UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended ~~July~~January 31, ~~2017~~2018

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _____ to _________

Commission File Number: 000-31797

CRYSTAL ROCK HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Delaware	03-0366218
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)

1050 Buckingham St., Watertown, CT	06795
(Address of principal executive offices)	(Zip Code)

(860) 945-0661

(Registrant's telephone number, including area code)

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.

Yes X No ___

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes X No ___

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ____ Accelerated filer ___ Non-accelerated filer ___ Smaller reporting company X_X (Do not check if smaller reporting company) Emerging Growth Company ~~_____~~____

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ___

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ___ No X_ X

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.

Class	~~September~~Shares 12outstanding at March 9, ~~2017~~2018
Common Stock, $.001 Par Value	21,358,411

CRYSTAL ROCK HOLDINGS, INC. AND SUBSIDIARY

Table of Contents

		Page
Part I - Financial Information
Item 1.	Financial Statements.
	Consolidated Balance Sheets as of July 31, 2017 and October 31, 2016	3
	Consolidated Balance Sheets as of January 31, 2018 and October 31, 2017	3
	Consolidated Statements of Operations for the Three and Nine Months Ended July 31, 2017 and 2016	4
	Consolidated Statements of Operations for the Three Months Ended January 31, 2018 and 2017	4
	Consolidated Statements of Comprehensive Income (Loss) for the Three and Nine Months Ended July 31, 2017 and 2016	5
	Consolidated Statements of Comprehensive Income (Loss) for the Three Months Ended January 31, 2018 and 2017	5
	Consolidated Statements of Cash Flows for the Nine Months Ended July 31, 2017 and 2016	6
	Consolidated Statements of Cash Flows for the Three Months Ended January 31, 2018 and 2017	6
	Notes to Consolidated Financial Statements	7-15
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations.	16–2321
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	2421
Item 4.	Controls and Procedures.	2421
Part II - Other Information
Item 1.	Legal Proceedings.	2523
Item 1A.	Risk Factors.	2523
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds.	2523
Item 3.	Defaults Upon Senior Securities.	2523
Item 4.	Mine Safety Disclosures.	2523
Item 5.	Other Information.	2523
Item 6.	Exhibits.	2623-24
Signature		2725

CRYSTAL ROCK HOLDINGS, INC. AND SUBSIDIARY

CONSOLIDATED BALANCE SHEETS

	July 31, 2017			October 31, 2016
	January 31, 2018			October 31, 2017
	(Unaudited)
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	~~497~~200,~~332~~979		$	51,~~553~~065,~~815~~000
Accounts receivable, trade - net of reserve of $445,648 and $268,711 for 2017 and 2016, respectively		6,993,451			8,022,952
Accounts receivable, trade - net of reserve of $262,511 and $330,720 for 2018 and 2017, respectively		6,768,744			7,013,184
Inventories		2,391,779			2,061,713
Inventories, net		2,124,337			2,200,666
Other current assets		1,~~332~~537,~~447~~874			~~901~~1,~~374~~276,850
Unrealized gain on derivatives		25,~~055~~098			-3,787
TOTAL CURRENT ASSETS		1110,~~217~~637,~~064~~032			1611,~~539~~559,~~854~~487
PROPERTY AND EQUIPMENT - net		6,~~809~~497,~~932~~455			6,~~768~~850,~~185~~771
OTHER ASSETS:
Goodwill		12,156,790			12,156,790
Other intangible assets - net		~~983~~691,~~086~~539			1833,~~493,694~~951
Deferred tax asset		692,373			692,373
Other assets		76,926			91,926
Other assets		106,926			278,633
TOTAL OTHER ASSETS		12,925,255			13,082,667
TOTAL OTHER ASSETS		13,939,175			14,621,490
TOTAL ASSETS	$	30,059,742		$	31,492,925
TOTAL ASSETS	$	31,966,171		$	37,929,529
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Line of credit	$	2,~~000~~015,~~000~~200		$	-2,000,000
Current portion of long term debt		1,599,996			1,599,996
Accounts payable		1,~~822~~787,~~315~~406			31,~~268~~723,~~951~~753
Accrued expenses		1,~~996~~992,~~823~~601			32,~~087~~261,~~566~~365
Current portion of customer deposits		~~680~~613,~~801~~433			~~647~~614,~~460~~789
Current portion of unrealized loss on derivatives		-			24,793
TOTAL CURRENT LIABILITIES		8,008,636			8,199,903
TOTAL CURRENT LIABILITIES		8,099,935			8,628,766
Long term debt, less current portion		6,133,348			6,533,347
Long term debt, less current portion		6,933,346			8,133,343
Deferred tax liability		2,626,013			4,027,550
Deferred tax liability		4,472,100			4,472,100
Subordinated debt		4,500,000			4,500,000
Subordinated debt		4,500,000			9,000,000
Other liability		29,138			30,561
Other liability		43,670			-
Customer deposits, less current portion		2,456,337			2,461,762
Customer deposits, less current portion		2,668,733			2,529,300
TOTAL LIABILITIES		23,753,472			25,753,123
Long term portion of unrealized loss on derivatives		-			7,660
TOTAL LIABILITIES		26,717,784			32,771,169
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock - $.001 par value, 50,000,000 authorized shares, 21,960,229 issued and 21,358,411 outstanding shares as of July 31, 2017 and October 31, 2016		21,960			21,960
Common stock - $.001 par value, 50,000,000 authorized shares, 21,960,229 issued and 21,358,411 outstanding shares as of January 31, 2018 and October 31, 2017		21,960			21,960
Additional paid in capital		58,464,742			58,464,742
Treasury stock, at cost, 601,818 shares as of July 31, 2017 and October 31, 2016		(900,360	)		(900,360	)
Treasury stock, at cost, 601,818 shares as of January 31, 2018 and October 31, 2017		(900,360	)		(900,360	)
Accumulated deficit		(5251,~~339~~283,~~187~~287	)		(5251,~~408~~848,~~509~~811	)
Accumulated other comprehensive income (loss)		1,232			(19,473	)
Accumulated other comprehensive income		3,215			2,271
TOTAL STOCKHOLDERS' EQUITY		56,~~248~~306,~~387~~270			5,~~158~~739,~~360~~802
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	3130,~~966~~059,~~171~~742		$	3731,~~929~~492,~~529~~925

See the accompanying notes to the consolidated financial statements.

CRYSTAL ROCK HOLDINGS, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF OPERATIONS

	Three months ended July 31,						Nine months ended July 31,
	Three months ended January 31,
	2017			2016			2017			2016
	2018			2017
	(unaudited)						~~(unaudited)~~
NET SALES	$	1413,~~943~~878,~~972~~372		$	1614,~~394~~650,~~476~~146		$	~~44,069,469~~		$	~~49,236,852~~
COST OF GOODS SOLD		6,~~819~~653,~~101~~099			76,~~560~~956,~~207~~412			~~20,581,805~~			~~24,584,269~~
GROSS PROFIT		87,~~124~~225,~~871~~273			87,~~834~~693,~~269~~734			~~23,487,664~~			~~24,652,583~~
OPERATING EXPENSES:
Selling, general and administrative expenses		7,~~265~~491,~~379~~877			67,~~933~~171,~~393~~804			~~21,536,138~~			~~21,032,489~~
Advertising expenses		~~126~~122,~~506~~510			~~137~~119,~~247~~439			~~344,592~~			~~388,708~~
Amortization		~~170~~142,~~136~~412			170,~~739~~337			~~510,608~~			~~500,800~~
Gain on disposal of property and equipment		(600	)		-			(600	)		(4,120	)
Loss on disposal of property and equipment		396,092			-
TOTAL OPERATING EXPENSES		78,~~561~~152,~~421~~891			7,~~241~~461,~~379~~580			~~22,390,738~~			~~21,917,877~~
INCOME FROM OPERATIONS		563,450			1,592,890			1,096,926			2,734,706
(LOSS) INCOME FROM OPERATIONS		(927,618	)		232,154
OTHER EXPENSE:
Interest expense - net		291,997			416,895			986,891			1,220,448
Interest		233,511			350,590
INCOME BEFORE INCOME TAXES		271,453			1,175,995			110,035			1,514,258
LOSS BEFORE INCOME TAXES		(1,161,129	)		(118,436	)
INCOME TAX EXPENSE		100,438			446,878			40,713			575,418
INCOME TAX BENEFIT		1,726,653			43,822
NET INCOME	$	171,015		$	729,117		$	69,322		$	938,840
NET INCOME (LOSS)	$	565,524		$	(74,614	)
NET INCOME PER SHARE - BASIC	$	0.01		$	0.03		$	0.00		$	0.04
NET INCOME (LOSS) PER SHARE - BASIC	$	0.03		$	(0.00	)
NET INCOME PER SHARE - DILUTED	$	0.01		$	0.03		$	0.00		$	0.04
NET INCOME (LOSS) PER SHARE - DILUTED	$	0.03		$	(0.00	)
WEIGHTED AVERAGE SHARES USED IN COMPUTATION - BASIC		21,358,411			21,358,411			~~21,358,411~~			~~21,358,411~~
WEIGHTED AVERAGE SHARES USED IN COMPUTATION - DILUTED		21,358,411			21,358,411			~~21,358,411~~			~~21,358,411~~

See the accompanying notes to the consolidated financial statements.

CRYSTAL ROCK HOLDINGS, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

	Three months ended July 31,					Nine months ended July 31,
	Three months ended January 31,
	2017		2016			2017		2016
	2018		2017
	(unaudited)					(unaudited)
	(Unaudited)
NET INCOME	$	171,015	$	729,117		$	69,322	$	938,840
NET INCOME (LOSS)	$	565,524	$	(74,614	)
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX:
OTHER COMPREHENSIVE INCOME, NET OF TAX:
Cash Flow Hedges:
Unrealized gain (loss) on derivatives designated as cash flow hedges		992		692			20,705		(24,524	)
Unrealized gain on derivatives designated as cash flow hedges		944		13,282
Other Comprehensive Income (Loss), net of tax		992		692			20,705		(24,524	)
Other Comprehensive Income, net of tax		944		13,282
TOTAL COMPREHENSIVE INCOME	$	172,007	$	729,809		$	90,027	$	914,316
TOTAL COMPREHENSIVE INCOME (LOSS)	$	566,468	$	(61,332	)

See the accompanying notes to the consolidated financial statements.

CRYSTAL ROCK HOLDINGS, INC. AND SUBSIDIARY

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Nine months ended July 31,
	Three months ended January 31,
	2017			2016
	2018			2017
	(Unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	69,322		$	938,840
Net income (loss)	$	565,524		$	(74,614	)
Adjustments to reconcile net income to net cash provided by operating activities:
Adjustments to reconcile net income (loss) to net cash provided (used) by operating activities:
Depreciation		1636,~~893,091~~887			1654,~~985,337~~427
Provision for bad debts on accounts receivable		~~527~~63,~~539~~220			~~193~~89,~~302~~129
Amortization		~~510~~142,~~608~~412			~~500~~170,~~800~~337
Non cash interest expense on subordinated debt		-			854,982
Deferred tax benefit		(1,401,537	)		-
Gain on disposal of property and equipment		(600	)		(4,120	)
Loss on disposal of property and equipment		396,092			-
Non cash share-based compensation		-			(1,580	)
Changes in operating assets and liabilities:
Accounts receivable		~~501~~181,~~962~~220			98217,~~808~~732
Inventories		~~(330~~76,~~066~~329	)		~~109~~(199,~~568~~643	)
Other current assets		(~~444~~261,~~876~~391	)		6874,~~500~~065
Other assets		~~171~~15,~~707~~000			-14,160
Accounts payable		(163,~~446,636~~653	)		(~~433~~1,~~601~~063,077	)
Accrued expenses		(1270,~~047,073~~187	)		~~672~~(1,~~034~~025,938	)
Customer deposits		~~172~~(6,~~774~~781	)		~~105,339~~(991	)
NET CASH PROVIDED BY OPERATING ACTIVITIES		577,752			5,088,209
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES		200,441			(1,144,413	)
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment		(1721,~~934,838~~763	)		(1638,~~611,526~~361	)
Proceeds from sale of property and equipment		~~600~~42,100			~~16,116~~-
NET CASH USED BY INVESTING ACTIVITIES		(1,934,238	)		(1,595,410	)
NET CASH USED IN INVESTING ACTIVITIES		(679,663	)		(638,361	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Net line of credit borrowings		215,~~000,000~~200			-
Principal payments on long term debt		(5,699,997	)		(1,199,997	)
Principal payments on debt		(399,999	)		(399,999	)
NET CASH USED BY FINANCING ACTIVITIES		(3,699,997	)		(1,199,997	)
NET CASH USED IN FINANCING ACTIVITIES		(384,799	)		(399,999	)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS		(5,056,483	)		2,292,802
NET DECREASE IN CASH		(864,021	)		(2,182,773	)
CASH AND CASH EQUIVALENTS - beginning of period		51,~~553~~065,~~815~~000			35,~~091~~553,~~471~~815
CASH AND CASH EQUIVALENTS - end of period	$	~~497~~200,~~332~~979		$	53,~~384~~371,~~273~~042
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid for interest	$	1232,~~145,662~~904		$	~~339~~371,~~933~~800
Cash paid (refunds received) for income taxes, net	$	566,050		$	(54,068	)
Cash paid for taxes	$	-		$	249,850
NON-CASH FINANCING AND INVESTING ACTIVITIES:

See the accompanying notes to the consolidated financial statements.

CRYSTAL ROCK HOLDINGS, INC. AND SUBSIDIARY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements have been prepared in accordance with Form 10-Q instructions and in the opinion of management contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly the consolidated financial position, results of operations, and cash flows for the periods presented. The results have been determined on the basis of generally accepted accounting principles and practices of the United States of America (“GAAP”), applied consistently with the Annual Report on Form 10-K of Crystal Rock Holdings, Inc. (the “Company”) for the year ended October 31, ~~2016~~2017.

Certain information and footnote disclosures normally included in audited consolidated financial statements presented in accordance with GAAP have been condensed or omitted. The accompanying consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended October 31, ~~2016~~2017. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year.

The financial statements herewith reflect the consolidated operations and financial condition of Crystal Rock Holdings, Inc. and its wholly owned subsidiary Crystal Rock LLC.

2. ~~GOODWILL~~Adopted ~~AND~~Accounting ~~OTHER~~Standards ~~INTANGIBLE ASSETS~~Updates

~~Major~~Effective ~~components~~November 1, 2017, we adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Update (”ASU”) No. 2015-11, “Simplifying the Measurement of ~~intangible~~Inventory”. ~~assets~~The ~~consisted~~ASU requires entities using the first-in, first-out (FIFO) inventory costing method to subsequently value inventory at the lower of: cost and net realizable value. The ASU defines net realizable value as the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. The adoption of this guidance by the Company did not have a material impact on its consolidated financial statements.

	July 31, 2017					October 31, 2016
		Gross Carrying Amount		Accumulated Amortization	Wgt. Avg. Amort. Years		Gross Carrying Amount		Accumulated Amortization	Wgt. Avg. Amort. Years
Amortized Intangible Assets:
Covenants Not to Compete	$	2,536,488	$	2,493,087	1.47	$	2,536,488	$	2,444,293	1.80
Customer Lists		10,313,819		9,654,686	1.37		10,313,819		9,217,143	2.02
Other Identifiable Intangibles		608,393		327,841	22.32		608,393		303,570	23.04
Total	$	13,458,700	$	12,475,614		$	13,458,700	$	11,965,006

Effective November 1, 2017, we adopted FASB ASU No. 2015-17, “Balance Sheet Classification of Deferred Taxes”. The ASU requires that deferred tax assets and liabilities be combined and be classified as non-current in a statement of financial position. The adoption of this guidance by the Company did not have a material impact on its consolidated financial statements.

Amortization expense for the three month periods ending July 31, 2017 and 2016 was $170,136 and $170,739, respectively. Amortization expense for the nine month periods ending July 31, 2017 and 2016 was $510,608 and $500,800, respectively. There were no changes in the carrying amount of goodwill for the three and nine month periods ending July 31, 2017.

3. ~~DEBT~~GOODWILL AND OTHER INTANGIBLE ASSETS

OnMajor ~~May~~components ~~20, 2015 the Company amended its Credit Agreement (the “Agreement”) with Bank~~ of ~~America~~intangible to provide a senior financing facility consisting of term debt and a revolving line of credit. Under the Agreement, the Company became obligated on $12,000,000 of debt in the form of a term note to refinance the previous senior term debt and to fund repayment of a portion of its outstanding subordinated debt. Additionally, the Agreement includes a $5,000,000 revolving line of credit that can be used for the purchase of fixed assets, toconsisted ~~fund acquisitions, to collateralize letters~~ of ~~credit, and for operating capital.~~:

Effective September 12, 2016, the Company further amended its Credit Agreement with Bank of America (the “Second Amendment”). Under the Second Amendment, interest is paid at a rate of one-month LIBOR plus a margin based on the achievement of a specified leverage ratio. As of July 31, 2017, the margin was 2.50% for the term note and 2.25% for the revolving line of credit. The Company fixed the interest rate on a portion of its term debt by entering into an interest rate swap. As of July 31, 2017, the Company had $4,266,000 of the term debt subject to variable interest rates. The one-month LIBOR was 1.22% on July 31, 2017 resulting in total variable interest rates of 3.72% and 3.47%, for the term note and the revolving line of credit, respectively, as of July 31, 2017.

	January 31, 2018						October 31, 2017
	Gross Carrying Amount		Accumulated Amortization		Wgt. Avg.Amort. Years		Gross Carrying Amount		Accumulated Amortization		_{Wgt. Avg. Amort. Years}
Amortized Intangible Assets:
Covenants Not to Compete	$	2,536,488	$	2,510,656		1.16	$	2,536,488	$	2,502,976		1.33
Customer Lists		10,313,819		9,912,484		0.93		10,313,819		9,785,842		1.15
Other Identifiable Intangibles		608,393		344,021		21.84		608,393		335,931		22.08
Total	$	13,458,700	$	12,767,161			$	13,458,700	$	12,624,749

~~The~~Amortization ~~Second~~expense ~~Amendment~~for ~~requires~~ the ~~Company~~three tomonth beperiods inending ~~compliance with~~January ~~certain~~31, ~~financial~~2018 ~~covenants~~and as2017 ~~follows:~~was ~~(i) a maximum annual limit for capital expenditures of~~ $4142,~~000,000~~412 ~~each~~and ~~fiscal year~~$170, ~~(ii) consolidated adjusted operating cash flows to consolidated total debt service ratio~~337, ~~as defined, to be no less than 1~~respectively.~~5 to~~ 1There ~~for~~were ~~any~~no ~~reference~~changes ~~period~~in ~~ending~~the oncarrying oramount ~~after~~of ~~October 31~~goodwill, ~~2016 and (iii) senior funded debt to consolidated adjusted EBITDA~~$12, ~~as defined~~156,790, tofor ~~be no greater than 2.5 to 1 as of~~ the ~~end~~three ofmonths ~~any fiscal quarter~~ ending onJanuary ~~or after October~~ 31, ~~2016~~2018. ~~As of July 31, 2017, the Company was in compliance with these financial covenants.~~

On June 13, 2017, the Company entered into a Third Amendment (the “Third Amendment”) to the Agreement with Bank of America. The Third Amendment increases the aggregate principal amount available under the revolving line of credit from $5,000,000 to $6,000,000. The Third Amendment allows the Company to use proceeds from the revolving line of credit to make payments on the Company’s subordinated debt in an amount not to exceed $2,000,000. The Third Amendment also allows for total prepayments on subordinated debt up to $4~~,500,000 in the aggregate~~. There were no other changes to the existing term facility, applicable margins for outstanding balances of term debt, or outstanding line of credit amounts. Subsequent to the execution of the Third Amendment, the Company paid an aggregate of $4,500,000 of subordinated debt principal payments to Peter and Jack Baker and the Estate of Henry Baker.DEBT

The Company has a Credit Agreement (the “Agreement”) with Bank of America to provide a senior financing facility consisting of term debt and a revolving line of credit. Under the Agreement, as amended, the Company became obligated on $12,000,000 of debt in the form of a term note to refinance the previous senior term debt and to fund repayment of a portion of its outstanding subordinated debt. Additionally, the Agreement includes a $5,000,000 revolving line of credit that can be used for the purchase of fixed assets, to fund acquisitions, to collateralize letters of credit, and for operating capital.

The Agreement amortizes the term debt over a five year period with 59 equal monthly installments of $133,333 plus interest and a final payment of $4,133,333 due in May 2020. The revolving line of credit matures in May 2018. There are various restrictive covenants under the Agreement, and the Company is prohibited from entering into other debt agreements without the bank’s consent. The Agreement also prohibits the Company from paying dividends without the prior consent of the bank.

Effective September 12, 2016, the Company amended its Agreement with the Bank (the “Second Amendment”). Under the Second Amendment, interest is paid at a rate of one-month LIBOR plus a margin based on the achievement of a specified leverage ratio. As of January 31, 2018, the margin was 2.50% for the term note and 2.25% for the revolving line of credit. The Company fixed the interest rate on a portion of its term debt by entering into an interest rate swap. As of January 31, 2018, the Company had $3,867,000 of the term debt subject to variable interest rates. The one-month LIBOR was 1.56% on January 31, 2018 resulting in total variable interest rates of 4.06% and 3.81%, for the term note and the revolving line of credit, respectively, as of January 31, 2018.

The ~~Agreement~~Second ~~amortizes~~Amendment requires the ~~term~~Company ~~debt~~to ~~over~~be in compliance with certain financial covenants as follows: (i) a ~~five~~maximum annual limit for capital expenditures of $4,000,000 each fiscal year, (ii) consolidated adjusted operating cash flows to consolidated total debt service ratio, ~~period~~as ~~with~~defined, 59to ~~equal~~be ~~monthly~~no ~~installments~~less ofthan ~~$133~~1.5 to 1 for any reference period ending on or after October 31,~~333~~ 2016 and a(iii) ~~final~~senior ~~payment~~funded ofdebt to $4consolidated adjusted EBITDA,~~133~~ as defined,~~333~~ ~~due~~to inbe ~~May~~no ~~2020~~greater than 2.5 ~~The~~to ~~revolving~~1 ~~line~~as of ~~credit~~ ~~matures~~the inend ~~May~~of ~~2018~~any fiscal quarter ending on or after October 31, 2016. ~~There~~The ~~are~~Amendment ~~various~~also ~~restrictive~~allows ~~covenants~~payments ~~under~~of ~~the~~interest ~~Agreement~~on Subordinated Notes. As of January 31, ~~and~~2018, the Company iswas not ~~prohibited~~in ~~from~~compliance ~~entering into~~with ~~other~~(ii) ~~debt~~and ~~agreements~~(iii) ~~without~~of the ~~bank’s~~financial ~~consent~~covenants. The ~~Agreement~~Bank ~~also~~waived ~~prohibits~~ the ~~Company~~covenant ~~from~~compliance ~~paying~~requirements ~~dividends~~for ~~without~~(ii) and (iii) for the ~~prior~~period ~~consent~~ended ofJanuary ~~the~~31, ~~bank~~2018.

AtOn ~~July~~June 3113, 2017, ~~there~~the ~~was~~Company entered into a ~~balance~~Third ofAmendment ~~$2,000,000 outstanding on~~ (the ~~line~~“Third ofAmendment”) ~~credit~~to ~~and~~the aAgreement. ~~letter~~The ofThird ~~credit~~Amendment ~~issued~~increases ~~for~~the ~~$1,327,000~~aggregate principal toamount ~~collateralize~~available under the ~~Company’s~~revolving ~~liability~~line ~~insurance~~of ~~program as~~credit offrom ~~that~~$5,000,000 ~~date.~~to ~~Consequently~~$6,000,000. asThe Third ofAmendment ~~July~~allows ~~31,~~the ~~2017,~~Company ~~there~~to ~~was~~use up to $2,~~673~~000,000 ~~available~~of toproceeds ~~borrow~~ from the revolving line of credit. to make payments on the ~~There~~Subordinated ~~was~~Debt. The Third Amendment also allows for prepayments on Subordinated Debt up to $84,~~533~~500,000 ~~outstanding~~in onthe aggregate. Subsequently, in fiscal 2017, the ~~term~~Company ~~note~~paid asan aggregate of ~~July 31~~$4,500,000 ~~2017~~of subordinated debt principal payments.

InAt ~~addition~~January to31, ~~the~~2018, ~~senior~~there ~~debt,~~was asa balance of ~~July 31~~$2, ~~2017~~015,200 outstanding on the ~~Company~~ ~~has~~line ~~subordinated~~of ~~debt~~credit ~~owed~~and toa ~~Peter~~letter ~~and~~of ~~John~~credit ~~Baker~~issued infor $1,327,000 to collateralize the ~~aggregate~~Company’s ~~principal~~liability ~~amount~~insurance program as of that date. Consequently, as of January 31, 2018, there was $42,~~500~~658,000 ~~that~~available isto ~~due~~borrow ~~November~~from the revolving line ~~20,~~of ~~2020~~credit. The ~~interest~~line ~~rate~~of credit matures in May 2018. There was $7,733,000 outstanding on ~~each~~the ofterm ~~these~~note ~~notes~~as isof ~~12%~~January ~~per~~31, ~~annum~~2018.

~~The~~In ~~notes~~addition ~~are~~to ~~secured~~the bysenior ~~all~~debt, as of ~~the~~January ~~assets~~31, of2018, the Company ~~but~~ ~~specifically~~had subordinated, ~~with~~debt aowed ~~separate~~to ~~agreement~~Peter ~~between~~and John Baker in the ~~debt~~aggregate ~~holders~~principal amount of $4,500,000 tothat ~~the~~is ~~senior~~due ~~financing~~November ~~facility~~20, ~~described~~2020. ~~above~~The interest rate on each of these notes is 12% per annum.

4.The ~~INVENTORIES~~notes are secured by all of the assets of the Company but specifically subordinated, with a separate agreement with the subordinated debt holders, to the senior financing facility (Credit Agreement) described above.

5.	INVENTORIES

Inventories consisted of the following at:

	July 31, 2017			October 31, 2016
	January 31,			October 31,
Finished Goods	$	2,254,596		$	2,117,241
	2018			2017
Raw Materials		167,183			178,134
Finished Goods	$	2,016,980		$	2,011,255
Inventory reserve		(30,000	)		(233,662	)
Raw Materials		182,357			189,411
Total Inventories	$	2,391,779		$	2,061,713
Inventory Reserve		(75,000	)		-
Total Inventories	$	2,124,337		$	2,200,666

Finished goods inventory consists of products that the Company sells such as, but not limited to, coffee, cups, soft drinks, and snack foods. Raw material inventory consists primarily of bottle caps. The amount of raw and bottled water on hand does not represent a material amount of inventory. Bottles are accounted for as fixed assets.

5Finished goods inventory consists of products that the Company sells such as, but not limited to, coffee, cups, soft drinks, and snack foods. ~~ON-BALANCE~~Raw ~~SHEET~~material ~~DERIVATIVE~~inventory consists ~~INSTRUMENTS~~primarily ~~AND~~of ~~HEDGING~~bottle ~~ACTIVITIES~~caps. The amount of raw and bottled water on hand does not represent a material amount of inventory. Bottles are accounted for as fixed assets.

6.	IMPAIRMENT OF LONG-LIVED ASSETS

The Company reviews long-lived assets and certain identifiable intangible assets for impairment whenever circumstances and situations change such that there is an indication that the carrying amounts may not be recovered. Recoverability is assessed based on estimated undiscounted future cash flows. The Company’s policy is to record an impairment loss when it is determined that the carrying amount of the asset may not be recoverable.

During the quarter ended January 31, 2018, the Company recorded an impairment loss of $385,463, included in loss on disposal of property and equipment on the consolidated statements of operations, related to the abandonment of an ERP software implementation that was yet to be placed in service. There were no impairment charges recognized during the quarter ended January 31, 2017.

7.	ON-BALANCE SHEET DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

Derivative Financial Instruments

The Company has stand-alone derivative financial instruments in the form of interest rate swap agreements, which derive their value from underlying interest rates. These transactions involve both credit and market risk. The notional amount is an amount on which calculations, payments, and the value of the derivative are based. The notional amount does not represent direct credit exposure. Direct credit exposure is limited to the net difference between the calculated amount to be received and paid, if any. Such difference, which represents the fair value of the derivative instrument, is reflected on the Company’s consolidated balance sheet as an unrealized gain or loss on derivatives.

The Company is also exposed to credit-related losses in the event of nonperformance by the counterparties to these agreements. The Company controls the credit risk of its financial contracts through credit approvals, limits and monitoring procedures, and currently has no reason to believe that any counterparties will fail to fulfill their obligations.

This interest rate swap agreement is considered a cash flow hedge to hedge against the variability of interest rates on outstanding debt. The net unrealized gain ~~(loss)~~ relating to interest rate swaps was recorded in current ~~and long term~~ assets ~~or liabilities~~ with an offset to other comprehensive income ~~(loss)~~ for the effective portion of the hedge~~, net of tax~~. At ~~July~~January 31, ~~2017~~2018, these cash flow hedges were deemed 100% effective. The portion of the net unrealized gain in current assets is the amount expected to be reclassified to income within the next twelve months.

The following information pertains to the Company's outstanding interest rate swap at July 31, 2017. The pay rate is fixed and the receive rate is one month LIBOR. The interest rate swap matures May 18, 2018.

Instrument	Notional Amount	Pay Rate	Receive Rate
Interest rate swap	$4,266,668	1.25%	1.22%

The ~~table~~following ~~below~~information ~~details~~pertains to the ~~adjustments~~Company's tooutstanding ~~other~~interest ~~comprehensive income~~rate ~~(loss)~~swap at January 31, on2018. The ainterest ~~before~~rate ~~tax~~swap ~~and~~matures ~~net-of~~in ~~tax~~May ~~basis,~~2018.The ~~for~~pay rate ~~the~~is ~~fiscal~~fixed ~~quarters~~and ~~ended~~the ~~July~~receive ~~31,~~rate ~~2017~~is ~~and~~one ~~2016~~month LIBOR.

	Before-Tax			Tax Benefit (Expense)			Net-of-Tax
Instrument		Notional Amount			Pay Rate		Receive Rate
Three Months Ended July 31, 2016
Interest rate swap		$	3,866,668		1.25%		1.56%
Loss on interest rate swap	$	(9,519	)	$	3,807		$	(5,712	)
Reclassification adjustment for loss in income		10,673			(4,269	)		6,404
Net unrealized gain	$	1,154		$	(462	)	$	692
Three Months Ended July 31, 2017
Gain on interest rate swap	$	185		$	(74	)	$	111
Reclassification adjustment for loss in income		1,469			(588	)		881
Net unrealized gain	$	1,654		$	(662	)	$	992

The reclassification adjustments of $1,469 and $10,673 represent interest the Company paid in excess of the amount that would have been paid without the interest rate swap agreement during the quarters ended July 31, 2017 and 2016, respectively. These amounts were reclassified from accumulated other comprehensive income (loss) and recorded in the consolidated statements of operations as interest expense. No other material amounts were reclassified during the quarters ended July 31, 2017 and 2016. The table below details the adjustments to other comprehensive income (loss), on a before tax and net-of tax basis, for the ~~nine~~fiscal ~~months~~quarters ended ~~July~~January 31, ~~2017~~2018 and ~~2016~~2017.

	Before-Tax			Tax Benefit (Expense)			Net-of-Tax
Nine Months Ended July 31, 2016
Three Months Ended January 31, 2017
Loss on interest rate swap	$	(64,461	)	$	25,784		$	(38,677	)
Gain on interest rate swap	$	15,121		$	(6,048	)	$	9,073
Reclassification adjustment for loss in income		23,588			(9,435	)		14,153
Reclassification adjustment to income		7,015			(2,806	)		4,209
Net unrealized loss	$	(40,873	)	$	16,349		$	(24,524	)
Net unrealized gain	$	22,136		$	(8,854	)	$	13,282
Nine Months Ended July 31, 2017
Three Months Ended January 31, 2018
Gain on interest rate swap	$	213,~~839~~003		$	(~~8,736~~841	)	$	132,~~103~~162
Reclassification adjustment for loss in income		12,669			(5,067	)		7,602
Reclassification adjustment to income		(1,692	)		474			(1,218	)
Net unrealized gain	$	341,~~508~~311		$	(~~13,803~~367	)	$	~~20,705~~944

The reclassification adjustments of $121,~~669~~692 represents savings in interest that would have been paid without the interest rate swap agreement during the quarter ended January 31, 2018, and $237,~~588~~ 015 represent interest the Company paid in excess of the amount that would have been paid without the interest rate swap agreement during the ~~nine months~~ quarter ended ~~July~~January 31, 2017 ~~and 2016, respectively~~. These amounts were reclassified from accumulated other comprehensive income (loss) and recorded in ~~the~~ consolidated statements of operations as a charge or credit to interest expense. No other material amounts were reclassified during the ~~nine months~~ quarters ended ~~July~~January 31, ~~2017~~2018 and ~~2016~~2017.

118. FAIR VALUES OF ASSETS AND LIABILITIES

6. FAIR VALUES OF ASSETS AND LIABILITIES

Fair Value Hierarchy

The Company’s assets and liabilities measured at fair value on a recurring basis are as follows:

	Level 1		Level 2			Level 3
Assets (Liabilities):
Assets:
July 31, 2017
January 31, 2018
Unrealized gain on derivatives	$	-	$	2,055		$	-
Unrealized gain on derivative	$	-	$	5,098		$	-
October 31, 2016
October 31, 2017
Unrealized loss on derivatives	$	-	$	(32,453	)	$	-
Unrealized gain on derivative	$	-	$	3,787		$	-

In determining the fair value, the Company uses a model that calculates a present value of the payments as they amortize through the life of the loan (float) based on the variable rate and compares them to the calculated value of the payment based on the fixed rate (fixed) defined in the swap. In calculating the present value, in addition to the term, the model relies on other data – the “rate” and the “discount factor.”

In the “float” model, the rate reflects where the market expects LIBOR to be for the respective period and is based on the Eurodollar futures market.

The discount factor is a function of the volatility of LIBOR.

Payments are calculated by applying the rate to the notional amount and adjusting for the term. Then the present value is calculated by using the discount factor.

There were no assets or liabilities measured at fair value on a nonrecurring basis.

79. ~~COMPENSATION~~IMPACT ~~PLANS~~OF TAX REFORM ACT

On December 22, 2017, H.R. 1, originally known as the Tax Cuts and Jobs Act (the “Tax Reform Act”) was enacted. The ~~Company~~Tax ~~measures~~Reform Act made significant changes to U.S. federal income tax laws including permanently lowering the ~~cost~~U.S. ofcorporate ~~employee~~income ~~services~~tax ~~received~~rate from 35% to 21% effective January 1, 2018. As inthe ~~exchange~~Company ~~for~~has an ~~award~~October of31 ~~equity~~fiscal ~~instruments~~year-end, ~~based~~the onlower ~~the~~corporate ~~grant~~income ~~date~~tax ~~fair~~rate ~~value~~will be phased in, resulting in a U.S. statutory rate of 23% for the ~~award~~fiscal year ending October 31, 2018. ~~That~~The ~~cost~~Company’s isstatutory ~~recognized~~federal ~~over~~tax ~~the~~rate will be 21% for fiscal ~~period~~years ~~during~~ending ~~which~~October an31, ~~employee~~2019 isand ~~required~~beyond. toU.S. ~~provide~~GAAP ~~services~~requires the impact of tax legislation be recognized in ~~exchange~~the ~~for~~period in which the ~~award~~law was enacted. In December 2017, the ~~requisite~~SEC ~~service~~issued ~~period~~Staff ~~(usually~~Accounting Bulletin No. 118, which allows a company to report provisional numbers related to the ~~vesting~~Tax Reform Act and adjust those amounts during a measurement period) not to extend beyond one year. ~~The~~For the three months ended January 31, 2018, the Company ~~provides~~recorded a one-time tax benefit of $1,400,000 due to a remeasurement of deferred tax assets and liabilities. In addition, applying the reduced rate of 23% to our first fiscal quarter earnings resulted in an $1,400,000 reduction to tax expense. These tax benefits represent provisional amounts and the Company’s best estimate. The provisional amounts are based on estimates of ~~forfeitures~~underlying attiming differences (primarily related to uncertainty in fixed assets) and the ~~initial~~Company’s current ~~date~~interpretations of ~~grant~~the Tax Reform Act. The ultimate impact of the Tax Reform Act may differ from our provisional amounts due to changes in interpretations and assumptions we made as well as any forthcoming legislative action or regulatory guidance.

~~In April 2014, the Company’s stockholders approved the 2014 Stock Incentive Plan~~10. ~~The~~INCOME ~~plan~~(LOSS) ~~provided~~PER ~~for~~SHARE ~~issuances~~AND ofWEIGHTED ~~awards~~AVERAGE of up to 500,000 restricted or unrestricted shares of the Company’s common stock, or incentive or non-statutory stock options to purchase such common stock. Of the total amount of shares authorized under this plan, no options have been granted and 500,000 shares are available for grant at July 31, 2017.SHARES

The Company considers outstanding in-the-money stock options, if any, as potential common stock in its calculation of diluted earnings per share, unless the effect would be anti-dilutive, and uses the treasury stock method to calculate the applicable number of shares.

~~Options~~The ~~issued~~following ~~under~~calculation provides the ~~plan~~reconciliation ~~generally~~of ~~vest~~the indenominators ~~periods~~used upin ~~to five years based on~~ the ~~continuous~~calculation ~~service~~ of ~~the~~basic ~~recipient~~ and ~~have~~fully 10diluted ~~year~~earnings ~~contractual~~per ~~terms. Share awards generally vest over one year. Option and~~ share ~~awards provide for accelerated vesting if there is a change in control of the Company (as defined in the plan).~~:

There was one option grant, for a total of 10,000 shares that was forfeited in the first nine months of fiscal 2016 issued under the 2004 Stock Incentive Plan (“2004 Plan”). As of February 18, 2014, no further options may be granted under the 2004 Plan. Other than this forfeiture, there was no activity related to stock options and outstanding stock option balances during the three and nine month periods ended July 31, 2017 and 2016.

	Three Months Ended January 31,
	2018		2017
Net Income (Loss)		565,524	$	(74,614	)
Denominator:
Basic Weighted Average Shares Outstanding		21,358,411		21,358,411
Dilutive effect of Stock Options		-		-
Diluted Weighted Average Shares Outstanding		21,358,411		21,358,411
Basic Income (Loss) Per Share	$	.03	$	(.00	)
Diluted Income (Loss) Per Share	$	.03	$	(.00	)

~~Compensation~~As isof ~~determined~~January ~~using~~31, ~~the~~2018 ~~Black-Scholes model~~ and ~~the~~2017 ~~simplified~~there ~~method~~were tono ~~derive the expected term of the~~ options ~~and historical volatility over the past five years~~ outstanding.

811. RECENT ACCOUNTING PRONOUNCEMENTS

In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)”, which stipulates that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve this core principle, an entity should apply the following steps: (1) identify the contract(s) with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract and (5) recognize revenue when (or as) the entity satisfies a performance obligation. In August 2015, the FASB issued ASU 2015-14, which deferred the effective date of the ASU to fiscal years beginning after December 15, 2017, and interim periods within those fiscal years. Early adoption is permitted for fiscal years beginning after December 15, 2016. Companies may use either a full retrospective or a modified retrospective approach to adopt this ASU. The Company plans to adopt the ASU effective the first quarter of fiscal year ~~2018~~2019 using a modified retrospective method. ~~The~~During ~~Company~~fiscal ~~does~~year ~~not~~2018 ~~believe~~we ~~ASU 2014-09~~ will ~~have~~be conducting a ~~material~~review of contracts to identify gaps between our current revenue recognition policies and the new standard so that we can quantify any impact onto ~~its~~our current consolidated financial statements.

In ~~July~~February ~~2015~~2016, the FASB issued ASU ~~2015~~2016-1102, "Leases", ~~“Simplifying~~which ~~the~~is ~~Measurement~~intended ofto ~~Inventory”.~~improve ~~The~~financial ~~ASU~~reporting ~~requires~~about ~~entities~~leasing ~~using~~transactions. This ~~the~~ASU ~~first-in,~~requires ~~first-out~~that ~~(FIFO)~~leased ~~inventory~~assets be recognized ~~costing~~as ~~method~~assets toon ~~subsequently~~the ~~value~~balance ~~inventory~~sheet atand the ~~lower~~liabilities offor ~~cost~~the ~~and~~obligations ~~net~~under ~~realizable~~the ~~value.~~lease ~~The~~also ~~ASU~~be ~~defines~~recognized ~~net~~on ~~realizable~~the ~~value~~balance sheet. asThis ~~the~~ASU ~~estimated~~requires ~~selling~~disclosures ~~prices~~to inhelp ~~the~~investors ~~ordinary~~and ~~course~~other offinancial ~~business,~~statement ~~less~~users ~~reasonably~~better ~~predictable~~understand ~~costs~~the ~~of completion~~amount, ~~disposal~~timing, and ~~transportation.~~uncertainty of ~~This~~cash ~~ASU~~flows ~~requires~~arising ~~prospective~~from ~~application~~leases. The required disclosures include qualitative and quantitative requirements. This ASU is effective for fiscal years beginning after December 15, ~~2016~~ 2018 and interim periods within those fiscal years~~, with early~~ . Early adoption is permitted. The ~~Company~~new ~~plans~~standard tomust ~~adopt~~be ~~this~~adopted ~~ASU~~using ~~effective~~a ~~the first~~modified ~~quarter~~retrospective oftransition, ~~fiscal~~and ~~year~~provides ~~2018~~for certain practical expedients. ~~The~~Transition ~~adoption~~will require application of ~~this~~the new guidance byat the beginning of the earliest comparative period presented. The Company is ~~not~~currently ~~expected~~in tothe ~~have~~process aof ~~material~~evaluating ~~impact~~our onadoption ~~its consolidated~~timing and cannot currently estimate the financial ~~statements~~statement impact of the adoption, but the Company does not expect adoption until fiscal year 2020.

In February 2016, the FASB issued ASU 2016-02, "Leases", which is intended to improve financial reporting about leasing transactions. This ASU requires that leased assets be recognized as assets on the balance sheet and the liabilities for the obligations under the lease also be recognized on the balance sheet. This ASU requires disclosures to help investors and other financial statement users better understand the amount, timing, and uncertainty of cash flows arising from leases. The required disclosures include qualitative and quantitative requirements. This ASU is effective for fiscal years beginning after December 15, 2018 and interim periods within those fiscal years. Early adoption is permitted. The new standard must be adopted using a modified retrospective transition, and provides for certain practical expedients. Transition will require application of the new guidance at the beginning of the earliest comparative period presented. The Company is currently in the process of evaluating our adoption timing and cannot currently estimate the financial statement impact of the adoption.

In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350), to simplify the process used to test for goodwill. Under the new standard, if “the carrying amount of a reporting unit exceeds its fair value, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit.” For public companies, the ASU is effective for annual and any interim impairment tests for periods beginning after December 15, 2019. Early adoption is permitted for impairment tests that occur after January 1, 2017. The Company will use the simplified test in its annual fourth quarter testing. Company does not believe the ASU will have a material impact on its consolidated financial statements.

In May 2017, the FASB issued ASU 2017-09, Compensation-Stock Compensation (Topic 718), to better define and provide guidance about which changes or conditions of a share based payment award require an entity to apply modification accounting in Topic 718. For public companies, the ASU is effective for annual and any interim periods beginning after December 15, 2017. The Company plans to adopt this ASU effective the first quarter of fiscal year 2018. The adoption of this guidance by the Company is not expected to have a material impact on its consolidated financial statements.

In August 2017, FASB issued ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. The targeted amendments help simplify certain aspects of hedge accounting and result in a more accurate portrayal of the economics of an entity’s risk management activities in its financial statements. For cash flow and net investment hedges as of the adoption date, the guidance requires a modified retrospective approach. The amended presentation and disclosure guidance is required only prospectively. The amendments are effective for the Company’s fiscal year beginning November 1, 2019, with early adoption permitted. The Company is currently evaluating the accounting, transition, and disclosure requirements of the standard and cannot currently estimate the financial statement impact of adoption.

1412. ACCOUNTS RECEIVABLE

9. ACCOUNTS RECEIVABLE

Trade Accounts Receivable - Uncollectible individual accounts receivable are written off when deemed uncollectible, with any future recoveries recorded as income when received.

For more details regarding the Company’s accounts receivable ~~policies~~polices refer to Note 2, Significant Accounting Policies, in the financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended October 31, ~~2016~~2017.

13.	SUBSEQUENT EVENTS

On February 12, 2018, the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Cott Corporation, a Canadian corporation (“Cott”), and CR Merger Sub, Inc., a wholly owned indirect subsidiary of Cott (“Purchaser”). Pursuant to the terms of the Merger Agreement, Purchaser commenced a tender offer (the “Offer”) on February 20, 2018 to purchase all of the outstanding shares of common stock, par value $0.001 per share, of the Company (the “Company Common Stock”), at a price per share of $0.97, net to the seller in cash, without interest (the “Offer Price”), and subject to deduction for any required withholding of taxes. The Offer is scheduled to expire on March 20, 2018, subject to extension in accordance with the terms of the Merger Agreement.

The consummation of the Offer is subject to customary closing conditions, including, among other things, the valid tender of shares of Company Common Stock representing a majority of the total outstanding shares of Company Common Stock, calculated on a fully diluted basis, and other conditions to the Offer set forth in Annex I to the Merger Agreement. The consummation of the Offer is not subject to any financing condition.

Upon the completion of the Offer, and subject to the satisfaction or waiver of the conditions set forth in the Merger Agreement, Purchaser will be merged with and into the Company, with the Company surviving as a wholly owned indirect subsidiary of Cott (the “Merger”). The Merger Agreement provides that the Merger will be governed by Section 251(h) of the Delaware General Corporation Law and shall be effected by Purchaser and the Company as soon as practicable following the consummation of the Offer without a stockholder meeting.

At the effective time of the Merger (the “Effective Time”), each outstanding share of Company Common Stock, other than shares of Company Common Stock owned by the Company, Cott or Purchaser immediately prior to the Effective Time, or by stockholders who have validly exercised their appraisal rights under Delaware law will be canceled and converted into the right to receive an amount in cash equal to the Offer Price, payable to the holder thereof on the terms and subject to the conditions set forth in the Merger Agreement.

On February 12, 2018, in connection with the entry into the Merger Agreement, each of Peter Baker and John Baker (the “Executives”) entered into a Separation and General Release Agreement with the Company (the “Separation Agreements”). Pursuant to the Separation Agreements, the employment of each Executive with the Company will terminate immediately prior to the closing of the Merger, and the Company will provide each Executive with the compensation and benefits set forth in the Employment Agreement between the Company and each Executive dated November 1, 2016 (the “Employment Agreements”) for “Termination by Company Without Cause” pursuant to Section 2.2.5 of each Employment Agreement. Pursuant to the Separation Agreements, each Executive has agreed to release the Company and Purchaser from claims arising out of or in connection with the Executive’s employment with or termination from the Company. The Separation Agreements also amend the non-competition provisions of the Employment Agreements, such that, during the 12-month period immediately following the closing date of the Merger, each Executive will be subject to certain restrictive covenants regarding non-competition and non-solicitation with respect to the Company.

On March 14, 2018, David Jurasek, the Company’s Chief Financial Officer, entered into an Employment Agreement with the Company (the “Jurasek Employment Agreement”). The Jurasek Employment Agreement provides Mr. Jurasek with an annual salary of $200,000. The Jurasek Employment Agreement provides Mr. Jurasek with payment of one year’s base salary in case of termination without cause or termination of employment following a change of control, as defined, plus an aggregate allowance of up to $25,000 per year to reimburse Mr. Jurasek for (1) the actual cost of premiums incurred by him for disability insurance he obtains, if any, (2) the actual cost of premiums incurred by him for any other insurance which would not be available to him under the Company’s customary benefit plans, and (3) the actual cost of leasing and operating an automobile for use by him during his employment with the Company. The Jurasek Employment Agreement further provides that if Mr. Jurasek continues his employment with the surviving company in the Merger for six months post-closing, the surviving company would pay him a lump-sum cash retention bonus equal to three months’ salary (in addition to salary earned during such six month period). The Jurasek Employment Agreement also provides that the “change of control” severance referred to above would be payable if Mr. Jurasek’s employment is terminated for any reason or he elects to discontinue employment with the surviving company within 30 days of the end of the six-month period following the closing of the Merger.

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis should be read in conjunction with the consolidated financial statements and notes thereto as filed in our Annual Report on Form 10-K for the year ended October 31, ~~2016~~2017 as well as the consolidated financial statements and notes contained herein.

Forward-Looking Statements

The “Management’s Discussion and Analysis” (MD&A) portion of this Form 10-Q contains forward-looking statements, including statements about these topics:

(1) ~~the~~we ~~increasing~~face significant competition ~~from~~in ~~virtual~~the ~~stores~~home ~~selling~~and ~~non-water~~office ~~products~~distribution ~~on the internet~~business,

(2) ~~the~~we ~~potential~~rely ~~adverse~~upon ~~effect~~a ofsingle ~~climate~~software ~~changes~~vendor for our route accounting and ~~severe~~online ~~weather~~storefront, and

	(3)	the outstanding debt levels may adversely impact the business profitability and ability to finance future expansion, and
	(4)	the cost pressures related to commodities affecting our business.

(3)

the outstanding debt levels may adversely impact the business profitability and ability to finance future expansion.

The following factors could strain ~~product~~sales ~~profit~~and margins and ~~profitability and~~ cause actual results to differ materially from statements in MD&A about topic (1): We incorporate by reference into this paragraph the full Risk Factor on page 1312 of our ~~2016~~2017 Form 10-K beginning “~~Internet technology~~We ~~and~~face ~~virtual~~significant competition ~~stores~~in ~~have~~the ~~lowered~~home ~~the~~and ~~barriers~~office ofdistribution ~~entry~~business”.

The following factors could strain ~~liquidity~~our ~~and~~ability ~~working~~to ~~capital~~compete in the ~~availability~~marketplace and cause actual results to differ materially from statements in MD&A about topic (2): We incorporate by reference into this paragraph the full Risk Factor on page 1513 of our ~~2016~~2017 Form 10-K beginning “~~Climate~~We ~~changes~~rely ~~and~~on ~~severe~~a ~~weather~~single ~~may~~software ~~impact~~vendor”.

The following factors could strain liquidity and working capital availability and cause actual results to differ materially from statements in MD&A about topic (3): We incorporate by reference into this paragraph the full Risk Factor on page 15 of our ~~2016~~2017 Form 10-K beginning “Our Company is significantly leveraged”.

~~The~~Results ~~following factors could cause actual results to differ materially from statements in MD&A about topic (4): We incorporate by reference into this paragraph the full Risk Factor on page 15~~ of ~~our 2016 Form 10-K beginning “Fluctuations in the cost of essential raw materials and commodities”.~~Operations

~~Results~~Overview ofand ~~Operations~~Trends

~~Overview~~Sales ~~and~~in ~~Trends~~the first quarter of fiscal 2018 declined 5% from the first quarter fiscal 2017, however sales of water products increased 2%, due to our strategy of focusing sales efforts on new water customers. The most notable sales decline for the period was in the office products category which accounted for over 70% of the net sales decline.

~~Our~~The ~~strategy~~revenue ofdecline ~~focusing sales efforts on new water customers and providing value-added service has~~ resulted in ~~higher~~a ~~water~~decrease ~~volume and an increase~~ in ~~equipment~~gross ~~rental~~profit ~~units for the first nine months~~ of ~~fiscal~~$469,000 or ~~2017 compared to the comparable period of 2016~~6%.

~~Sales~~Our operating expenses were higher in the first ~~nine~~quarter ~~months~~ of fiscal ~~2017~~2018 ~~declined~~compared ~~$5.2~~to ~~million~~the orcomparable ~~11%~~period ~~from~~in ~~$49.2~~2017 ~~million~~which resulted in ~~the~~a ~~first~~loss ~~nine~~from ~~months~~operations of ~~fiscal 2016~~$928,000 ~~however~~in ~~sales~~2018 ofcompared ~~water~~to ~~products~~income ~~and~~of ~~rental~~$232,000 ~~revenues~~in ~~increased slightly~~2017. ~~The~~This ~~most~~was ~~notable~~driven ~~sales~~by ~~decline~~higher ~~for~~selling ~~the~~and ~~period~~general ~~was~~and inadministrative ~~the~~expenses ~~office~~due ~~products~~to ~~category~~costs ~~which~~associated ~~accounted for~~with ~~64% of~~ the ~~net~~planned ~~sales~~merger with ~~decline.~~Cott ~~Refreshment~~Corporation ~~products~~ and ~~coffee~~an ~~sales~~impairment ~~also~~charge ~~declined~~on ~~during~~a ~~the~~write-down ~~first~~of ~~nine~~ERP ~~months~~software ofthat ~~fiscal~~had ~~2017~~previously been capitalized.

~~The~~However, ~~effect~~due ofto the ~~total~~reduction ~~revenue~~in ~~decline~~the ~~through~~corporate tax rate and the resulting $1,400,000 tax benefit recognized upon revaluing the ~~first~~deferred ~~nine~~tax ~~months~~assets ofand ~~fiscal~~liabilities, ~~2017~~the ~~resulted~~company inrecorded anet ~~decrease~~income of $565,000 in ~~gross~~the ~~profit~~first quarter of ~~$1.2~~fiscal ~~million~~2018 versus a net loss of $74,000 orin 5%the comparable period in 2017.

~~Operating~~Results ~~expenses increased $473,000, or 2% during the first nine months~~ of ~~fiscal~~Operations ~~2017~~for ~~as compared to 2016. This is~~ the ~~result~~Three ofMonths ~~adding~~Ended ~~resources~~January to31, ~~increase~~2018 ~~sales~~(First ~~volumes of traditional~~Quarter) ~~water~~Compared ~~and~~to ~~coffee products and improving customer service levels. The result of~~ the ~~lower~~Three ~~gross~~Months ~~profit~~Ended ~~and~~January ~~increased~~31, ~~operating expenses resulted in a reduction in operating income of $1.6 million in the first nine months of fiscal~~ 2017 ~~compared to the comparable period in 2016.~~

~~Results of Operations for the Three Months Ended July 31, 2017 (Third Quarter) Compared to the Three Months Ended July 31, 2016~~Sales

Sales for the three months ended January 31, 2018 were $13,878,000 compared to $14,650,000 for the corresponding period in 2017, a decrease of $772,000 or 5%. Other than water, all sales categories declined. The most notable decline was that of office products. The comparative breakdown of sales of the product lines for the respective three-month periods ended January 31, 2018 and 2017 is as follows:

Sales for the three months ended July 31, 2017 were $14,944,000 compared to $16,394,000 for the corresponding period in 2016, a decrease of $1,450,000 or 9%. Other than equipment rental, all sales categories declined. The most notable decline was that of office products. The comparative breakdown of sales of the product lines for the respective three-month periods ended July 31, 2017 and 2016 is as follows:

Product Line (000’s $)	2018		2017		Difference			% Diff.
Water	$	6,621	$	6,520	$	101			2	%
Coffee		2,559		2,700		(141	)		(5	%)
Refreshment		1,965		2,049		(84	)		(4	%)
Equipment Rental		1,769		1,779		(10	)		(1	%)
Office Products		576		1,127		(551	)		(49	%)
Other		388		475		(87	)		(18	%)
Total	$	13,878	$	14,650	$	(772	)		(5	%)

Product Line (000’s $)	2017		2016		Difference			% Diff.
Water	$	7,427	$	7,525	$	(98	)		(1	%)
Coffee		2,461		2,591		(130	)		(5	%)
Refreshment		2,214		2,626		(412	)		(16	%)
Equipment Rental		1,756		1,754		2			0	%
Office Products		677		1,444		(767	)		(53	%)
Other		409		454		(45	)		(10	%)
Total	$	14,944	$	16,394	$	(1,450	)		(9	%)

Water – Sales of water increased 2% for the first quarter 2018 as compared to the same period of 2017. The increase is attributable to a volume increase of 1% as prices have remained stable.

~~Water~~Coffee – ~~Sales~~The ofdecrease ~~water~~in ~~decreased~~sales 1%was ~~for~~attributable ~~the~~to a ~~third~~decline ~~quarter 2017~~in asour ~~compared~~traditional tohigher ~~the~~volume ~~same~~bulk ~~period~~and ofK-cup ~~2016~~lines. ~~Though~~Bulk ~~volume~~products ~~increased~~sales 3%continued ~~for~~to be negatively influenced by the single ~~third~~serve ~~quarter~~lines ~~2017~~and K-cup sales declined as ~~compared~~a toresult ~~the~~of ~~same~~ongoing ~~period~~ commoditization of ~~2016,~~coffee ~~the~~products. ~~average~~The ~~price~~Cool ~~declined~~Beans® 4brand single serve coffee sales increased 16% though the volume did not offset lost sales in other coffee packaging.

~~Coffee~~Refreshment – ~~The~~Complementary ~~decrease~~coffee ~~in sales was attributable to a decline in our traditional higher volume bulk and K-cup lines. Bulk~~ products, ~~sales continued to be negatively influenced by the~~ single serve ~~lines~~drinks, ~~and~~small ~~K-cup~~package ~~sales~~water, ~~declined as a result of ongoing commoditization of coffee products~~ and ~~availability~~cups, ofall ~~products on the internet through virtual storefronts~~declined.

~~Refreshment~~Equipment Rental – ~~Complementary~~The ~~coffee~~decrease ~~products,~~in ~~single serve~~sales ~~drinks,~~was ~~small~~a ~~package~~result of ~~water,~~a ~~and~~1% ~~cups,~~decrease ~~all~~in ~~declined.~~the ~~The~~average ~~Company~~monthly norental ~~longer~~price ~~services~~per ~~vending~~rental ~~machines~~unit. ~~which~~The ~~accounted~~number ~~for $219,000~~ of rental units in the ~~sales~~field ~~decline~~increased inby ~~this~~less than ~~category~~1%.

~~Equipment~~Office ~~Rental~~Products – The ~~minimal~~decrease ~~increase~~ in sales was a result of a ~~2.1%~~reduced ~~increase~~online inpresence ~~the~~for ~~number of rental units in~~ the ~~field~~category ~~partially~~and ~~offset~~less byfocus aon ~~decrease~~sales offrom ~~1.9%~~our insales ~~the average monthly rental price per rental unit~~department.

~~Office~~Other ~~Products~~ – The decrease inis ~~sales~~attributable ~~was~~to a ~~result~~decrease ~~of implemented price increases on items previously sold at cost or near cost, a decreased focus on sales~~ in ~~this~~the ~~category~~sale ~~and availability~~ of ~~products on the internet through virtual storefronts~~equipment.

~~Other~~Gross Profit/Cost of Goods Sold – The decrease in issales ~~attributable~~for tothe three months ended January 31, 2018, resulted in a lower ~~sales~~ gross profit of ~~coolers~~$7,225,000 afrom ~~decrease~~$7,694,000 infor ~~late~~the ~~payment~~comparable period ~~finance~~in ~~charges~~2017. ~~and~~As a ~~reduction~~percentage inof ~~fees~~sales, ~~that~~gross ~~are~~margin ~~charged~~was to52% ~~offset~~compared ~~energy~~to ~~costs~~53% for ~~delivery and~~the ~~freight,~~same ~~raw~~period ~~materials~~a ~~and~~year ~~bottling operations~~ago.

~~Gross Profit/~~Cost of ~~Goods~~goods ~~Sold~~sold –includes ~~The~~all ~~decrease in~~costs ~~sales~~to ~~for~~bottle ~~the~~water, ~~three~~costs ~~months~~of purchasing ~~ended~~and ~~July~~receiving 31products for resale, ~~2017~~including ~~resulted~~freight, inas awell ~~decrease~~as ofcosts ~~gross~~associated ~~profit~~with toproduct $8quality,~~125~~ warehousing and handling costs,~~000~~ ~~from~~internal $8transfers,~~834~~ and the repair and service of rental equipment,~~000~~ ~~for~~but does not include the costs of distributing ~~comparable~~our ~~period~~product to our customers. We include distribution costs in ~~2016~~selling, ageneral, ~~decrease~~and ofadministrative ~~$709~~expense,~~000,~~ orand 8%the amount is reported below. AsThe areader ~~percentage~~should ofbe ~~sales,~~aware ~~gross~~that ~~margin~~other ~~was~~companies ~~54%~~may ~~for~~include ~~the~~distribution ~~three~~costs ~~months~~in ~~ended~~their cost of goods sold, in ~~July~~which 31case, ~~2017~~on ~~and~~a ~~2016~~comparative basis, such other companies may have a lower gross margin as a result.

~~Cost~~Operating ofExpenses ~~goods sold includes all costs to bottle water, costs of purchasing~~ and ~~receiving~~Loss/Income ~~products~~from for resale, including freight, as well as costs associated with product quality, warehousing and handling costs, internal transfers, and the repair and service of rental equipment, but does not include the costs of distributing our product to our customers. We include distribution costs in selling, general, and administrative expense, and the amount is reported below. The reader should be aware that other companies may include distribution costs in their cost of goods sold, in which case, on a comparative basis, such other companies may have a lower gross margin as a result.Operations

~~Operating~~Total ~~Expenses~~operating ~~and~~expenses ~~Income~~increased to $8,153,000 in the first fiscal quarter of 2018 from ~~Operations~~$7,462,000 in the comparable period in 2017, an increase of $691,000, or 9%.

~~Total~~Selling, ~~operating~~general ~~expenses~~and ~~increased~~administrative to(SG&A) expenses of $7,~~562~~492,000 in the ~~third~~first fiscal quarter of ~~2017~~2018 increased $320,000, or 4%, from $7,~~241~~172,000 in the comparable period in ~~2016~~2017. Of total SG&A expenses, route distribution costs decreased $2,000, as a result of lower labor costs offset by an increase in truck operating and fuel costs; combined selling and marketing costs decreased $26,000, or 3%, as a result of a decrease in sales staffing; and administration costs increased $~~321~~348,000, or 412%, as a result of costs associated with the planned merger with Cott Corporation.

~~Selling,~~Advertising ~~general and administrative (SG&A)~~ expenses ofwere $7123,~~265,~~000 in the ~~third~~first fiscal quarter of 2018 ~~2017~~compared ~~increased~~to $~~332~~119,000, ~~or 5%, from $6,933,000~~ in the ~~comparable~~first ~~period~~quarter inof ~~2016. Of total SG&A expenses~~2017, ~~route~~an ~~distribution~~increase ~~costs decreased $72,000, or 2%, as a result~~ of ~~lower labor, truck leasing and insurance costs; combined selling and marketing costs decreased~~ $94,000, or 13%. asThe aincrease ~~result of lower labor costs for the third quarter of 2017 as compared to the same period~~ in ~~2016;~~advertising ~~and administration~~ costs ~~increased~~is ~~$413,000, or 15%, as a result of increased spending in the areas~~primarily ofrelated ~~liability~~to ~~insurance,~~sponsorship ~~information technology and customer service improvements and provisions for bad debt~~costs.

~~Advertising~~Amortization ~~expenses~~decreased ~~were~~to $~~127~~142,000 in the ~~third~~first fiscal quarter of ~~2017~~2018 ~~compared~~from to $~~137~~170,000 in the ~~third~~comparable quarter ofin ~~2016~~2017, a decrease of $1028,000, or 716%. ~~The~~Amortization ~~decrease~~is inattributable ~~advertising~~to ~~costs~~intangible assets isthat ~~primarily related~~were toacquired ~~lower~~as ~~utilization~~part of ~~printed advertising materials~~acquisitions.

18We had a loss from the sale and disposal of assets in the first quarter of 2018 totaling $396,000 compared to no gains or losses for the comparable period in 2017. The abandonment of the implementation of a new enterprise resource planning, (“ERP”) software, resulted in an impairment of property and equipment that accounted for $385,000 of the loss in fiscal 2018.

~~Amortization~~The ~~decreased~~loss tofrom ~~$170,000~~operations infor the ~~third~~three ~~fiscal~~months ~~quarter~~ended ofJanuary 31, 2018 was $928,000 ~~2017~~compared to income from operations of $~~171~~232,000 in the comparable ~~quarter~~period in ~~2016~~2017, a ~~decrease~~decline of $1,~~000~~160, ~~or less than 1%~~000. ~~Amortization~~The isdecline ~~attributable~~was tothe ~~intangible~~result ~~assets that were acquired as part~~ of ~~acquisitions.~~lower Wesales ~~had~~resulting ain ~~gain~~lower ofgross ~~$1,000~~profit ~~from~~combined ~~the~~with ~~sale of assets in~~ the ~~fiscal~~current ~~third~~period ~~quarter of~~cost ~~2017~~associated ~~compared~~with tothe noplanned ~~gains~~merger orwith ~~losses~~Cott Corporation inand the ~~third~~impairment ~~quarter~~write-off of ~~fiscal~~the ~~2016.~~software Wecosts ~~routinely~~capitalized ~~sell~~related ~~assets~~to ~~used in~~ the ~~normal~~ERP ~~course of business as they are replaced with newer assets~~system.

The income from operations for the three months ended July 31, 2017 was $563,000 compared to $1,593,000 in the comparable period in 2016, a decline of $1,030,000. The decline was the result of lower sales and corresponding gross profit combined with higher administrations costs partially offset by lower route distribution and sales and marketing costs.18

Interest, Taxes, and Other Expenses

~~Net~~Interest ~~interest~~ expense was $~~292~~234,000 for the three months ended ~~July~~January 31, ~~2017~~2018 compared to $~~417~~351,000 in the three months ended ~~July~~January 31, ~~2016~~2017, a decrease of $~~125~~117,000. The decrease is attributable to ~~lower~~to ~~average interest rates and~~ lower debt balances asand alower ~~result~~average ~~of paying off subordinated debt that requires~~ interest ~~at 12%~~rates.

The ~~income~~loss before income taxes was $~~271~~1,161,000 for the three months ended ~~July~~January 31, ~~2017~~2018 compared to ~~income before income taxes of~~ $1118,~~176,~~000 in the corresponding period in ~~2016~~2017, a ~~decrease~~decline of $~~905~~1,043,000. The tax ~~expense~~benefit for the first ~~third~~ quarter of ~~2017~~2018 was $~~100~~1,727,000 compared to ~~tax~~$44,000 ~~expense~~in 2017. As a result of the Tax Cuts and Jobs Act of 2017, the Company recognized a benefit of $~~447~~1,402,000 indue to a remeasurement of deferred tax assets and liabilities. In addition to the ~~corresponding~~reduction of ~~period~~the deferred tax liability the Company had an additional tax benefit of ~~2016~~$325,000 as a result of the first quarter 2018 loss before taxes.

Net Income (Loss)

The net income for the three months ended ~~July~~January 31, ~~2017~~2018 was $~~171~~565,000 compared to a net ~~income~~loss of $~~729~~75,000 in the corresponding period in ~~2016~~2017. The ~~lower~~increase ~~net income~~ is attributable to ~~lower~~the ~~sales~~increased ~~and~~tax benefit ~~corresponding~~recognized ~~gross~~through ~~profit~~the ~~combined~~remeasurement ~~with~~of ~~higher~~deferred ~~administration~~tax ~~costs~~assets ~~partially~~and liabilities offset by lower ~~route~~sales ~~distribution,~~and ~~selling~~gross ~~and~~profit combined with ~~marketing~~increased merger costs asand ~~well~~the asloss ~~lower~~on ~~interest~~disposal ~~expense~~of an asset.

~~Results~~Liquidity ofand ~~Operations~~Capital ~~for the Nine Months Ended July 31, 2017 Compared to the Nine Months Ended July 31, 2016~~Resources

~~Sales~~As of January 31, 2018, we had working capital of $2,628,000 compared to $3,359,000 as of October 31, 2017, a decrease of $731,000. The most significant change in working capital was due to the use of cash for investment purposes in the purchase of equipment in the first quarter of 2018. Cash provided from operations during the three months ended January 31, 2018 was $200,000. The Company also reduced debt by $385,000 during the first quarter of 2018.

~~Sales~~Our ~~for~~Credit Agreement with Bank of America (the ~~nine~~“Bank”) provides ~~months~~a ~~ended~~senior ~~July~~financing facility consisting of term debt and a revolving line of credit. As of January 31, ~~2017~~2018 ~~were~~we had $447,~~069~~733,000 ~~compared~~outstanding toon our term loan. There was a balance of $492,~~237~~015,~~000~~200 ~~for~~outstanding on the ~~corresponding~~line ~~period~~of incredit ~~2016,~~and a ~~decrease~~letter of credit issued for $51,~~168~~327,000, orto ~~10%.~~collateralize ~~The~~the ~~most~~Company’s ~~notable~~liability ~~decline~~insurance ~~was~~program as of that date. Consequently, as of ~~office~~January ~~products~~31, 2018, there was $2,658,000 available to borrow from the revolving line of credit.

19Our term debt amortizes over a five year period with 59 equal monthly installments of $133,333 and a final payment of $4,133,333 due in May 2020. The revolving line of credit matures in May 2018. There are various restrictive covenants under the Agreement, and the Company is prohibited from entering into other debt agreements without the bank’s consent. The Agreement also prohibits the Company from paying dividends without the prior consent of the bank.

~~The comparative breakdown of sales of the product lines for the respective nine-month periods ended July 31, 2017 and 2016 is as follows:~~19

Product Line (000’s $)	2017		2016		Difference			% Diff.
Water	$	20,658	$	20,579	$	79			0	%
Coffee		7,786		8,505		(719	)		(8	%)
Refreshment		6,293		7,502		(1,209	)		(16	%)
Equipment Rental		5,293		5,289		4			0	%
Office Products		2,668		5,976		(3,308	)		(55	%)
Other		1,371		1,386		(15	)		(1	%)
Total	$	44,069	$	49,237	$	(5,168	)		(10	%)

~~Water~~The –following ~~Sales~~information ofpertains ~~water~~to ~~increased less than 1% for~~ the ~~first~~ ~~nine~~Company's ~~months~~outstanding ofinterest ~~fiscal~~rate ~~2017~~swap asat January ~~compared~~31, ~~to the same period of 2016~~2018. The ~~increase~~pay rate is ~~attributable~~fixed toand anthe ~~increase~~receive inrate ~~volume of~~is ~~2.4%~~one ~~partially~~month ~~offset by a decrease in average price of 2~~LIBOR.~~0%.~~

Coffee – The decrease in sales was attributable to a decline in our traditional higher volume lines, bulk and K-cup, while Cool Beans® pods increased 11%. Bulk products sales continued to be negatively influenced by the single serve lines and K-cup sales declined as a result of ongoing commoditization and availability of products on the internet through virtual storefronts. The increase in pod sales is a result of conversion of the other lines as well as new sales but the volume of the product, to date, has not approached that of the others.

Instrument			Notional Amount				Pay Rate			Receive Rate
Interest rate swap			$	3,866,668			1.25%			1.56%

~~Refreshment~~The –Second ~~Complementary~~Amendment ~~coffee~~requires ~~products, single~~the ~~serve~~Company ~~drinks~~to be in compliance with certain financial covenants as follows: (i) a maximum annual limit for capital expenditures of $4,000,000 ~~small~~each ~~package~~fiscal ~~water~~year, ~~and~~(ii) ~~cups~~consolidated adjusted operating cash flows to consolidated total debt service ratio, ~~all~~as defined, ~~declined~~to be no less than 1.5 ~~The~~to ~~Company~~1 nofor ~~longer~~any ~~services~~reference ~~vending~~period ~~machines~~ending ~~which~~on ~~accounted~~or ~~for~~after October 31, 2016 and (iii) senior funded debt ~~$638~~to consolidated adjusted EBITDA,~~000~~ as defined, to be no greater than 2.5 to 1 as of the ~~sales~~end ~~decline~~of inany ~~this~~fiscal ~~category~~quarter ending on or after October 31, 2016.

~~Equipment~~On ~~Rental~~June –13, 2017, the Company entered into a Third Amendment (the “Third Amendment”) to the Agreement. The ~~small~~Third ~~increase~~Amendment inincreases ~~sales~~the ~~was~~aggregate aprincipal ~~result~~amount available under the revolving line of acredit 1from $5,000,000 to $6,000,000.9% ~~increase~~The Third inAmendment allows the ~~number~~Company to use up to $2,000,000 of ~~rental~~proceeds ~~units~~from inthe revolving line of credit to make payments on the Subordinated ~~field~~Debt. ~~partially~~The ~~offset~~Amendment byalso aallows ~~decrease~~payments of 1interest on Subordinated Notes.8% As of January 31, 2018, the Company was not in compliance with (ii) and (iii) of the ~~average~~financial ~~monthly~~covenants. The Bank waived the covenant compliance requirements for ~~rental~~(ii) ~~revenue~~and ~~per~~(iii) ~~unit~~for the period ended January 31, 2018.

~~Office~~In ~~Products~~addition –to ~~The~~the ~~decrease~~senior indebt, ~~sales~~as ~~was~~of aJanuary ~~result of~~31, ~~implemented~~2018, ~~price~~the ~~increases~~Company has onsubordinated ~~items~~debt ~~previously~~owed ~~sold~~to atPeter ~~cost~~and orJohn ~~near~~Baker ~~cost,~~in athe ~~decreased~~aggregate ~~focus~~principal onamount ~~sales~~of in$4,500,000 ~~this~~that ~~category~~is ~~and~~due ~~availability~~November 20, 2020. ofThe ~~products~~interest rate on ~~the~~each ~~internet~~of ~~through~~these ~~virtual~~notes ~~storefronts~~is 12% per annum.

~~Other~~In –addition ~~The~~to ~~decrease~~our issenior ~~primarily~~and ~~the~~subordinated ~~result~~debt ofcommitments, awe ~~reduction~~have significant future incash ~~fees~~commitments, ~~that~~primarily ~~are~~in ~~charged~~the toform ~~offset~~of ~~energy~~operating ~~costs~~leases ~~for~~that ~~delivery~~are ~~and~~not ~~freight,~~reported ~~raw~~on ~~materials~~the ~~and~~consolidated ~~bottling~~balance ~~operations~~sheet.

Gross Profit/Cost of Goods Sold – The decrease in sales for the nine months ended July 31, 2017 resulted in a gross profit decrease of $1,165,000 to $23,488,000 from $24,653,000 for the comparable period in 2016. As a percentage of sales, gross margin was 53% for the nine months ended July 31, 2017 compared to 50% for the same period a year ago. Due to a changing sales mix with a reduction of lower margin sales items, the gross margin percentage increased in 2017 as compared to 2016.20

20The following table sets forth our contractual commitments in the remainder of the current year and future fiscal years as of January 31, 2018:

Cost of goods sold includes all costs to bottle water, costs of purchasing and receiving products for resale, including freight, as well as costs associated with product quality, warehousing and handling costs, internal transfers, and the repair and service of rental equipment, but does not include the costs of distributing our product to our customers. We include distribution costs in selling, general, and administrative expense, and the amount is reported below. The reader should be aware that other companies may include distribution costs in their cost of goods sold, in which case, on a comparative basis, such other companies may have a lower gross margin as a result.

Contractual Obligations	Payment due by Period
	Total		Remainder of 2018		2019-2020		2021-2022		After 2022
Debt (1)	$	14,248,000	$	3,215,000	$	6,533,000	$	4,500,000	$	-
Interest on Debt (2)		2,212,000		741,000		1,441,000		30,000		-
Operating Leases		8,246,000		2,118,000		4,236,000		1,840,000		52,000
Total	$	24,706,000	$	6,074,000	$	12,210,000	$	6,370,000	$	52,000

~~Operating~~(1) ~~Expenses~~Interest based on 50% of outstanding senior debt at the hedged interest rate discussed above, 50% of outstanding senior debt at a variable rate of 4.06%, line of credit at a rate of 3.81%, and ~~Income~~subordinated ~~from~~debt ~~Operations~~at a rate of 12%.

~~Total~~(2) ~~operating~~Customer ~~expenses~~deposits ~~increased~~have tobeen ~~$22,391,000~~excluded infrom the ~~first~~table. ~~nine months~~Deposit ofbalances ~~2017~~vary from ~~$21,918,000~~period to period with water sales but future increases and decreases in the ~~comparable~~balances ~~period~~are innot ~~2016,~~accurately anpredictable. ~~increase~~Deposits are excluded because, net of ~~$473~~periodic additions and reductions,~~000,~~ orit 2%is probable that a customer deposit balance will always be outstanding as long as the business operates.

~~Selling,~~We ~~general~~have ~~and~~no ~~administrative~~other ~~(SG&A)~~material ~~expenses~~contractual ofobligations ~~$21,536,000 in the first nine months of 2017 increased $504,000,~~ or ~~2%, from $21,032,000 in the comparable period in 2016~~commitments. Of total SG&A expenses, route distribution costs decreased $523,000, or 5%, as a result of lower labor, truck leasing and insurance costs; combined selling and marketing costs increased $189,000, or 7%, as a result of an increase in staffing; and administration costs increased $838,000, or 10%, as a result of increased spending in the areas of information technology and customer service improvements and provisions for bad debt partially offset by a decrease in overall labor costs.

Advertising expenses were $345,000 in the first nine months of 2017 compared to $389,000 in the first nine months of 2016, a decrease of $44,000, or 11%. The decrease in advertising costs is primarily related to a reduction in printed sales materials.

Amortization increased to $511,000 in the first nine months of 2017 from $501,000 in the comparable period of 2016, an increase of $10,000, or 2%. Amortization is attributable to intangible assets that were acquired as part of acquisitions. We had a gain of $1,000 from the sale of assets in the first nine months of 2017 compared to a gain from the sale of assets of $4,000 in the first nine months of 2016. We routinely sell assets used in the normal course of business as they are replaced with newer assets.

The income from operations for the nine months ended July 31, 2017 was $1,097,000 compared to $2,735,000 in the comparable period in 2016, a decrease of $1,638,000. The decline was the result of lower sales and corresponding gross profit combined with higher selling and administration costs partially offset by lower route distribution costs.

Interest, Taxes, and Other Expenses

Interest expense was $987,000 for the nine months ended July 31, 2017 compared to $1,220,000 in the nine months ended July 31, 2016, a decrease of $233,000. The decrease is attributable to lower average interest rates and lower debt balances as a result of paying off subordinated debt that requires interest at 12%.

The income before income taxes was $110,000 for the nine months ended July 31, 2017 compared to income before income taxes of $1,514,000 in the corresponding period in 2016, a decline of $1,404,000. The tax expense for the first nine months of 2017 was $41,000 compared to a tax expense of $575,000 in 2016.

Net Income

The net income for the nine months ended July 31, 2017 was $69,000 compared to a net income of $939,000 in the corresponding period in 2016. The reduction in net income is attributable to lower sales and corresponding gross profit combined with higher selling and administration costs partially offset by lower route distribution costs.

Liquidity and Capital Resources

As of July 31, 2017, we had working capital of $3,117,000 compared to $7,911,000 as of October 31, 2016, a decrease of $4,794,000. As permitted in the “Third Amendment”, we made a $4,500,000 prepayment on our subordinated debt. We paid $2,500,000 in cash and used proceeds from the revolving line of credit for the remaining $2,000,000. Cash provided from operations during the nine months ended July 31, 2017 was $578,000.

Our Credit Agreement with Bank of America (the “Bank”) provides a senior financing facility consisting of term debt and a revolving line of credit. As of July 31, 2017 we had $8,533,000 outstanding on our term loan. At July 31, 2017, there was a balance of $2,000,000 outstanding on the line of credit and a letter of credit issued for $1,327,000 to collateralize the Company’s liability insurance program as of that date. Consequently, as of July 31, 2017, there was $2,673,000 available to borrow from the revolving line of credit. The line of credit matures in May 2018.

Our term debt amortizes over a five year period with 59 equal monthly installments of $133,333 and a final payment of $4,133,333 due in May 2020. There are various restrictive covenants under the Credit Agreement, and the Company is prohibited from entering into other debt agreements without the bank’s consent. The Credit Agreement also prohibits the Company from paying dividends without the prior consent of the Bank.

Effective September 12, 2016, the Company further amended its Credit Agreement with the Bank (the “Second Amendment”). Under the Second Amendment, interest is paid at a rate of one-month LIBOR plus a margin based on the achievement of a specified leverage ratio. As of July 31, 2017, the margin was 2.50% for the term note and 2.25% for the revolving line of credit. The Company fixed the interest rate on a portion of its term debt by entering into an interest rate swap. As of July 31, 2017, the Company had $4,266,000 of the term debt subject to variable interest rates. The one-month LIBOR was 1.22% on July 31, 2017 resulting in total variable interest rates of 3.72% and 3.47%, for the term note and the revolving line of credit, respectively, as of July 31, 2017.

The following information pertains to the Company's outstanding interest rate swap at July 31, 2017. The pay rate is fixed and the receive rate is one month LIBOR.

Instrument	Notional Amount	Pay Rate	Receive Rate
Interest rate swap	$4,266,668	1.25%	1.22%

The Second Amendment requires the Company to be in compliance with certain financial covenants as follows: (i) a maximum annual limit for capital expenditures of $4,000,000 each fiscal year, (ii) consolidated adjusted operating cash flows to consolidated total debt service ratio, as defined, to be no less than 1.5 to 1 for any reference period ending on or after October 31, 2016 and (iii) senior funded debt to consolidated adjusted EBITDA, as defined, to be no greater than 2.5 to 1 as of the end of any fiscal quarter ending on or after October 31, 2016. As of July 31, 2017, the Company was in compliance with these financial covenants.

On June 13, 2017, the Company entered into a Third Amendment (the “Third Amendment”) to the Agreement with the Bank. The Third Amendment increases the aggregate principal amount available under the revolving line of credit from $5,000,000 to $6,000,000. The Third Amendment allows the Company to use proceeds from the revolving line of credit to make payments on the Subordinated Debt in an amount not to exceed $2,000,000. The Third Amendment also allows for total prepayments on Subordinated Debt up to $4,500,000 in the aggregate. There were no other changes to the existing term facility, applicable margins for outstanding balances of term debt, or outstanding line of credit amounts. Subsequent to the execution of the Third Amendment, the Company paid an aggregate of $4,500,000 of subordinated debt principal payments to Peter and Jack Baker and the Estate of Henry Baker.

In addition to the senior debt, as of July 31, 2017, the Company has subordinated debt owed to Peter and John Baker in the aggregate principal amount of $4,500,000 that is due November 20, 2020. The interest rate on each of these notes is 12% per annum.

In addition to our senior and subordinated debt commitments, we have significant future cash commitments, primarily in the form of operating leases that are not reported on the consolidated balance sheet. The following table sets forth our contractual commitments in the remainder of the current year and future fiscal years as of July 31, 2017:

	Payment due by Period
Contractual Obligations			Remainder
	Total		of 2017		2018-2019		2020-2021		After 2021
Debt (1)	$	15,033,000	$	400,000	$	5,200,000	$	9,433,000	$	-
Interest on Debt (2)		2,547,000		282,000		1,603,000		662,000		-
Operating Leases		8,074,000		704,000		4,725,000		2,587,000		58,000
Total	$	25,654,000	$	1,386,000	$	11,528,000	$	12,682,000	$	58,000

(1) Debt payments in 2018 include repayments of $2,000,000 outstanding under our line of credit.

(2) Interest based on 50% of outstanding senior debt at the hedged interest rate discussed above, 50% of outstanding senior debt at a variable rate of 3.72%, line of credit at a rate of 3.47%, and subordinated debt at a rate of 12%.

(3) Customer deposits have been excluded from the table. Deposit balances vary from period to period with water sales but future increases and decreases in the balances are not accurately predictable. Deposits are excluded because, net of periodic additions and reductions, it is probable that a customer deposit balance will always be outstanding as long as the business operates.

We have no other material contractual obligations or commitments.

Item 3. Quantitative and Qualitative Disclosures about Market Risks.

Pursuant to Regulation S-K, Item 305(e), smaller reporting companies are not required to provide this information.

Item 4. Controls and Procedures.

Our Chief Executive Officer and our Chief Financial Officer have evaluated the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)). Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures, as of the end of the period covered by this report, were adequate and effective to provide reasonable assurance that information required to be disclosed by us, including our consolidated subsidiary, in reports that we file or submit under the Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that information we are required to disclose in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive and Chief Financial officers, as appropriate to allow timely decisions regarding required disclosure.

The effectiveness of a system of disclosure controls and procedures is subject to various inherent limitations, including cost limitations, judgments used in decision making, assumptions about the likelihood of future events, the soundness of internal controls, and fraud. Due to such inherent limitations, there can be no assurance that any system of disclosure controls and procedures will be successful in preventing all errors or fraud, or in making all material information known in a timely manner to the appropriate levels of management.

Changes in Internal Control over Financial Reporting.

No change in our internal control over financial reporting occurred during the ~~nine~~three month period ended ~~July~~January 31, ~~2017~~2018 that has materially affected, or is reasonably likely to materially affect, ~~our~~ our internal control over financial reporting.

2422

PART II – OTHER INFORMATION

Item 1.

Legal Proceedings.

None.

Item 1A.

Risk Factors.

There was no change in the ~~nine~~three months ended ~~July~~ January 31, ~~2017~~ 2018 from the Risk Factors reported in our Annual Report on Form 10-K for the year ended October 31, ~~2016~~2017.

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3.

Defaults Upon Senior Securities.

None.

Item 4.

Mine Safety Disclosures.

None.

Item 5.

Other Information.

~~None~~On March 14, 2018, David Jurasek, the Company’s Chief Financial Officer, entered into an Employment Agreement with the Company (the “Jurasek Employment Agreement”). The Jurasek Employment Agreement provides Mr. Jurasek with an annual salary of $200,000. The Jurasek Employment Agreement provides Mr. Jurasek with payment of one year’s base salary in case of termination without cause or termination of employment following a change of control, as defined, plus an aggregate allowance of up to $25,000 per year to reimburse Mr. Jurasek for (1) the actual cost of premiums incurred by him for disability insurance he obtains, if any, (2) the actual cost of premiums incurred by him for any other insurance which would not be available to him under the Company’s customary benefit plans, and (3) the actual cost of leasing and operating an automobile for use by him during his employment with the Company. The Jurasek Employment Agreement further provides that if Mr. Jurasek continues his employment with the surviving company in the Merger for six months post-closing, the surviving company would pay him a lump-sum cash retention bonus equal to three months’ salary (in addition to salary earned during such six month period). The Jurasek Employment Agreement also provides that the “change of control” severance referred to above would be payable if Mr. Jurasek’s employment is terminated for any reason or he elects to discontinue employment with the surviving company within 30 days of the end of the six-month period following the closing of the Merger. The foregoing summary of the Jurasek Employment Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Jurasek Employment Agreement, a copy of which is attached hereto as Exhibit 10.1, and the terms of which are incorporated herein by reference.

Item 6.

Exhibits.

Exhibit

Number

Description

2.1

Agreement and Plan of Merger dated February 12, 2018, by and among Cott Corporation, CR Merger Sub, Inc. and Crystal Rock Holdings, Inc. (Incorporated by reference to Exhibit 2.1 of our current report on Form 8-K, filed with the SEC on February 13, 2018)

3.1

Certificate of Incorporation (Incorporated by reference to Exhibit B to Appendix A to our registration statement on Form S-4, File No. 333-45226, filed with the SEC on September 6, 2000)

3.2

Certificate of Amendment of Certificate of Incorporation (Incorporated by reference to Exhibit 4.2 of our current report on Form 8-K, filed with the SEC on October 19, 2000)

3.3

Certificate of Ownership and Merger of Crystal Rock Holdings, Inc. with and into Vermont Pure Holdings, Ltd. (Incorporated by reference to Exhibit 3.1 to our current report on Form 8-K, filed with the SEC on May 6, 2010)

3.4

Amendment to Amended and Restated By-laws of Crystal Rock Holdings, Inc. (Incorporated by reference to Exhibit 3.1 of our current report on Form 8-K, filed with the SEC on February 13, 2018)

10.1

Employment Agreement between Crystal Rock Holdings, Inc. and David Jurasek dated March 14, 2018

10.2

Separation and General Release Agreement dated February 12, 2018, by and between Peter Baker and Crystal Rock Holdings, Inc. (Incorporated by reference to Exhibit 10.1 of our current report on Form 8-K, filed with the SEC on February 13, 2018)

10.3

Separation and General Release Agreement dated February 12, 2018, by and between John Baker and Crystal Rock Holdings, Inc. (Incorporated by reference to Exhibit 10.2 of our current report on Form 8-K, filed with the SEC on February 13, 2018)

31.1

Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31.2

Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1

Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2

Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101

Interactive Data Files regarding (a) our Consolidated Balance Sheets as of January 31, 2018 and October 31, 2017, (b) our Consolidated Statements of Operations for the Three Months Ended January 31, 2018 and 2017, (c) our Consolidated Statements of Comprehensive Loss for the Three Months Ended January 31, 2018 and 2017, (d) our Consolidated Statements of Cash Flows for the Three Months Ended January 31, 2018 and 2017, and (e) the Notes to such Consolidated Financial Statements.

SIGNATURE

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.

Dated: March 16, 2018
	CRYSTAL ROCK HOLDINGS, INC.

	By:	/s/ David Jurasek
		David Jurasek
		Chief Financial Officer/Treasurer
		(Principal Accounting Officer and Principal Financial Officer)

~~Item~~Exhibits 6.Filed ~~Exhibits.~~Herewith

Exhibit

Number

Description

310.1 ~~Certificate~~Employment ofAgreement ~~Incorporation~~between ~~(Incorporated~~Crystal byRock ~~reference to Exhibit B to Appendix A to our registration statement on Form S-4~~Holdings, ~~File No~~Inc. ~~333-45226,~~and ~~filed~~David ~~with~~Jurasek ~~the~~dated ~~SEC~~March ~~on September 6~~14, ~~2000)~~2018

331.21 ~~Certificate~~Certification of ~~Amendment~~Chief ofExecutive ~~Certificate~~Officer ofpursuant ~~Incorporation (Incorporated by reference~~ to ~~Exhibit~~Section ~~4.2~~302 of ~~our~~the ~~current report on Form 8~~Sarbanes-K,Oxley ~~filed~~act ~~with~~of ~~the SEC on October 19, 2000)~~2002.

331.32 ~~Certificate~~Certification of ~~Ownership~~Chief ~~and~~Financial ~~Merger~~Officer ofpursuant ~~Crystal Rock Holdings, Inc. with and into Vermont Pure Holdings, Ltd. (Incorporated by reference~~ to ~~Exhibit~~Section ~~3.1~~302 toof ~~our~~the ~~current report on Form 8~~Sarbanes-K,Oxley ~~filed~~act ~~with~~of ~~the SEC on May 6, 2010)~~2002.

332.41 ~~By-laws,~~Certification asof ~~amended~~Chief ~~(Incorporated~~Executive byOfficer ~~reference~~pursuant to ~~Exhibit~~18 3U.2S.C. toSection ~~our~~1350, ~~report~~as onadopted ~~Form~~pursuant ~~8-K,~~to ~~filed~~Section ~~with~~906 of the ~~SEC~~Sarbanes-Oxley onAct ~~April~~of ~~2, 2010)~~2002.

1032.12 ~~Third~~Certification ~~Amendment Agreement with Bank~~ of ~~America~~Chief ~~dated~~Financial ~~June~~Officer ~~13,~~pursuant ~~2017 (Incorporated by reference~~ to ~~Exhibit~~18 10U.1S.C. toSection ~~our~~1350, ~~report~~as onadopted ~~Form~~pursuant ~~8-k,~~to ~~filed~~Section ~~with~~906 of the ~~SEC~~Sarbanes-Oxley onAct ~~June~~of ~~13, 2017)~~2002

101 Interactive Data Files regarding (a) our Consolidated Balance Sheets as of January 31.1, ~~Certification~~2018 and October 31, 2017, (b) our Consolidated Statements of ~~Chief~~Operations ~~Executive~~for ~~Officer~~the ~~pursuant~~Three toMonths ~~Section~~Ended ~~302~~January 31, 2018 and 2017, (c) our Consolidated Statements of Comprehensive Loss for the ~~Sarbanes-Oxley~~Three ~~Act~~Months Ended January 31, 2018 and 2017, (d) our Consolidated Statements of ~~2002~~Cash Flows for the Three Months Ended January 31, 2018 and 2017, and (e) the Notes to such Consolidated Financial Statements.

~~31.2 Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002~~26

32.1 Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2 Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101 Interactive Data Files regarding (a) our Consolidated Balance Sheets as of July 31, 2017 and October 31, 2016, (b) our Consolidated Statements of Operations for the Three and Nine Months Ended July 31, 2017 and 2016, (c) our Consolidated Statements of Comprehensive Income (Loss) for the Three and Nine Months Ended July 31, 2017 and 2016, (d) our Consolidated Statements of Cash Flows for the Nine Months Ended July 31, 2017 and 2016, and (e) the Notes to such Consolidated Financial Statements.

SIGNATURE

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.

Dated: September 14, 2017

CRYSTAL ROCK HOLDINGS, INC. By: /s/ David Jurasek David Jurasek Chief Financial Officer/Treasurer (Principal Accounting Officer and Principal Financial Officer) Exhibits Filed Herewith

Exhibits Filed Herewith

Exhibit Number Description

31.1 Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley act of 2002.

31.2 Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley act of 2002.

32.1 Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2 Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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