RELATED PARTY TRANSACTIONS

12 Months Ended

Oct. 31, 2011

Notes to Financial Statements

RELATED PARTY TRANSACTIONS

The Company has engaged its 40% partner in Generation Coffee Company, LLC as an outside contractor (the “Partner”). Included in contract labor expense, which is a component of cost of sales, are expenses incurred from the Partner during the years ended October 31, 2011 and 2010 of $457,566 and $505,977, respectively.

An employee of one of the top two vendors is a director of the Company. Purchases from that vendor totaled approximately $25,300,000 and $19,282,000 for the years ended October 31, 2011 and 2010, respectively. The corresponding accounts payable balance to this vendor was approximately $2,041,000 and $474,000 at October 31, 2011 and 2010, respectively. Management does not believe the loss of any one vendor would have a material adverse effect of the Company’s operations due to the availability of many alternate suppliers. Management does not believe the loss of any one vendor would have a material adverse effect of the Company’s operations due to the availability of many alternate suppliers.

In January 2005, the Company established the “Coffee Holding Co., Inc. Non-Qualified Deferred Compensation Plan.” Currently, there is only one participant in the plan: Andrew Gordon, the CEO. Within the plan guidelines, this employee is deferring a portion of his current salary and bonus. The deferred compensation payable represents the liability due to an officer of the Company. The deferred compensation liability at October 31, 2011 and 2010 was $538,707 and $540,642, respectively. Deferred compensation expenses included in officers’ salaries were approximately $0 and $13,462 during the years ended October 31, 2011 and 2010, respectively.