can be affected by inaccurate assumptions we might make or by known or unknown risks and uncertainties. Consequently, no forward looking statement can be guaranteed. In addition, we undertake no responsibility to update any forward-looking statement to reflect events or circumstances which occur after the date of this report.</P>
<P style="margin-top:0px; margin-bottom:8.867px"><B>Overview</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px">We are an integrated wholesale coffee roaster and dealer in the United States and one of the few coffee companies that offers a broad array of coffee products across the entire spectrum of consumer tastes, preferences and price points. As a result, we believe that we are well positioned to increase our profitability and endure potential coffee price volatility throughout varying cycles of the coffee market and economic conditions.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px">Our operations have primarily focused on the following areas of the coffee industry:</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:5.533px; padding-left:80px">the sale of wholesale specialty green coffee;</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:5.533px; padding-left:80px">the roasting, blending, packaging and sale of private label coffee; and</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:5.533px; padding-left:80px">the roasting, blending, packaging and sale of our seven brands of coffee.</P>
<P style="margin-top:0px; margin-bottom:5.533px; text-indent:48px">Our operating results are affected by a number of factors including:</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:5.533px; padding-left:80px">the level of marketing and pricing competition from existing or new competitors in the coffee industry;</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:5.533px; padding-left:80px">our ability to retain existing customers and attract new customers;</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:5.533px; padding-left:80px">the success of our hedging strategy;</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:5.533px; padding-left:80px">fluctuations in purchase prices and supply of green coffee and in the selling prices of our products; and</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol">&#183;</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:80px">our ability to manage inventory and fulfillment operations and maintain gross margins.</P>
<P style="margin-top:0px; margin-bottom:8.867px"><BR>
<BR></P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center>11</P>
<P style="margin:0px"><BR></P>
<HR style="margin-top:9.6px; margin-bottom:9.6px" noshade size=1.333>
<P style="margin:0px; page-break-before:always"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px">We operate from an East Coast facility located in Brooklyn, New York and a Western facility located in La Junta, Colorado. Operating out of these two facilities allows us to produce and distribute large quantities of fresh coffee products throughout the United States. In addition, by operating out of two facilities, we are able to gain economies of scale in both manufacturing and logistical efficiencies. This has allowed us to compete aggressively throughout the United States. As discussed in more detail below, we also own 60% of a specialty coffee joint venture located in Brecksville, Ohio.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px">Our net sales are driven primarily by the success of our sales and marketing efforts and our ability to retain existing customers and attract new customers. For this reason, we have made the strategic decision to invest in measures that will increase sales. For example, we recently established a West Coast sales department to increase our sales to West Coast customers.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px">In April&nbsp;2006, we entered into a joint venture with Caruso&#146;s Coffee of Brecksville, Ohio and formed Generations Coffee Company, LLC, a Delaware limited liability company, which engages in the roasting, packaging and sale of private label specialty coffee products. We own 60% of the joint venture and are the exclusive supplier of its coffee inventory. We believe that the Generations Coffee joint venture&nbsp;allows us to bid on the private label gourmet whole bean business we had not been equipped to pursue from an operational standpoint in the past. With this specialty roasting facility in place, in many cases right in the backyard of our most important wholesale and retail customers, we&nbsp;believe that we are in an ideal position to combine our current canned private label business with high-end private label specialty whole bean business. High-end specialty whole bean coffee sells for as much as three times more per pound than t
he canned coffees in which we currently specialize<B>. </B>Generations had approximately $208,000 and $109,000 in net sales for the six and three month periods ended April&nbsp;30, 2008, respectively. At April&nbsp;30, 2008, Generations had nine accounts, four of which made Generations the exclusive supplier for their fast growing and highly visible organic coffee programs.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px">As a result of these efforts, net sales increased in our specialty green coffee, private label and branded coffee business lines in both dollars and pounds sold. In addition, we increased the number of our customers in all three areas.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px">In July&nbsp;2007, we entered into a three-year licensing agreement with Entenmann&#146;s Products, Inc., a subsidiary of Entenmann&#146;s, Inc., which is one of the nation&#146;s oldest baking companies. The agreement gives us the exclusive rights to manufacture, market and distribute a full line of Entenmann&#146;s brand coffee products throughout the United States.<B> </B>We have developed not only mainstream Entenmann&#146;s coffee items, but upscale flavored Entenmann&#146;s products in twelve ounce valve bags as well. These products will give the line a visible upscale image to our retailers and their customers, which we believe will be integral to the long term success of this arrangement. Our first production run was in February&nbsp;2008 and our Entenmann&#146;s coffee products began appearing in supermarkets in the Northeast during mid-March&nbsp;2008. Although sales of Entenmann&#146;s coffee products started slowly, we expect sale
s to increase significantly as the products are stocked on more shelves and our advertising campaign begins during the third quarter of fiscal 2008.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px">Our net sales are affected by the price of green coffee. We import green coffee from Colombia, Mexico, Kenya, Brazil and Uganda. The supply and price of coffee beans are subject to volatility and are influenced by numerous factors which are beyond our control. For example, coffee crops in Brazil, which produces one-third of the world&#146;s green coffee, are susceptible to frost in June&nbsp;and July&nbsp;and drought in September, October&nbsp;and November. However, because we purchase coffee from a number of countries and are able to freely substitute one country&#146;s coffee for another in our products, price fluctuations in one country generally have not had a material impact on the price we pay for coffee. Historically, because we generally have been able to pass green coffee price increases through to customers, increased prices of green coffee generally result in increased net sales. However, the average indicator price for Robusta cof
fee, the main component for our leading espresso brands (Caf&#233; Caribe and Caf&#233; Supremo) remains near its highest level in the last eight years. We initiated a price increase on most roasted products of $0.10 per pound in late fiscal 2007 which took effect in fiscal 2008. During the beginning of calendar 2008, prices of Arabica and Robusta coffee continued to rise, increasing over 20% in a few weeks time. These price appreciations have negatively impacted our profit margins for a significant portion of our business. Early in 2008, we again initiated price increases in response to these conditions and have been able to obtain price concessions from most of our customers. Although, due to their timing, these price increases did not have a positive impact during our first two fiscal quarters of 2008, we anticipate that they will have a positive impact going forward. While Arabica and Robusta prices fell slightly in March&nbsp;and April&nbsp;of 2008, Robusta prices remain at historically high levels. In 
addition, the recent volatility in the markets had prevented us from successfully implementing our hedging </P>
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<P style="margin-top:0px; margin-bottom:8.867px">strategies during the past quarter. However, we believe that we will again be able to use our hedging strategy to reduce our cost of sales in the third quarter of fiscal 2008.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px">Historically, we have used short-term coffee futures and options contracts primarily for the purpose of partially hedging and minimizing the effects of changing green coffee prices and to reduce our cost of sales. In addition, we acquire futures contracts with longer terms, generally three to four months, primarily for the purpose of guaranteeing an adequate supply of green coffee at favorable prices. Although the use of these derivative financial instruments has enabled us to mitigate the effect of changing prices, no strategy can entirely eliminate pricing risks and we generally remain exposed to loss when prices decline or increase significantly in a very short period of time. In addition, we generally remain exposed to supply risk in the event of non-performance by the counter-parties to any futures contract. If the hedges that we enter do not adequately offset the risks of coffee bean price volatility or our hedges result in losses, our 
cost of sales may increase, resulting in a decrease in profitability. For the three and six month periods ended April&nbsp;30, 2008, we incurred net losses on options and futures contracts of $2,082,679 and $1,489,236, respectively. We believe these losses resulted from a surge in commodities prices due to the weaker U.S. dollar and a significant increase in market speculation. According to Commodities Futures Trading Commission tracking data, index funds almost doubled their positions in agricultural contracts from January&nbsp;2006 though April&nbsp;2008. As a result, fundamental players in the commodities markets lacked the liquidity necessary to maintain their positions due to margin calls. We believe that increased regulatory scrutiny has driven speculators out of the market. We do not expect future trading losses going forward.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px"><B>Critical Accounting Policies and Estimates</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px">The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Estimates are used for, but not limited to, the accounting for the allowance for doubtful accounts, inventories, income taxes and loss contingencies. Management bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results could differ from these estimates under different assumptions or conditions. </P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px">We believe the following critical accounting policies, among others, may be impacted significantly by judgment, assumptions and estimates used in the preparation of the financial statements:</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px; font-family:Symbol"><B>&#183;</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:80px">We recognize revenue in accordance with Securities and Exchange Commission Staff Accounting Bulletin No.&nbsp;104, &#147;Revenue Recognition&#148; (&#147;SAB 104&#148;). Under SAB 104, revenue is recognized at the point of passage to the customer of title and risk of loss, when there is persuasive evidence of an arrangement, the sales price is determinable, and collection of the resulting receivable is reasonably assured. We recognize revenue at the time of shipment. Sales are reflected net of discounts and returns.</P>
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<P style="margin-top:0px; margin-bottom:8.867px; padding-left:80px">Our allowance for doubtful accounts is maintained to provide for losses arising from customers&#146; inability to make required payments. If there is deterioration of our customers&#146; credit worthiness and/or there is an increase in the length of time that the receivables are past due greater than the historical assumptions used, additional allowances may be required. For example, every additional one&nbsp;percent of our accounts receivable that becomes uncollectible would increase our operating loss by approximately $57,000.\</P>
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<P style="margin-top:0px; margin-bottom:8.867px; padding-left:80px">Inventories are stated at cost (determined on a first-in, first-out basis). Based on our assumptions about future demand and market conditions, inventories are subject to be written-down to market value. If our assumptions about future demand change and/or actual market conditions are less favorable than those projected, additional writedowns of inventories may be required. Each additional one&nbsp;percent of potential inventory write-down would have increased operating loss by approximately $45,000 for the three months ended April&nbsp;30, 2008.</P>
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<P style="margin-top:0px; margin-bottom:8.867px; padding-left:80px">We account for income taxes in accordance with Statement of Financial Accounting Standards No.&nbsp;109, &#147;Accounting for Income Taxes&#148; (&#147;SFAS No.&nbsp;109&#148;). Under SFAS No.&nbsp;109, deferred tax assets and liabilities are determined based on the liabilities, using enacted tax rates in effect for the year in which the differences are expected to reverse. Deferred tax assets are reflected on the balance sheet when it is determined that it is more likely than not that the asset will be realized. Accordingly, </P>
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<P style="margin-top:0px; margin-bottom:8.867px; padding-left:80px">our net deferred tax asset as of April&nbsp;30, 2008 of approximately $1.3&nbsp;million could need to be written off if we do not remain profitable.</P>
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<P style="margin-top:0px; margin-bottom:8.867px; padding-left:80px">In addition, the calculation of our tax liabilities involves the inherent uncertainty associated with the application of complex tax laws. We are also subject to examination by various taxing authorities. We will estimate and provide adequate accruals, when necessary, for potential additional taxes and related interest expense that may ultimately result from such examinations in accordance with FIN 48.</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:80px; text-indent:-32px"><B>Comparison of Results of Operations for the Three Months Ended April&nbsp;30, 2007 and 2008</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px"><B><I>Net Loss.</I></B> We had a net loss of $2,044,178, or $0.37 per share (basic and diluted), for the three months ended <A NAME="OLE_LINK7"></A>April&nbsp;30, 2008 compared to net income of $338,888, or $0.06 per share (basic and diluted), for the three months ended April&nbsp;30, 2007. The net loss is a result of the fact that increased coffee prices and hedging losses resulted in our cost of sales exceeding our net sales for the current quarter.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px"><B><I>Net Sales.</I></B> Net sales totaled $18,169,441 for the three months ended April&nbsp;30, 2008, an increase of $3,975,068, or 28.0%, from $14,194,373 for the three months ended April&nbsp;30, 2007. The increase in net sales reflects both increased amounts of green coffee, branded coffee and private label coffee sold as well as increased sales prices compared to the second quarter of fiscal 2007. The increase in net sales also reflects the price increases we implemented in <A NAME="OLE_LINK11"></A>the fourth quarter of fiscal 2007 and the first quarter of fiscal 2008. We were forced to implement these price increases because sharp increases in the coffee commodity market over the past couple of years has increased the amount we pay for coffee beans.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px"><B><I>Cost of Sales.</I></B> Cost of sales for the three months ended April&nbsp;30, 2008 was $19,843,502 or 109.2% of net sales, as compared to $12,087,210 or 85.2% of net sales for the three months ended April&nbsp;30, 2007. The increase in cost of sales primarily reflects the increased cost of green coffee and losses on options and futures contracts. Green coffee purchases increased $4,649,166 from $10,360,268 to $15,009,434 due to higher green coffee prices and private label and green coffee sales volumes. Net losses on options and futures contracts, a component of cost of sales, equaled $2,082,679 for the second quarter of fiscal 2008 compared to net gains of $442,463 for the second quarter of fiscal 2007. We believe these losses resulted from a surge in commodities prices due to the U.S. weaker dollar and a significant increase in market speculation. According to Commodities Futures Trading Commission data, index funds almost doubled th
eir positions in agricultural contracts from January&nbsp;2006 though April&nbsp;2008. As a result, fundamental players in the commodities markets lacked the liquidity necessary to maintain their positions due to margin calls. We believe that increased regulatory scrutiny has driven speculators out of the market. We do not expect future trading losses going forward. The increase in cost of sales as a&nbsp;percentage of net sales reflects both higher green coffee prices which could not fully be passed along to customers through sales price increases and net losses on options and futures contracts.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px"><B><I>Gross Loss.</I></B> We had a gross loss of $1,674,061 for the three months ended April&nbsp;30, 2008 compared to gross profit of $2,107,163 for the three months ended April&nbsp;30, 2007. During the beginning of calendar 2008, prices of Arabica and Robusta coffee rose over 20% in a few weeks time. We initiated price increases in response to these conditions and have been able to obtain price concessions from most of our customers. Although, due to their timing, these price increases did not have a positive impact in our first two fiscal quarters of 2008, we anticipate that they will have a positive impact going forward beginning in the third quarter of 2008. While green coffee prices fell slightly during March&nbsp;and April&nbsp;of 2008, Robusta prices still remain at historically high levels and will continue to negatively impact our profit margins for a significant portion of our business to the extent we are not able to fully pass t
he price increases on to our customers. In addition, when national brands rolled back recent price increases during the second fiscal quarter of 2008, we were left with inventories that we sold at low profit levels. We have now sold approximately 80% of our poorly priced inventories and believe that margins will improve in the third quarter as a result.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px"><B><I>Operating Expenses.</I></B> Total operating expenses increased by $74,079, or 4.6%, to $1,678,755 for the three months ended <A NAME="OLE_LINK8"></A>April&nbsp;30, 2008 from $1,604,676 for the three months ended April&nbsp;30, 2007. The increase in operating expenses was due to an increases in selling and administrative expense of $53,193 and an increase in officers&#146; salaries of $20,886. The increase in selling and administrative expenses mainly reflects increases of approximately $60,000 in insurance expense, $29,000 in shipping costs and $25,000 in packaging development expenses, partially offset by decreases of approximately $30,000 in show and demo expenses, $22,000 in depreciation expense, $19,000 in repairs and maintenance and $15,000 in professional services. Insurance expense increased due to </P>
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<P style="margin-top:0px; margin-bottom:8.867px">increased premiums on workers compensation insurance resulting from higher payroll levels. Shipping costs rose due to increased net sales and higher fuel prices. Packaging development expenses increased due to approximately $75,000 spent on packaging related to the new Entenmann&#146;s line of products. We attended fewer trade shows during the second quarter of 2008 than we did during 2007, which is the reason for the expense decrease in that category. The decrease in professional services expense reflects litigation costs associated with Caf&#233; La Rica during the second quarter of fiscal 2007.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px"><B><I>Other Expense.</I></B> Other expense decreased by $48,568 to $13,038 for the three months ended April&nbsp;30, 2008 compared to $61,606 for the three months ended April&nbsp;30, 2007. Interest income decreased by $22,403 and interest expense remained relatively unchanged during the quarter compared to the same period in 2007. However, during the three months ended April&nbsp;30, 2007, we incurred expense of $30,000 which constituted our share of the loss incurred by our former Caf&#233; La Rica joint venture. Caf&#233; La Rica was dissolved effective October&nbsp;17, 2007. We also incurred an impairment loss of $31,892 on leasehold improvements during the second fiscal quarter of 2007. We incurred neither of those expenses during the first quarter of fiscal 2008.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px"><B><I>Loss Before Income Taxes and Minority Interest in Subsidiary.</I></B> We had a loss of $3,365,854 before income taxes and minority interest in subsidiary for the three months ended April&nbsp;30, 2008 compared to income of $440,881 during the comparable period in 2007.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px"><B><I>Income Taxes</I>.</B> Our benefit for income tax expense for the three months ended April&nbsp;30, 2008 totaled $1,312,000 compared to a provision of $102,200 for the three months ended April&nbsp;30, 2007. <A NAME="OLE_LINK2"></A>The change was attributable to a loss from operations during the second quarter of 2008 compared to income from operations during the second quarter of 2007.</P>
<P style="margin-top:0px; margin-bottom:8.867px"><B>Comparison of Results of Operations for the Six Months Ended April&nbsp;30, 2007 and 2008</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px"><B><I>Net Loss. </I></B>We had a net loss of $1,861,913, or $0.34 per share (basic and diluted), for the six months ended April&nbsp;30, 2008 compared to net income of $648,592, or $0.12 per share (basic and diluted), for the six months ended April&nbsp;30, 2007. The net loss reflects the fact that increased coffee prices and hedging losses resulted in very narrow margins for the period.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px"><B><I>Net Sales.</I></B> Net sales totaled $33,131,982 for the six months ended April&nbsp;30, 2008, an increase of $6,302,497, or 23.5%, from $26,829,485 for the six months ended April&nbsp;30, 2007. The increase in net sales reflects both increased amounts of green coffee, branded coffee and private label coffee sold as well as increased sales prices compared to the six months ended April&nbsp;30, 2007. The increase in net sales also reflects the price increases we implemented in the fourth quarter of fiscal 2007 and the first quarter of fiscal 2008. We were forced to implement these price increases because sharp increases in the coffee commodity market over the past couple of years has increased the amount we pay for coffee beans.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px"><B><I>Cost of Sales.</I></B> Cost of sales for the six months ended April&nbsp;30, 2008 was $32,925,925 or 99.4% of net sales, as compared to $22,553,727 or 84.1% of net sales for the six months ended April&nbsp;30, 2007. The increase in cost of sales primarily reflects the increased cost of green coffee and losses on options and futures contracts. Green coffee purchases increased $6,876,818 from $19,484,145 to $26,360,963 due to higher green coffee prices and private label and green coffee sales volumes. Net losses on options and futures contracts, a component of cost of sales, totaled $1,489,236 for the six months ended April&nbsp;30, 2008 compared to net gains of $1,032,779 for the six months ended April&nbsp;30, 2007. We believe these losses resulted from a surge in commodities prices due to the U.S. weaker dollar and a significant increase in market speculation. According to Commodities Futures Trading Commission data, index funds al
most doubled their positions in agricultural contracts from January&nbsp;2006 though April&nbsp;2008. As a result, fundamental players in the commodities markets lacked the liquidity necessary to maintain their positions due to margin calls. We believe that increased regulatory scrutiny has driven speculators out of the market. We do not expect future trading losses going forward. The increase in cost of sales as a&nbsp;percentage of net sales reflects both higher green coffee prices which could not fully be passed along to customers through sales price increases and net losses on options and futures contracts.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px"><B><I>Gross Profit.</I></B> Gross profit decreased by $4,069,701 from $4,275,758 for the six months ended April&nbsp;30, 2007 to $206,057 for the six months ended April&nbsp;30, 2008. Gross profit as a&nbsp;percentage of net sales decreased to 0.6% for the six months ended April&nbsp;30, 2008 from 15.9% for the six months ended April&nbsp;30, 2007. The decrease in our margins is attributable to higher green coffee prices that we were unable to pass on to our customers as well as net losses on options and futures contracts.</P>
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<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px">During the beginning of calendar 2008, prices of Arabica and Robusta coffee rose over 20% in a few weeks time. We initiated price increases in response to these conditions and have been able to obtain price concessions from most of our customers. Although, due to their timing, these price increases did not have a positive impact during our first two fiscal quarters of 2008, we anticipate that they will have a positive impact going forward beginning in the third quarter of 2008. While green coffee prices fell slightly during March&nbsp;and April&nbsp;of 2008, they still remain at historically high levels and will continue to negatively impact our profit margins for a significant portion of our business to the extent we are not able to fully pass the price increases on to our customers. In addition, when national brands rolled back recent price increases during the second fiscal quarter of 2008, we were left with inventories that we sold at
 low profit levels. We have now sold approximately 80% of our poorly priced inventories and believe that margins will improve in the third quarter as a result.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px"><B><I>Operating Expenses.</I></B> Total operating expenses decreased by $135,322, or 4.0%, to $3,219,056 for the six months ended April&nbsp;30, 2008 from $3,354,378 for the six months ended April&nbsp;30, 2007. The decrease in operating expenses primarily reflects a $242,000 write-down of amount due from Caf&#233; La Rica during the six months ended April&nbsp;30, 2007 and no corresponding write-down during the corresponding period in 2008. Selling and administrative expenses increased by $41,427 and officers&#146; salaries increased by $65,251. The increase in selling and administrative expenses mainly reflects increases of approximately $51,000 in insurance expense and $49,000 in utilities, partially offset by a decrease of approximately $84,000 in professional services. Insurance increased due to increased premiums on workers compensation insurance resulting from higher payroll levels. Utilities expense increased due to higher natural
 gas prices. The decrease in professional services expense reflects litigation costs associated with Caf&#233; La Rica during the first two quarters of fiscal 2007.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px"><B><I>Other Expense.</I></B> Other expense decreased by $118,842 to $17,773 for the six months ended April&nbsp;30, 2008 compared to $136,615 for the six months ended April&nbsp;30, 2007. The major components of other expense, interest income and interest expense, decreased by $32,248 and increased by $5,026, respectively, during the first six months of fiscal 2008 compared to fiscal 2007. However, we incurred expense of $93,939 during the six months ended April&nbsp;30, 2007, which constituted our share of the loss incurred by our Caf&#233; La Rica joint venture. We also wrote-down $33,000 of our investment in Caf&#233; La Rica during that period. Because Caf&#233; La Rica was dissolved effective October&nbsp;17, 2007, we incurred neither of those expenses during the six months ended April&nbsp;30, 2008. In addition, we incurred an impairment loss of $31,892 on leasehold improvements during the first six months of fiscal 2007 and we incu
rred no similar expense during 2008.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px"><B><I>Loss Before Income Taxes and Minority Interest in Subsidiary.</I></B> We had a loss of $3,030,772 before income taxes and minority interest in subsidiary for the six months ended April&nbsp;30, 2008 compared to income of $784,765 during the comparable period in 2007. The decrease was attributable to a loss from operations, partially offset by decreased other expense.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px"><B><I>Income Taxes</I>.</B> Our benefit for income taxes for the six months ended April&nbsp;30, 2008 totaled $1,169,949 compared to a provision of $140,050 for the six months ended April&nbsp;30, 2007. The change was attributable to a loss from operations during the six months ended April&nbsp;30, 2008 compared to income from operations during the same period in 2007.</P>
<P style="margin-top:0px; margin-bottom:8.867px"><B>Liquidity and Capital Resources</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px">As of April&nbsp;30, 2008, we had working capital of $5,635,154 which represented a $3,646,193 decrease from our working capital of $9,281,347 as of October&nbsp;31, 2007, and total stockholders&#146; equity of $8,657,125, which decreased by $3,545,218 from our total stockholders&#146; equity of $12,202,343 as of October&nbsp;31, 2007. Our working capital decreased primarily due to a decrease of $2,636,212 in commodities held at broker, a $1,659,571 increase in line of credit borrowings and a $1,478,680 decrease in accounts receivable, partially offset by a $1,052,000 increase in our deferred income tax asset and a $726,764 increase in cash. At April&nbsp;30, 2008, the outstanding balance on our line of credit was $2,556,762 compared to $897,191 at October&nbsp;31, 2007. Total stockholders&#146; equity decreased due to a decrease in retained earnings as a result of our net loss for the six month period, the payment of a cash dividend $0.2
8 per share in February&nbsp;2008 and the repurchase of 34,714 shares of our outstanding common stock during the quarter at a cost of $138,737.</P>
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<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px">As of April&nbsp;30, 2008, we had a financing agreement with Merrill Lynch Business Financial Services Inc. This line of credit is for a maximum $4,000,000, expires on October&nbsp;31, 2008 and requires monthly interest payments at a rate of LIBOR plus 1.95%. This loan is secured by a blanket lien on all of our assets. The credit facility contains covenants that place restrictions on our operations. Among other things, these covenants and the personal guarantees of two of the Company&#146;s officers/shareholders: require us to maintain certain financial ratios; require us to maintain a minimum net worth; and prohibit us from merging with or into other companies, acquiring all or substantially all of the assets of other companies, or selling all or substantially all of our assets without the consent of the lender. These restrictions could adversely impact our ability to implement our business plan, or raise additional capital, if needed. I
n addition, if we default under our existing credit facility or if our lender demands payment of a portion or all of our indebtedness, we may not have sufficient funds to make such payments. Due to our net losses for the three and six months ended April&nbsp;30, 2008, as of that date we were in violation of the Fixed Charge Coverage Ratio and the Total Debt to EBITDA Ratio covenants contained in the financing agreement. We have received a waiver of our violation of those two financial covenants as of April&nbsp;30, 2008 from Merrill Lynch. We expect to be in compliance with those financial covenants going forward.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px">For the six months ended April&nbsp;30, 2008, our operating activities provided net cash of $1,016,499 as compared to the six months ended April&nbsp;30, 2007 when net cash provided by operating activities was $1,597,041. The decreased cash flow from operations for the six months ended April&nbsp;30, 2008 was primarily due to our net loss during the period.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px">For the six months ended April&nbsp;30, 2008, our investing activities used net cash of $267,091 as compared to the six months ended April&nbsp;30, 2007 when net cash used in investing activities was $188,575. During each of the six month periods ended April&nbsp;30, 2008 and April&nbsp;30, 2007, all of the net cash used in investing activities related to purchases of property and equipment.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px">For the six months ended April&nbsp;30, 2008, our financing activities used net cash of $23,734 as compared to the six months ended April&nbsp;30, 2007 when net cash used by financing activities was $838,929. The decreased cash used in financing activities reflects increased advances under our bank line of credit, partially offset by increased cash payments under our line of credit, the payment of a cash dividend of $0.28 per share in February&nbsp;2008 and repurchases of our common stock.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px">We expect to fund our operations, including paying our liabilities, payment of any dividends, funding capital expenditures and making required payments on our debts, through the next twelve months with cash provided by operating activities and the use of our credit facility. We also believe we could, if necessary, obtain additional loans by mortgaging the building in which our headquarters is located.</P>
<P style="margin-top:0px; margin-bottom:8.867px"><B>Off-Balance Sheet Arrangements</B></P>
<A NAME="_Toc201059402"></A><P style="margin:0px; text-indent:48px">We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, results of operations, liquidity, capital expenditures or capital resources, that is material to investors.</P>
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<P style="margin-top:0px; margin-bottom:8.867px; padding-left:72px; font-family:Times New Roman Bold"><B>Quantitative and Qualitative Disclosures About Market Risk.</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px">Market risks relating to our operations result primarily from changes in interest rates and commodity prices as further described below.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px"><B><I>Interest Rate Risks.</I></B><I> </I>We are subject to market risk from exposure to fluctuations in interest rates. At April&nbsp;30, 2008, our debt consisted of $2,556,762 of variable rate debt under our revolving line of credit. At April&nbsp;30, 2008, interest on the variable rate debt was payable at 5.21 (or 1.95% above the one-month LIBOR rate) for the revolving line of credit.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px"><B><I>Commodity Price Risks.</I></B><I> </I>The supply and price of coffee beans are subject to volatility and are influenced by numerous factors which are beyond our control. Historically, we have used short-term coffee futures and options contracts (generally with terms of two months or less) primarily for the purpose of hedging and minimizing the effects of changing green coffee prices, as further explained in Note 7 of the notes to condensed consolidated financial statements in this report. At April&nbsp;30, 2008, we did not hold any options. In addition, we acquire futures contracts with longer terms (generally three to four months) primarily for the purpose of guaranteeing an adequate supply of green coffee. <A NAME="OLE_LINK9"></A>At April&nbsp;30, 2008, we held 71 futures contracts for the purchase of 2,662,500 pounds of coffee at an average price of $1.37 per pound. The market price of coffee applicable to such contracts was $1.3
7 per pound at that date.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px">The use of these derivative financial instruments has enabled us to mitigate the effect of changing prices although we generally remain exposed to loss when prices decline significantly in a short period of time or remain at higher levels, preventing us from obtaining inventory at favorable prices. We generally have been able to pass green coffee price increases through to customers, thereby maintaining our gross profits. However, we cannot predict whether we will be able to pass inventory price increases through to our customers in the future. Increased green coffee prices cause our margins to shrink to the extent we are unable to pass the full amount of increase through to our customers. We incurred significant losses on options and futures contracts during the three and six months ended April&nbsp;30, 2008. We believe these losses resulted from a surge in commodities prices due to the U.S. weaker dollar and a significant increase in ma
rket speculation. According to Commodities Futures Trading Commission data, index funds almost doubled their positions in agricultural contracts from January&nbsp;2006 though April&nbsp;2008. As a result, fundamental players in the commodities markets lacked the liquidity necessary to maintain their positions due to margin calls. We believe that increased regulatory scrutiny has driven speculators out of the market and we do not expect future trading losses going forward. Despite the losses we recently incurred, we believe our hedging policies remain a vital element to our business model not only in controlling our cost of sales, but also giving us the flexibility to obtain the inventory necessary to continue to grow our sales while minimizing margin compression during a time of historically high coffee prices.</P>
<A NAME="_Toc201059404"></A><A NAME="_Toc201059552"></A><A NAME="_Toc201059922"></A><P style="margin-top:0px; margin-bottom:-16px; padding-left:72px; text-indent:-72px; font-family:Times New Roman Bold"><B>Item 4.</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:72px; font-family:Times New Roman Bold"><B>Controls and Procedures.</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px">Management, including our President, Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of the end of the period covered by this report. Based upon that evaluation, the President and Chief Executive Officer, who is also the Chief Financial Officer, concluded that the disclosure controls and procedures were effective to ensure that information required to be disclosed in the reports that we file and submit under the Exchange Act is (1)&nbsp;recorded, processed, summarized and reported as and when required; and (2) accumulated and communicated to the Company&#146;s management, including its President and Chief Executive Officer, who is also the principal executive officer and principal financial officer, as appropriate to allow timely discussions regarding disclosure.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:49.867px">There have been no changes in our internal control over financial reporting identified in connection with the evaluation that occurred during our last fiscal quarter that has materially affected, or that is reasonably likely to materially affect, our internal control over financial reporting.</P>
<P style="margin-top:0px; margin-bottom:8.867px"><BR>
<BR></P>
<P style="margin-top:0px; margin-bottom:6.667px" align=center>18</P>
<P style="margin:0px"><BR></P>
<HR style="margin-top:9.6px; margin-bottom:9.6px" noshade size=1.333>
<P style="margin:0px; page-break-before:always"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:13.333px" align=center><B>Part II &#150; OTHER INFORMATION</B></P>
<A NAME="_Ref3974856"></A><A NAME="_Toc201059405"></A><A NAME="_Toc201059553"></A><A NAME="_Toc201059923"></A><P style="margin-top:0px; margin-bottom:-16px; padding-left:72px; text-indent:-72px; font-family:Times New Roman Bold"><B>Item 1.</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:72px; font-family:Times New Roman Bold"><B>Legal Proceedings.</B></P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">We are not a party to, and none of our property is the subject of, any pending legal proceedings other than routine litigation that is incidental to our business. To our knowledge, no governmental authority is contemplating initiating any such proceedings.</P>
<A NAME="_Toc201059406"></A><A NAME="_Toc201059554"></A><A NAME="_Toc201059924"></A><P style="margin-top:0px; margin-bottom:-16px; padding-left:72px; text-indent:-72px; font-family:Times New Roman Bold"><B>Item 1A.</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:72px; font-family:Times New Roman Bold"><B>Risk Factors.</B></P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">Not applicable.</P>
<A NAME="_Ref3974871"></A><A NAME="_Toc201059407"></A><A NAME="_Toc201059555"></A><A NAME="_Toc201059925"></A><P style="margin-top:0px; margin-bottom:-16px; padding-left:72px; text-indent:-72px; font-family:Times New Roman Bold"><B>Item 2.</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:72px; font-family:Times New Roman Bold"><B>Unregistered Sales of Equity in Securities and Use of Proceeds.</B></P>
<A NAME="_Ref3974881"></A><P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px">The following table provides information regarding repurchases of our common stock in each month of the quarter ended April&nbsp;30, 2008.</P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:48px" align=center><B>COMPANY PURCHASES OF EQUITY SECURITIES</B></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=175.133></TD><TD width=21.467></TD><TD width=4.267></TD><TD width=63.667></TD><TD width=21.467></TD><TD width=18.2></TD><TD width=64.4></TD><TD width=21.467></TD><TD width=4.267></TD><TD width=102.467></TD><TD width=21.467></TD><TD width=4.267></TD><TD width=99.867></TD><TD width=1.6></TD></TR>
<TR><TD style="border-bottom:1px solid #000000" valign=bottom width=175.133><P style="line-height:10pt; margin:0px; font-size:8pt"><B>Period</B></P>
</TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=63.667><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>Total<BR>
Number of<BR>
Shares<BR>
Purchased</B></P>
</TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>Average Price<BR>
Paid per<BR>
Share</B></P>
</TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=102.467><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>Total Number of<BR>
Shares<BR>
Purchased as<BR>
Part of Publicly<BR>
Announced Plans<BR>
or Programs</B><FONT style="font-family:Times New Roman Bold"><B>(1)</B></FONT></P>
</TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=99.867><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>Maximum<BR>
Number of<BR>
Shares that may<BR>
yet be Purchased<BR>
under the Plans<BR>
or Programs</B><FONT style="font-family:Times New Roman Bold"><B>(1)</B></FONT></P>
</TD><TD valign=bottom width=1.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=175.133><P style="margin:0px">February&nbsp;1, 2008 through<BR>
February&nbsp;29, 2008</P>
</TD><TD valign=bottom width=21.467><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD valign=bottom width=4.267><P style="margin:0px">&nbsp;</P>
</TD><TD valign=bottom width=63.667><P style="margin:0px" align=right>3,114</P>
</TD><TD valign=bottom width=21.467><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD valign=bottom width=18.2><P style="margin:0px">$</P>
</TD><TD valign=bottom width=64.4><P style="margin:0px" align=right>4.10</P>
</TD><TD valign=bottom width=21.467><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD valign=bottom width=4.267><P style="margin:0px">&nbsp;</P>
</TD><TD valign=bottom width=102.467><P style="margin:0px" align=right>3,114</P>
</TD><TD valign=bottom width=21.467><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD valign=bottom width=4.267><P style="margin:0px">&nbsp;</P>
</TD><TD valign=bottom width=99.867><P style="margin:0px" align=right>240,667</P>
</TD><TD valign=bottom width=1.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=175.133><P>&nbsp;</P></TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=63.667><P>&nbsp;</P></TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=18.2><P>&nbsp;</P></TD><TD valign=bottom width=64.4><P>&nbsp;</P></TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=102.467><P>&nbsp;</P></TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=99.867><P>&nbsp;</P></TD><TD valign=bottom width=1.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=175.133><P style="margin:0px">March&nbsp;1, 2008 through<BR>
March&nbsp;31, 2008</P>
</TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=63.667><P style="margin:0px" align=right>8,000</P>
</TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=18.2><P style="margin:0px">$</P>
</TD><TD valign=bottom width=64.4><P style="margin:0px" align=right>2.75</P>
</TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=102.467><P style="margin:0px" align=right>8,000</P>
</TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=99.867><P style="margin:0px" align=right>232,667</P>
</TD><TD valign=bottom width=1.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=175.133><P>&nbsp;</P></TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=63.667><P>&nbsp;</P></TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=18.2><P>&nbsp;</P></TD><TD valign=bottom width=64.4><P>&nbsp;</P></TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=102.467><P>&nbsp;</P></TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=99.867><P>&nbsp;</P></TD><TD valign=bottom width=1.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=175.133><P style="margin:0px">April&nbsp;1, 2008 through<BR>
April&nbsp;30, 2008</P>
</TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=63.667><P style="margin:0px" align=right>5,800</P>
</TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=18.2><P style="margin:0px">$</P>
</TD><TD valign=bottom width=64.4><P style="margin:0px" align=right>2.57</P>
</TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=102.467><P style="margin:0px" align=right>5,800</P>
</TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=99.867><P style="margin:0px" align=right>226,867</P>
</TD><TD valign=bottom width=1.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=175.133><P>&nbsp;</P></TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=63.667><P>&nbsp;</P></TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=18.2><P>&nbsp;</P></TD><TD valign=bottom width=64.4><P>&nbsp;</P></TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=102.467><P>&nbsp;</P></TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=99.867><P>&nbsp;</P></TD><TD valign=bottom width=1.6><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=175.133><P style="margin:0px"><B>Total</B></P>
</TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=63.667><P style="margin:0px" align=right>16,914</P>
</TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=18.2><P style="margin:0px">$</P>
</TD><TD valign=bottom width=64.4><P style="margin:0px" align=right>2.94</P>
</TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=102.467><P style="margin:0px" align=right>16,914</P>
</TD><TD valign=bottom width=21.467><P>&nbsp;</P></TD><TD valign=bottom width=4.267><P>&nbsp;</P></TD><TD valign=bottom width=99.867><P style="margin:0px" align=right>226,867</P>
</TD><TD valign=bottom width=1.6><P>&nbsp;</P></TD></TR>
</TABLE>
<P style="margin-top:3.333px; margin-bottom:0px">&#151;&#151;&#151;&#151;&#151;&#151;&#151;</P>
<A NAME="_Toc201059408"></A><P style="margin-top:0px; margin-bottom:-16px; padding-left:32px; text-indent:-32px">(1)</P>
<P style="margin:0px; padding-left:32px">On April&nbsp;13, 2007, our Board of Directors authorized a stock repurchase plan pursuant to which we could repurchase up to 276,491 shares (5% of our common stock outstanding as of April&nbsp;12, 2007) in either open market or private transactions. The stock repurchase plan is not subject to an expiration date.</P>
<P style="margin-top:0px; margin-bottom:8.867px; font-family:Times New Roman Bold"><B>&nbsp;<A NAME="_Toc201059409"></A><A NAME="_Toc201059556"></A><A NAME="_Toc201059557"></A><A NAME="_Toc201059926"></A><A NAME="_Toc201059927"></A></B></P>
<P style="margin-top:0px; margin-bottom:8.867px"><BR>
<BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<HR style="margin-top:9.6px; margin-bottom:9.6px" noshade size=1.333>
<P style="margin:0px; page-break-before:always"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; font-family:Times New Roman Bold"><B>Item 3.</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; text-indent:72px; font-family:Times New Roman Bold"><B>Defaults upon Senior Securities.</B></P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">None.</P>
<A NAME="_Ref3974892"></A><A NAME="_Toc201059410"></A><A NAME="_Toc201059558"></A><A NAME="_Toc201059928"></A><P style="margin-top:0px; margin-bottom:-16px; padding-left:72px; text-indent:-72px; font-family:Times New Roman Bold"><B>Item 4.</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:72px; font-family:Times New Roman Bold"><B>Submission of Matters to a Vote of Security Holders.</B></P>
<A NAME="_Ref3974903"></A><A NAME="OLE_LINK3"></A><A NAME="OLE_LINK4"></A><P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">On April&nbsp;10, 2008, we held our annual meeting of stockholders. 3,056,305 shares, representing a majority of our issued and outstanding shares of common stock, were represented at the meeting.</P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">At the meeting, David Gordon and John Rotelli were elected to our Board of Directors for terms expiring at the 2011 annual meeting of stockholders. Election of directors was the only proposal at the meeting.</P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">The proposal submitted to shareholders and the tabulation of votes for the proposal are as follows:</P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=189.867></TD><TD width=83.333></TD><TD width=118.467></TD><TD width=83.333></TD><TD width=149></TD></TR>
<TR><TD style="border-bottom:1px solid #000000" valign=bottom width=189.867><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>Election of Directors</B></P>
</TD><TD valign=bottom width=83.333><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=118.467><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>Votes For</B></P>
</TD><TD valign=bottom width=83.333><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=149><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>Votes Withheld</B></P>
</TD></TR>
<TR><TD valign=bottom width=189.867><P style="margin:0px">David Gordon</P>
</TD><TD valign=bottom width=83.333><P>&nbsp;</P></TD><TD valign=bottom width=118.467><P style="margin:0px" align=center>3,031,223</P>
</TD><TD valign=bottom width=83.333><P>&nbsp;</P></TD><TD valign=bottom width=149><P style="margin:0px" align=center>25,082</P>
</TD></TR>
<TR><TD valign=bottom width=189.867><P style="margin:0px">John Rotelli</P>
</TD><TD valign=bottom width=83.333><P>&nbsp;</P></TD><TD valign=bottom width=118.467><P style="margin:0px" align=center>3,031,673</P>
</TD><TD valign=bottom width=83.333><P>&nbsp;</P></TD><TD valign=bottom width=149><P style="margin:0px" align=center>24,632</P>
</TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:72px; text-indent:-72px; font-family:Times New Roman Bold"><B>&nbsp;<A NAME="_Toc201059411"></A><A NAME="_Toc201059559"></A><A NAME="_Toc201059929"></A>Item 5.</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:72px; font-family:Times New Roman Bold"><B>Other Information.</B></P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">None.</P>
<A NAME="_Toc201059412"></A><A NAME="_Toc201059560"></A><A NAME="_Toc201059930"></A><P style="margin-top:0px; margin-bottom:-16px; padding-left:72px; text-indent:-72px; font-family:Times New Roman Bold"><B>Item 6.</B></P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:72px; font-family:Times New Roman Bold"><B>Exhibits.</B></P>
<TABLE style="font-size:10pt" cellspacing=0><TR height=0 style="font-size:0"><TD width=101.867></TD><TD width=510.867></TD></TR>
<TR><TD valign=top width=101.867><P style="line-height:10.95pt; margin-top:6.667px; margin-bottom:3.2px; color:#0000FF" align=center><A HREF="exhibit111.htm"><U>11.1</U></A><FONT style="color:#000000"></FONT></P>
</TD><TD valign=top width=510.867><P style="margin-top:6.667px; margin-bottom:13.333px">Earnings Per Share Calculation.</P>
</TD></TR>
<TR><TD valign=top width=101.867><P style="line-height:10.95pt; margin-top:6.667px; margin-bottom:3.2px; color:#0000FF" align=center><A HREF="exhibit311.htm"><U>31.1</U></A><FONT style="color:#000000"></FONT></P>
</TD><TD valign=top width=510.867><P style="margin-top:6.667px; margin-bottom:13.333px">Rule&nbsp;13a - 14(a)/15d - 14a Certification.</P>
</TD></TR>
<TR><TD valign=top width=101.867><P style="line-height:10.95pt; margin-top:6.667px; margin-bottom:3.2px; color:#0000FF" align=center><A HREF="exhibit321.htm"><U>32.1</U></A><FONT style="color:#000000"></FONT></P>
</TD><TD valign=top width=510.867><P style="margin-top:6.667px; margin-bottom:13.333px">Section&nbsp;1350 Certification.</P>
</TD><A NAME="_Ref3977269"></A></TR>
</TABLE>
<A NAME="_Toc201059931"></A><P style="margin:0px" align=center><BR>
<BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<HR style="margin-top:9.6px; margin-bottom:9.6px" noshade size=1.333>
<P style="margin:0px; page-break-before:always"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px; font-family:Times New Roman Bold" align=center><B>SIGNATURES</B></P>
<P style="margin-top:20px; margin-bottom:20px; text-indent:48px">Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.</P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=311.533></TD><TD width=21.933></TD><TD width=289.067></TD><TD width=1.467></TD></TR>
<TR><TD valign=top width=311.533><P>&nbsp;</P></TD><TD valign=top colspan=2><P style="margin:0px"><B>Coffee Holding Co., Inc.</B></P>
</TD><TD valign=top width=1.467><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=311.533><P>&nbsp;</P></TD><TD valign=top colspan=2><P style="margin:0px">(Registrant) </P>
</TD><TD valign=top width=1.467><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=311.533><P style="margin:0px">&nbsp;&nbsp;</P>
</TD><TD valign=top width=21.933><P>&nbsp;</P></TD><TD valign=top width=289.067><P>&nbsp;</P></TD><TD valign=top width=1.467><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=311.533><P style="margin:0px">&nbsp;&nbsp;</P>
</TD><TD valign=top width=21.933><P>&nbsp;</P></TD><TD valign=top width=289.067><P>&nbsp;</P></TD><TD valign=top width=1.467><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=311.533><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD valign=top width=21.933><P style="margin:0px">By:</P>
</TD><TD style="border-bottom:1px solid #000000" valign=top width=289.067><P style="line-height:normal; margin:0px">/s/ A<FONT style="font-size:6pt">NDREW</FONT> G<FONT style="font-size:6pt">ORDON</FONT></P>
</TD><TD valign=top width=1.467><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=311.533><P>&nbsp;</P></TD><TD valign=top width=21.933><P>&nbsp;</P></TD><TD valign=top width=289.067><P style="margin:0px">President, Chief Executive Officer and Chief</P>
</TD><TD valign=top width=1.467><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=311.533><P>&nbsp;</P></TD><TD valign=top width=21.933><P>&nbsp;</P></TD><TD valign=top width=289.067><P style="margin:0px">Financial Officer</P>
</TD><TD valign=top width=1.467><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=311.533><P>&nbsp;</P></TD><TD valign=top width=21.933><P>&nbsp;</P></TD><TD valign=top width=289.067><P>&nbsp;</P></TD><TD valign=top width=1.467><P>&nbsp;</P></TD></TR>
<TR><TD valign=top width=311.533><P>&nbsp;</P></TD><TD valign=top width=21.933><P>&nbsp;</P></TD><TD valign=top width=289.067><P style="margin:0px">(Principal Executive, Financial and Accounting<BR>
Officer)</P>
</TD><TD valign=top width=1.467><P>&nbsp;</P></TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px">June&nbsp;13, 2008</P>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
</BODY>
<!-- EDGAR Validation Code: FCB3A40C -->
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-11.1
<SEQUENCE>2
<FILENAME>exhibit111.htm
<DESCRIPTION>EARNINGS PER SHARE CALCULATION
<TEXT>
<!doctype html public "-//IETF//DTD HTML//EN">
<HTML>
<HEAD>
<TITLE>United States Securities and Exchange Commission EDGAR Filing</TITLE>
<META NAME="date" CONTENT="06/12/2008">
</HEAD>
<BODY style="line-height:12pt; font-family:Times New Roman; font-size:10pt; color:#000000">
<A NAME="_Toc32385713"></A><P style="margin-top:0px; margin-bottom:26.667px" align=right><B>EXHIBIT 11.1</B></P>
<P style="margin:0px" align=center><B>Coffee Holding Co., Inc.</B></P>
<P style="margin:0px" align=center><B><I>Computation of Per Share Earnings</I></B></P>
<P style="margin-top:0px; margin-bottom:13.333px" align=center><B>(Unaudited)</B></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=266.533></TD><TD width=16.667></TD><TD width=6.667></TD><TD width=66.8></TD><TD width=20></TD><TD width=6.667></TD><TD width=60.933></TD><TD width=16.733></TD><TD width=6.667></TD><TD width=67.133></TD><TD width=20></TD><TD width=6.667></TD><TD width=61.133></TD><TD width=1.4></TD></TR>
<TR><TD valign=bottom width=266.533><P>&nbsp;</P></TD><TD valign=bottom width=16.667><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>2008</B></P>
</TD><TD valign=bottom width=20><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>2007</P>
</TD><TD valign=bottom width=16.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center><B>2008</B></P>
</TD><TD valign=bottom width=20><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom colspan=2><P style="line-height:10pt; margin:0px; font-size:8pt" align=center>2007</P>
</TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=266.533><P style="margin:0px"><B>Net Income (Loss)</B></P>
</TD><TD valign=bottom width=16.667><P style="margin:0px"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=66.8><P style="margin:0px" align=right><B>(1,861,913</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=20><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=60.933><P style="margin:0px" align=right>648,592</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=16.733><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=67.133><P style="margin:0px" align=right><B>(2,044,178</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=20><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=61.133><P style="margin:0px" align=right>338,888</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=266.533><P>&nbsp;</P></TD><TD valign=bottom width=16.667><P style="margin:0px"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B></P>
</TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=66.8><P>&nbsp;</P></TD><TD valign=bottom width=20><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=60.933><P>&nbsp;</P></TD><TD valign=bottom width=16.733><P style="margin:0px"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B></P>
</TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=67.133><P>&nbsp;</P></TD><TD valign=bottom width=20><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=61.133><P>&nbsp;</P></TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=266.533><P style="margin:0px"><B>BASIC EARNINGS:</B></P>
</TD><TD valign=bottom width=16.667><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=66.8><P>&nbsp;</P></TD><TD valign=bottom width=20><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=60.933><P>&nbsp;</P></TD><TD valign=bottom width=16.733><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=67.133><P>&nbsp;</P></TD><TD valign=bottom width=20><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=61.133><P>&nbsp;</P></TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=266.533><P style="margin:0px; padding-left:8px; text-indent:-8px"><B>Weighted average number of common<BR>
shares outstanding</B></P>
</TD><TD valign=bottom width=16.667><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=66.8><P style="margin:0px" align=right><B>5,497,254</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=20><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=60.933><P style="margin:0px" align=right>5,529,830</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=16.733><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=67.133><P style="margin:0px" align=right><B>5,497,254</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=20><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=61.133><P style="margin:0px" align=right>5,529,830</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=266.533><P>&nbsp;</P></TD><TD valign=bottom width=16.667><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=66.8><P>&nbsp;</P></TD><TD valign=bottom width=20><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=60.933><P>&nbsp;</P></TD><TD valign=bottom width=16.733><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=67.133><P>&nbsp;</P></TD><TD valign=bottom width=20><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=61.133><P>&nbsp;</P></TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=266.533><P style="margin:0px"><B>Basic earnings (loss) per common share</B></P>
</TD><TD valign=bottom width=16.667><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=66.8><P style="margin:0px" align=right><B>(.34</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=20><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=60.933><P style="margin:0px" align=right>.12</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=16.733><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=67.133><P style="margin:0px" align=right><B>(.37</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=20><P style="margin:0px">)</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=61.133><P style="margin:0px" align=right>.06</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=266.533><P>&nbsp;</P></TD><TD valign=bottom width=16.667><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=66.8><P>&nbsp;</P></TD><TD valign=bottom width=20><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=60.933><P>&nbsp;</P></TD><TD valign=bottom width=16.733><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=67.133><P>&nbsp;</P></TD><TD valign=bottom width=20><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=61.133><P>&nbsp;</P></TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=266.533><P style="margin:0px"><B>DILUTED EARNINGS:</B></P>
</TD><TD valign=bottom width=16.667><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=66.8><P>&nbsp;</P></TD><TD valign=bottom width=20><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=60.933><P>&nbsp;</P></TD><TD valign=bottom width=16.733><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=67.133><P>&nbsp;</P></TD><TD valign=bottom width=20><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=61.133><P>&nbsp;</P></TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=266.533><P style="margin:0px; padding-left:8px; text-indent:-8px"><B>Weighted average number of common<BR>
shares outstanding</B></P>
</TD><TD valign=bottom width=16.667><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=66.8><P style="margin:0px" align=right><B>5,497,254</B></P>
</TD><TD valign=bottom width=20><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=60.933><P style="margin:0px" align=right>5,529,830</P>
</TD><TD valign=bottom width=16.733><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=67.133><P style="margin:0px" align=right><B>5,497,254</B></P>
</TD><TD valign=bottom width=20><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=61.133><P style="margin:0px" align=right>5,529,830</P>
</TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=266.533><P style="margin:0px"><B>Warrants &#150; common stock equivalents</B></P>
</TD><TD valign=bottom width=16.667><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.667><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=66.8><P style="margin:0px" align=right><B>0</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=20><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.667><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=60.933><P style="margin:0px" align=right>70,000</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=16.733><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.667><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=67.133><P style="margin:0px" align=right><B>0</B></P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=20><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=6.667><P>&nbsp;</P></TD><TD style="border-bottom:1px solid #000000" valign=bottom width=61.133><P style="margin:0px" align=right>0</P>
</TD><TD style="border-bottom:1px solid #FFFFFF" valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=266.533><P>&nbsp;</P></TD><TD valign=bottom width=16.667><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=66.8><P>&nbsp;</P></TD><TD valign=bottom width=20><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=60.933><P>&nbsp;</P></TD><TD valign=bottom width=16.733><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=67.133><P>&nbsp;</P></TD><TD valign=bottom width=20><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=61.133><P>&nbsp;</P></TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=266.533><P style="margin:0px; padding-left:8px; text-indent:-8px"><B>Weighted average number of common<BR>
shares outstanding &#150; as adjusted</B></P>
</TD><TD valign=bottom width=16.667><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=66.8><P style="margin:0px" align=right><B>5,497,254</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=20><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=60.933><P style="margin:0px" align=right>5,599,830</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=16.733><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=67.133><P style="margin:0px" align=right><B>5,497,254</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=20><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=61.133><P style="margin:0px" align=right>5,529,830</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=266.533><P>&nbsp;</P></TD><TD valign=bottom width=16.667><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=66.8><P>&nbsp;</P></TD><TD valign=bottom width=20><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=60.933><P>&nbsp;</P></TD><TD valign=bottom width=16.733><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=67.133><P>&nbsp;</P></TD><TD valign=bottom width=20><P>&nbsp;</P></TD><TD valign=bottom width=6.667><P>&nbsp;</P></TD><TD valign=bottom width=61.133><P>&nbsp;</P></TD><TD valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
<TR><TD valign=bottom width=266.533><P style="margin:0px; padding-left:8px; text-indent:-8px"><B>Diluted earnings (loss) per common<BR>
share</B></P>
</TD><TD valign=bottom width=16.667><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=66.8><P style="margin:0px" align=right><B>(.34</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=20><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=60.933><P style="margin:0px" align=right>.12</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=16.733><P>&nbsp;</P></TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P style="margin:0px"><B>$</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=67.133><P style="margin:0px" align=right><B>(.37</B></P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=20><P style="margin:0px"><B>)</B></P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=6.667><P style="margin:0px">$</P>
</TD><TD style="border-bottom:3px double #000000" valign=bottom width=61.133><P style="margin:0px" align=right>.06</P>
</TD><TD style="border-bottom:3px double #FFFFFF" valign=bottom width=1.4><P>&nbsp;</P></TD></TR>
</TABLE>
<P style="margin:0px" align=justify><BR></P>
<P style="margin:0px" align=justify><BR></P>
<P style="margin:0px" align=justify><BR>
<BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
</BODY>
<!-- EDGAR Validation Code: 29238EEF -->
</HTML>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-31.1
<SEQUENCE>3
<FILENAME>exhibit311.htm
<DESCRIPTION>CERTIFICATION
<TEXT>
<!doctype html public "-//IETF//DTD HTML//EN">
<HTML>
<HEAD>
<TITLE>United States Securities and Exchange Commission EDGAR Filing</TITLE>
<META NAME="date" CONTENT="06/12/2008">
</HEAD>
<BODY style="line-height:12pt; font-family:Times New Roman; font-size:10pt; color:#000000">
<P style="margin-top:0px; margin-bottom:13.333px" align=right><B>EXHIBIT 31.1</B></P>
<P style="margin:0px" align=center><B>CERTIFICATION</B></P>
<P style="margin:0px" align=center><BR></P>
<P style="margin-top:0px; margin-bottom:8.867px">I, Andrew Gordon, certify that:</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px">1.</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:80px">I have reviewed this quarterly report on Form 10-Q for the period ended April 30, 2008 of Coffee Holding Co., Inc.; </P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px">2.</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:80px">Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; </P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px">3.</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:80px">Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px">4.</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:80px">I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the company and have:</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:112px; text-indent:-32px">(a)</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:112px">Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:112px; text-indent:-32px">(b)</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:112px">Evaluated the effectiveness of the company&#146;s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:112px; text-indent:-32px">(c)</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:112px">Disclosed in this report any change in the issuer&#146;s internal control over financial reporting that occurred during the period covered by the quarterly report that has materially affected, or is reasonably likely to materially affect, the issuer&#146;s internal control over financial reporting; and</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px">5.</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:80px">I have disclosed, based on my most recent evaluation of internal control over financial reporting, to the company&#146;s auditors and the audit committee of the company&#146;s board of directors (or persons performing the equivalent functions):</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:112px; text-indent:-32px">(a)</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:112px">All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company&#146;s ability to record, process, summarize and report financial information; and</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:112px; text-indent:-32px">(b)</P>
<P style="margin-top:0px; margin-bottom:8.867px; padding-left:112px">Any fraud, whether or not material, that involves management or other employees who have a significant role in the company&#146;s internal control over financial reporting.</P>
<P style="margin:0px; padding-left:48px; text-indent:-48px" align=justify>Date: &nbsp;June 13, 2008</P>
<P style="margin:0px" align=justify><BR></P>
<TABLE style="font-size:10pt" cellspacing=0 align=center><TR height=0 style="font-size:0"><TD width=270></TD><TD width=354></TD></TR>
<TR><TD valign=top width=270><P style="margin:0px">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
</TD><TD style="border-bottom:1px solid #000000" valign=top width=354><P style="margin:0px">/s/ Andrew Gordon</P>
</TD></TR>
<TR><TD valign=top width=270><P>&nbsp;</P></TD><TD valign=top width=354><P style="margin:0px">Andrew Gordon</P>
</TD></TR>
<TR><TD valign=top width=270><P>&nbsp;</P></TD><TD valign=top width=354><P style="margin:0px">President, Chief Executive Officer and Chief Financial Officer </P>
</TD></TR>
<TR><TD valign=top width=270><P>&nbsp;</P></TD><TD valign=top width=354><P style="margin:0px">(Principal Executive Officer and Principal Financial and<BR>
Accounting Officer)</P>
</TD></TR>
</TABLE>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
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<DOCUMENT>
<TYPE>EX-32.1
<SEQUENCE>4
<FILENAME>exhibit321.htm
<DESCRIPTION>CERTIFICATION
<TEXT>
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<TITLE>United States Securities and Exchange Commission EDGAR Filing</TITLE>
<META NAME="date" CONTENT="06/12/2008">
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<P style="margin:0px" align=right><B>EXHIBIT &nbsp;32.1</B></P>
<P style="margin:0px" align=right><BR></P>
<P style="margin:0px" align=center><BR></P>
<P style="margin:0px" align=center><B>STATEMENT FURNISHED PURSUANT TO SECTION 906 OF THE <BR>
SARBANES-OXLEY ACT OF 2002, 18 U.S.C. SECTION 1350</B></P>
<P style="margin:0px" align=center><BR></P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">The undersigned, Andrew Gordon, is the President, Chief Executive Officer and Chief Financial Officer of Coffee Holding Co., Inc.<FONT style="color:#3F3F3F"> </FONT>(the &#147;Company&#148;).</P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">This statement is being furnished in connection with the filing by the Company of the Company&#146;s Quarterly Report on Form 10-Q for the period ended April 30, 2008 (the &#147;Report&#148;).</P>
<P style="margin-top:0px; margin-bottom:13.333px; text-indent:48px">By execution of this statement, I certify that:</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px" align=justify>(A)</P>
<P style="margin-top:0px; margin-bottom:13.333px; padding-left:80px" align=justify>the Report fully complies with the requirements of Section&nbsp;13(a) or 15(d) of the Securities Exchange Act of 1934 (15&nbsp;U.S.C.&nbsp;78m(a) or 78o(d)); and</P>
<P style="margin-top:0px; margin-bottom:-16px; padding-left:80px; text-indent:-32px" align=justify>(B)</P>
<P style="margin-top:0px; margin-bottom:13.333px; padding-left:80px" align=justify>the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods covered by the Report.</P>
<P style="margin:0px">This statement is authorized to be attached as an exhibit to the Report so that this statement will accompany the Report at such time as the Report is filed with the Securities and Exchange Commission, pursuant to Section&nbsp;906 of the Sarbanes-Oxley Act of 2002, 18&nbsp;U.S.C. Section 1350. &nbsp;It is not intended that this statement be deemed to be filed for purposes of the Securities Exchange Act of 1934, as amended.</P>
<P style="margin:0px"><BR></P>
<P style="margin:0px">A signed original of this written statement required by Section 906 has been provided to Coffee Holding Co., Inc. and will be retained by Coffee Holding Co., Inc. and furnished to the Securities and Exchange Commission or its staff upon request.</P>
<P style="margin-top:0px; margin-bottom:40px"><BR></P>
<P style="margin-top:0px; margin-bottom:-16px"><U>June 13, 2008</U></P>
<P style="margin:0px; text-indent:384px"><U>/s/ Andrew Gordon</U></P>
<P style="margin-top:0px; margin-bottom:-16px">Dated</P>
<P style="margin-top:0px; margin-bottom:6.667px; text-indent:384px">Andrew Gordon</P>
<P style="margin-top:0px; margin-bottom:6.667px"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR>
<BR></P>
<P style="margin:0px"><BR></P>
<P style="margin:0px"><BR></P>
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