Leases

9 Months Ended

Jul. 31, 2024

Leases

Leases

Note 9 – Leases

The following summarizes the Company’s operating leases:

Assets	2024		2023
Right-of-use operating lease assets	$	1,192,834	$	2,696,159
Total lease assets	$	1,192,834	$	2,696,159

Liabilities		2024		2023
Current lease liability	$	636,534	$	255,625
Non-current lease liability		903,821		2,974,579
Total lease liability	$	1,540,355	$	3,230,204

The amortization of the right-of-use asset for the three months ended July 31, 2024 and 2023 was $79,812 and $80,662, respectively. The amortization of the right-of-use asset for the nine months ended July 31, 2024 and 2023 was $203,268 and $240,504, respectively.

The weighted-average remaining lease term and the weighted-average discount rate of the Company’s leases were as follows:

Weighted average remaining lease term (in years)	4.15
Weighted average discount rate	5.1	%

Maturities of lease liabilities by fiscal year for the Company’s operating leases are as follows:

For the Years Ending October 31,
Remainder of fiscal 2024	$	463,319
2025		334,784
2026		308,624
2027		295,762
2028		229,466
Thereafter		66,571
Total lease payments		1,698,526
Less: imputed interest		(158,171	)
Present value of operating lease liabilities	$	1,540,355

In June 2021, the Company purchased a facility in Colorado for $900,321 that it was previously leasing. On the date of purchase, the Company wrote off the carrying value of the right-of-use asset and lease liability associated with this facility of $242,888.

In December 2022, the Company extended SONO’s lease in Washington through December 2023. As a result, on the date of the modification the Company increased its right-of-use asset and lease liability by $40,797 as of January 31, 2023. In December 2023, the Company extended SONO’s lease in Washington through December 2024. As a result, on the date of the modification the Company increased its right-of-use asset and lease liability by $41,962 as of January 31, 2024.

In March 2023, the Company extended OPTCO’s lease in Washington through March 2026. As a result, on the date of the modification the Company increased its right-of-use asset and lease liability by $105,619.

COFFEE HOLDING CO., INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

In May 2024, the Company modified its existing lease agreement pertaining to a portion of its office facility. The Company wrote off $1,848,032 in right-of-use assets and $2,058,599 lease liability associated with this agreement, resulting in a gain on extinguishment of lease of $210,567. On May 1, 2024, the Company entered into an amended lease agreement for the remaining portion of its office facility in Staten Island, NY, which changed the lease modification date to April 30, 2029. The amended lease commenced on May 1, 2024. The Company recognized a right-of-use asset and lease liability associated with this modified agreement of $547,975. As a result of the modification, the Company decreased its right-of-use asset by $1,300,057 and lease liability by $1,510,624 as of July 31, 2024.