UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF ~~THE SECURITIES EXCHANGE ACT OF 1934~~

~~For~~THE ~~the~~SECURITIES ~~quarterly~~EXCHANGE ~~period~~ACT ~~ended~~OF ~~March 31, 2017~~1934

For the quarterly period ended June 30, 2017

Commission file number 33-37809-NY

CASTLE HOLDING CORP.

(Exact Name of Registrant as Specified in Its Charter)

Nevada		77-0121957
(State or Other Jurisdiction of Identification No.)		(I.R.S. Employer Incorporation or Organization)
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. EmployerIdentification No.)

111 West Sunrise Highway, Second Floor East

Freeport, NY 11520

(516)-378-1000

(Address of Principal Executive Offices, Zip Code & Telephone Number)

Securities registered pursuant to Section 12(b) of the Act:

None

Securities registered pursuant to section 15(d) of the Act:

Common Stock, $0.0025 par value

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes o No x

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes x No o

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 o No x

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 (ss.232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes o No x

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. (Check one):

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	x
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

As of ~~April~~August 284, 2017, the registrant had 47,003,510 shares of common stock issued and 46,414,710 shares of common stock outstanding, as well as 522,250 Class A Convertible preferred shares issued and outstanding and 100,000 Class B Preferred shares issued and outstanding.

Castle Holding Corp.

TABLE OF CONTENTS

Quarterly Period Ended ~~March~~June 3130, 2017

		Page No.
PART I – FINANCIAL INFORMATION
Item 1.	Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of ~~Operations~~Operaions	13
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	14
Item 4.	Controls and Procedures	14
PART II – OTHER INFORMATION
Item 1.	Legal Proceedings	15
Item 1A.	Risk Factors	15
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	15
Item 3.	Defaults Upon Senior Securities	15
Item 4.	Mine Safety Disclosures	15
Item 5.	Other Information	15
Item 6.	Exhibits	1615
		16
SIGNATURES		17

PART I

ITEM 1. FINANCIAL STATEMENTS

CASTLE HOLDING CORP. AND SUBSIDIARIES
Consolidated Statements of Financial Condition
(Unaudited and Unreviewed)
	March 31, 2017			September 30, 2016
	June 30, 2017			September 30, 2016
Assets
Cash and cash equivalents	$	~~115~~109,~~442~~900		$	41,643
Marketable securities, at market value		3,~~400~~300			140,362
Inventory		1112,~~841~~536			3,405
Investment in Emergent Health Corporation common stock		40,000			60,000
License agreement with Emergent Health Corporation		30,000			30,000
Other assets		2			2
Total assets	$	~~200~~195,~~685~~738		$	275,412
Liabilities and Stockholders' Equity
Liabilities:
Margin liability to broker	$	-		$	19,751
Accounts payable and accrued expenses		13,~~248~~427			785
Loans payable to affiliates		18,081			18,081
Total liabilities		1921,~~329~~508			38,617
Stockholders' equity:
Preferred stock, $.01 par value; authorized 8,900,000 and 8,900,000 shares, respectively; none issued and outstanding		-			-
Class A Convertible Preferred stock, $.01 par value; authorized 1,000,000 shares, issued and outstanding 522,250 and 522,250 shares, respectively		5,223			5,223
Class B Preferred stock, $.01 par value; authorized 100,000 shares, issued and outstanding 100,000 and 100,000 shares, respectively		1,000			1,000
Common stock, $.0025 par value; authorized 200,000,000 shares, issued 47,003,510 and 47,003,510 shares, respectively (net of 261,000 shares "stopped" and requested to be cancelled)		117,509			117,509
Treasury common stock - 588,800 and 588,800 shares, respectively - at cost		(32,620	)		(32,620	)
Additional paid-in capital		1,883,177			1,883,177
Accumulated deficit		(1,~~792~~800,~~933~~059	)		(1,737,494	)
Total stockholders' equity		~~181~~174,~~356~~230			236,795
Total liabilities and stockholders' equity	$	~~200~~195,~~685~~738		$	275,412

See notes to consolidated financial statements.

Table of Contents

CASTLE HOLDING CORP. AND SUBSIDIARIES
Consolidated Statements of Operations
(Unaudited and Unreviewed)
	Three Months Ended March 31,						Six Months Ended March 31,
	Three Months Ended June 30,						Nine Months Ended June 30,
	2017			2016			2017			2016
Sales	$	1917,~~445~~317		$	~~2,474~~959		$	1936,~~445~~762		$	78,~~253~~212
Cost of sales		24,~~886~~637			86211			27,~~886~~523			~~847~~1,058
Gross profit		1612,~~559~~680			~~2,388~~748			1629,~~559~~239			67,~~406~~154
Selling expenses		711,~~286~~414			~~1,620~~506			819,~~391~~805			3,~~337~~843
General and administrative expenses		18,~~689~~289			315,~~387~~572			514,~~813~~102			3550,~~010~~582
Total operating expenses		819,~~975~~703			516,~~007~~078			1433,~~204~~907			3854,~~347~~425
Income (loss) from operations		(7,~~584~~023	)		(215,~~619~~330	)		2(4,~~355~~668	)		(3147,~~941~~271	)
Other income (expense):
Interest and dividends revenues		1-			-14,501			1,601			721,~~250~~751
Royalties revenues		-			-			1,500			572
Net gain (loss) on marketable securities		(~~1,314~~100	)		36(90,~~930~~585	)		(40,~~373~~473	)		47(42,~~950~~635	)
Impairment of investment in Emergent Health Corporation
Impairment of investment in Emergent Health Corporation common stock		-			-			(20,000	)		(80,000	)
common stock		(20,000	)		(40,000	)		(20,000	)		(80,000	)
Interest expense		(3	)		(87	)		(525	)		(87	)
Interest expense		(76	)		-			(522	)		-
Total other income (expense) - net		(103	)		(76,171	)		(57,897	)		(100,399	)
Total other income (expense) - net		(21,389	)		(3,070	)		(57,794	)		(24,228	)
Income (loss) before income taxes		(7,126	)		(91,501	)		(62,565	)		(147,670	)
Income (loss) before income taxes		(13,805	)		(5,689	)		(55,439	)		(56,169	)
Provision for income taxes		-			-			-			-
Net income (loss)	$	(137,~~805~~126	)	$	(591,~~689~~501	)	$	(5562,~~439~~565	)	$	(56147,~~169~~670	)
Net income (loss) per common share:
Basic	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)
Diluted	$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)
Weighted average number of common shares outstanding:
Basic		46,414,710			4446,~~394~~407,~~710~~237			46,414,710			4445,~~394~~065,~~710~~562
Diluted		46,936,960			4446,~~916~~929,~~960~~487			46,936,960			4445,~~916~~587,~~960~~812

See notes to consolidated financial statements.

Table of Contents

CASTLE HOLDING CORP. AND SUBSIDIARIES Consolidated Statements of Changes in Stockholders' Equity For the Period October 1, 2015 to ~~March~~June 3130, 2017 (Unaudited and Unreviewed)

	Class A Convertible Preferred Stock, $.01 Par Value					~~Class B Preferred Stock, $.01 Par Value~~		Class B Preferred Stock, $.01 Par Value			~~Common Stock, $.0025 Par Value~~			Common Stock, $.0025 Par Value		~~Treasury Common Stock, $.0025 Par Value~~						~~Additional~~Treasury ~~Paid-in~~Common Stock, $.0025 Par Value			~~Accumulated~~			~~Total Stock- holders'~~		Additional Paid-in		Accumulated			Total Stock- holders'
	Shares		~~Amount~~	Amount		~~Shares~~		Shares	~~Amount~~		~~Shares~~Amount		~~Amount~~	Shares		~~Shares~~		Amount	~~Amount~~			~~Capital~~Shares			~~Deficit~~	Amount		~~Equity~~		Capital		Deficit			Equity
Balances, September 30, 2015		522,250	$	~~5,223~~$	5,223		~~100,000~~		$100,000	~~1,000~~	$	441,~~983,510~~000	$	~~112,459~~	44,983,510		~~(588,800~~	)$	$112,459	~~(32,620~~	)	$	1(588,~~833,527~~800	)	$	~~(1,458,943~~$	)(32,620	$)	~~460,646~~	$	1,833,527	$	(1,458,943	)	$	460,646
Issuance of common shares on April 1, 2016 for 1,500,000 free trading shares of Gold Mining USA Inc. ("GMUI") common stock		-		-	-		-		-	-		~~2,000,000~~-		~~5,000~~	2,000,000		-		5,000	-			~~47,500~~-			-	-		~~52,500~~		47,500		-			52,500
Issuance of common shares on May 5, 2016 for legal services rendered		-		-	-		-		-	-		~~20,000~~-		50	20,000		-		50	-			~~2,500~~-			-	-		~~2,200~~		2,500		-			2,200
Net loss		-		-	-		-		-	-		-		-	-		-		-	-			-			~~(278,551~~	)-		~~(278,551~~	)	-		(278,551	)		(278,551	)
Balances, September 30, 2016		522,250		~~5,223~~	5,223		~~100,000~~		100,000	~~1,000~~		471,~~003,510~~000		~~117,509~~	47,003,510		~~(588,800~~	)	117,509	~~(32,620~~	)		1(588,~~883,177~~800	)		~~(1,737,494~~	)(32,620	)	~~236,795~~		1,883,177		(1,737,494	)		236,795
Net loss for the six months ended March 31, 2017		-		-			-			-		-		-			-			-			-			(55,439	)		(55,439	)
Net loss for the nine months ended June 30, 2017		-			-				-			-			-				-				-				-				-		(62,565	)		(62,565	)
Balances, March 31, 2017		522,250	$	5,223			100,000		$	1,000		47,003,510	$	117,509			(588,800	)	$	(32,620	)	$	1,883,177		$	(1,792,933	)	$	181,356
Balances, June 30, 2017		522,250		$	5,223				100,000		$	1,000			47,003,510			$	117,509				(588,800	)		$	(32,620	)		$	1,883,177	$	(1,800,059	)	$	174,230

See notes to consolidated financial statements.

Table of Contents

CASTLE HOLDING CORP. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Unaudited and Unreviewed)
	Six Months Ended March 31,
	Nine Months Ended June 30,
	2017			2016
Cash flows from operating activities:
Net income (loss)	$	(5562,~~439~~565	)	$	(56147,~~169~~670	)
Adjustments to reconcile net income (loss) to net
cash provided by (used in) operating activities:
Issuance of common stock for legal services		-			2,200
Impairment of investment in Emergent Health Corporation common stock		20,000			80,000
Changes in operating assets and liabilities:
Marketable securities		~~136~~137,~~962~~062			~~(47~~43,~~850~~327	)
Inventory		(89,~~436~~131	)		(~~694~~483	)
Margin liability to broker		(19,751	)		-
Accounts payable and accrued expenses		~~463~~2,642			(~~448~~481	)
Net cash provided by (used in) operating activities		7368,~~799~~257			(2523,~~161~~107	)
Cash flows from investing activities		-			-
Cash flows from financing activities		-			-
Net increase (decrease) in cash and cash equivalents		7368,~~799~~257			(2523,~~161~~107	)
Cash and cash equivalents, beginning of period		41,643			65,969
Cash and cash equivalents, end of period	$	~~115~~109,~~442~~900		$	4042,~~808~~862
Supplemental disclosures of cash flow information:
Interest paid	$	~~446~~525		$	-82
Income taxes paid	$	-		$	-
Non-cash investing and financing activities:
Issuance of 2,000,000 restricted shares of CHOD common stock in exchange for 1,500,000 free trading shares of Gold Mining USA Inc., (“GMUI”) common stock	$	-		$	52,500

See notes to consolidated financial statements.

Table of Contents

CASTLE HOLDING CORP. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Three and ~~Six~~Nine Months Ended ~~March~~June 3130, 2017 and 2016

(Unaudited and Unreviewed)

1. ORGANIZATION

Castle Holding Corp. (“CHOD”) is a holding company which was incorporated in Nevada on June 13, 1986. The subsidiaries of CHOD are as follows:

	1.	Castle Royalties Corp. (incorporated in New York April 11, 1991) – name changed from Church Street Securities Corp. on March 16, 2015; assignee of License Agreement with Emergent Health Corporation effective March 16, 2015 (see Note 5).

	2.	SAS Health and Beauty Corp. (incorporated in New York May 27, 1994) – name changed from Wall Street Indians, Ltd. on March 31, 2015; manufactures and markets a skin care product (commencing July 2015) and vitamin supplements (commencing November 2016).

	3.	The Unlisted Stock Market Corporation (incorporated in New York December 9, 1999) – no operations from inception.

	4.	Shark Venture Capital Inc. (incorporated in Nevada December 22, 2014) – plans to engage in venture capital activities.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Interim financial statements – The accompanying unaudited interim financial statements have been prepared by management in accordance with accounting principles generally accepted in the United States of America for interim financial information and pursuant to rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all information and footnotes required by generally accepted accounting principles for annual audited financial statements. In the opinion of management, the unaudited financial statements have been prepared on the same basis as the annual financial statements and reflect all adjustments considered necessary for a fair presentation.

The results of operations for the three and ~~six~~nine months ended ~~March~~June 3130, 2017 are not necessarily indicative of the results to be expected for the year ending September 30, 2017. The accompanying unaudited interim financial statements should be read in conjunction with the Company’s financial statements and notes related thereto for the years ended September 30, 2016 and 2015 included in our Form 10-K filed with the SEC.

Principles of consolidation – The consolidated financial statements include the accounts of CHOD and its subsidiaries (collectively, the “Company”). All significant intercompany balances and transactions have been eliminated in consolidation.

Use of estimates – The preparation of the financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates.

Cash and cash equivalents ‑ The Company considers highly liquid investments with maturities of three months or less at the time of purchase to be cash equivalents.

Marketable securities ‑ Marketable securities consist of trading securities valued at market. All fair value measurements are based on Level 1 inputs (i.e., closing trading prices of respective marketable securities). Unrealized gains and losses are reflected in income ($310,~~629~~529 and ($4743,~~850~~231) for the ~~six~~nine months ended ~~March~~June 3130, 2017 and 2016, respectively).

Table of Contents

CASTLE HOLDING CORP. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Three and ~~Six~~Nine Months Ended ~~March~~June 3130, 2017 and 2016

(Unaudited and Unreviewed)

Inventory – Inventory is stated at the lower of cost (first–in, first–out method) or market (net realizable value). At ~~March~~June 3130, 2017 and September 30, 2016, substantially all inventory are finished goods available for sale.

Revenue recognition – Revenues are recognized upon delivery of the products, at which time title passes to the customer, provided that: there are no uncertainties regarding customer acceptance; persuasive evidence of an arrangement exists; the sales price is fixed or determinable; and collectibility is deemed probable.

Income taxes – Income taxes are accounted for under the assets and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled.

Net income (loss) per common share – Basic net income (loss) per common share is calculated based upon the weighted average number of common shares outstanding. Diluted net income (loss) per common share is calculated based upon the weighted average number of common shares outstanding and dilutive convertible preferred shares outstanding.

Recent accounting pronouncements – Certain accounting pronouncements have been issued by the FASB and other standard setting organizations which are not yet effective and therefore have not yet been adopted by the Company. The impact on the Company’s financial position and results of operations from adoption of these standards is not expected to be material.

3. MARKETABLE SECURITIES, AT MARKET VALUE

At ~~March~~June 3130, 2017 and September 30, 2016, marketable securities consist of:

	March 31, 2017		September 30, 2016
	June 30, 2017		September 30, 2016
32,000 shares, Medallion Financial Group (MFIN)	$	-	$	135,040
1,000,000 and 1,400,000 shares, respectively, Gold Mining USA Inc. (GMUI)		3,~~300~~200		5,222
Various		100		100
Total	$	3,~~400~~300	$	140,362

Table of Contents

CASTLE HOLDING CORP. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Three and ~~Six~~Nine Months Ended ~~March~~June 3130, 2017 and 2016

(Unaudited and Unreviewed)

4. INVESTMENT IN EMERGENT HEALTH CORPORATION COMMON STOCK

On November 20. 2014, pursuant to a Stock Purchase Agreement involving a change in control of CHOD, CHOD acquired 2,000,000 restricted shares of Emergent Health Corporation (“EMGE”) common stock in exchange for the issuance of 2,000,000 restricted shares of CHOD common stock. The EMGE investment was initially valued at an estimated fair value of $250,000. The closing trading price of EMGE free trading common stock at November 20, 2014 was $0.49 per share.

At September 30, 2015, the Company recognized an impairment loss on the investment in EMGE common stock of $90,000 and reduced the carrying value from $250,000 to $160,000. At December 31, 2015, the Company recognized an additional impairment loss on the investment in EMGE common stock of $40,000 and reduced the carrying value from $160,000 to $120,000. At March 31, 2016, the Company recognized an additional impairment loss on the investment in EMGE common stock of $40,000 and reduced the carrying value from $120,000 to $80,000. At September 30, 2016, the Company recognized an additional impairment loss on the investment in EMGE common stock of $20,000 and reduced the carrying value from $80,000 to $60,000. At March 31, 2017, the Company recognized an additional impairment loss on the investment in EMGE common stock of $20,000 and reduced the carrying value from $60,000 to $40,000. The closing trading price of EMGE free trading common stock at September 30, 2016 and ~~March~~June 3130, 2017 was $0.0326 per share and $0.020332 per share, respectively.

5. LICENSE AGREEMENT WITH EMERGENT HEALTH CORPORATION

On November 20, 2014, pursuant to the Stock Purchase Agreement involving a change in control of CHOD, CHOD was assigned effective January 1, 2015 the License Agreement between Cappello’s, Inc, (Licensor) and EMGE (Licensee) dated August 26, 2014 (the “EMGE License Agreement”) in exchange for the issuance of 2,000,000 restricted shares of CHC common stock. The EMGE License Agreement was valued at its estimated fair value of $30,000 based upon 2014 royalties.

The EMGE License Agreement provided for Licensee’s payment of quarterly royalty payments to Licensor equal to 5% of the first $1,000,000 of annual net sales of the Licensed Products, 4% of the next $1,000,000 of annual net sales, 3% of the next $1,000,000 of annual net sales, 2% of the next $2,000,000 of annual net sales, and 1% of all additional annual net sales. The term of the EMGE License Agreement was to expire upon the expiration of the last to expire of the Patent Rights. In the event the Base Sales of any one or more of the Licensed Products did not increase by 15% per year over each prior calendar year (“Underperforming Licensed Products”) and the Licensee did not pay royalties based on 15% annual increases in Base Sales for the Underperforming Licensed Product(s), Licensor could terminate the license for such Underperforming Licensed Product(s) or convert the license from an exclusive license to a non-exclusive license for such Underperforming Licensed Product(s). During the term, Licensor was to keep Licensee informed of the progress of the Patent Rights in the U.S. Patent Office and was to direct and control all aspects of the prosecution and maintenance of the Patent Rights using patent counsel of its choice; Licensee was to pay all reasonable costs and fees attributable to the Patent Rights including patent maintenance fees, government fees and attorney fees.

On June 17, 2015, pursuant to a Swenson-Emergent Loan and Security Agreement, the Company consented to EMGE’s grant of a security interest in the License Agreement to a lender.

~~Based~~9 onTable ~~the calendar year 2015 sales~~ of the licensed products reported to CHOD by EMGE, the Company was entitled to royalties of $18,528. However, the Company collected royalties of only $572 from EMGE in 2015. Due to the uncertainty of future collections from EMGE, the Company has not recognized the remaining $17,956 royalties due at December 31, 2015.Contents

9CASTLE ~~Table~~HOLDING ofCORP. ~~Contents~~AND SUBSIDIARIES

~~CASTLE~~Notes ~~HOLDING~~to ~~CORP.~~Consolidated ~~AND~~Financial ~~SUBSIDIARIES~~Statements

~~Notes~~Three toand ~~Consolidated~~Nine ~~Financial~~Months ~~Statements~~Ended June 30, 2017 and 2016

~~Three~~(Unaudited and ~~Six Months Ended March 31, 2017 and 2016~~Unreviewed)

~~(Unaudited~~Based ~~and~~on ~~Unreviewed)~~the calendar year 2015 sales of the licensed products reported to CHOD by EMGE, the Company was entitled to royalties of $18,528. However, the Company collected royalties of only $572 from EMGE in 2015. Due to the uncertainty of future collections from EMGE, the Company has not recognized the remaining $17,956 royalties due at December 31, 2015.

EMGE did not report sales of the Licensed Products to CHOD in the first quarter 2016 or the second quarter 2016 and did not remit any royalties to CHOD. On April 28, 2016, CHOD notified EMGE that the EMGE License Agreement was terminated. The Company plans to pursue the manufacturing and marketing of the Licensed Products through its subsidiary SAS Health and Beauty Corp.

In November 2016, the Company collected $1,500 of current royalties from EMGE.

6. LOANS PAYABLE TO AFFILIATES

Loan payable to affiliates consist of:

	March 31, 2017		September 30, 2016
	June 30, 2017		September 30, 2016
SAS Health and Beauty Corp. Promissory
Note due John V. Cappello, chief executive
officer of the Company, non-interest
bearing, due December 1, 2016	$	15,000	$	15,000
Loans payable to entities affiliated with
president and treasurer of the Company,
president and former treasurer of the Company,
non-interest bearing, due on demand		3,081		3,081
Total	$	18,081	$	18,081

7. STOCKHOLDERS’ EQUITY

Class A Convertible Preferred Stock

From March 2001 to September 2001, CHC sold a total of 706,750 shares of Class A Convertible Preferred Stock for gross proceeds of $706,750.

Each share of Class A Convertible Preferred Stock is convertible at any time into one share of the Company’s Common Stock at the election of the Class A Convertible Preferred Stockholder. At any time, CHOD may require conversion of the Class A Convertible Preferred Shares provided that CHOD Common Stock closes at a price of $1.50 per share or higher for more than 20 consecutive business days. At any time after one year from the issue date of the Class A Convertible Preferred Shares, CHOD may require conversion of the Class A Convertible Preferred Shares provided that CHOD pay the Class A Convertible Preferred Stockholder $0.50 per Class A Convertible Preferred Share.

The Class A Convertible Preferred Shares are non-voting and have a first priority, up to $1.00 per Class A Convertible Preferred Share, in the event of liquidation of CHOD.

Table of Contents

CASTLE HOLDING CORP. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Three and ~~Six~~Nine Months Ended ~~March~~June 3130, 2017 and 2016

(Unaudited and Unreviewed)

Class B Preferred Stock

Effective June 1, 2015, CHOD issued 100,000 shares of Class B Preferred Stock (valued at $10,000) to John V. Cappello, chief executive officer of the Company, in connection with a $15,000 loan made to SAS Health and Beauty Corp., subsidiary of CHOD (see Note 6). Each share of Class B Preferred Stock is entitled to 100 votes per share but has no conversion, liquidation, or dividend rights.

Common Stock

Effective April 1, 2016, CHOD issued a total of 2,000,000 restricted shares of CHOD common stock to a corporate investor in exchange for 1,500,000 free trading shares of Gold Mining USA Inc. ("GMUI") common stock. The transaction was valued at $0.035 per GMUI share or $52,500 total.

On May 5, 2016, CHOD issued 20,000 restricted shares of CHOD common stock to an attorney for legal services. The transaction was valued at $0.11 per CHOD share or $2,200 total.

8. INCOME TAXES

CHOD files a consolidated income tax return with its subsidiaries for federal reporting purposes. CHOD and its subsidiaries file separate income tax returns for state reporting purposes.

The provisions for (benefit from) income taxes consisted of:

	Six Months Ended March 31,
	Nine Months Ended June 30,
	2017			2016
Current:
Federal	$	-		$	-
State		-			-
Total		-			-
Deferred:
Federal		(1113,~~266~~531	)		7(21,~~576~~512	)
State		(2,~~303~~767	)		1(4,~~549~~399	)
Change in valuation allowance		1316,~~569~~298			(925,~~125~~911	)
Total		-			-
Provision for income taxes	$	-		$	-

Table of Contents

CASTLE HOLDING CORP. AND SUBSIDIARIES

Notes to Consolidated Financial Statements

Three and ~~Six~~Nine Months Ended ~~March~~June 3130, 2017 and 2016

(Unaudited and Unreviewed)

The Company’s effective tax rate differed from the United States Federal income tax rate for the following reasons:

	Six Months Ended March 31,
	Nine Months Ended June 30,
	2017			2016
Computed Federal income tax at 34%	$	(1821,~~849~~272	)	$	(1950,~~097~~208	)
Computed state income tax, net of Federal tax effect		(2,~~378~~684	)		(26,~~410~~335	)
Non-deductible impairment of investment in Emergent Health Corporation common stock		7,658			30,632
Change in valuation allowance		1316,~~569~~298			(925,~~125~~911	)
Provision for income taxes	$	-		$	-

Based on management's present assessment, the Company has not yet determined it to be more likely than not that a deferred tax asset of $405,884 attributable to the future utilization of $1,142,747 of prior year net operating loss carryforwards and $51,030 of capital loss carryforwards will be realized. Accordingly, the Company has maintained a 100% allowance against the deferred tax asset in the financial statements at ~~March~~June 3130, 2017. The Company will continue to review this valuation allowance and make adjustments as appropriate. The net operating loss carryforwards expire as follows: $180,132 in year 2021, $694,345 in year 2022, $135,943 in year 2023, $66,021 in year 2024, $39,208 in year 2025, and $27,098 in year 2036. The capital loss carryforward of $51,030 expires $49,175 in year 2018 and $1,855 in year 2021.

Current United States income tax laws limit the amount of loss available to be offset against future taxable income when a substantial change in ownership occurs. Therefore, the amount available to offset future taxable income may be limited.

9. COMMITMENTS AND CONTINGENCIES

Since December 2005, the Company has been using space in Freeport New York provided by a public accounting firm owned by the Company’s former treasurer at no cost to the Company.

From September 2015 to August 2016, the Company also occupied office space in King of Prussia, Pennsylvania under a lease at a rent of $950 per month. Since September 2016, the Company has been using other space in King of Prussia, Pennsylvania provided by EMGE at no cost to the Company. Management of the Company is currently working with EMGE to revive its business model and become viable.

12 Table of Contents

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

GENERAL

Castle Holding Corp. (“CHOD”) is a holding company which was incorporated in Nevada on June 13, 1986. On September 30, 1987, CHOD acquired Castle Securities Corp., a New York corporation which operated as a securities broker dealer from November 1, 1985 to October 31, 2003. On April 11, 1991, CHOD formed Church Street Securities Corp., a New York corporation which operated as a securities broker dealer from October 26, 1995 to January 6, 2005. From January 2005 to June 2015, CHOD and its subsidiaries had minimal business operations and operating revenues.

Commencing July 2015, CHOD’s subsidiary SAS Health and Beauty Corp. (“SAS”) has engaged in the production and sales of a skin care product called “SAS Flower of Youth Facial Lift Spray.” In November 2016, SAS also started marketing two vitamin supplement products called “JDI MultiVitamin/MultiMineral with NeuStem” and “NeuStem”.

RESULTS OF OPERATIONS – Three Months ended ~~March~~June 3130, 2017 compared to Three Months ended ~~March~~June 3130, 2016.

Sales increased $16,~~971~~358 from $~~2,474~~959 in 2016 to $1917,~~445~~317 in 2017. The increase in sales was due to the introduction of our new vitamin supplement products in late 2016.

Cost of sales increased $24,~~800~~426 from $86211 in 2016 to $24,~~886~~637 in 2017.

Gross profit increased $1411,~~171~~932 from $~~2,388~~748 in 2016 to $1612,~~559~~680 in 2017 due to increased sales as a result of the introduction of the new products discussed above. The gross profit percentage of sales in 2017 was approximately 8573%.

Total operating expenses increased $3,~~968~~625 from $516,~~007~~078 in 2016 to $819,~~975~~703 in 2017.

Other expense – net ~~increased~~decreased $1876,~~319~~068 from $376,~~070~~171 in 2016 to $~~21,389~~103 in 2017. The ~~increase~~decrease was due primarily to the $3890,~~244~~485 ~~negative~~positive comparison in net gain (loss) on marketable securities from a ~~gain~~loss of $3690,~~930~~585 in 2016 to a loss of $~~1,314~~100 in 2017, offset by a $2014,~~000~~501 decrease in ~~impairment~~interest ~~expense~~and ofdividends ~~our~~revenues ~~investment~~from $14,501 in ~~Emergent~~2016 ~~Health~~to ~~Corporation~~$0 ~~common~~in ~~stock~~2017.

Net loss ~~increased~~decreased $884,~~116~~375 from $591,~~689~~501 in 2016 to $137,~~805~~126 in 2017. The ~~increase~~decrease was due to the $311,~~968~~932 increase in ~~operating~~gross ~~expenses~~profit and the $1876,~~319~~068 ~~increase~~decrease in other expense-net, offset partially by the $143,~~171~~625 increase in ~~gross~~operating ~~profit~~expenses.

RESULTS OF OPERATIONS – ~~Six~~Nine Months ended ~~March~~June 3130, 2017 compared to ~~Six~~Nine Months ended ~~March~~June 3130, 2016.

Sales increased $1228,~~192~~550 from $78,~~253~~212 in 2016 to $1936,~~445~~762 in 2017. The increase in sales was due to the introduction of our new vitamin supplement products in late 2016.

Cost of sales increased $26,~~039~~458 from $~~847~~1,058 in 2016 to $27,~~886~~523 in 2017.

Gross profit increased $1022,~~153~~085 from $67,~~406~~154 in 2016 to $1629,~~559~~239 in 2017 due to increased sales as a result of the introduction of the new products in late 2016. The gross profit percentage of sales in 2017 and 2016 was approximately 8580% and 8887%, respectively.

Table of Contents

Total operating expenses decreased $2420,~~143~~518 from $3854,~~347~~425 in 2016 to $1433,~~204~~907 in 2017. The decrease was primarily due to $20,000 of consulting fees incurred in 2016 relating to a Financial Public Relations Agreement executed in November 2015 which did not recur in 2017.

Other expense – net ~~increased~~decreased $3342,~~566~~502 from $24100,~~228~~399 in 2016 to $57,~~794~~897 in 2017. The ~~increase~~decrease was due primarily to the $8860,~~323~~000 ~~negative~~decrease ~~comparison~~ in ~~net~~impairment ~~gain~~expense ~~(loss) on marketable securities from a gain~~ of ~~$47,950~~our investment in ~~2016~~Emergent toHealth aCorporation ~~$40,373~~common ~~loss in 2017~~stock, offset by athe $6019,~~000~~970 decrease in ~~impairment~~interest ~~expense~~and ofdividends ~~our~~revenues ~~investment~~from $21,751 in ~~Emergent~~2016 ~~Health~~to ~~Corporation~~$1,601 ~~common~~in ~~stock~~2017.

Net loss decreased $~~730~~85,105 from $56147,~~169~~670 in 2016 to $5562,~~439~~565 in 2017. The decrease was due to the $1022,~~153~~085 increase in gross profit, ~~and~~ the $2420,~~143~~518 decrease in operating expenses, ~~offset~~and ~~partially by~~ the $3342,~~566~~502 ~~increase~~decrease in other expense -net.

LIQUIDITY AND CAPITAL RESOURCES

At ~~March~~June 3130, 2017, the Company had cash and cash equivalents of $~~115~~109,~~442~~900, total assets of $~~200~~195,~~685~~738, total liabilities of $1921,~~329~~508, and total stockholders’ equity of $~~181~~174,~~356~~230.

Cash and cash equivalents increased $7368,~~799~~257 from $41,643 at September 30, 2016 to $~~115~~109,~~442~~900 at ~~March~~June 3130, 2017. The $7368,~~799~~257 increase was due primarily to the sale of 32,000 shares of Medallion Finance Group (MFIN) common stock in January 2017 for proceeds of $97,820.

The Company currently has no other agreements, arrangements or understandings with any person to obtain funds through bank loans, lines of credit or any other sources.

We currently have no commitments with any person for any capital expenditures.

We have no off-balance sheet arrangements.

Changes ~~inand~~in and Disagreements with Accountants on Accounting and Financial Disclosure

Since year ended September 30, 2002, Castle Holding Corp. has had no principal accountant. Accordingly, there has been no disagreements with accountants on accounting and financial disclosure.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As a “smaller reporting company” as defined by Rule 229.10(f)(1), we are not required to provide the information required by this Item 3.

ITEM 4. CONTROLS AND PROCEDURES

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

Under the supervision and with the participation of our management, including our principal executive officer and the principal financial officer, we have conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934, as of the end of the period covered by this report. Based on this evaluation, our principal executive officer and principal financial officer concluded as of the evaluation date that our disclosure controls and procedures were effective such that the material information required to be included in our Securities and Exchange Commission reports is accumulated and communicated to our management, including our principal executive and financial officer, recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms relating to our company, particularly during the period when this report was being prepared.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There have been no changes in our internal control over financial reporting that occurred during the fiscal quarter ended ~~March~~June 3130, 2017 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Table of Contents

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

There are no pending legal proceedings to which the Company is a party or in which any director, officer or affiliate of the Company, any owner of record or beneficially of more than 5% of any class of voting securities of the Company, or security holder is a party adverse to the Company or has a material interest adverse to the Company. The Company’s property is not the subject of any pending legal proceedings.

ITEM 1A. RISK FACTORS

As a “smaller reporting company” as defined by Rule 229.10(f)(1), we are not required to provide the information required by this Item 1A.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

(a) Recent Sales of Unregistered Securities – In the three months ended ~~March~~June 3130, 2017, we did not sell any of our common stock or Class A Convertible Preferred Stock.

(b) Issuer Purchases of Equity Securities: In the three months ended ~~March~~June 3130, 2017, we did not purchase any of our common stock or Class A Convertible Preferred Stock.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

~~None~~On July 17, 2017, Michael T. Studer resigned as chief financial officer and director of the Company.

Table of Contents

ITEM 6. EXHIBITS

The following exhibits are including with this filing:

3.1*	Articles of Incorporation (Form S-18 Registration No. 33-8395-LA, effective November 14, 1986)	~~Articles of Incorporation (Form S-18 Registration No. 33-8395-LA, effective November 14, 1986)~~
3.2*	Amendment to Articles of Incorporation (Form S-18 Registration No. 33-37809-NY, effective February 11, 1991)	~~Amendment to Articles of Incorporation (Form S-18 Registration No. 33-37809-NY, effective February 11, 1991)~~
3.2*	Amendment to Articles of Incorporation filed August 15, 2001 (September 30, 2001 Form 10-K filed January 15, 2002)	~~Amendment to Articles of Incorporation filed August 15, 2001 (September 30, 2001 Form 10-K filed January 15, 2002)~~
3.3*	By-laws (Form S-18 Registration No. 33-8395-LA, effective November 14, 1986)	~~By-laws (Form S-18 Registration No. 33-8395-LA, effective November 14, 1986)~~
4.4*	Specimen Stock Certificate (Form S-18 Registration No. 33-37809-NY, effective February 11, 1991)	~~Specimen Stock Certificate (Form S-18 Registration No. 33-37809-NY, effective February 11, 1991)~~
31.1	Sarbanes-Oxley Section 302 certification by John V. Cappello	~~Sarbanes-Oxley Section 302 certification by John V. Cappello~~
31.2		Sarbanes-Oxley Section 302 certification by Michael T. Studer
32.1	Sarbanes-Oxley Section 906 certification by John V. Cappello
32.1		Sarbanes-Oxley Section 906 certification by John V. Cappello
99.1*	Complaint for Injunctive and Other Relief (dated September 14, 1994) – Securities and Exchange Commission, Plaintiff (Form 8-K dated September 13, 1994)
32.2		Sarbanes-Oxley Section 906 certification by Michael T. Studer
99.3*	Distribution Agreement (Form 8-K filed October 29, 2014)
99.1*		Complaint for Injunctive and Other Relief (dated September 14, 1994) – Securities and Exchange Commission, Plaintiff (Form 8-K dated September 13, 1994)
99.3*		Distribution Agreement (Form 8-K filed October 29, 2014)

____________

* Previously filed and incorporated by reference.

Table of Contents

SIGNATURES

Pursuant to the requirements of Section 13(a) or 15(d) 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.

	Castle Holding Corp.
Date: April 28, 2017	By:	/s/ John V. Cappello
Date: August 4, 2017	By:	/s/ John V. Cappello
		John V. Cappello
		Chief Executive Officer
		Chief Executive Officer and Chief Financial Officer
	Castle Holding Corp.
Date: April 28, 2017	By:	/s/ Michael T. Studer
		Michael T. Studer
		Secretary, Treasurer, Chief Financial Officer

Filing Compare · ENERKON SOLAR INTERNATIONAL, INC.