UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, ~~D.C.~~DC 20549

FORM 10-K

(Mark One)

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

For the fiscal year ended September 30, ~~2009~~2010

¨ TRANSITION REPORT ~~UNDER~~PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the ~~transition~~Transition ~~period~~Period from ________ to _ _______

Commission file number 0-3338

ORGANIC SALES AND MARKETING, INC. ~~(Name of small business issuer in its charter)~~

Delaware		33-1069593
(State or other jurisdiction of		(I.R.S. Employer Identification No.)
Incorporation or organization)

(Exact Name of small business issuer as specified in its Charter)

114 Broadway Raynham, MA		02767
Delaware	33-1069593
(Address of Principal executive offices)		(Zip Code)
(State or other Jurisdiction of Incorporation or Organization)	(IRS Employer Identification No.)

~~Issuer's telephone~~114 ~~number~~Broadway, ~~{508)~~Raynham, ~~823-1117~~MA 02767

~~Securities registered under Section 12~~(b) Address of ~~the~~Principal ~~Exchange~~Executive ~~Act:~~Office)

Title of each class		Name of each exchange on which to be registered
Common Stock		Over the Counter
$.0001 par value		Bulletin Board

(508) 823-1117

~~Securities~~(Registrant’s ~~registered~~telephone ~~under~~number ~~Section~~including ~~12(g)~~area ~~of the Exchange Act:~~ code)

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

~~Check~~The ~~whether~~number of shares of outstanding of each of the issuer’s isclasses ~~not~~of ~~required~~common equity, toas ~~file~~of ~~reports~~the ~~pursuant~~latest topracticable ~~Section 13~~date orwas ~~15(d)~~13,840,722 shares of ~~the~~common ~~Exchange~~stock, par ~~Act~~value $.0001, oissued and outstanding as of January 11, 2010.

~~Note~~Indicate ~~- Checking~~by ~~the~~check ~~box~~mark ~~above~~whether the ~~will~~issuer ~~not~~(1) ~~relieve~~filed ~~any~~all ~~registrant~~reports required to ~~file~~be ~~reports pursuant~~filed toby Section 13 or 15(d) of the Securities Exchange Act ~~from~~of ~~their~~1934 ~~obligations~~during ~~under~~the preceding 12 months (or for such ~~those~~shorter ~~Sections~~period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.

Check whether the issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 ¨

~~Check if~~Indicate ~~there~~by ischeck nomark ~~disclosure~~whether ofthe ~~delinquent~~registrant ~~filers~~is ina ~~response~~large toaccelerated ~~Item 405 of Regulation S-B contained in this form~~filer, ~~and no disclosure will be contained, to~~an ~~the~~accelerated ~~best of registrant's knowledge~~filer, ina ~~definitive~~non-accelerated ~~proxy~~filer or ~~information statements~~a ~~incorporated~~smaller ~~by reference in Part III of this Form 10-KSB or any~~public ~~amendment to this Form 10-KSB~~company. ¨

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

~~State~~Indicate ~~issuer's~~by ~~gross~~check ~~revenues~~mark ~~for~~whether ~~its~~the ~~most~~registrant ~~recent~~is ~~fiscal~~a ~~year.~~shell ~~$224,999~~company (as defined in Rule 12b-2 of the Exchange Act).

~~State~~Yes ¨ ~~the~~No aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, or the average bid and asked price of such common equity, as of a specified date within the past 60. (See definition of affiliate in Rule 12b02 of the Exchange Act.) $1,231,214 as of December 15, 2009.x

~~Note: If~~Organic ~~determining~~Sales ~~whether a person is an affiliate will involve an unreasonable effort~~ and ~~expense~~Marketing, ~~the issuer may calculate the aggregate market value of the common equity held by non-affiliates on the basis of reasonable assumptions, if the assumptions are stated~~Inc.

~~(ISSUERS~~Form ~~INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)~~10-K

~~Check whether the issuer has filed all documents and reports required to be filed by Section 12, 13 or 15(d)~~ Table of ~~the Exchange Act after the distribution of securities under a plan confirmed by a court. Yes ¨ No x~~ Contents

(APPLICABLE ONLY TO CORPORATE REGISTRANTS)

		Page
Part I

Item 1	Description of Business	3

Item 2	Description of Property	13

Item 3	Legal Proceedings	14

Item 4	(Removed and Reserved)	14

Part II

Item 5	Market for Common Equity, Related Stockholder Matters and Issuer Purchasers of Equity Securities	15

Item 6	Selected Financial Data	16

Item 7	Management's Discussion and Analysis of Financial Condition and Results of Operations; Plan of Operations	16

Item 7A	Quantitative and Qualitative Disclosures about Market Risk	28

Item 8	Financial Statements and Supplementary Data	30

Item 9	Changes in and Disagreement With Accountants on Accounting and Financial Disclosure	30

Item 9A	Controls and Procedures	30

Item 9B	Other Information	30

Part III

Item 10	Directors, Executive Officers and Corporate Governance	31

Item 11	Executive Compensation	34

Item 12	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	34

Item 13	Certain Relationships and Related Transactions, and Director Independence	35

Item 14	Principal Accounting Fees and Services	36

Part IV

Item 15	Exhibits, Financial Statement Schedules	37
	Signatures
	Supplemental Information

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

10,190,072 shares of common stock as of January 13, 2010

DOCUMENTS INCORPORATED BY REFERENCE

If the following documents are incorporated by reference, briefly describe them and identify the part of the Form 10-K (e.g., Part I, Part II, etc.) into which the document is incorporated: (1) any annual report to security holders; (2) any proxy or information statement; and (3) any prospectus filed pursuant to Rule 424(b) or (c) of the Securities Act of 1933 ("Securities Act"). The listed documents should be clearly described for identification purposes (e.g. annual report to security holders for fiscal year ended December 24, 1990). None

Transitional Small Business Disclosure Format (Check one): Yes o No x

ORGANIC SALES AND MARKETING, INC. FORM 10-K

September 30, 2009

Table of Contents		Page
Part I
Item 1.	Description of Business	3
Item 2.	Description of Property	15
Item 3.	Legal Proceedings	16
Item 4.	Submission of Matters to a Vote of Security Holders	16
Part II
Item 5.	Market for Common Equity, Related Stockholder Matters and Issuer Purchasers of Equity Securities	16
Item 6.	Selected Financial Data	18
Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations; Plan of Operations	23
Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	29
Item 8.	Financial Statements and Supplementary Data	31
Item 9.	Changes in and Disagreement With Accountants on Accounting and Financial Disclosure	31
Item 9A	Controls and Procedures	32
Item 9B	Other Information	32
Part III
Item 10	Directors, Executive Officers, Promoters and Control Persons; Compliance with Section 16(a) of the Exchange Act	32
Item 11	Executive Compensation	36
Item 12	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	37
Item 13	Certain Relationships and Related Transactions	38
Item 14	Principal Accounting Fees and Services	39
Part IV
		40
Item 15	Exhibits, Financial Statement Schedules
	Signatures
	Supplemental Information

PART I

ITEM 1. DESCRIPTION OF BUSINESS

(a)

Business Development

Form and Year of Organization.

Organic Sales and Marketing, Inc. (the "Company" or the "Registrant" or the "Issuer") was incorporated in the State of Delaware as Garden Connections, Inc. on August 23, 2003. On April 20, 2005, Garden Connections, Inc. changed its’ name to Organic Sales and Marketing, Inc. The Company purchased the assets of Garden Connections LLC, a Massachusetts limited liability company in September 2003. The acquisition of the assets of Garden Connections LLC took the form of an exchange agreement whereby all of the outstanding common stock of the Company was exchanged for all of the interests of the respective partners of Garden Connections, LLC. The major reasons for the exchange were that the management of Garden Connections, LLC was desirous of adopting a name that would better describe the mission statement and that the Company could not function as an LLC if its securities were to be publicly held. The exchange rate whereby the partners of the LLC received shares of the Company's common stock was arbitrary and not at arms length. It should be noted that the officers and directors of the Company as a group beneficially own 4131.3% of the Company's outstanding common stock and as a result, control the operations of the Company.

Any bankruptcy, Receivership or Similar Proceeding. Not Applicable

Any Material Reclassification, Merger, Consolidation, or Purchase/Sale of a Significant Amount of Assets not in the Ordinary Course of Business. Not Applicable

(b)

Business of Issuer

~~The~~Organic ~~Company~~Sales isand aMarketing, ~~sales~~Inc. ~~and~~(“OSM” ~~marketing~~or ~~company~~the ~~that~~“Company”) specializes in ~~private~~the ~~labeling~~sales ofand ~~all~~marketing of non-food natural and ~~organic non~~organically-~~food~~certified products, ~~developed~~including fertilizers, ~~and~~horticultural ~~manufactured~~products, bycleaning ~~other~~agents and hand ~~companies~~sanitizers. The ~~who~~Company dohas ~~not~~positioned ~~have~~itself in the ~~marketing~~rapidly-growing non-food ~~skills~~natural orand ~~means~~organic marketplace to ~~market~~capitalize ~~and~~on ~~sell~~the ~~their~~large-scale ~~products.~~movement Weaway ~~believe~~from ~~that~~synthetic wenon-food ~~are~~products, ~~able~~a tomovement ~~bring~~which ~~their~~has ~~products~~been sparked toby ~~multiple markets~~widespread ~~through~~evidence concerning the ~~Internet,~~harmful ~~our~~effects ~~radio~~to ~~show~~the environment and ~~our~~human ~~established~~health ~~distribution network~~caused ~~consisting~~by ofthe ~~independent~~chemicals ~~representatives~~used ~~and~~in ~~distributors~~their manufacture. Just ~~Through~~seven ~~our live~~months ago, ~~three~~a ~~hour~~report ~~weekly~~from ~~radio~~the ~~garden~~President’s Cancer ~~talk~~Panel ~~show,~~identified ~~which~~agricultural ischemical ~~currently~~exposure ~~heard on two~~as ~~radio stations throughout~~ the ~~Northeast,~~third welargest ~~believe~~risk factor ~~that~~for wedeveloping ~~can generate~~cancer. OSM ~~market~~has ~~interest~~received ~~and~~United ~~sales~~States Department inof ~~organic~~Agriculture ~~and~~(USDA) ~~all~~BioPreferred ~~natural~~(federally-managed ~~product~~program ~~alternatives,~~designed ~~interest~~to inincrease ~~and~~the ~~knowledge~~purchase ofand ~~the~~use ~~importance~~ of ~~organics~~renewable, ~~and~~sustainable bio-based ~~information~~products) ~~regarding~~status ~~where~~for toits ~~purchase~~fertilizers, ~~these~~cleaners ~~related~~and ~~products~~hand sanitizer.

For the past three years, OSM has focused the majority of its selling efforts on federal, regional and local government agencies; military branches, colleges and universities; and laboratories, with much success. The Company is in a joint marketing effort with industry giants Corning, Inc. and Thermo Fisher Scientific to supply commercial cleaning products, The Company is a contracted vendor for Thermo Fisher Scientific and industrial supply company, W.W. Grainger, both of whom are government service account (GSA) vendors; OSM is also a registered vendor/supplier for the Department of Defense as part of the DOD EMALL. Considering the distribution base of the latter three channels, coupled with the growing concern of the use of synthetic fertilizers, and the recently passed law in the state of New York, banning chemical pesticides from all school lawns and turf in the state of New York, signed-off by their governor in early 2010, the Company’s target market is potentially thousands if not millions of tons. That target market is guaranteed to expand exponentially as more legislation aimed at protecting public areas and water supplies is enacted which prohibits the use of chemical fertilizers and pesticides. However, since the Company does not presently have any significant contracts in place, there can be no guarantees that it will meet its goals or projections.

~~The~~OSM is ~~Company~~pursuing ~~uses~~a ~~the~~$2.5 ~~services~~million line of ~~well~~credit ~~established~~to ~~and~~take ~~experienced~~its ~~sales~~business to the next ~~organizations~~level. The ~~and~~Company ~~distributors~~will use these funds to: fund ~~introduce,~~a ~~promote,~~medley of product marketing programs offered through W. W. Grainger and ~~sell~~Thermo Fisher Scientific; obtain its ~~line~~own ofGSA account in order to sell directly to ~~cleaning~~the U.S. Department of Energy, U.S. Department of Agriculture and ~~gardening~~the ~~products~~National Institutes onof aHealth; ~~commission~~obtain ~~basis.~~Green ~~The~~Seal ~~Company~~product ~~has~~certification ~~begun~~for toits ~~advertise~~fertilizers, ~~promote~~horticultural products and ~~sell~~cleaners; ~~its~~pursue ~~Nevr-Dull~~exclusive ~~brand~~contracts with ofother ~~all~~large ~~natural~~industrial ~~cleaners~~giants towho have the purchasing power; hire dedicated ~~Nevr-Dull's~~sales ~~worldwide~~staff ~~clientele~~for ~~pursuant~~commercial and retail sales; relocate its corporate offices to Rhode aIsland; ~~royalty~~and source another liquid EPA approved manufacturing facility in ~~agreement~~Rhode Island.

~~The Company~~OSM ~~is a franchised vendor with Fisher Scientific Company LLC ("Fisher") for~~was ~~sales~~incorporated ofin ~~our~~Delaware ~~industrial,~~as ~~all~~a ~~natural~~C ~~cleaners~~Corporation. Its ~~through Fisher's website and their~~corporate ~~well~~headquarters ~~respected national sales organization. Fisher~~ is alocated ~~major~~at ~~international medical~~114 ~~instrument~~Broadway, ~~distributor. On October 31~~Raynham, ~~2007 the Company and Fisher~~Massachusetts. All ~~signed~~of anits ~~agreement~~liquid ~~that~~products ~~designates~~are ~~Fisher~~manufactured asby ~~our~~contract ~~sole~~manufacturer, ~~United~~Webco, ~~States "National~~of ~~Laboratory Distributor" for our commercially branded product line through December 31~~Dudley, ~~2008~~Massachusetts. Its ~~This exclusivity will be reviewed annually and awarded based on meeting mutually agreed upon~~ non-~~binding~~liquid ~~targets.~~fertilizer ~~Fisher orders~~ products ~~by placing purchase~~are ~~orders,~~manufactured ~~and~~by ~~the~~Land ~~Company~~O’Lakes ~~fills~~Purina ~~these orders as set forth~~ in ~~the agreement~~St. ~~In ordering the products~~Joseph, ~~Fisher has no minimum order requirement; nor does it make any annual minimum purchasing commitment~~MO. Following the initial term, the agreement has been automatically renewed for successive twelve month periods. Fisher Scientific carries nine of the Company's industrial cleaners in three different sizes; fertilizers and hand sanitizers in their international catalog and now actively sells them through their national sales organization.

The Company isuses ~~currently~~the ~~selling~~services ~~its~~of ~~all~~well ~~natural~~established ~~cleaning~~ and ~~gardening~~experienced ~~products~~sales ~~through~~organizations ~~Kehe~~and ~~Foods,~~distributors ato ~~major~~introduce, ~~organic food distributor based in Romeoville~~promote, IL and ~~UNFI~~ ~~(United~~sell ~~Natural~~its ~~Foods~~line ~~Inc), the leading organic~~ of products ~~distributor~~on ina ~~the country,~~commission ~~based in Dayville, CT~~basis. ~~Some~~The ofCompany ~~the~~continues ~~major retail outlets that we sell~~ to ~~via~~ ~~these~~market ~~distributors or direct are Shaw's, Stop & Shop, Whole Foods, Tops, Giant,~~ and ~~Key Stores. In addition, we also~~ sell ~~to Bozzuto Bros~~its ~~Distributors~~Nevr-Dull inbrand ~~Cheshire, Connecticut, which sells to many~~ of ~~the~~all ~~smaller, independent~~natural ~~grocery store chains throughout the Northeast~~cleaners. There, ofis ~~course,~~some ~~can~~potential beinterest nowith ~~absolute~~one ~~assurance that meaningful orders from any~~ of ~~these~~Nevr-Dull's ~~outlets~~worldwide ~~will continue or increase~~clients.

The Company ~~launched~~continues ~~its~~to ~~line~~sell ofits ~~organic~~all ~~fertilizers~~natural incleaning ~~the~~products ~~spring~~through ofUNFI ~~2008 through~~(United ~~retail~~Natural ~~outlets~~Foods ~~such as Shaw's~~Inc), ~~Agway~~one ~~and~~of ~~many~~the ~~smaller~~leading ~~independent~~organic ~~garden centers.~~products Indistributors ~~the~~in ~~spring of 2009~~the country, ~~Whole~~based ~~Foods,~~in ~~Benny’s Hardware~~Providence, ~~Rocky’s~~RI. ~~Ace Hardware,~~Some ~~Aubuchon~~of ~~Hardware~~the ~~and~~major ~~Kehe~~retail ~~Foods~~outlets ~~also~~that ~~carried~~ the ~~organic fertilizer~~ ~~products.~~Company Wesell’s ~~purchase~~to ~~our~~via ~~proprietary~~these ~~organic~~distributors ~~fertilizer~~or ~~products~~direct ~~from~~are ~~Land O'Lakes~~Stop ~~Purina Feed Organization ("LOL")~~& Shop, Whole ~~a division of Land O'Lakes~~Foods, ~~Inc.~~Tops and ~~private~~ ~~label~~Giant.. ~~them~~In ~~under~~addition, the ~~brand~~Company ~~name,~~also ~~Mother~~sells ~~Natures~~to Associated ~~Cuisine™.~~Buyers, ~~The~~Barrington, ~~packaging~~NH ~~contains bilingual~~which ~~instructions.~~may ~~Organic~~focus ~~fertilizer~~on ~~sales~~many ~~for~~of the ~~spring 2009 were~~smaller, ~~stronger~~independent ~~than~~grocery ~~the~~store ~~previous~~chains, ~~year~~colleges, ~~but~~spa’s ~~lower~~and ~~than~~health ~~anticipated~~food ~~due to economic~~stores ~~pressures~~throughout ~~and~~ the ~~extremely~~Northeast. ~~wet~~There, ~~and~~of ~~cool~~course, ~~season~~can inbe ~~the~~no ~~Northeast.~~absolute ~~The~~assurance ~~intrigue~~that ~~and~~meaningful ~~attraction~~orders from any of these ~~items~~outlets iswill ~~that~~continue ~~they are plant based fertilizers, rather~~or ~~than animal waste~~increase.

The Company continues to sell it own branded Mother Natures Cuisine fertilizers through retail outlets such as Whole Foods, Aubuchon Hardware and independent garden centers. The Company purchases its proprietary organic fertilizer products from Land O'Lakes Purina Feed Organization ("LOL"), a division of Land O'Lakes, Inc. and labels it under the brand name, Mother Natures Cuisine ™. The packaging contains bilingual instructions. Organic fertilizer sales for the year were far lower than anticipated due to economic pressures. The intrigue and attraction of these items is that they are derived from plant based components, rather than animal or municipal waste.

The Company's organically certified insecticide/fungicide product, Garden Guys Garden NEEM, which was first introduced in the spring of 2007, is continually shipping to many of the above named customers in conjunction with the fertilizer products.

The Company's ~~structured~~has ~~deal~~attained ~~between~~USDA ~~Northeast~~BioPreferred ~~Garden~~status ~~Group,~~for ~~Agway,~~many ~~and~~of ~~Land~~its commercial ~~O'Lakes/~~cleaning ~~Purina~~and ~~Feeds~~hand ~~remains~~sanitizer inproducts. ~~motion~~This ~~for~~distinction ~~the~~continues ~~2010~~to ~~growing~~open ~~season. The Company~~doors isfor ~~acting~~those asdistributors awho ~~representative~~sell ~~for~~the ~~all~~government ~~sales~~through ofGSA ~~Agway's~~and ~~newly~~other ~~launched~~related ~~All-Natural~~contracts. ~~4-Stage~~The ~~lawn~~Company ~~fertilizer.~~has ~~Sales~~shipped ~~have~~orders ~~already~~to ~~eclipsed~~the ~~$450~~USDA,~~000.00~~ ~~and continue~~Ames, toIowa ~~climb.~~facility, ~~This is~~ and the ~~first~~Post ~~time~~Office. ~~Agway~~The ~~has~~Company ~~ever~~anticipates ~~launched~~additional ~~their~~interest ~~own~~within various ~~branded~~government ~~natural~~sectors ~~lawn fertilizer~~ in athe ~~4-Stage~~near ~~offering~~future. ~~The~~Furthermore, the Company is ~~also~~ in ~~negotiations~~discussions with aanother major national ~~lawn & garden distributor to warehouse~~ and ~~sell~~international ~~its garden and retail cleaning related products. This could have long term positive implications, as well, given that the~~ distributor iswho ~~willing to~~sells ~~participate~~to in the ~~Company's media component, the Garden Guys radio show~~government.

The Company continues to maintain an e-commerce interest presence hosting five different Websites; www.garden-guys.com; www.mothernaturescuisine.com; www.naturalnevrdull.com; www.osm-inc.com and www.dragonflyorganix.com. The latter is also under the direction of Eye Level Solutions, a division of Kehe Distributors, Inc., which offers the Dragonfly Organix products for sale in over 12,000 e-commerce capable grocery stores nationwide. Acting as distributor, Kehe will process and fulfill orders placed. This enables the Company's products to gain shelf presence in stores that otherwise may not currently stock these items.

The Company continues its active participation in various related trade publications and trade shows. Most recent completed shows were; the USDA BioPreferred meeting and trade show, GSA show, Kehe Food Distributor show, UNFI Distributor show, Agway retail buyers show, Fisher Scientific National Science show, Wind Energy Expo and GovEnergy. Other shows include the Natural Products Expo, Associated Buyers, the New Hampshire Hospitality show and the National Association of Education Procurement Buyers. Each of these markets are currently carrying the Company's products or have expressed interest in carrying them.

Since its participation in the USDA BioPreferred show in June of this year, the Company has attained USDA BioPreferred status for many of its commercial cleaning and hand sanitizer products. This distinction continues to open doors for those distributors who sell the government through GSA and other related contracts. The Company has shipped orders to the CDC (Center for Disease Control) and to Homeland Security. The Company anticipates additional interest within various government sectors in the near future. Furthermore, the Company is in discussions with two other major national and international distributors who sell to the government.

The Company plans to concentrate its marketing efforts solely in the rapidly growing all natural non-food organic arena. The Company believes that consumers are being drawn to organic products by a growing desire for fewer chemicals and additives in their everyday lives. However, there can be no assurance that this trend will translate into sales and profits for the Company.

The Company believes that the organic industry, consisting of food and non-food products continues to be one of the fastest growing segments of our economy and that recent decisions by major corporations to make "going green" part of their mission statements could accelerate that growth.

A 2009 Organic Industry Survey prepared by the Lieberman Research Group on behalf of the Organic Trade Association showed that in 2008 $24.6 billion was spent on organic food and non-food products, an increase of 17.1% over 2007. The organic non-food segment of the survey showed sales of $1.6 billion or an increase of 39.4% over 2008. The survey projects that spending on organic food products could increase from $22.9 billion in 2008 to $27.7 billion in 2010, a projected two year increase of 20.9%.

The 2007 Organic Trade Association survey projected that organic non-food products could grow anywhere from 16% - 40% each year through 2010 and that trend seems to be holding, given growth rates of 26% in 2006 and 2007 and 39.4% in 2008. The Company believes that these explosive growth rates of non-food organic products will continue well into the next decade.

The Company specializes in the more rapidly growing non-food organic areas, such as private label premium fertilizers, insecticides and consumer and industrial cleaners, where profit margins can be substantially greater. It understands, however, that external factors such as economic conditions and climatic issues can impact these trends in an unfavorable way and that there can be no assurance that all of its products will follow the same overall upward trend currently underway in the organic industry.

We understand, however, that external factors such as economic conditions and climatic issues can impact these trends in an unfavorable way and that there can be no assurance that our products will follow the same overall upward trend currently underway in the organic industry.

The Company has established important marketing relationships with Land O'Lakes; CA Fortune Co, a major mid-western food broker based in Bloomingdale, IL; North Eastern Sales Solutions, a major independent grocery store sales representative organization in the New England area; EC Desmond Sales and Marketing, Inc. a major grocery store sales representative organization covering the NY, NJ and Pennsylvania areas and Northeast Garden Group, an independent garden center sales representative based in Connecticut. The Company also currently has a verbal working agreement with Land O'Lakes Purina Feed Organization.

The Company has also established important manufacturing relationships with Land O'Lakes for its fertilizer products, secured a licensing agreement with a British based company and has the rights to several proprietary formulas used in its extensive line of cleaning products, outsourced its fulfillment operation to Webco Chemical Co., located in Dudley, Massachusetts, which has the capacity to handle any and all requirements that the Company may have and, as a backup to Webco, the Company also has made arrangements with JNJ Industries, located in Franklin, Massachusetts.

The Company generates brand awareness and consumer loyalty for a growing array of selective non-food organic products by educating the consumer, and acts as a distributor and marketer for the retailers that carry our products. The Company intends to capitalize on the growing interest in all natural non-food organics in several different markets with the intention of using the radio to increase awareness that organic products offer healthy alternatives without sacrificing expected results.5

It must be emphasized that although the Company continues to be very excited about its product lines and its prospects in a rapidly growing and explosive industry, the purchase of the Company's securities carries a significant risk. The Company has not had substantial revenues from operations and has not yet been profitable. While it has built important, strategic relationships with customers and vendors, the outlook remains uncertain in the absence of the receipt of substantial orders or substantial funding. Although the Company believes its overhead to be low, there can be no assurance that it will continue to find sources of working capital to keep operations funded until and even after break even volumes are achieved. It should also be noted that the Company's auditors have included a "going concern" qualification in their opinion (see "Financial Statements").

1.	Principal Products and Services and Their Markets

Currently the major all natural products that the Company is selling are all natural cleaners, which include stain remover, odor control, glass cleaner, floor cleaner, degreaser, concrete cleaner, eyeglass cleaner, jewelry cleaner, surface prep and glue cleaner, solely utilizing outside independent sales professionals, as well as an all natural insecticide-fungicide, ~~organic soy candles~~ and organic fertilizers. Since the Company sells non-food, all natural products, the shelf-life of its products can be in excess of one year or more, depending upon storage and climatic conditions. The Company uses a proprietary blend of ~~organic~~ compounds in its all natural products which are non-toxic, biodegradable and safe for use around children and pets.

The Company receives revenues from sales of product on ~~our~~its various websites; products are sold directly ~~by us~~ or by ~~our~~ independent reps to distributors who ~~then~~ then re-sell to retail stores; products sold to retail stores directly ~~by us~~ or ~~our~~by independent reps, re-selling our organic products to other companies who wish to private label or license our products and the sale of advertising inventory (commercial spots) available to the Company through the ~~various~~ radio ~~stations~~station that carries ~~carry~~ the Garden Guys radio talk show.

Organic Fertilizer Market:

The Company is focusing marketing efforts on organic fertilizers, a rapidly growing segment of the fertilizer industry. In ~~our~~its opinion, ~~industry~~nation-wide ~~organic~~awareness and ~~fertilizer~~the ~~sales~~potential ~~have~~impacts ~~risen~~of sothe ~~rapidly~~use inof ~~the~~synthetic ~~last~~fertilizers ~~three~~vs. ~~years~~organic fertilizers ~~that~~will ~~they~~continue to have ~~commanded~~ aan ~~premium~~impact ~~price~~ in ~~the~~rising ~~marketplace.~~sales of organic fertilizers. Accordingly, wethe ~~foresee~~Company projects some of ~~our~~ ~~greatest~~its greatest growth over the next 3-5 years to potentially be in this arena.

By letter dated November 148, ~~2006~~2010 wethe ~~were~~Company ~~notified~~recently ~~that~~entered weinto ~~have~~an ~~been~~Agreement ~~selected~~with by Land O'’Lakes Purina Feed ~~Organization~~LLC (LOLPF) to act as ~~their~~its ~~private~~preferred ~~label~~sales ~~fertilizer marketer,~~agent ~~starting~~to ~~in the spring of 2008. A strong marketing focus will be on~~promote ~~the~~sales ~~major~~to ~~home~~ and ~~garden~~solicit ~~retail chains such as Home Depot, Lowe's~~ and ~~Agway, which~~process ~~Land~~orders ~~O'Lakes~~of ~~Purina~~Products ~~Feed Organization does not presently supply internally. The Company will be receiving~~ from ~~Land~~organic ~~O'Lakes Purina Feed~~fertilizer ~~Organization~~customers aon ~~complete~~behalf ~~line~~ of ~~fertilizers,~~LOLPF asin ~~jointly~~the ~~formulated,~~United ~~designed~~States and ~~marketed~~Canada. Presently, byit usis ~~under~~not ~~our~~an ~~Mother~~exclusive ~~Natures Cuisine™ and Garden Guys™ brands~~relationship. Under the arrangement, Land O'Lakes Purina Feed Organization will also assist in product ~~registration~~ registration for each state, manufacturing, logistics, and distribution. They will also provide sales and marketing ~~expertise~~support for the Company,’s ~~when~~efforts ~~needed~~as part of the Agreement. The Company believes this will ultimately lead to major sales, as it continues to be introduced into the 35 billion dollar lawn and garden market as reported by the National Gardening Association in its Garden Market Research newsletter. Ultimate product line acceptability will depend on customer demand, so true assurances cannot be made as to the viability of this product line at this point in time.

Land O'Lakes Purina Feed Organization is also a prime advertiser on our weekly radio show. In addition to our Dragonfly Organix brand, Land O'Lakes Purina Feed Organization will also advertise their own brand of Bradfield Organics fertilizers, whose market is strictly geared to their existing independent channel and does not compete in the markets that we are pursuing.

Organic Based Household Cleaner Market:

Other areas which the Company believes hold considerable promise are the residential and commercial cleaner markets. We believe that the momentum in the rise in organic food sales, due primarily to the growing education of how toxic chemicals can have a direct or indirect impact on human health, is carrying over to that of non-food organic products, which may pose similar health hazards and risks. ~~Our~~Its weekly radio show allows us to, 1)educate consumers about the ~~potential~~ potential hidden risks of chemical based products, 2)inform listeners about products that offer healthy alternatives to chemical cleaners, including ~~our~~its own and 3)let folks know where ~~our~~these products can be purchased. either in store or on-line.

Jewelry, Modeling, and Bead Markets:

WeThe Company currently ~~supply~~supplies one of the major industry distributors, Fire Mountain ~~Gems~~ Gems & Beads, Inc., in Grant Pass, Oregon. Fire Mountain does over 100 ~~million~~ million dollars in annual sales and has an extensive customer base. Their customers are some of the major retail jewelry and bead shops in the industry~~, including Zales~~ and other distributors within the trade. In addition to post card mailers, the Company has maintained an advertising presence in industry-related magazines to help to create brand awareness for our Glitz Jewelry Shiner and ODX Surface Cleaner products in these markets. There is no assurance, however, that ~~these~~ these markets will develop for ~~our~~these products.

Funeral Industry & Medical Examiners Market:

The Company is currently supplying its Funeral Organix product line to Funeral Homes ~~across~~and ~~the country~~churches. The Company still expects that this class of trade has ~~strong~~ strong upside potential because there is a great need for cleaners and deodorizers in this industry due to the large amounts of chemicals currently used by this profession on a daily basis. Preliminary data indicates a strong willingness by the industry to replace chemical products with those that are all natural, chemical-free and environmentally friendly. ~~Marketing plans include advertising in industry related magazines and post card mailers and the establishment of a network of independent sales representatives and distributors.~~ There is no assurance that these markets will develop significantly for ~~our~~these products. This depends entirely upon product quality, the ability to reach the target market and consumer acceptance.

According to Funeral Directors Association (FDA) statistics, there are 21,528 funeral homes nationwide, and 51% of new funeral directors entering the profession today are women. An adjunct industry to this one would be the ambulance industry, which has similar issues and problems with the use of chemicals.

Municipalities and Waste Disposal Markets:

Due to the various odor problems that these markets encounter on a daily basis, the Company's Odor Eliminator product ~~has~~offers ~~been~~a ~~independently tested by customers and the results have been excellent~~solution. ~~Previously,~~This ~~the Massachusetts Bay Transit Authority ("MBTA") has made small purchases of our product~~ and ~~has~~other ~~had~~products ~~success~~ in ~~treating~~ the ~~urine~~Company’s ~~odor problem in the transit system. We see our growing~~ portfolio of all natural products ~~and~~are ~~other~~positioned ~~related products~~ as having ~~numerous~~ numerous applications in multiple industries such as nursing homes, industrial kitchens, waste management, fishing industry, daycare centers, Montessori schools, kennels, hospice-home care, pet shops, and veterinarian locations. There is no assurance that these markets will develop for ~~our~~these products. This will depend upon product quality, the ability to reach the target market and ~~consumer~~ consumer acceptance.

The Company ~~has~~is ~~attained~~capitalizing ~~USDA~~on ~~BioPreferred~~the ~~status~~growing ~~for~~interest ~~many~~and ofdesire ~~its~~among ~~commercial~~consumers for ~~cleaning~~safe, ~~and~~environment-friendly ~~hand sanitizer~~ products. ~~This~~To ~~distinction~~do ~~continues~~this, toit ~~open~~has ~~doors~~developed strategic ~~for~~marketing ~~those~~relationships ~~distributors~~with ~~who~~manufacturers ~~sell~~that offer "green" alternatives to some of the ~~government~~traditional, ~~through~~chemical-based ~~GSA~~products ~~and~~that ~~other~~are ~~related~~currently being used ~~contracts~~in various industries. The Company ~~has~~hopes ~~shipped orders~~ to ~~Homeland~~be ~~Security~~the ~~and~~dominant toleader in the ~~CDC~~all ~~(Center~~natural, ~~for~~non-food ~~Disease~~organic ~~Control).~~industry ~~The~~so ~~Company~~it ~~anticipates~~is ~~additional~~aggressively ~~interest~~working ~~from~~with several ~~other~~manufacturing ~~government~~companies ~~sectors~~to infurther ~~the~~develop ~~near~~and ~~future~~perfect its growing line of all natural, non-food product offerings. ~~Furthermore~~IDue to uncertainties with the safety of rubber mulch, the Company ishas ~~having discussions~~decided ~~with~~to ~~two~~discontinue ~~other~~its ~~major~~development, ~~national~~sales and marketing ~~international~~of ~~distributors~~it ~~who~~Terra Rubber brand rubber tire mulch product that can be used in ~~sell~~playgrounds, toflower ~~the~~beds ~~government~~and gardens.

The ~~Company~~ ~~is capitalizing on the growing interest and desire among consumers for~~last ~~safe,~~five ~~environment-friendly~~plus ~~products.~~years ~~To do this, we~~ have ~~developed~~been ~~strategic marketing~~spent ~~relationships~~establishing ~~with~~what ~~manufacturers~~the ~~that~~Company ~~offer~~believes ~~"green" alternatives~~ to ~~some~~ ofbe ~~the traditional~~a strong, ~~chemical-based~~solid ~~products~~foundation ~~that~~needed ~~are currently being used in various industries. The Company hopes~~ to besupport the ~~dominant~~next ~~leader~~phase inof ~~the~~its ~~all~~business plan. All natural, non-food organic ~~industry~~products ~~so we~~ are ~~aggressively~~growing ~~working~~in ~~with~~demand. ~~several~~The Company's ~~manufacturing~~products ~~companies~~are targeted to ~~further~~sophisticated, ~~develop~~environmentally ~~and~~aware ~~perfect~~companies ~~our growing line of all~~and ~~natural,~~consumers ~~non-food~~in ~~product~~various ~~offerings~~markets. InThe ~~conjunction~~Company ~~with~~believes athat strategic ~~partner, we~~affiliations which have ~~also~~been developed awith ~~rubber~~well-established ~~tire~~corporations ~~mulch~~could ~~product~~eventually pave ~~that~~the ~~can~~way befor ~~used~~its inall ~~playgrounds~~natural, ~~flower~~ ~~beds~~non-food ~~and~~organic ~~gardens~~products ~~and~~to ~~has~~become ~~a definite ecological benefit by keeping old,~~ubiquitous ~~used~~throughout ~~tires~~the ~~out of landfills~~country.

The last five plus years have been spent establishing what the Company believes to be a strong, solid foundation needed to support the next phase in our business plan. All natural, non-food organic products are growing in demand. The Company's products are targeted to sophisticated, environmentally aware companies and consumers in various markets. The Company believes that strategic affiliations which have been developed with well-established manufacturers and sales and marketing companies, including the marketing expertise and reach of Land O'Lakes Purina Feed Organization; could eventually pave the way for our all natural, non-food organic products to become available in many retail outlets throughout the country.7

2.	Distribution

Our sales, marketing and promotional efforts are accomplished through the following:

Radio Show

Radio Advertising

E-Commerce Websites

Interactive Website with on-line forum room for gardeners

Industry-related Magazines and Newspapers

Face-to-face Client and Prospect Meetings

Sales Brochures and Product Samples

Point-of-Sale and End Cap Displays

Trade Shows

Membership in Trade Organizations

Garden Clubs

E-mail and Direct Mailings

Telemarketing

Strategic Marketing Alliances

Cooperative Advertising

~~We are~~The Company is now able to bring ~~our~~its products from its contract manufacturer to consumer with limited financial exposure. WeIt ~~have~~has the added advantage of being able to market ~~our~~ these products not only through ~~our~~its independent ~~marketing~~ marketing associates, but through ~~our~~its own radio ~~programs~~show., What with a recognized ~~growing~~ growing interest in organics., ~~The~~the Garden Guys ® ensure that brand awareness reaches the consumer through the radio,streaming, podcasting, RSS feed and a weekly newsletter. This creates a multi-faceted, multi-revenue channel model for the Company. Moreover, wethe ~~hope~~Company hopes to add new strategically selected radio personalities and stations to ~~our~~its Garden Guys ® radio network over the next several years with a reach that goes far beyond the New England area. Because of the knowledge wethe ~~have~~Company ~~obtained~~has obtained of how the communications industry works, as a result of the Garden Guys® radio talk show, weit ~~believe~~ believes that this is a very attainable goal. There is no set schedule for this expansion at this time and there can be no assurance that enrolling additional stations will be made easier due to ~~our~~the working knowledge of radio internet or current radio relationships.

3.	Status of Any Publicly Announced New Products or Services

Currently the Company has a portfolio of approximately 100 items, all of which are company branded products. The Company will begin to offer its new Egg Wipes under the new brand it developed, Healthier Homestead positioned, but limited to, the farm and fleet trade. The Company will be able to market its products not only through its distributors and independent sales ~~organizations~~ organizations but through the Garden Guys ® radio show which provides a ~~viable~~ viable channel through the creation of brand awareness on the consumer’s part and a growing interest in organics and natural products. Management believes ~~our~~its all natural non-food products will attract both male and female consumers looking to avoid the health risks and implications that have been found in non-organic or ~~synthetic~~ synthetic compounds. Management believes this is a promising trend which is supported by numerous independent articles and surveys which have been conducted some of which have been referenced in other sections of this 10K.

10All of these products are manufactured for the Company to its own specifications without any additional research and development costs being incurred. In some cases, the Company will put a contract in place for existing technology already developed by said manufacturer whereby it may see long-term benefits of their research by finding niche markets for a particular product. The foregoing arrangements greatly limit the Company's financial exposure:

All of these products are manufactured for the Company to its own specifications without any research and development costs being incurred since the manufacturers with whom we have existing relationships have already done the R&D. We achieve the benefits of their research by finding niche markets for these products, creating our own labels, and implementing a sales program by which to bring these products to market. We hope to continue to expand revenues without the need for an in-house sales force. The foregoing arrangements greatly limit the Company's financial exposure:

No research and development costs

No manufacturing facilities and related costs

Lower inventory costs and warehousing costs

Limited employees and staff

4.	Competition

~~According~~Because to the ~~Organic Trade Association, a leading~~ organic ~~association~~and ~~publication, organic~~natural ~~non-foods~~cleaner ~~had~~market ~~consumer~~is ~~sales~~relatively ofsmall ~~$938 million~~ in ~~2006,~~comparison ato ~~growth of 26%~~the ~~for~~total ~~that~~organic ~~year.~~market, ~~Organic~~it ~~non-food~~is ~~products are still emerging as~~ a ~~category~~fragmented ~~and sales are anticipated to grow anywhere from 16% - 40% each year through 2010~~market, ~~according~~ toready ~~Organic~~for ~~Trade Association Forecasting Survey 2007~~development. The ~~Company~~ Company believes ~~its~~that ~~largest competitors are privately-owned~~ Seventh Generation, ~~located in New Hampshire~~Inc., Clorox, ~~Mrs~~S.C. Johnson, Mrs. Meyers and ~~Imus`~~3-M, ~~Greening~~are its major competitors in the ~~Cleaning~~ cleaner market.

~~Because~~Competition ~~the~~in lawn and garden organic ~~cleaner~~product ~~market~~sales is ~~relatively~~equally ~~small~~as inintense ~~comparison~~however few companies have the ability to ship their products cost effectively across the country. The ~~total~~Company believes its distribution network of LOL/Purina Feed, ThermoFisher Scientific and Grainger can satisfy these concerns. These markets are large and can support many companies offering these and similar organic ~~market,~~products. itThe Company is unique in that it offers a ~~fragmented~~service ~~market,~~(the ~~ready~~radio program) ~~for~~in ~~development~~addition to a product. WeIt ~~believe~~does not know of another company that does this. However, many of the companies that ~~Seventh~~make ~~Generation~~up the competition in this market are better financed, ~~Inc.~~more experienced, ~~Clorox~~have more recognizable or established brand names, ~~Mrs.~~may ~~Meyers~~have ~~and~~better ~~Imus'~~control ~~Greening~~over ~~the~~their manufacturing and distribution ~~Cleaning~~process, ~~are~~have ~~our~~a ~~major~~longer ~~competitors~~history inof servicing the ~~organic~~retail ~~cleaner~~and ~~market.~~commercial ~~Management~~industries ~~believes,~~ and ~~early~~may ~~indications~~be ~~support~~better ~~its~~positioned ~~belief~~to control sales to large retail outlets and, ~~that~~as ~~the~~a result, ~~Company's~~realize ~~products~~a dominant or substantial market share. The Company ~~will~~is bein ~~accepted~~discussions ~~into~~with ~~the~~some ~~marketplace~~large ~~due~~horticultural companies who may want to private ~~their~~label ~~unique~~its ~~qualities~~fertilizers. These discussions are on-going and ~~eye~~may ~~catching~~have ~~packaging~~a material impact on its sales however, ~~coupled~~since ~~with~~the ~~extensive~~Company ~~radio~~does ~~support~~not presently have any significant contracts in place, there can be no guarantees that these discussions will materialize.

~~Competition~~The inmarket ~~lawn~~for cleaning and garden ~~organic~~products ~~product~~is ~~sales~~highly incompetitive. ~~New~~Although ~~England~~these products ~~and~~are ~~the~~natural ~~East~~and ~~Coast, however,~~that issome ~~much~~of ~~more~~which ~~intense.~~carry ~~These~~USDA ~~markets~~BioPreferred ~~are large~~ designation and ~~can~~therefore ~~support~~distinguishable ~~many companies~~from ~~offering~~most ~~these~~other ~~and~~more ~~similar~~established ~~organic~~brands, ~~products.~~which Wedo contain ~~are~~chemicals, ~~unique~~it inis possible that ~~we offer~~many aconsumers ~~service~~neither ~~(the~~care ~~radio~~about ~~program)~~that fact, innor ~~addition~~understand toits ~~a product~~significance. WeThere doare ~~not~~a ~~know~~number of ~~another~~ ~~company~~other established providers that ~~does~~have ~~this.~~greater ~~However~~resources, ~~many~~including ofmore ~~the~~extensive ~~companies~~research ~~that make up the~~and ~~competition~~development, inmarketing ~~this~~and ~~market~~capital ~~are~~than ~~better~~we ~~financed,~~do ~~more~~and ~~experienced,~~also have ~~more~~greater name ~~recognizable~~recognition orand ~~established~~market ~~brand~~presence. ~~names,~~These ~~have~~competitors ~~better~~could ~~control~~reduce ~~over~~ their ~~manufacturing~~ prices and thereby ~~distribution~~decrease ~~process,~~the ~~have~~demand afor ~~longer history of servicing~~ the ~~retail~~ ~~industry~~Compmany’s products and ~~may~~technologies. beThe Company ~~better~~expects ~~positioned~~competition to ~~control~~intensify ~~sales~~in tothe ~~large retail outlets and~~future, aswhich acould also result in price reductions, ~~realize~~fewer acustomers ~~dominant~~and orlower ~~substantial~~gross ~~market~~profit ~~share~~margins.

The market for cleaning and garden products is highly competitive. Although our products are natural and therefore distinguishable from most other more established brands, which do contain chemicals, it is possible that many consumers neither care about that fact, nor understand its significance. There are a number of other established providers that have greater resources, including more extensive research and development, marketing and capital than we do and also have greater name recognition and market presence. These competitors could reduce their prices and thereby decrease the demand for our products and technologies. We expect competition to intensify in the future, which could also result in price reductions, fewer customers and lower gross profit margins.9

11Access to retail or commercial opportunities may be restricted due to pre-existing agreements that prohibit these potential vendors from selling its products, or certain retailers may require substantial payments (slotting fees) for shelf space which is beyond the Company's financial capabilities. Such payments are common in the retail industry, but historically, the Company has been successful in mitigating these costs due to the uniqueness of its products. In the future some existing retailers may require such payments in order for the Company to continue to sell them and new retail outlets may require payments to sell our product. The Company will treat each opportunity on a case by case basis. It must be emphasized that lack of revenues and somewhat limited financial resources may also have a serious impact on the ability to sell these products in various venues.

Access to retail outlets may be restricted due to pre-existing agreements that prohibit retailers from selling our products, or retailers may require substantial payments (slotting fees) for shelf space which is beyond the Company's financial capabilities. Such payments are common in the retail industry, but historically, the Company has been successful in mitigating these costs due to the uniqueness of our products. In the future our existing retailers may require such payments in order for us to continue to sell through them and new retail outlets may require payments to sell our product. It must be emphasized that our lack of revenues and somewhat limited financial resources may also have a serious impact on our ability to sell our products in these retail outlets and prevent us from executing our business plan.

5.	The Sources and Availability of Raw Materials

The Company is not necessarily dependent on any one vendor for its raw materials. All products which are sold and marketed by the Company are fulfilled by ~~our~~its fulfillment ~~company~~companies. Although wethe ~~believe~~Company webelieves it can secure other suppliers should the need arise, weit would expect that the deterioration or cessation of any relationship would have a temporarily adverse effect, until new ~~relationships~~ relationships are satisfactorily in place.

WeThe Company may also run the risk of manufacturer price increases and component shortages. Competition for products or materials in short supply can be intense, and weit may not be able to compete effectively against other purchasers who have ~~higher~~ higher volume requirements or more established relationships. Even if ~~manufacturers~~ manufacturers have adequate supplies of components, they may be unreliable in meeting delivery schedules, experience their own financial difficulties, provide components of inadequate quality or provide them at prices which reduce our profit. Any problems with our third-party suppliers can be expected to temporarily have a material adverse effect on our financial condition, business, results of operations and continued growth prospects. Our principal suppliers are:

Abott-Action, Inc. - Shipping Materials Enzyme Solutions, Inc. Organic Liquid Concentrates Key Container, Corp. - Shipping Materials Lightning Labels Inc. - Bottle Labels Tursso Label, Inc. - Bottle Labels Microbial Technologies, Ltd. - Organic Liquid Concentrates Webco Chemical Corp. — Liquid Fulfillment Webco Chemical Corp. - Bottles and Sprayers Organica Neem concentrate McKernan Packaging - Bottles and Sprayers

6.	Dependence on a Single or Few Customers

The Company currently has several customers. It has developed and continues to develop multiple strategic alliances with several distributors and independent sales organizations. The Company does not anticipate that it will ultimately be dependent on a single customer or small group of customers.

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7.	The Importance of Patents, Trademarks, Licenses, Franchises and Concessions Held

To protect its rights to its intellectual property, the Company relies on a combination of trademark and copyright law, patents, trade secret protection, confidentiality agreements, and other contractual arrangements with its employees, affiliates, clients, strategic partners, and others. The protective steps it has taken may be inadequate to deter misappropriation of the Company's proprietary information. The Company may be unable to detect the unauthorized use of, or take appropriate steps to enforce its intellectual property rights. The Company has registered certain of its trademarks in the United States and has pending U.S. applications for other trademarks and patents.

Effective trademark, copyright, patent, and trade secret protection may not be available in every country in which it offers or intends to offer its products or services. In addition, although The Company believes that its proprietary rights do not infringe on the intellectual property rights of others, other parties may assert infringement claims against the Company or claims that we have violated a patent or infringed a copyright, trademark, or other proprietary right belonging to them. Such claims, even if not meritorious, could result in the expenditure of significant time and money on our part which could materially adversely affect the Company's business, results of operations, and financial condition.

The Company incorporates certain licensed third-party technology in some if its services. In these license agreements, the licensors have generally agreed to defend, indemnify, and hold the Company harmless with respect to any claim by a third party that the licensed software infringes any patent or other proprietary right. The Company cannot assure that these provisions will be adequate to protect it from infringement claims. The loss or inability to obtain or. maintain any of these technology licenses could result in delays in introduction of new services.

The Company has trademark protection for its "Garden Guys Down to Earth Up to Date"(TM) trademark~~. In addition~~, ~~the Company has applied to the US Patent and Trademark Office~~ for ~~trade mark protection for~~ its "Dragonfly Organix from the Earth to the World"(TM) brand-name trade mark,for " Mother Natures Cuisine(TM) Feed your Land from Mother Nature" brand name trade mark, and the picture of the "Plate with Garden Hand Fork and Hand Trowel with Gingham Placemat" trade dress. Final action on these applications is pending subject to publication in the Official Gazette.

8.	Government Approval

Government approval is required for some of the Company's current products. The initial approval process is generally handled by the manufacturer. Should ~~The~~a manufacturer that registers a product with the Federal Government such as the EPA and then sub-registers said product to the Company, ~~does~~and not meet proper ~~believe~~Government ~~that~~approval and not notify the ~~approval~~Company ~~process~~of ~~will~~any such wrong doing, this could have a material ~~impact~~and financial effect on some of the Company’s products and sales. The Company has received official notification that it is a participant in the United States Department of Agriculture’s (USDA) BioPreferred program for some of its ~~business~~cleaners, hand sanitizers, and agricultural ~~growth~~products. BioPreferred is a Federally managed program that aims to increase the purchase and use of renewable, sustainable biobased products.

9.	Effect of Any Existing or Proposed Government Regulations

Other than normal government regulation that any business encounters, the Company's business is not significantly affected by any government regulations. As a publicly held company, we do have extensive responsibilities and expenses to assure compliance with federal and state securities regulation.

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10.	Research and Development Costs

The cost of Research and Development is borne initially by the manufacturer and built into our manufacturing expense. Since the Company began operations in August 2003 it has spent over one million dollars on market research and development of its markets. The revenues of the Company will be primarily from strategic alliances as described above. Revenues generated, while paying indirectly for research and technology costs accrued to date, will fund the operations of the Company, which includes funding any ongoing research and development.

11.	Cost and Effects of Compliance With Environmental Laws and Regulations

The Company is not involved in a business which involves the use of materials in a manufacturing stage where such materials are likely to result in the violation of any potential environmental rules and/or regulations. Further, the Company does not own any real property which would lead to potential liability as a land owner. Therefore, the Company does not anticipate that there will be any costs associated with compliance with environmental laws and regulations. The Company does, however, pay registration fees to each state in which it sells its fertilizers and insecticide/fungicide products.

12.

Employees

As of the date hereof, the Company employs 5 full-time employees and 2 part-time employees. The Company hires independent contractors on an "as needed" basis only. It has no collective bargaining agreements with its employees. The Company believes that its employee relationships are satisfactory. In the long term, wethe Company will hire additional employees, as needed, based on the growth of the Company.

We will be dependent on our current management team for the foreseeable future. The loss of the services of any member of this management group could have a material adverse effect on our operations and prospects. Our success will be dependent to a substantial degree on Sam Jeffries and other key management personnel. CEO Sam Jeffries' continued involvement is particularly critical. In the event he becomes unavailable, it would have a material adverse effect on operations. At this time, we have no employment. agreements in place and we have a "key man" insurance policy on Sam Jeffries, but no one else. The expansion of our business may be hampered by our inability to attract and retain additional qualified personnel, as needed, for the management team. There is no assurance that we can find suitable management personnel or that we will have the financial resources to hire or retain them once found.

13.	Cautionary Statement on Forward Looking Statements

Certain statements in this Report constitute "forward — looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities and Exchange Act of 1934. Management believes such statements to be relevant to an assessment and understanding of our results of operations and financial condition, which are based upon our financial statements prepared in accordance with generally accepted accounting principles in the USA. The discussion should be read in conjunction with our financial statements and notes thereto, appearing in this report.

The preparation of these financial statements requires us to make estimates and judgments that may affect the reported amount of assets and liabilities, revenues and expenses, and the related disclosure of such contingent assets and liabilities at the date of our financial statements. Actual results may substantially differ from these estimates under different assumptions and conditions.

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This report also contains forward-looking statements that involve risks and uncertainties, which may include statements about our:

Business strategy

Expansion of our manufacturing capabilities

Plans for entering into collaborative agreements

Anticipated sources of funds to finance our operations following the date of this report

The Company is in the process of applying for a 2.5 million dollar loan through the State of Rhode Island as part of the Rhode Island Economic Development Job Creation Guaranty Program.

Plans, objectives, expectations and intentions contained in this report that are not historical fact

The following words and financial projections contain figures related to plans, expectations, future hoped-for results, performance, events or other matters that are "forward-looking statements". When used in the section describing our Plan of Operations, words such as "estimate", "project", "intend", "expect", "anticipate", and other similar expressions are intended to be forward-looking statements. Such statements involve numerous risks and uncertainties, including, but not limited to, the science of organics, the development of the Company's products, markets for those products, timing and level of customer orders, competitive products and pricing, changes in economic conditions and other risks and uncertainties. Actual results, performance and events could likely differ materially and adversely. Investors are cautioned not to place undue reliance on these forward looking statements which are often no more than Management's expression of its expectations. The Company undertakes no obligation to release or deliver to investors, revisions to these forward-looking statements to reflect events or circumstances after the date of this report, the occurrence of unanticipated events or other matters that may occur in the future.

ITEM 2. DESCRIPTION OF PROPERTY

The Company is in a "tenant at will" agreement with Leo S. Arcand (Lessor) of 114 Broadway, Raynham, MA. The premises encompass the North side of a one story, commercial, wood building with approximately 500 square feet of office space. The monthly lease payment is $600~~.00~~ per month. It is located in an area that ~~has~~ has easy access to major highways. Products are received and shipped by contract carriers.

The Company also maintains storage space at two locations. The cleaning and gardening products raw material and finished goods inventories are stored at ~~our•~~ our fulfillment house, Webco Chemical in Dudley, Massachusetts. The storage and picking is performed as a function of fulfillment and the Company is not separately charged for storage. We utilize about 10,000 sq. ft. of space. We do not have a warehouse agreement with Webco.

In addition, the Company rents a small storage unit on a month-to-month basis with Extra Space Storage located at 266 Broadway, Raynham, MA, The storage unit is approximately 20' X 20' and is used for storing office records, sales support materials and small amounts of corrugated materials used for shipping. The monthly payment for this space is $129.~~00.~~

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ITEM 3. LEGAL PROCEEDINGS

WeRegistrant is ~~are~~the defendant in a lawsuit commenced by Entercom Boston LLC in Superior ~~not~~Court, ~~presently~~Suffolk, MA. (CA 10-1652E) on May 17, 2010. Plaintiff alleges that Registrant owes approximately $64,000 for advertising and air time. OSM has asserted a ~~party~~counterclaim, asserting tobreach ~~any~~of ~~material~~contract ~~litigation~~and other defenses.

~~ITEM~~Registrant has also been sued in New Bedford, MA. Civil Court, Docket no. 201033CV001618, by Saga Communications of New England, LLC. d/b/a WZAN-AM Radio for $4,233 in alleged unpaid advertising and air time. The suit was commenced ~~SUBMISSION~~on October OF20, ~~MATTERS~~2010 TOand ARegistrant ~~VOTE~~has OFcounterclaimed ~~SECURITY~~for ~~HOLDERS~~breach of contract.

~~No matters~~ITEM ~~were submitted to a vote of our shareholders during the fourth quarter~~4. of(Removed ~~fiscal~~and ~~2009.~~Reserved)

PART II

ITEM 5. MARKET FOR COMMON EQUITY, ~~AND~~ RELATED STOCKHOLDER MATTERS AND PURCHASERS OF EQUITY SECURITIES

(a) Market Information. The Company's common stock has been listed on NASDAQ's Over The Counter Bulletin Board since May 5, 2008 and is traded under the symbol OGSM.

(b) Holders. As of December 15, ~~2009~~2010, there are ~~174~~155 record holders of 913,~~990~~840,~~072~~722 shares of the Company's common stock.

(c) Dividends. The Company has not paid any cash dividends to date and does not anticipate or contemplate paying dividends in the foreseeable future. It is the present intention of management to utilize all available funds for the development of the Company's business.

(d) Recent sales of unregistered securities.

~~Effective~~On ~~January~~December 316, ~~2006~~2009, the Company commenced a private stock offering, whereby it authorized ~~issued~~the ~~an aggregate~~issuance of ~~999~~3,~~500~~333,334 shares of its common stock for ~~cash~~a total raise of $~~999,~~500 ~~as of December 31~~, ~~2007~~000. The ~~Included~~offering inwas ~~this,~~closed ison anMarch ~~aggregate of 576~~31,~~993~~ ~~shares~~2010 ~~of common~~and ~~stock~~$37,097 ~~for cash~~ of the $~~576~~500,~~993~~000 ~~issued~~was ~~during~~raised ~~the~~and ~~fiscal~~247,317 ~~year~~shares ~~ended~~of ~~September~~common ~~30,~~stock were ~~2007~~issued.

On ~~February~~January 1821, ~~2008~~2010, the ~~Company~~Board ~~conducted~~of aDirectors ~~private~~approved ~~stock offering whereby it authorized~~ the issuance of ~~100~~1,~~000~~ 773,333 shares of common stock in ~~exchange~~satisfaction ~~for~~of ~~cash~~$260,000 in related party notes ofpayable and $506,000. ~~The~~in ~~offering~~accrued ~~was~~interest ~~closed~~to asa director of ~~March~~the ~~31,~~Company. ~~2008~~As ~~and~~part 50of the agreement,~~000~~ ~~shares~~the remaining balance of ~~common~~ ~~stock~~the ~~were~~related party note of $100,000 (See ~~ultimately~~Note ~~issued~~11) inwill ~~this~~be ~~stock~~due ~~offering~~and inpayable ~~exchange~~over ~~for~~the ~~cash~~next 7 years at an interest rate of 8% ~~$25,000~~per annum.

On ~~February~~January 2021, ~~2008~~2010, the ~~Company~~Board ~~conducted~~of aDirectors ~~private~~approved ~~stock offering whereby it authorized~~ the issuance of 50680,000 shares of common stock in ~~exchange~~satisfaction ~~for~~of ~~cash~~$90,000 ofin related party notes payable and $5012,000. ~~The~~in ~~offering~~accrued ~~was~~interest ~~closed~~to asa director of ~~March~~the ~~31,~~Company. ~~2008~~As ~~and~~part 33of the agreement,~~123~~ ~~shares~~the remaining balance of the related party note of $14,000 (See Note ~~common~~11) ~~stock~~will ~~were~~be ~~ultimately~~due ~~issued~~and inpayable ~~this~~over ~~stock~~the ~~offering~~next in2 ~~exchange~~years ~~for~~at ~~cash~~ an interest rate of ~~$33,123~~8% per annum.

On ~~February~~ ~~28,~~May ~~2008~~1, 2010 the Company's ~~Board~~commenced ofa ~~Directors'~~private ~~approved~~stock ~~the~~offering, whereby it authorized the issuance of ~~139~~ 5,~~562~~000,000 shares of its common stock atfor a total raise of $1500,000.00 As ~~per~~of ~~share~~September in30, ~~settlement~~2010 $92,005 of ~~equal~~the ~~amounts~~$500,000 was raised and 920,050 shares of ~~Notes~~common ~~and~~stock ~~Accounts~~were ~~Payable~~issued.

OnFor ~~April~~a ~~11,~~more ~~2008~~complete ~~the~~list ~~Company~~of ~~conducted~~previous asales ~~private~~of ~~stock~~unregistered ~~offering~~securities ~~whereby~~by itthe ~~authorized~~Company, ~~the~~please ~~issuance~~refer ofto ~~820,000~~Part ~~shares~~5 of ~~common~~Form ~~stock~~10K ~~in exchange~~ for ~~cash~~the ofyear ~~$410,000. The~~ended ~~offering~~September ~~was closed as of April~~ 30, ~~and 820~~2009,~~000~~ ~~shares of common stock were~~which ~~ultimately~~is ~~issued~~incorporated inby ~~this~~reference ~~stock offering in exchange for cash of $410,000~~herein.

On May 30, 2008, the Company extended a Conversion offer to nine bridge loan note holders who had loaned the Company funds during the 3rd Quarter of 2007. In exchange for their notes, the note holders were offered two shares of stock for each dollar of debt and accrued interest they were owed through June 30, 2008. Debt settlement expense associated with these transactions was $685,421 for the twelve months ending September 30, 2008. Note holders were also offered one common stock warrant for each dollar of debt and accrued interest at an exercise price of $2.00 per share and a two year exercise period. Warrant expense associated with these transactions was $239,549 for the twelve months ending September 30, 2008.

On October 3, 2008, the Company commenced a private stock offering, whereby it authorized the issuance of 1,440,000 Units consisting of one share of its common stock and one common stock purchase warrant for a total raise of $360,000. The common stock purchase warrants are exercisable at $1.00 per share and carrying a five year exercise period. The offering was closed as of November 30, 2008. All 1,440,000 units were issued and $360,000 in cash was received.

On January 28, 2009, the Company commenced a private stock offering, whereby it authorized the issuance of 1,750,000 Units, each consisting of one share of its common stock and one common stock purchase warrant for a total raise of $262,500. The common stock purchase warrants are exercisable at $1.00 per share and carry a five year exercise period. The offering was closed on March 31, 2009 at which time 1,296,800 unit shares were issued and $194,520 in cash was received.

During the year ended September 30, 2009 the Company issued 450,000 shares of stock to Nu Vision Holdings, LLC. valued at $180,000 for consulting services rendered to the Company. The contract expired on April 7, 2009.

During the year ended September 30, 2009 the Company issued 102,500 shares of stock to an individual at an aggregate value of $14,350 for services rendered to the Company in connection with the Garden Guys radio talk show. An issuance of 50,000 shares was issued on July 1, 2009; 50,000 shares were issued on August 1, 2009 and 2,500 shares were issued on September 1, 2009.

For a more complete list of previous sales of unregistered securities by the Company, please refer to Part 5 of Form 10K for the year ended September 30, 2007, which is incorporated by reference herein.

(e)

Description of Securities.

(i)

Common Stock

The Company is authorized by its Certificate of Incorporation to issue an aggregate of 100,000,000 shares of capital stock, of which 100,000,000 are shares of Common Stock, par value $.0001 per share (the "Common Stock").

The following is a summary description of our capital stock and certain provisions of our certificate of incorporation and by-laws, copies of which have been included as exhibits to this report. The following discussion is qualified in its entirety by reference to such exhibits.

All common shares are equal to each other with respect to voting; dividend rights and liquidation rights. Special meetings may be called by the Board of Directors or by any officer instructed by the directors to call the meeting. Shareholders have no right to call special meetings. Holders of common shares are entitled to one vote at any meeting of the shareholders for each common share they own as of the record date fixed by the Board of Directors. At any meeting of shareholders, a majority of the outstanding common shares represented at the meeting will govern, even if this is substantially less than a majority of common shares outstanding. Directors are elected by a plurality of votes. Holders of shares are entitled to receive such dividends as may be declared by the Board of Directors out of funds legally available therefore; and on liquidation are entitled to participate pro rata in a distribution of assets available for such a distribution to shareholders. Assets for conversion, pre-emptive or other subscriptions are not available for such a distribution to shareholders. Shares do not have cumulative voting rights which mean that the holders of more than fifty percent of the common shares voting for election of directors may elect all the directors, if they choose to do so. In such event, the holders of the remaining shares aggregating less than fifty will not be able to elect directors.

This description of certain matters relating to the securities of the Company is a summary and is qualified in its entirety by the provisions of the Company's Certificate of Incorporation and By-Laws, copies of which have been filed as exhibits to the Form 10-KSB for the year ended September 30, 2007, which is incorporated by reference herein.

(ii)

Debt Securities. None

(iii)

Securities To Be Registered. None

17ITEM 6. SELECTED FINANCIAL DATA Not Applicable

~~(iv) Market~~ITEM ~~Value~~7. ~~Table~~MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS; PLAN OF OPERATIONS

	CLOSING BID				CLOSING ASK
2009	HIGH		LOW		HIGH		LOW
Jan 1 thru Mar 31	$	.35	$	.20	$	1.01	$	.25
April 1 thru June 30	$	.30	$	.05	$	.65	$	.25
July 1 thru Sept 30	$	.25	$	.05	$	.40	$	.10
Oct 1 thru Dec 31		.30		.10		.35		.16

The market value information above was compiled by Pink OTC Markets, Inc. from sources they believed to be reliable, however, they do not guarantee the accuracy, nor warranty its use for any purpose.

The above quotations represent prices between dealers and do not include retail markup, markdown or commission. They may not represent actual transactions and have not been adjusted for stock dividends or splits of which there were none.

ITEM 6. SELECTED FINANCIAL DATA

Selected Financial Data

Organic Sales and Marketing, Inc.

For the Years Ended September 30,2009 and 2008

Statements of Operations

	Twelve Months Ended			Twelve Months Ended
	September 30, 2009			September 30, 2008
Revenues (Net)	$	224,999		$	347,111
Margin		41,488			103,725
Selling, General and Administrative Expenses		1,446,873			1,370,934
(Loss) from Operations	$	(1,405,385	)	$	(1,267,209	)
Other Income/(Expense)		(47,105	)		(56,089	)
Debt Settlement Expense		0			(685,421	)
Warrants granted in settlement of debt		0			(239,549	)
Warrants granted for financing costs		(954,837	)		0
Profit/(Loss) Before Taxes	$	(2,407,327	)	$	(2,248,268	)
Loss per share-Basic and Diluted	$	(0.26	)	$	(0.37	)
Weighted Average Number of Shares		9,124,777			6,002,421

Balance Sheets

	Twelve Months Ended			Twelve Months Ended
	September 30, 2009			September 30, 2008
Cash	$	24,547		$	27,838
Accounts Receivable		8,090			26,710
Inventories		109,581			149,386
Fixed Assets		9,383			14,284
Other Assets		200			200
Prepaid Expense		7,479			53,932
TOTAL ASSETS	$	159,280		$	272,350
LIABILITIES
Accounts Payable-trade	$	581,215		$	480,483
Accounts Payable-related party		3,986			—
Accrued Expenses		95,427			68,108
Notes Payable-Current		567,790			336,909
TOTAL LIABILITIES	$	1,248,418		$	885,500
STOCKHOLDERS (DEFICIT)
Common Stock (Note 1)	$	1,009		$	680
Additional Paid in Capital		5,669,969			3,738,959
Accumulated (Deficit)		(6,760,116	)		(4,352,789	)
TOTAL STOCKHOLDERS (DEFICIT)	$	(1,089,138	)	$	(613,150	)
TOTAL LIABILITIES AND STOCKHOLDERS (DEFICIT)	$	159,280		$	272,350

Note 1:

Common Stock, $.0001 par value, 100,000,000 shares authorized 10,088,794; 6,799,494 shares issued and outstanding respectively.

Detailed information regarding the Company’s operations is contained in the Selected Financial Data and Financial Statements section of this Report. The following sets forth, for the periods indicated certain key information about the Company.

The Company is continuing to focus its efforts on improving and expanding its all natural cleaning and garden product lines and establishing a large viable national distribution network for these products. While there are no assurances, the Company anticipates that by continuing to improve and expand its quality product offerings, in conjunction with establishing a broad national distribution network, it will be in a position to receive substantial revenues in the not-too-distant future.

The Company has incurred costs associated with the establishment of its business and the development and launching of its products line. The Company has established brand names, consumer recognition and interest in organics through private labels, the internet, the radio show and an established regional distribution network. The Company’s products started generating revenues during the second half of calendar 2007.

Significant resources have been allocated to growing and expanding the Company from October 1, 2007 through September 30, 2009. These costs include, but are not limited to $164,274 for Legal and Accounting Fees, $562,027 for Payroll and payroll taxes, $230,537 for Advertising, $492,237 for brokered time purchased for our radio shows and $107,523 for Interest Expense. To help absorb these costs, the Company financed its operations during this period primarily through convertible promissory notes of $184,120, common stock issued in lieu of debt and payables for $139,562 and private placement stock offerings totaling $1,022,643.

The Company has issued shares directly to accredited investors and through the conversion of the 6% convertible debentures and convertible promissory notes previously issued. All such shares have been issued in reliance upon exemptions from registration with the Securities and Exchange Commission. An approximate total of 69% of the Company’s outstanding common shares were restricted as of June 30, 2009.

For a more complete list of sales of unregistered securities by the Company, please refer to Part 5 of Form 10K for the year ended September 30, 2009, which is incorporated by reference herein.

Results of Operations

Year Ended September 30, ~~2009~~2010, Compared to Year Ended September 30, ~~2008~~2009

Revenues for FY ~~2009~~2010 totaled $224,~~999~~680 compared to $~~347~~224,~~111~~999 for FY ~~2008~~2009. ~~This~~Stable ~~35%~~sales ~~drop~~growth inis ~~revenue~~mainly isdue ~~almost~~to ~~entirely~~the ~~attributable~~company’s efforts to ~~declining~~discontinue ~~economic conditions~~unprofitable ~~and~~product ~~the~~lines ~~drop~~while increasing sales in ~~retail~~higher ~~sales~~margin lines. ~~Gardening~~The ~~product~~largest ~~sales~~growth came ~~were~~from ~~relatively~~self-branded ~~flat~~cleaners ~~for FY~~using ~~2009~~wider ~~and~~distribution ~~advertising~~networks ~~revenues~~in ~~increased~~2010, bywhile reducing ~~60%~~lower-margin ~~compared~~product sales to FYretail end users versus ~~2008~~2009.

Gross profit was 1841.47% in FY ~~2009~~2010 compared to 2918.94% in FY ~~2008~~2009. The ~~11.5%~~increase ~~drop~~ in gross margin can be attributed mainly to ~~decreased~~a ~~prices~~concerted toeffort ~~stay competitive~~toward higher-margin, ~~the increased~~lower cost ofproducts ~~raw~~via ~~materials~~superior ~~and increased shipping and receiving costs. All~~distribution ~~of the changes were directly related to declining economic conditions~~networks.

Operating expenses ~~increased~~decreased by ~~5.5~~almost 50% during FY ~~2009~~2010, primarily due to adecreases ~~licensing agreement with Microbial Technologies for the use of their formulations~~ in ~~our~~ ~~manufacturing~~staffing, ~~process.~~advertising ~~Due to the drop in sales the full savings margin effect on gross margins was not able to be realized. To offset these licensing~~ costs, ~~a number~~via ~~of our~~ radio ~~station~~show ~~agreements were not renewed; there was a cutback in personnel in the office~~ and ~~non-recurring legal fees associated with taking the~~professional ~~Company~~consulting. These ~~public~~reductions inwere ~~May,~~necessary ~~2008~~to ~~did~~reduce ~~not repeat in FY 2009.~~overhead costs

Other Income/(Expense) was essentially unchanged from year to year. In FY 2009, 2,736,800 warrants were granted to entice investors to participate in our private placement, incurring a warrant expense of $954,837. In FY 2008 bridge loan note holders converted their bridge loans. Each note holder was offered two shares of stock for each dollar of debt and accrued interest they were owed for a significant discount in stock price. As such, the Company incurred debt settlement expense of $685,421. Note holders were also granted one warrant for each dollar of debt and accrued interest owed which resulted in warrant expense of $239,549 for the grant of 184,120 warrants. Interest expense decreased 18% in FY 2009 when compared to FY 2008 primarily due to the bridge loans that were converted.16

Other Income/(Expense) was significantly lower in due to no warrants being issued in FY 2010 versus FY 2009. In FY 2009, warrants were granted to entice investors to participate in our private placement, incurring a warrant expense of $954,837. Interest expense increased 20.9% in FY 2010 when compared to FY 2009 primarily due to the Notes Payable - Related Party increases as discussed in the footnotes to the Financial Statements included in this filing.

Liquidity and Capital Resources

Cash was $2446,~~547~~237 at September 30, ~~2009~~2010 compared to $2724,~~838~~547 in FY ~~2008~~2009 or aan ~~decrease~~increase of $321,~~291~~690. Net Cash Used in Operating Activities decreased by 1850% or $~~176~~394,~~061~~085 from the prior fiscal year. The net loss of the Company of $2693,~~407,327~~761 is offset, in part, by stock issuances, ~~and~~for ~~options~~cash and ~~warrants~~options granted during the ~~year~~ year in the amount of $1455,~~376~~394,~~820~~ with an additional $367,755 in stock issuances for conversion of debt. Net Cash Provided by Financing Activities was $~~785~~416,~~400~~296 in FY ~~2009~~2010 compared to $~~805~~785,~~032~~400 in FY ~~2008~~2009 or a decrease of $19369,~~632~~104 or 47% which was due to decreased ~~borrowings~~proceeds onfrom ~~the~~issuance ~~Line~~ of ~~Credit and lower~~common ~~cash~~stock, ~~received on Bridge Loans~~ offset by ~~a net increase in~~ ~~private~~increased ~~placement~~borrowing ~~raises~~from ofa ~~$86,397 and an increase in~~ related party ~~notes payable of $233,633~~.

Significant Accounting Policies

Financial statements have been prepared in accordance with accounting principles generally accepted in the United States.

Significant accounting policies are defined as those that are reflective of significant judgments and uncertainties, and potentially result in materially different results under different assumptions and conditions and are incorporated in these financial statements. We believe that our significant accounting policies are limited to those described below.

Principles of Accounting

The Company employs the accrual method of accounting for both financial statements and tax purposes. Using the accrual method, revenues and related assets are recognized when earned, and expenses and the related obligations are recognized when incurred. The Company has elected a September 3030th year end.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Revenue Recognition

We earn our revenues from the distribution of garden and cleaning products to retailers and directly to consumers via our internet site and from advertising contracts. Four basic criteria must be met before revenue can be recognized: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services rendered; (3) the fee is fixed and determinable; and (4) ~~collectibility~~collectability is reasonably assured.

Revenue from garden and cleaning products is recognized upon shipment of the product. The distribution of products is governed by purchase orders or direct sale agreements which fix the price and delivery date. In ~~The~~accordance ~~Company records a~~with ~~provision for product returns and price markdowns as a reduction of gross sales~~ASC at the time the product passes to these retailers or consumers. The provision for anticipated product returns and price markdowns is primarily based upon the Company's analysis of historical product return and price markdown results. Should product sell605-through results at retail store locations fall significantly below anticipated levels this allowance may be insufficient. The Company will review the adequacy of its allowance for product returns and price markdowns and if necessary will make adjustments to this allowance on a quarterly basis.45 ~~In accordance with GAAP, "~~“Accounting for Shipping and Handling Fees and Costs," ” distribution costs charged to customers are recognized as revenue when the related product is shipped. Advance payments are recorded on the balance sheet as deferred revenue until the revenue recognition criteria is met.

Revenue from radio advertising is derived from three sources, the sale of commercial spots on the Garden Guys radio talk show, the sponsorship of informative show segments and hosting live remote broadcasts. Revenue from radio advertising is recognized after the commercial has been aired and/or a remote broadcast has taken place. Customers will prepay for radio spots or remote broadcasts at the time they contract with the Company to air their commercials or host a remote broadcast. The Company will carry this prepayment as a liability, until such time as economic performance takes place. Money received is refundable prior to the airing of commercials or the airing of the remote broadcast, adjusted by any production or other direct costs incurred up to that point in time. Radio advertising for the years ended September 30, 2009 and 2008 were $40,210 and $25,260, respectively.17

Revenue from radio advertising is derived from three sources, the sale of commercial spots on the Garden Guys radio talk shows, the sponsorship of informative show segments and hosting live remote broadcasts. Revenue from radio advertising is recognized after the commercial has been aired and/or a remote broadcast has taken place. Customers will prepay for radio spots or remote broadcasts at the time they contract with the Company to air their commercials or host a remote broadcast. The Company will carry this prepayment as a liability, until such time as economic performance takes place. Money received is refundable prior to the airing of commercials or the airing of the remote broadcast, adjusted by any production or other direct costs incurred up to that point in time.

Cash and Cash Equivalents

The Company considers all highly liquid investments with a maturity of three months or less at the time of purchase to be cash equivalents. During the past twelve months the Company maintained cash in bank accounts which, at times, exceeded Federal Deposit Insurance Corporation insured limits. The Company has not experienced, nor does it anticipate, any losses on these accounts and believes their risk to be minimal.

Accounts Receivable

The Company carries its accounts receivable at cost less an allowance for doubtful accounts. ~~On a periodic basis~~Periodically, the Company evaluates its accounts receivable and establishes an allowance for doubtful accounts, based on a history of past write-offs and collections and current credit conditions. The Company feels that ~~all~~the ofentire ~~its~~balance ~~accounts~~of ~~receivable~~Accounts Receivable as of September 30, ~~2009~~2010 and September 30, ~~2008~~ 2009 are collectable and, therefore, no allowance has been taken. The full value of accounts receivable is held as collateral for the Company’s Line of Credit.

Inventory

The inventory is stated at the lower of cost (first-in-first-out method) or market. Inventory items consist of raw material and finished goods. Raw materials consist of labels, bottles, sprayers, fertilizers and shipping materials. Finished goods consist of fertilizer bags and bottles of organic cleaning products ready for shipment. The inventory consists of newly purchased items; therefore, there is currently no allowance for excess or obsolete inventory. The ~~full~~ full value of inventory is held as collateral for the Company’s Line of Credit.

Prepaid ~~Expense~~Expenses

Business expenses, including consulting expenses, that are paid for in advance of services being rendered are treated as prepaid expenses. ~~The~~On occasion, the Company ~~occasionally~~ pays for ~~these~~prepaid expenses with ~~its~~ common stock. When ~~this~~these ~~occurs~~transactions occur, ~~the~~they ~~offset~~are isidentified ~~shown~~ as a negative ~~component~~components of stockholders' ’ equity.

Fixed Assets

Fixed assets are stated at cost less accumulated depreciation. The Company has elected to capitalize and depreciate any fixed asset item costing in excess of $1,000. Expenditures for minor replacements, maintenance and repairs which do not increase the ~~usefullives~~useful lives of the property and equipment are charged to operations as incurred. Major additions and improvements are capitalized. Depreciation and amortization are computed using the straight-line method over estimated useful lives of ~~five~~three to seven years. The full value of fixed assets is held as collateral for the Company’'s Line of Credit.

Advertising

The Company follows the policy of charging ~~advertising~~the costs of advertising to expense as incurred. Advertising ~~expenses~~expense primarily ~~consist~~consists of the Company'’s three hour ~~weekly~~ weekly Garden ~~Talk~~Guys radio call in program with Greater Media and Citadel Communications, ~~(WBSM)~~slotting fee expense, display case costs, samples and ~~Greater~~trade ~~Media~~show participation. ~~Annual~~ The total advertising expense for the radio show contracts was $~~209~~54,~~615~~200 and $~~282~~209,~~622~~615 for the ~~years~~ twelve months ended September 30, ~~2009~~2010 and September ~~2008~~30, 2009, respectively. In addition, the Company advertises its products on its own website and in numerous trade and industry publications. Total advertising, including radio contracts, for the years ended September 30, 2010 ~~2009~~ and ~~2008~~2009 was $~~265~~69,~~687~~790 and $~~457~~311,~~087~~362, respectively. ~~Advertising expense also includes display rack costs, slotting fees, samples, trade show participation and print media advertising.~~

Income Taxes

The Company utilizes the liability method of accounting for income taxes. Under the liability method, deferred income tax assets and liabilities are provided based on the difference between the financial statement and tax bases of assets and liabilities measured by the currently enacted tax rates in effect for the years in which these differences are expected to reverse. Deferred tax expense or benefit is the result of changes in deferred tax assets and liabilities.

Fair Value of Financial Instruments

On January 1, 2008, the Company adopted FASB ASC 820-10-50, “Fair Value Measurements. ” This guidance defines fair value, establishes a three-level valuation hierarchy for disclosures of fair value measurement and enhances disclosure requirements for fair value measures. The three levels are defined as follows:

Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 2 inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.

Level 3 inputs to valuation methodology are unobservable and significant to the fair measurement.

The carrying amounts reported in the balance sheets for the cash and cash equivalents, receivables and current liabilities each qualify as financial instruments and are a reasonable estimate of fair value because of the short period of time between the origination of such instruments and their expected realization and their current market rate of interest. The carrying value of related party notes payable approximates fair value because negotiated terms and conditions are consistent with current market rates as of September 30, ~~2009~~2010 and ~~2008~~2009.

Stock-Based Compensation

In December 2004, FASB issued FASB ASC 718 (Prior authoritative literature: SFAS No. 123R, “Share-Based Payment”). FASB ASC 718 establishes standards for the accounting for transactions in which an entity exchanges its equity instruments for goods or services. It also addresses transactions in which an entity incurs liabilities in exchange for goods or services that are based on the fair value of the entity’s equity instruments or that may be settled by the issuance of those equity instruments. FASB ASC 718 focuses primarily on accounting for transactions in which an entity obtains employee services in share-based payment transactions. FASB ASC 718 requires that the compensation cost relating to share-based payment transactions be recognized in the financial statements. That cost will be measured based on the fair value of the equity or liability instruments issued.

The Company’s accounting policy for equity instruments issued to consultants and vendors in exchange for goods and services follows the provisions of FASB ASC 505-50 (Prior authoritative literature: EITF 96-18, “Accounting for Equity Instruments That are Issued to Other Than Employees for Acquiring, or in Conjunction with Selling, Goods or Services” and EITF 00-18, “Accounting Recognition for Certain Transactions Involving Equity Instruments Granted to Other Than Employees”). The measurement date for the fair value of the equity instruments issued is determined at the earlier of (i) the date at which a commitment for performance by the consultant or vendor is reached or (ii) the date at which the consultant or vendor’s performance is complete. In the case of equity instruments issued to consultants, the fair value of the equity instrument is recognized over the term of the consulting agreement. Stock-based compensation related to non-employees is accounted for based on the fair value of the related stock or options or the fair value of the services, whichever is more readily determinable in accordance with FASB ASC 718.

Net Income (Loss) per Share

Basic net Income (loss) per share is computed by dividing net income {loss) by the weighted average number of common shares outstanding. Diluted net income (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding and dilutive potential common shares, which includes the dilutive effect of stock options and warrants granted. Dilutive potential common shares for all periods presented are computed utilizing the treasury stock method. Common stock options of 1,140,145 were considered, but not included in the computation of loss per share because their effect is anti-dilutive. Common stock warrants of 2,920,920 were considered, but not included in the computation of loss per share, because their effect is anti-dilutive, as well.

Recently Issued Accounting Standards

In June 2006, FASB issued FASB ASC 740-10 (Prior authoritative literature: FASB Interpretation No. 48 “Accounting for Uncertainty in Income Taxes—an interpretation of FASB Statement No. 109”). This Interpretation clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with FASB No. 109, “Accounting for Income Taxes”. FASB ASC 740-10 prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. FIN 48 also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. FASB ASC 740-10 is effective for fiscal years beginning after December 15, 2006. The adoption of FASB ASC 740-10 did not have a material impact on the Company’s financial position, results of operations, or cash flows.

In September 2006, the FASB issued FASB ASC 820-10 (Prior authoritative literature: FASB Statement 157, “Fair Value Measurements”). FASB ASC 820-10 defines fair value, establishes a framework for measuring fair value under GAAP and expands disclosures about fair value measurements. FASB ASC 820-10 applies under other accounting pronouncements that require or permit fair value measurements. Accordingly, FASB ASC 820-10 does not require any new fair value measurements. However, for some entities, the application of FASB ASC 820-10 will change current practice. The changes to current practice resulting from the application of FASB ASC 820-10 relate to the definition of fair value, the methods used to measure fair value and the expanded disclosures about fair value measurements. The provisions of FASB ASC 820-10 are effective as of January 1, 2008, with the cumulative effect of the change in accounting principle recorded as an adjustment to opening retained earnings. However, delayed application of this statement is permitted for nonfinancial assets and nonfinancial liabilities, except for items that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually), until fiscal years beginning after November 15, 2008, and interim periods within those fiscal years. The adoption of FASB ASC 820-10 did not have a material impact on the Company’s financial position, results of operations, or cash flows.

In February 2007, FASB ASC 825-10 (Prior authoritative literature: Statement of Financial Accounting Standards No. 159, “ The Fair Value Option for Financial Assets and Financial Liabilities-Including an Amendment of FASB Statement No. 115 ,”) was issued. This standard allows a company to irrevocably elect fair value as the initial and subsequent measurement attribute for certain financial assets and financial liabilities on a contract-by-contract basis, with changes in fair value recognized in earnings. The provisions of this standard were effective as of the beginning of fiscal year 2008, with early adoption permitted. The adoption of FASB ASC 825-10 did not have a material impact on the Company’s financial position, results of operations, or cash flows.

In March 2007, FASB ASC 715-60 (Prior authoritative literature: EITF Issue No. 06-10, "Accounting for Collateral Assignment Split-Dollar Life Insurance Agreements”). FASB ASC 715-60 provides guidance for determining a liability for the postretirement benefit obligation as well as recognition and measurement of the associated asset on the basis of the terms of the collateral assignment agreement. FASB ASC 715-60 is effective for fiscal years beginning after December 15, 2007. The adoption of FASB ASC 715-60 did not have a material impact on the Company’s financial position, results of operations, or cash flows.

In December, 2007, the FASB issued FASB ASC 805 (Prior authoritative literature: SFAS No. 141(R), “Business Combinations”), which established the principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, any non-controlling interest in the acquiree and the goodwill acquired. FASB ASC 805 also establishes disclosure requirements to enable the evaluation of the nature and financial effects of the business combination. FASB ASC 805 is effective the first annual reporting period beginning on or after December 15, 2008 and is not expected to have any impact on the Company’s financial statements.

In December, 2007, the FASB issued FASB ASC 810-10-65 (Prior authoritative literature: SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements”, an amendment of ARB No. 51). FASB ASC 810-10-65 will change the accounting and reporting for minority interests which will be characterized as noncontrolling interests and classified as a component of equity. This new consolidation method will significantly change the accounting for transactions with minority interest shareholders. This standard is effective for fiscal years and interim periods within those fiscal years beginning on or after December 15, 2008.and is not expected to have an impact on the Company’s financial statements.

In March 2008, the FASB issued FASB ASC 815-10 (Prior authoritative literature: SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities”), which is effective January 1, 2009. FASB ASC 815-10 requires enhanced disclosures about derivative instruments and hedging activities to allow for a better understanding of their effects on an entity’s financial position, financial performance, and cash flows. Among other things, this standard requires disclosures of the fair values of derivative instruments and associated gains and losses in a tabular formant. This standard is not currently applicable to the Company since we do not have derivative instruments or engage in hedging activity.

In May 2008, the FASB issued FASB ASC 944 (Prior authoritative literature: SFAS No. 163, "Accounting for Financial Guarantee Insurance Contracts - an interpretation of FASB Statement No. 60"). FASB ASC 944 interprets Statement 60 and amends existing accounting pronouncements to clarify their application to the financial guarantee insurance contracts included within the scope of that Statement. This standard is effective for financial statements issued for fiscal years beginning after December 15, 2008, and all interim periods within those fiscal years. As such, the Company is required to adopt these provisions at the beginning of the fiscal year ended March 31, 2009. The Company does not believe this standard will have any impact on the financial statements.

In April, 2009, the FASB issued FASB ASC 810-10-65 (Prior authoritative literature: SFAS No. 164, “Not-for-Profit Entities: Mergers and Acquisitions”) which governs the information that a not-for-profit entity should provide in its financial reports about a combination with one or more other not-for-profit entities, businesses or nonprofit activities and sets out the principles and requirements for how a not-for-profit entity should determine whether a combination is in fact a merger or an acquisition. This standard is effective for mergers occurring on or after Dec. 15, 2009 and for acquisitions where the acquisition date is on or after the beginning of the first annual reporting period, beginning on or after Dec. 15, 2009. This standard does not apply to the Company since the Company is considered a for-profit entity

In May 2009, FASB issued FASB ASC 855-10 (Prior authoritative literature: SFAS No. 165, "Subsequent Events"). FASB ASC 855-10 establishes principles and requirements for the reporting of events or transactions that occur after the balance sheet date, but before financial statements are issued or are available to be issued. FASB ASC 855-10 is effective for financial statements issued for fiscal years and interim periods ending after June 15, 2009. As such, the Company adopted these provisions at the beginning of the interim period ended June 30, 2009. Adoption of FASB ASC 855-10 did not have a material effect on our financial statements.

In June 2009, the FASB ASC 860-10 (Prior authoritative literature: issued SFAS No. 166, “Accounting for Transfers of Financial Assets, an Amendment of FASB Statement No. 140”), which eliminates the concept of a qualifying special-purpose entity (“QSPE”), clarifies and amends the de-recognition criteria for a transfer to be accounted for as a sale, amends and clarifies the unit of account eligible for sale accounting and requires that a transferor initially measure at fair value and recognize all assets obtained and liabilities incurred as a result of a transfer of an entire financial asset or group of financial assets accounted for as a sale. This standard is effective for fiscal years beginning after November 15, 2009. The Company is currently evaluating the potential impact of this standard on its financial statements, but does not expect it to have a material effect.

In June 2009, the FASB issued FASB ASC 810-10-65 (Prior authoritative literature: SFAS No. 167, “Amendments to FASB Interpretation No. 46(R)”) which amends the consolidation guidance applicable to a variable interest entity (“VIE”). This standard also amends the guidance governing the determination of whether an enterprise is the primary beneficiary of a VIE, and is therefore required to consolidate an entity, by requiring a qualitative analysis rather than a quantitative analysis. Previously, the standard required reconsideration of whether an enterprise was the primary beneficiary of a VIE only when specific events had occurred. This standard is effective for fiscal years beginning after November 15, 2009, and for interim periods within those fiscal years. Early adoption is prohibited. The Company is currently evaluating the potential impact of the adoption of this standard on its financial statements, but does not expect it to have a material effect.

In June 2009, FASB issued ASC 105-10 (Prior authoritative literature: SFAS No. 168, "The FASB Accounting Standards Codification TM and the Hierarchy of Generally Accepted Accounting Principles - a replacement of FASB Statement No. 162").FASB ASC 105-10 establishes the FASB Accounting Standards Codification TM (Codification) as the source of authoritative accounting principles recognized by the FASB to be applied by nongovernmental entities in the preparation of financial statements in conformity with GAAP. FASB ASC 105-10 is effective for financial statements issued for fiscal years and interim periods ending after September 15, 2009. As such, the Company is required to adopt these provisions at the beginning of the fiscal year ending September 30, 2009. Adoption of FASB ASC 105-10 did not have a material effect on the Company’s financial statements.

~~Income Taxes~~20

~~The~~In October 2009, the Financial Accounting Standards Board (“FASB”) ~~has~~ issued Accounting ~~FASB~~Standards ~~ASC~~Update ~~740~~(“ASU”) 2009-1013, Revenue Recognition (~~Prior authoritative~~Topic ~~literature~~605): Multiple-Deliverable ~~Financial~~Revenue ~~Interpretation~~Arrangements—a ~~No.~~consensus ~~48,~~of ~~"Accounting~~the ~~for~~FASB Emerging ~~Uncertainty~~Issues inTask ~~Income~~Force ~~Taxes~~(“ASU 2009-13”). AnASU ~~Interpretation~~2009-13 ofchanges ~~FASB~~accounting ~~Statement~~for ~~No.~~certain multiple ~~109~~deliverable ~~(FIN 48))~~arrangements. ~~FASB~~ ~~ASC~~ASU ~~740~~2009-1013 ~~clarifies~~addresses the ~~accounting~~separation ~~for~~of deliverables ~~uncertainty~~and inhow ~~income taxes~~to ~~recognized~~measure inand anallocate ~~enterprise's~~the ~~financial~~arrangement ~~statements~~consideration to one or more units of accounting in ~~accordance~~multiple ~~with~~deliverable arrangements. Currently, ~~prior~~under ~~literature~~the ~~FASB~~residual ~~Statement~~method ~~No.~~of ~~109~~allocation, ~~Accounting~~we ~~for~~use ~~Income~~objective ~~Taxes. This~~and reliable evidence ~~standard~~of ~~requires~~the afair ~~company~~value of the undelivered elements to ~~determine~~separate ~~whether~~deliverables itin multiple isdeliverable ~~more~~arrangements. ~~likely~~ASU ~~than~~2009-13 ~~not~~eliminates ~~that~~the residual method aand ~~tax~~requires ~~position~~that ~~will~~consideration befrom ~~sustained~~the ~~will~~arrangement be ~~sustained~~allocated ~~upon~~to ~~examination~~all deliverables ~~based~~using ~~upon~~ the ~~technical~~relative ~~merits~~selling ofprice ~~the position~~method. If ~~the~~ASU ~~more~~2009-~~likely-than-~~13 ~~not~~requires ~~threshold~~additional isdisclosures ~~met,~~related ato ~~company~~multiple ~~must~~deliverable ~~measure~~revenue ~~the~~arrangements ~~tax~~upon adoption ~~position~~and tois ~~determine~~effective ~~the~~for fiscal years beginning after June 15, 2010. In ~~amount~~addition, toASU ~~recognize~~2009-13 inmay ~~the~~be ~~financial~~early ~~statements~~adopted. As aIt ~~result~~may ofbe ~~the~~implemented with either ~~implementation~~prospective ofor ~~this~~retrospective ~~standard~~application; however, if early adoption is chosen, the ~~Company~~entity ~~performed~~must aeither ~~review~~adopt at the beginning of its ~~material~~fiscal year, or adopt using ~~tax~~retrospective ~~positions~~application. inWe ~~accordance~~are ~~with~~currently ~~recognition~~evaluating the impact ASU 2009-13 will have on our financial position and ~~measurement~~results ~~standards~~of operations, whether to early ~~established~~adopt byand ~~FASB~~which ~~ASC~~implementation ~~740-10~~method to use upon adoption if not prescribed.

~~Deferred~~In ~~taxes~~October ~~are~~2009, ~~provided~~the onFASB aissued ~~liability~~ASU ~~method~~2009-14, ~~whereby~~Software ~~deferred~~(Topic ~~tax~~985): ~~assets~~Certain ~~are~~Revenue ~~recognized~~Arrangements That Include Software Elements—a consensus of the FASB Emerging Issues Task Force (“ASU 2009-14”). ASU 2009-14 changes the accounting for revenue ~~deductible~~arrangements ~~temporary~~that ~~differences~~include ~~and~~both ~~operating~~tangible ~~loss~~products and ~~tax~~software elements. ~~credit~~Tangible ~~carryforwards~~products containing software components and ~~deferred~~non-software ~~tax~~components that ~~liabilities~~function ~~are~~together ~~recognized~~to ~~for~~deliver ~~taxable~~the tangible product’s essential functionality ~~temporary~~is ~~differences. Temporary~~no ~~differences~~longer ~~are~~within the ~~differences~~scope ~~between~~of the software revenue guidance. Under prior guidance such arrangements were accounted for as software if the ~~reported~~software ~~amounts~~was determined to be more than incidental. ASU 2009-14 requires that any hardware components of ~~assets~~such ~~and~~arrangements ~~liabilities~~be ~~and~~excluded ~~their~~from ~~tax~~software ~~basis.~~revenue guidance and ~~Deferred~~that ~~tax~~any ~~assets~~essential ~~are~~software ~~reduced~~that byis asold ~~valuation~~with ~~allowance~~or ~~when,~~embedded inwithin the product ~~opinion~~also ofbe ~~management,~~excluded itfrom software revenue guidance. This ASU is ~~more~~effective ~~likely~~for fiscal ~~than~~years ~~not~~beginning ~~that~~after ~~some~~June ~~portion~~15, 2010. In addition, ASU 2009-14 may be early adopted. ASU 2009-14 may be implemented with either prospective or retrospective ~~all~~application; ofhowever, if early adoption is chosen, the entity must either adopt at the ~~deferred~~beginning ~~tax~~of ~~assets~~its ~~will~~fiscal ~~not~~year, beor ~~realized~~adopt using retrospective application. ~~Deferred~~ ~~tax~~Further, ~~assets~~ASU 2009-14 must be adopted in the same period and with ~~liabilities~~the same implementation method as ASU 2009-13. We are ~~adjusted~~currently ~~for~~evaluating the impact ~~effects~~ASU 2009-14 will have on our financial position and results of operations, ~~changes~~whether into ~~tax~~early ~~laws~~adopt and ~~rates~~which onimplementation ~~the~~method to use upon ~~date~~adoption ofif ~~enactment~~not prescribed.

~~The~~In ~~Company~~January ~~has~~2010, ~~adopted~~the FASB ~~ASC~~issued ~~740-10~~ASU toNo. ~~account~~2010-06 ~~for~~regarding ~~income~~fair ~~taxes.~~value ~~The Company~~measurements ~~currently~~and ~~has~~disclosures noand ~~issues~~improvement ~~creating~~in ~~timing~~the ~~differences~~disclosure ~~that~~about ~~would~~fair ~~mandate~~value ~~deferred~~measurements. ~~tax~~This ~~expense.~~ASU ~~Net~~requires additional disclosures ~~operating~~regarding ~~losses~~significant transfers ~~would create possible tax assets~~ in ~~future years.~~and ~~Due~~out toof ~~the~~Levels ~~uncertainty~~1 ofand ~~the~~2 ~~utilization~~ of ~~net~~fair ~~operating~~value measurements, including ~~loss~~a ~~carry~~description of the reasons for the ~~forwards~~ transfers. Further, anthis ~~evaluation~~ASU ~~allowance~~requires ~~has~~additional ~~been~~disclosures ~~made~~for to the ~~extent of any tax benefit~~ ~~that~~activity ~~net~~in ~~operating~~Level ~~losses~~3 ~~may~~fair ~~generate. A~~value ~~provision~~measurements, ~~for~~requiring ~~income~~presentation ~~taxes~~of ~~has~~information ~~not~~about ~~been~~purchases, ~~made~~sales, ~~due~~issuances, and tosettlements in the reconciliation for fair value ~~net~~measurements. ~~operating~~This ~~loss carry-forwards of $4,189,293 and~~ASU ~~$2,964,435~~is aseffective offor ~~September~~fiscal ~~30,~~years ~~2009~~beginning ~~and~~after ~~September~~December 3015, ~~2008~~2010, ~~respectively,~~and ~~which~~for interim ~~may~~periods bewithin ~~offset~~those ~~against~~fiscal ~~future~~years. ~~taxable~~The ~~income~~adoption ~~through~~of ASU ~~2029.~~2010-06 did Nonot have ~~tax~~a ~~benefit~~material ~~has been~~impact ~~reported~~on in the ~~financial~~Company’s consolidated financial statements.

~~The~~In ~~Company~~February ~~did~~2010, ~~not~~the ~~have~~FASB ~~any~~issued ~~tax~~Accounting ~~positions~~Standards Update No. 2010-09 (“ASU 2010-09”) as amendments to certain recognition and disclosure requirements. The amendments remove the requirement for ~~which~~an itSEC isfiler ~~reasonably~~to ~~possible~~disclose ~~that~~a date in both issued and revised financial statements. Revised financial statements include financial statements revised as a result of either correction of an error or retrospective application of U.S. GAAP. Those amendments remove potential conflicts with the ~~total~~SEC’s ~~amount~~literature. All of ~~unrecognized~~the ~~tax~~amendments ~~benefits~~in ~~will~~ASU ~~significantly~~2010-09 ~~increase~~were effective orupon issuance for interim and annual periods. The adoption of ASU ~~decrease~~2010-09 did ~~within~~not have a material impact on the ~~next~~Company’s 12consolidated financial ~~months~~statements.

The Company includes interest and penalties arising from the underpayment of income taxes in the consolidated statements of operations in the provision for income taxes. As of September 30, 2009 and 2008, the Company had no accrued interest or penalties related to uncertain tax positions.21

The tax years that remain subject to examination by major taxing jurisdictions are for the years ended December 31, 2008, 2007 and 2006.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward Looking Statements

The following discussion and analysis provides information which management believes is relevant to an assessment and understanding of our results of operations and financial condition, which are based upon our financial statements. The discussion should be read in conjunction with our financial statements and notes thereto, appearing in this Report.

The preparation of these financial statements requires us to make estimates and judgments that may affect the reported amount of assets and liabilities, revenues and expenses, and the related disclosure of such contingent assets and liabilities at the date of our financial statements. Actual results may differ from these estimates under different assumptions and conditions.

This Report also contains forward-looking statements that involve risks and uncertainties, which may include statements about our:

·	Business strategy

·	Expansion of our manufacturing capabilities

·	Plans for entering into collaborative agreements

· Anticipated sources of funds to finance our operations following the date of this ~~report~~Report

·	Plans, objectives, expectations and intentions contained in this prospectus that are not historical fact

The following words and financial projections contain figures related to plans, expectations, future results, performance, events or other matters that are “forward-looking statements”. When used in the Plan of Operations, words such as “estimate”, “project”, “intend”, “expect”, “anticipate”, and other similar expressions are intended to identify forward-looking statements. Such statements involve numerous risks and uncertainties, including, but not limited to, the science of organics, the development of the Company’s products, markets for those products, timing and level of customer orders, competitive products and pricing, changes in economic conditions and other risks and uncertainties. Actual results, performance and events are likely to differ and may differ materially and adversely. Investors are cautioned not to place undue reliance on these forward looking statements which speak only as of the date of the Plan of Operations. The Company undertakes no obligation to release or deliver to investors revisions to these forward-looking statements to reflect events or circumstances after the date of the Plan of Operations, the occurrence of unanticipated events or other matters that may occur.

2322

~~Since~~PLAN ~~inception~~OF the Company has principally financed its operations through private placements offerings as noted in PART II, Item 5(d) of this Form 10K. Since its inception in August 2003, the Company has been involved in the development and acquisition of a wide variety of non-food organic and naturally based products to be initially sold to retail supermarkets, convenience stores, colleges, universities, laboratories, local, regional and national government agencies, lawn and garden centers and the funeral industry. In addition, new markets continue to be pursued that include costume jewelry, sporting goods, sports teams, hobby and craft, health, beauty and wellness, footwear, automotive, cigar catalog houses, wine industry and the international cocoa industry. The Company also recently began fulfilling orders under its own private label offering program for a multi-level marketing company based in the Midwest and is in discussions with another national catalog company which also has brick and mortar retail locations. Essentially, OSM, Inc. has become a sales and marketing company of branded organic and natural products which markets to many different industries throughout the world. The Company began generating revenues in January, 2007.OPERATIONS

~~The~~OSM, ~~Company~~Inc., ~~has~~is a ~~licensing~~sales ~~agreement~~and ~~with~~marketing acompany ~~British~~that ~~based~~specializes ~~company~~in the sales and marketing ~~has~~of ~~the~~non-food natural and organically certified ~~rights~~products. Primarily tocleaners, ~~several~~hand ~~proprietary~~sanitizers ~~formulas~~and ~~used~~fertilizers, developed inthrough much of its ~~extensive~~own ~~line~~licensed technology the Company uses a contract manufacturer located in Massachusetts for much of ~~cleaning~~its ~~products~~production. The ~~Through~~Company is continuing to focus its ~~own~~efforts ~~brands~~for sales opportunities to Federal government agencies, ~~these~~military branches, small ~~excellent~~to ~~non~~mid-~~food~~sized ~~organic~~retail supermarkets, hotel and~~/or~~ ~~natural~~hospitality ~~products~~facilities, ~~are~~colleges, ~~then~~universities, ~~marketed~~and atlaboratories, local and regional government agencies, and lawn and garden centers. In addition, new markets continue to be pursued that include on line retail operations, ~~wholesale~~some orof whom ~~through~~carry their own inventory and others who may rely on the Company to fulfill ~~internet~~their orders. The Company also will continue to offer its products for private label. Essentially, OSM, Inc. has become a sales and marketing company of branded certified organic and natural products which markets into many different industries throughout the world.

The Company continues to develop its operating history on which to evaluate its prospects. The risks, expenses and difficulties encountered by an expanding company must be considered when evaluating the Company’s prospects. Management believes that ~~existing funds, in conjunction with~~ minimum funds sought to be raised during ~~2009-~~2010 and 2011 and projected revenues from operations will be sufficient to reach self-sufficiency by ~~the~~late ~~end~~2011 ~~of 2010~~ or early ~~2011~~2012. Expansion of the business into ~~2010~~2011 and beyond will ~~likely~~ require additional investment through private placement offers or the ability of the Company to secure funding elsewhere. There can be no guarantee, however, that the Company will be able to raise either the minimum capital it needs to sustain its ~~2010~~2011 operations or the larger amount of capital it will need to expand and grow the business well into ~~2010~~ 2011 and beyond. Failure to do so would likely have an adverse effect on the Company’s ability to continue its operations. Most recently, the Company has been loaned money by its President & CEO, Sam Jeffries.

The Company believes it is equipped with the necessary products to go to market and has developed strategic alliances with several distributors in various industries, however given the existing economic climate, and lack of sales to date, operating expenses cannot be predicted with any real degree of certainty. ~~They~~ They will depend on several factors, including, but not limited to, marketing expenses, continued acceptance of the Company’s products, competition for such products and the current economic environment. In order to preserve cash, the Company Officers have elected to not be compensated with cash and in lieu thereof, will receive compensation in the form of stock, stock options, and or warrants for any unpaid time.

Management has no firm basis for projecting the increase in revenue required to sustain operations, as anticipated above. Such assumptions are based almost entirely on the strategic relationships the Company has forged which it believes will ultimately translate into operating revenues. It is important to stress, however, that these assumptions are not at all based on firm commitments from customers or on other tangible evidence.

The Company ~~currently~~recently ~~has~~entered ininto ~~excess~~an ofAgreement ~~100~~with ~~SKU~~Land O’sLakes inPurina ~~its~~Feed ~~product~~LLC (LOLPF) ~~line~~to ~~offering~~act ~~and~~as ~~it continues~~its topreferred ~~develop~~sales ~~and~~agent ~~introduce~~to ~~new~~promote ~~and~~sales ~~better~~to ~~non-food~~and ~~organic~~solicit and~~/or~~ ~~natural~~process ~~products~~orders asof ~~they~~Products ~~present~~from ~~themselves.~~organic ~~For~~fertilizer ~~instance,~~customers ~~its’~~on ~~Dragonfly OrganixTM~~behalf ~~cleaner product~~of ~~line is currently sold~~ LOLPF in ~~such~~the ~~large~~United ~~chains~~States ~~as Stop & Shop~~ and ~~many~~Canada. Presently, ~~other~~it ~~smaller~~is ~~independent~~not ~~supermarkets~~an exclusive relationship.

The Company anticipates its sales will continue to grow with the addition of W.W. Grainger as one of its leading distributors in the many sales sectors aforementioned. Since agreement finalization earlier in 2010, the Company continues to be proactive in sales tool offerings to its employees. The Company will have some of its 11 total horticultural items (fertilizers, insect and animal repellants), on display and showcased in the ‘Sustainability booth’ at the upcoming Grainger trade show in late February early March. The plan is to further educate Grainger employees and customers of the new products and product category. Moreover, the Grainger Sourcing division will continue selling OSM cleaners & hand sanitizers. In addition, OSM products will become available on the GSA contract schedule through Grainger. The OSM/Bradfield Organics fertilizers offered by Grainger will be manufactured by LOLPF and distributed by Grainger. As this relationship continues to grow and mature, the Company anticipates sales growth and a much larger joint opportunity and positive outlook going forward given the positioning, timing, and USDA BioPreferred designation of these products.

The Garden Guys radio show is still looking to have a key GSA Administrator on the radio show to discuss GSA’s “green initiatives” and how they relate to sales with the US Government through GSA and its partners. The Garden Guys radio show recently interviewed a senior scientist from the United States Department of Energy.

The Company continues to work closely with the USDA (United Stated Department of Agriculture) BioPreferred group by adding its products as new categories are approved for USDA BioPreferred designation (www.biopreferred.gov ). The Company anticipates that as new categories are added by BioPreferred, any of the Company’s applicable items will be later added. In addition, should the Company attain additional funding, it will look to have applicable products become certified by a third party certification group. It currently has a relationship with Green Seal.

The Company continues to work towards growing its business as a registered vendor/supplier for the Department of Defense, as part of the DOD EMALL. The Company is in discussions with an independent sales agent to the DOD and its affiliates. There have not been any orders received to date.

The Company is currently in discussions with a major world wide distributor of fire safety equipment and apparatus about some of its products. These may be sold under the Company’s own OSM brand or a private label. The discussions are still in the developmental stages.

The Company recently entered into a Supplier Service Agreement with IntraMalls LLC of Hunt Valley, MD. The Company will act as a supplier in the NIH IntraMall e-commerce platforms offered to various government or commercial buyers. To date, there have not been any orders received.

The Company currently has in excess of 100 SKU’s in its product line offering. Should other opportunities present themselves whereby the Company can capitalize on immediate sales growth then the Company will carefully evaluate such opportunities provided it has the necessary funds to do so.

In the current market, consumers have become more discretionary in their disposable income since the economic downturn. They have embraced "trading down" as well as searching for better bargains online. This is especially true of the Millennial generation's 70-80 million members (21-33 year olds) who are willing to experiment and are bargain savvy, using electronic media to find the best deals. Since the Company started offering its e-mail newsletter, with weekly coupons, on-line sales have increased by 54 %. The Company anticipates its on-line sales will continue to grow as its products become more mainstream.

The Company continues to ~~maintain~~develop ~~strong,~~relationships ~~strategic~~where ~~relationships~~there ~~with~~is ~~United~~an increasing demand ~~Natural~~for ~~Foods~~consistent ~~(UNFI)~~performance and safe environmental acceptability of eco-products. Should the present “green movement” continue, athe Company ~~leading~~may ~~natural~~be ~~food~~well ~~distributor~~positioned ~~based~~capitalize in ~~Chesterfield~~these sales. Together, NHand ~~servicing~~in ~~over~~conjunction 17with its recent USDA BioPreferred status,~~000~~ ~~customers~~the ~~nationwide~~Company believes ~~and~~that ~~Kehe~~it ~~Foods~~could provide simple, ~~another~~safe ~~leading~~solutions for the replacement of ~~natural~~harmful ~~food~~chemicals ~~distributor~~increasingly ~~based~~being found in ~~Romeoville,~~the ILvarious ~~which~~work ~~services~~places encountered ~~over~~daily 9by such entities as W.W. Grainger,~~000 customers~~ ~~nationwide~~Fisher Scientific and others.

The Company ~~launched~~continues ~~its organic fertilizer products in the spring of 2008 under its Mother Natures CuisineTM with Shaw’s Supermarkets and many Agway Stores. The current economic pressures in addition~~ to maintain an ~~extremely~~e-commerce ~~wet~~internet ~~and~~presence ~~cool~~hosting ~~weather season in the~~five ~~northeast~~different ~~in 2009 had adverse effects on the overall sales. Commitments to carry the fertilizer products still remain from Shaw’s~~sites, ~~Whole Foods, Benny’s Hardware, Rocky’s Ace Hardware, Aubuchon Hardware, Agway, Kehe Foods and many independent~~ www.garden ~~centers~~-guys. Incom ~~addition~~, ~~the Company contracted with Arett Sales, a $150 million lawn, garden and home~~www.mothernaturescuisine.com ~~improvement distributor of 54 years based in Cherry Hill~~, ~~NJ, servicing 20 states and Washington, D~~www.Cosm-inc.com ~~to sell its products. The Company’s organically certified insecticide/fungicide product~~, ~~Garden Guys Garden NEEM,~~ ~~which was first introduced in the spring of 2007, is continually shipping to many of the above named customers in conjunction with the fertilizer products~~www.naturalnevrdull.com ~~Sales of Garden Guys Garden NEEM in 2010 should continue to grow with the additional distribution outlets~~, ~~increased exposure due to advertising~~ and ~~brand~~www.dragonflyorganix.com ~~recognition and on-going discussions with government entities through the Company’s affiliation with the USDA BioPreferred program~~.

ToSince ~~date,~~its ~~Kehe~~participation ~~Distributors,~~in ~~Inc.,~~the ~~has~~USDA ~~only~~BioPreferred ~~sold~~program, ~~the~~this ~~Company’s~~distinction ~~Dragonfly~~continues ~~Organix line of~~to ~~cleaning~~open ~~products,~~doors ~~yet~~for ~~has added~~ the Company’s ~~entire~~into ~~line~~those ofdistributors ~~branded~~who ~~Mother Nature’s~~sell ~~Cuisine~~the ~~line of products which includes, All-Purpose, Flower, and~~national ~~Veggie~~government &through ~~Herb~~GSA ~~five~~(General ~~pound~~Services ~~bagged granular fertilizers~~Administration), Ohor Nostate ~~Deer~~and ~~repellant,~~local ~~Fish~~contracts &and ~~Seaweed~~other ~~liquid~~contracts ~~concentrate~~where ~~fertilizer,~~there ~~four~~may ~~varieties~~be ofan ~~suet~~increased ~~cakes, &~~interest ~~Garden~~for ~~Guys~~USDA BioPreferred ~~Garden~~approved ~~NEEM~~products. ~~Kehe~~When ~~Distributors,~~or ~~Inc.,~~should ~~recently~~additional resources ~~reached~~become anavailable, ~~agreement~~the toCompany ~~purchase~~anticipates ~~Tree~~it ofwill ~~Life,~~apply ~~Inc (see~~for ~~exhibit~~its own GSA 10number.~~23). Distributors~~ Until ~~which~~then, ~~may~~it ~~have~~will ancontinue ~~impact~~to onrely ~~the~~upon ~~Company’s~~distributors ~~future~~and ~~sales~~or inbrokers ~~markets~~with ~~not~~whom ~~currently~~it ~~being~~has ~~sold for or some of the above mentioned products~~relations.

~~In the~~The Company’s ~~structured~~average ~~deal~~monthly ~~between~~sales ~~Northeast~~for ~~Garden~~the quarter ~~Group,~~ending ~~Agway, and Land O’Lakes~~9/~~Purina~~30/2010 increased ~~Feeds~~by ~~with~~5.8% over the ~~Company~~average ismonthly ~~acting~~sales asfor athe ~~representative~~same ~~for~~quarter ~~all sales~~ of ~~Agway’s~~the prior ~~newly~~fiscal ~~launched~~year ~~All-Natural~~and ~~4-Stage~~profit ~~lawn~~margins ~~fertilizer,~~for the ~~Company received~~current afiscal ~~total~~year ~~compensation~~are ofhave steadily ~~$5,000~~increased ~~thousand~~vs. ~~dollars~~the prior fiscal year. This is ~~the first~~due ~~time~~in ~~Agway~~part ~~has~~to ~~ever~~driving down ~~launched~~such ~~their~~costs ~~own~~as ~~branded~~operational ~~natural~~& ~~lawn~~freight ~~fertilizer~~costs, inslotting fees, radio aexpenditures, ~~4-Stage~~and ~~offering~~salary cutbacks. ~~This~~ ~~could~~The ~~also~~Company ~~have~~chose ~~long~~to maintain its largest ~~term~~network ~~positive~~station ~~implications~~while ~~given~~eliminating ~~that~~all ~~Agway~~of ~~continues~~its toother ~~participate~~stations, inthereby ~~the~~eliminating ~~Company’s~~cost ~~media~~and ~~component~~redundancy. In addition, the ~~Garden~~Company ~~Guys~~cut back the amount paid out to its weekly radio ~~show~~talent. The Company continually looks for opportunities to cut costs that don’t impact customer service or product quality.

~~The~~ In ~~Company~~2011, ~~has~~the ~~started~~Company toprojects ~~generate~~a ~~initial~~loss. If, ~~sales~~however, ofthe ~~its~~Company ~~Nev’r Dull commercial brand~~is ofunsuccessful ~~cleaning~~in ~~products~~raising ~~and~~additional ~~anticipates~~capital ~~more~~by ~~significant sales to follow in~~ the ~~boating,~~ ~~automotive~~end ~~and~~of ~~janitorial~~spring ~~industries~~of ~~through 2010 and beyond. The Company continues to receive orders from J. Racenstein Company~~2011, ~~a well known~~the ~~national~~probability ~~distributor~~ of ~~window~~hitting ~~cleaning~~its ~~supplies~~short ~~and~~term isfinancial ~~currently~~goals inwill ~~discussions with~~be ~~other distributors~~seriously impacted.

The Company will continue to use the radio as the primary source for marketing and creating brand awareness of its non-food, and natural product offerings. The Company’s commercials are currently being aired weekly on a Boston based FM talk station. Sam Jeffries, the Company’s President, continues to ~~develop~~host ~~relationships~~a ~~where~~live, ~~there~~weekly isthree anhour ~~increasing~~Sunday ~~demand~~morning garden talk radio ~~for~~show ~~consistent~~which ~~performance~~is currently heard on Greater Media radio 96.9 FM WTKK and ~~safe~~also available ~~environmental~~on ~~acceptability~~the internet via streaming or Podcasts through one of the Company’s ~~eco~~websites, www.garden-~~products~~guys.com . ~~Should~~He shares the ~~present~~responsibility ~~“green~~with ~~movement”~~two ~~continue,~~other ~~the Company~~hosts ~~may~~of behis ~~well~~choosing and ~~positioned~~therefore ~~capitalize~~works inon ~~these~~a ~~sales~~rotating schedule. ~~Together~~Using this allows it to keep listeners informed about the importance of considering natural, organic, chemical-free alternatives, how they should use these products and inwhere ~~conjunction~~they can buy them. This also forges relationships with ~~its~~key ~~recent~~people ~~USDA~~in ~~BioPreferred~~various ~~status~~scopes of business, politics and the general public. Since the Company pays ~~believes~~for ~~that~~the air time, it ~~could~~also ~~provide~~receives ~~simple~~an inventory of commercials which are used as a follow up during the work week to educate consumers about its organic and natural products, ~~safe~~hand ~~solutions~~sanitizers, etc. and where they can purchase these products. This also creates a medium for the ~~replacement~~Company to offset some of its radio ~~harmful~~and ~~chemicals~~related ~~increasingly~~expenses ~~being~~by ~~found~~selling inthe air time to potential sponsors and or advertisers of the ~~various~~radio ~~work~~show. The ~~places~~Company has yet to sell all of the ~~encountered~~inventory ~~daily~~allotted or enough to cover the current costs of the radio. Owned by ~~such~~Greater ~~entities~~Media, asWTKK ~~Grainger~~96.9 FM is the base station. Based in Boston, ~~Fisher~~MA, ~~Scientific~~it ~~and~~is part to one of the largest ~~others~~markets in the country.

As previously noted, the Company has strategic relationships established with key sales representative and distributor organizations in the markets that it services and has developed very strong relationships with several vendors for the fulfillment of its organic liquid and granular fertilizer product lines. The Company plans to vigorously pursue all strategic relationships that enhance its ability to deliver quality non-food, all natural products at reasonable prices.

The Company’s ~~continues~~projected toPlan maintain an e-commerce internet presence hosting five different sites, www.garden-guys.com , www.mothernaturescuisine.com , www.osm-inc.com , www.naturalnevrdull.com , and www.dragonflyorganix.com . The latter is also under the direction of ~~Eye~~Operations ~~Level~~for ~~Solutions,~~2011 ~~a division~~consist of ~~Kehe Distributors, Inc., which offers~~ the ~~Dragonfly~~following: ~~Organix products for sale in over 12,~~(000 ~~e-commerce capable grocery stores nationwide. Acting as distributor, Kehe continues to process and fulfill orders placed. This enables the Company~~’s ~~products to gain~~ ~~shelf presence, without slotting fees, within stores which otherwise may not currently stock these items.~~omitted)

The Company will continue its active participation in various related trade publications and trade shows. Most recent completed shows were; the Massachusetts Conference for Women, Natural Products Expo, Kehe Holiday Trade Show, Insalon 2009 Salon & Spa Trade Show, Arett Seasonal Showcase, Fisher Scientific regional show at University of Iowa, Agway retail buyers show, New Hampshire Hospitality, and the Fisher Science Education show Other shows recently committed to include the New England Grows Lawn & Garden Show, Fisher Scientific National Sales Meeting and Natural Products Expo. Each of these markets are either currently carrying the Company’s products or have expressed interest in them.

	Year 2011
Revenues	$	4,140
Margin		1,209
Selling, General and Administrative Expense		1,198
Net Profit from Operations	$	11

~~Since its~~The ~~participation in the USDA BioPreferred show in June of 2009, the~~ Company ~~has attained~~continues ~~USDA~~to ~~BioPreferred~~rely ~~status~~on ~~for~~invested ~~many~~capital ~~of its commercial cleaning~~ and ~~hand sanitizer~~short-term ~~products~~debt. ~~(see Exhibit~~It ~~10.24 USDA letter dated Oct. 22, 09) This distinction~~also continues to ~~open~~seek ~~doors~~additional ~~for~~financing ~~those~~of ~~distributors who sell the national government through GSA (General Services Administration)~~$2,500,000 orto ~~state~~maintain ~~and~~operations ~~local contracts and~~in ~~other~~2011. ~~contracts~~Additional ~~where~~investor ~~there~~funds ~~may~~will still be anneeded ~~increased~~to ~~interest~~continue ~~for~~to ~~USDA~~expand ~~BioPreferred~~in ~~approved~~2011 ~~products~~and beyond. ~~The~~ ~~Company~~On ~~has~~the ~~shipped~~other ~~orders~~hand, toif the ~~CDC (Center for Disease Control) and Homeland Security. The~~ Company is inunable ~~futher discussions~~to ~~with~~raise ~~other entities within~~ the minimum ~~United~~financing ~~States~~needed ~~government~~in ~~through~~2011, ~~some of~~it ~~its~~would ~~distributors~~likely ~~currently~~exhaust ~~holding GSA contracts~~its resources.

The Company continues to receive orders from Fisher Scientific, its National Laboratory Distributor that sells into the colleges and universities, Hospital and Healthcare Laboratory industries, Educational K-12 and Government services, the Company’s OSM branded line of all natural products to their customer base. The Company is still working with Fisher Scientific to add its products to the Fisher Scientific Safety division, which focuses heavily on municipal and government sales. The Company and Fisher are also finalizing the additions of its fertilizer and other garden related items.

Net cash used in operating activities dropped 18.2% in the current fiscal year vs. the prior fiscal year. This is due in part to driving down such costs as slotting fees, radio expenditures, and salary cutbacks. The Company continually looks for opportunities to cut costs that don’t impact customer service or product quality.

In 2010, the Company projects a loss, however, if sales come in stronger than anticipated, a small profit and positive cash flow from operations are a distinct possibility. If, however, the Company is unsuccessful in raising additional capital by the late spring of 2010, the probability of hitting its short term financial goals will be seriously impacted.

The Company will continue to use the radio as the primary source for marketing and creating brand awareness of our non-food, and natural product offerings. Sam Jeffries, the Company’s President, hosts a live, weekly three hour Sunday morning garden talk radio show which is currently heard on two radio stations in the Northeast and also available on the internet via streaming or Podcasts. Using this allows us to keep listeners informed about the importance of considering natural, organic, chemical-free alternatives, how they should use these products and where they can buy them. This also forges relationships with key people in various scopes of business, politics and the general public. Since the Company pays for the air time, it also receives an inventory of commercials which are used as a follow up during the work week to educate consumers about its organic and natural products, hand sanitizers, etc. and where they can purchase these products. This also creates a medium for the Company to offset some of its radio and related expenses by selling the air time to potential sponsors and or advertisers of the radio show. Essentially, the Company has created its own media network, The Garden Guys, within the New England region. Owned by Greater Media, WTKK 96.9 FM is the base station. Based in Boston, MA, it is part of one of the largest markets in the country.

As previously noted, the Company has strategic relationships established with key sales representative and distributor organizations in the markets that it services and has developed very strong relationships with several vendors for the fulfillment of its organic liquid and fertilizer product lines. The Company plans to vigorously pursue all strategic relationships that enhance its ability to deliver quality non-food, all natural products at reasonable prices.

The Company’s projected Plan of Operations for 2010 consist of the following: (000’s omitted)

CALENDAR

	Year 2010
Revenues	$	3,000
Margin		600
Selling, General and Administrative Expense		700
Net Profit/ (Loss) from Operations		(100	)

In 2010, the Company will likely continue to rely on invested capital and short-term debt to fund operations. The Company continues to seek additional minimum financing of $500,000 to maintain and grow operations in 2010. If operating revenues increase as expected and we attain close to break even in 2010, operations could be able self-sustaining in 2011; however, additional investor funds would still be needed to continue to expand in 2010 and beyond. On the other hand, if we are unable to raise the minimum financing needed in 2010, the Company would likely exhaust its resources in mid 2010.

1.	Revenue Projections

Despite its heavy financial commitment to continually advertise and promote its products to enhance brand awareness, foster customer loyalty and encourage reorders, there can be no guarantee that the products will sell as the Company believes they will, or that the consumer will reorder the products once they have used them.

27Given the most recent an unprecedented economic market, the Company did not reach and fell well short of its 2010 projections. Although the Company has been able to strategically align itself with a multitude of distributors in various retail, wholesale and commercial sectors, it did not anticipate the length of time go to market. The 2011 projections have been made on a product category basis with 82% of projected revenues coming from a combination national distributors in the Federal government, military, laboratory, commercial and industrial sectors, grocery, farm & fleet, private label, hotel & hospitality, and the remaining from a combination of website and radio ad sales:

Given the most recent unprecedented economic market, the Company did not reach and fell well short of its 2009 projections. Although the Company has been able to strategically align itself with a multitude of distributors in various retail, wholesale and commercial sectors, it did not anticipate the length of time to go to market. The 2010 projections have been made on an industry-by-industry basis with 25% of projected revenues coming from a combination of Grocery, Convenience and College Book Stores; 65% from commercial sales including our exclusive National Laboratory Distributor, Fisher Scientific and the remaining 10% from a combination of website, radio ad sales and private label sales. In preparing these projections customers were identified as those currently being shipped, those to whom are about to start shipping and those who have indicated a desire to carry the products at some point during 2010.

Retail Sales	11	%
Commercial Sales	63	%
Private Label Sales	19	%
Other	7	%

In preparing these projections customers were identified as those currently being shipped, those to whom are about to start shipping and those who have indicated a desire to carry the products at some point during 2011. Based upon these assumptions, estimates of how much product would be sold each month and how much the projected dollar revenue would represent on a monthly, quarterly and annual basis.

2.	Expense Projections

Costs of sales were projected based upon the amount of product being sold using the extensive by product costs we had developed for each of our products. As volume increases it is expected that costs will go down as a function of better quantity purchases. Our projections do not, however, take all of these cost ~~reductions~~ reductions into consideration.

General and Administrative costs were projected at 17.5% of revenues, in line with our corporate objective of keeping G&A expenses level as sales increase.

Selling expenses were projected at 15% of revenues. If revenues are higher than projected, more of the additional revenues will be reinvested in further marketing and selling activities. If revenues come in lower than projected, analysis will be done to determine why and, if appropriate, marketing and selling expenses will be reduced or redirected. These expenses include, but are not limited to, radio show costs, display cases, trade shows, commissions, samples, payroll and print media advertising.26

~~The~~Selling ~~Company~~expenses ~~believes~~were ~~that~~projected itat ~~has~~11.4% ~~developed~~of arevenues. ~~careful,~~If ~~well-thought~~revenues ~~out~~are ~~business~~higher ~~plan~~than ~~based~~projected, ~~upon~~more ~~educated~~of ~~assumptions using~~ the ~~most~~additional ~~current~~revenues ~~data~~will ~~available.~~be ~~There~~reinvested ~~is,~~in further ofmarketing ~~course,~~and noselling ~~guarantee~~activities. asIf torevenues ~~how~~come ~~much~~in orlower ~~how~~than ~~often existing or new customers~~projected, analysis will ~~buy The~~be ~~Company~~done ~~also~~to ~~believes~~determine ~~that~~why ~~its~~and, ~~business~~if ~~plan~~appropriate, ~~contains~~marketing and ~~enough~~selling ~~flexibility~~expenses towill ~~weather~~be ~~unforeseen~~reduced ~~delays~~or inredirected. ~~the~~These ~~generation~~expenses ofinclude, ~~revenues~~but byare ~~being~~not ~~able~~limited to, ~~modify~~radio ~~expenses~~show ~~and~~costs, ~~other~~display ~~spending~~cases, astrade ~~required~~shows, ~~assuming minimum~~commissions, ~~financing~~samples, ispayroll ~~obtained~~and ~~by mid 2010~~advertising.

The Company believes that it has developed a careful, well-thought out business plan based upon educated assumptions using the most current data available. There is, of course, no guarantee as to how much or how often existing or new customers will buy. The Company also believes that its business plan contains enough flexibility to weather unforeseen delays in the generation of revenues by being able to modify expenses and other spending, as required, assuming minimum financing is obtained by the spring of 2011.

There can be no assurance that the Company’s actual operations will reflect the above projections. Market conditions, competition, supplier delays, the ability to raise capital and all other risks associated with the operation of a business could adversely impact the Company’s ability to reach the above projections.

The Company anticipates that in order to fulfill its plan of operations, it will need to attract additional key markets to sell its natural cleaning and gardening products, and continue to leverage its other business relationships. The Company continues to receive orders and re-orders from the various outlets in which it is positioned. In addition, the recent ~~H1N1~~emphasis ~~concern~~on ~~across~~Executive ~~the~~Order ~~country~~#13514 ~~has~~may ~~created~~create additional sales opportunities for the Company’s products through existing distributor, broker and on-line relationships.

28To fulfill orders in a timely fashion, the Company must have the capability of producing and delivering its cleaning and gardening products in sufficient volume and quantity to achieve its projections. The Company will rely on LOL/Purina Feed to fulfill its fertilizer requirements. In addition, it will continue to outsource its fulfillment of liquid products to Webco Chemical Co., located in Dudley, Massachusetts and possibly others. It believes that these contract manufacturers have the capacity and ability to handle any and all requirements that the Company may have and more, over the next five years. As a backup, the Company also has made arrangements with JNJ Industries, located in Franklin, MA. The Company has also made arrangements with LOL/Purina and RitePak of St. Joe, MO to fulfill its distribution needs for potential orders that will require different sizes and quantity of dry fertilizer products.

ToIn ~~fulfill~~addition ~~orders~~to ~~in a timely fashion,~~ the ~~Company~~minimum ~~must~~financing ~~have~~needed ~~the~~by ~~capability~~spring of ~~producing~~ ~~and~~2011, ~~delivering~~the ~~its~~Company ~~cleaning and gardening products in sufficient~~will ~~volume~~need ~~and~~to ~~quantity~~continue to ~~achieve~~seek ~~its~~financing ~~projections. To~~from ~~satisfy~~outside ~~this requirement,~~sources ~~for~~to ~~the~~expand ~~past two plus years~~ the ~~Company has outsourced its~~business ~~fulfillment~~further ~~operation~~into to2011 ~~Webco~~and ~~Chemical Co~~beyond., In ~~located~~order into ~~Dudley,~~provide ~~Massachusetts.~~this necessary Itadditional ~~believes~~financing, ~~that Webco has~~ the ~~capacity~~Company ~~and~~intends ~~ability~~ to ~~handle~~offer ~~any~~private ~~and all~~placement ~~requirements~~opportunities ~~that~~to ~~the~~investors ~~Company~~in ~~may~~an ~~have~~as ~~and~~yet ~~more,~~undetermined ~~over the next five years~~amount. ~~As a backup, the~~ The Company ~~also~~ has ~~made~~no ~~arrangements with JNJ Industries~~basis, ~~located in Franklin~~however, ~~MA. The Company is also in discussions with LOL/Purina to potentially satisfy its distribution and manufacturing needs~~ for ~~potential~~predicting ~~orders~~the ~~that~~success ~~may~~of ~~require~~such ~~larger sizes and~~other ~~quantity of product~~offerings.

In addition to the minimum financing needed by mid 2010, the Company will need to continue to seek financing from outside sources to expand the business into 2010 and beyond. In order to provide this necessary additional financing, the Company intends to offer private placement opportunities to investors in an as yet undetermined amount. The Company is currently undergoing a private offering to raise $500,000 dollars. The Company has no basis, however, for predicting the success of such an offering.27

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

·¨ Risks Related To Our Business and Operations

·¨ Economic or industry-wide factors relevant to the Company:

Should consumer interest in "organic" or "natural" products diminish or discontinue; should there be a natural disaster that adversely impacts garden center product sales such as extreme weather conditions throughout the United States; should there be a shortage of suppliers in the enzyme technology that is used in some of our products or should there be a slower than anticipated roll-out of products to customers due to such external factors, the Company's ability to realize a profit and yield a positive cash flow from operations as quickly as we anticipate could be adversely impacted.

·¨ Material opportunities, challenges:

Should our suppliers not be able to deliver in the quantities the Company needs at any given time in order to fulfill orders; should our contract manufacturer not be able to deliver finished goods in a timely manner or suffer any type of physical plant disaster, labor strike or shortage, it would adversely impact the Company's' business. Difficult challenges may be incurred as more competitors, who are more heavily financed than we are, enter into the market and create pricing issues which could adversely impact the Company's operations.

29¨ Risks in short and long term and the actions we are taking to address them:

·Undercapitalization could ~~Risks~~impose ingrowth ~~short~~restraints on the Company preventing us from entering other markets and ~~long~~regions, ~~term~~as planned. The Company will continue to actively pursue private placement investor funding as allowed by SEC regulations and to satisfy debt and payables with stock, stock options and/or warrants as a means of capitalizing the ~~actions~~Company weuntil operations are ~~taking~~sufficient enough to ~~address~~be self-sustaining, ~~them:~~which could happen by the end of 2011. There can be no assurance, however, that these activities will be successful.

Undercapitalization could impose growth restraints on the Company preventing us from entering other markets and regions, as planned. The Company will continue to actively pursue private placement investor funding as allowed by SEC regulations and to satisfy debt and payables with stock, stock options and/or warrants as a means of capitalizing the Company until operations are sufficient enough to be self-sustaining, which could happen by the end of 2009. There can be no assurance, however, that these activities will be successful.

If Sam Jeffries were unable to host and produce the weekly talk show, this could have an adverse impact on the show's educational and promotional programming which is considered an essential part of our advertising and marketing plan. The present co-hosts, Jim Zoppo and Layanee DeMerchant, could produce and conduct the show in Sam Jeffries absence. In addition, Jim Zoppo, is a well respected, well known horticulturist and radio talk show host in his own right.

Although unlikely, interest in organics could diminish which would have an adverse effect on the popularity of the radio show. To mitigate this possibility, "home remedy", "how to" and "natural and organic health-care alternative” segments are being added to the shows programming to expand listener interest and extend the seasonality of the show. The Company also has plans to ultimately reach a national audience by franchising the Garden Guys concept throughout the country by having local talk shows discuss organics and lawn and gardening techniques and problems indigenous to each of those regions.

~~· Reliance on Investment Funds~~28

We¨ ~~just recently~~Reliance ~~started to receive meaningful cash flow from customer sales. We expect that for the short term future, we will still rely~~ on ~~external~~Investment funding sources, primarily equity capital, to finance our operations. While we believe that increasing cash flow from customer sales will ultimately provide adequate funds to permit us to become self-sufficient, possibly, by the end of 2009; until then, we will continue to require additional capital from investors. If we were unable to obtain such funding from outside sources, we would likely be forced to reduce the level of our operations and business failure could become a real possibility.Funds

·Although the ~~Reliance~~Company has increased its cash flow from customer sales, we expect that for the short term future, we will still rely on ~~Management~~external ~~Team~~funding sources, primarily equity capital, to finance our operations. While we believe that increasing cash flow from customer sales will ultimately provide adequate funds to permit us to become self-sufficient, possibly by the end of 2011, until then we will continue to require additional capital from investors. If we were unable to obtain such funding from outside sources, we would likely be forced to reduce the level of our operations and business failure could become a real possibility.

¨	Reliance on Management Team

As stated above, the Company relies heavily upon a small team of full-time officers and consultants. It has "key man" life insurance on the CEO, Samuel Jeffries that would compensate us in the event of his demise. Sam Jeffries continued involvement is deemed especially critical to our marketing efforts. The loss of Sam Jeffries or one of several key officers or consultants could have an adverse impact on the Company's chances for success. At present, "key man" insurance coverage is not being pursued on the other full-time officers due to cost.

30o Risks Related to Ownership of Our Stock

·¨ ~~Risks~~Trading ~~Related to Ownership of Our Stock~~Market

· Trading Market

Our stock officially began trading on Monday, May 5, 2008 on the Over The Counter Electronic Bulletin Board under the trading symbol; OGSM. Even with our shares being traded publicly, there is a substantial "overhang" of outstanding shares that would be eligible for sale under Rule 144. Such sales, if they were to occur, could tend to suppress the market value of our shares for some time.

·¨ No Dividends in Foreseeable Future

Our board of directors determines whether to pay cash dividends on our issued and outstanding shares. Such determination will depend upon our future earnings, our capital requirements, our financial condition and other relevant factors. At present, our board is not intending to declare any dividends in the foreseeable future. Earnings, once achieved, are expected to be retained to help finance the growth of our business and for general corporate purposes.

·¨ Provisions of our Certificate of Incorporation, By-laws and Delaware Law

Provisions of our Certificate of Incorporation, By-laws and Delaware law may make it more difficult for someone to acquire control of us or for our stockholders to remove existing management, and might discourage a third party from offering to acquire us, even if a change in control or in management would be beneficial to our stockholders. For example, our Certificate of Incorporation allows us to issue different series of shares of common stock without any vote or further action by our stockholders and our Board of Directors has the authority to fix and determine the relative rights and preferences of such series of common stock. As a result, our Board of Directors could authorize the issuance of a series of common stock that would grant to holders the preferred right to our assets upon liquidation, the right to receive dividend payments before dividends are distributed to the holders of other common stock and the right to the redemption of the shares, together with a premium, prior to the redemption of other series of our common stock.

ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

For the Financial Statements required by Item 8 see the Financial Statements included at the end of this Form 10-K.

ITEM 9.

CHANGES IN AND DISAGREEMENT WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURES.

The Company changed audit firms for the fiscal year ended September 30, 2010 to Morrill & Associates. There have been no changes in or disagreements with accountants with respect to accounting and/or financial disclosure.

ITEM 9A. CONTROLS AND PROCEDURES.

~~Item~~We 9Amaintain disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required financial disclosures. ~~Controls~~ Because of inherent limitations, our disclosure controls and ~~Procedures~~procedures, no matter how well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of such disclosure controls and procedures are met.

~~We maintain~~As ~~disclosure~~of ~~controls and procedures that are designed to ensure that information required to be disclosed in our reports made pursuant to~~ the ~~Securities~~end ~~Exchange Act~~ of ~~1934, as amended (~~the ~~“Exchange~~period ~~Act”).~~covered isby ~~recorded, processed,~~this ~~summarized~~Report ~~and~~we ~~reported~~conducted ~~within~~an ~~the~~evaluation, ~~timelines~~under ~~specified in~~ the ~~Securities~~supervision and ~~Exchange~~with ~~Commission’s~~the ~~rules~~participation ~~and~~of ~~forms, and that such information is accumulated and communicated to~~ our management, including our principal ~~Chief~~executive ~~Executive Officer~~officer and ~~Chief~~principal ~~Financial~~financial ~~Officer~~officer, asof ~~appropriate, to allow timely decisions~~the ~~regarding~~effectiveness ~~required~~of ~~disclosure. In designing and evaluating~~ the ~~disclosure controls~~design and ~~procedures,~~operation ~~management~~of ~~recognized~~our ~~that~~disclosure ~~any~~ controls and ~~procedures,~~ noprocedures ~~matter~~pursuant ~~how~~to ~~well~~Exchange ~~designed~~Act Rules 13a-15(b) and ~~operated, can only provide reasonable assurance~~ of15d-15(b). Based ~~achieving~~on ~~the~~this ~~desired control objectives~~evaluation, ~~and~~our inprincipal ~~reaching~~executive ~~a reasonable level~~officer ofand ~~assurance,~~principal ~~management~~financial ~~necessarily~~officer ~~was~~concluded ~~required~~that toour ~~apply~~disclosure ~~its~~controls ~~judgment in~~and ~~evaluating~~procedures ~~the~~were ~~cost-benefit~~ineffective ~~relationship~~as of ~~possible~~September ~~controls~~30, ~~and procedures~~2010.

AsThere ~~required~~were byno ~~Rule 13a-15(b)~~changes ~~under~~in ~~the~~our ~~Exchange~~internal ~~Act,~~controls weover ~~carried~~financial ~~out~~reporting ~~an evaluation,~~(as ~~under~~such ~~the supervision and with the participation of our management,~~term ~~including~~is ~~our~~defined ~~Chief~~in ~~Executive~~Rule 13a-15(f) ~~Officer~~under ~~and Chief Financial Officer, of~~ the ~~effectiveness~~ ofExchange ~~the~~Act) ~~design~~that ~~and~~occurred ~~operation of~~ during our ~~disclosure controls and procedures as of the end of the~~ year ~~covered~~ended bySeptember ~~this~~30, ~~report. Based on the foregoing~~2010, ~~our Chief Executive Officer and Chief Financial Officer concluded~~ that ~~our~~have ~~disclosure~~materially ~~controls~~affected, ~~and~~or ~~procedures were not effective as of the end of~~are ~~the~~reasonably ~~period~~likely ~~covered~~to bymaterially ~~this~~affect, ~~report~~our ininternal ~~timely~~controls ~~alerting~~over ~~them to material~~financial ~~information~~reporting. ~~relating~~As ~~to Organic Sales and Marketing~~such, ~~Inc.~~because ~~required to be disclosed in our periodic reports with~~ the ~~Securities~~Company ~~and~~maintains ~~Exchange Commission. As~~ a ~~result~~small ofoffice ~~this~~staff ~~conclusion,~~it maintains wethat ~~have initiated~~ the ~~remedial~~internal ~~actions~~controls ~~disclosed below~~are ineffective.

Management’s Report on Internal Control over Financial Reporting

Our Chief Executive Officer and Chief Financial Officer are responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) of the Exchange Act.

Internal control over financial reporting is promulgated under the Exchange Act as a process designed by, or under the supervision of, our Chief Executive Officer and Chief Financial Officer and effected by our board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:

• Pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;

• Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and

• Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition or disposition of our assets that could have a material effect on the financial statements.

Readers are cautioned that internal control over financial reporting, no matter how well designed, has inherent limitations and may not prevent or detect misstatements.

Therefore, even effective internal control over financial reporting can only provide reasonable assurance with respect to the financial statement preparation and presentation.

Our management, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our internal controls over financial reporting as of the end of the period covered by this report. .

As a result of this evaluation we identified a material weakness in our internal controls over financial reporting relating to the recording of a non-cash transaction in the financial statements.

A material weakness is a control deficiency, or a combination of control deficiencies, that results in a more than remote likelihood that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected. Management has concluded that a material weakness existed in the following area as of September 30, 2009:

· A consulting agreement with NU Vision Holdings LLC that was paid for with stock in lieu of cash had been erroneously misfiled, and an entry to book the transaction was not recorded until the annual audit.

The following remedial actions have been undertaken to prevent this from reoccurring:

· All contracts or agreements, whether paid in cash or with stock, will now be placed in a specific location in the Chief Financial Officer’s office with a check list cover letter that requires both the Chief Executive Officer and Chief Financial Officer to sign off that different requirements, including in this case, the booking of the entry, have taken place before the document can be filed.

In addition, because the Company maintains a small office staff it was not able to timely handle the absence of the Chief Financial Officer when he had major open heart surgery at the end of the fiscal year. This resulted in some minor control deficiencies in the handling of office documentation which will now be mitigated in the future, should there be another extended absence, by hiring a qualified temporary replacement.

Organic Sales and Marketing, Inc. continues the process to complete a thorough review of its internal controls as part of its preparation for compliance with the requirements of Section 404 of the Sarbanes-Oxley Act of 2002. Section 404 requires our management to report on, and our external auditors to attest to, the effectiveness of our internal control structure and procedures for financial reporting. As a non-accelerated filer under Rule 12b-2 of the Exchange Act, our first report under Section 404 as a smaller reporting company will be contained in our Form 10-K for the period ended September 30, 2010.

This annual report does not include an attestation report of the company’s independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the company’s registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the company to provide only management’s report.

Despite these material weaknesses, management believes that the consolidated financial statements are fairly stated in all material respects as of and for the year ended September 30, 2009.

There were no changes in our internal controls over financial reporting (as such term is defined in Rule 13a-15(f) under the Exchange Act) that occurred during our year ended September 30, 2009, that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

ITEM 9B. OTHER INFORMATION.

None.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, ~~PROMOTERS~~ AND ~~CONTROL~~CORPORATE ~~PERSONS~~GOVERNANCE

A.	Directors and Executive Officers

The following table sets forth our current directors, officers and significant employees, their ages, and all offices and positions with our company.

NAME	AGE	POSITION
Samuel F.H. Jeffries	48	President, Chief Executive Officer and Chairman of the Board of Directors
Stephen B. Jeffries '	49	Director and Audit Committee Member
Stephen B. Jeffries	49	Director and Audit Committee Member
Leonard B. Colt, Jr.	73	Director~~, Secretary~~
Jerry Adelstein	77	Director
Joanne L.H. Anderson	52	Director, ~~vice~~Vice President
Laurie Basch-Levy	56	Director and Audit Committee Member
Mark J. McEvoy	57	Treasurer and Chief Financial Officer
Michael Ernst.	52	Director, Secretary
Keith D. Lowey	49	Treasurer and Chief Financial Officer

The following is a biographical summary of our directors and officers:

Samuel F.H. Jeffries has been president, Chief Executive Officer, and Chairman of the Board of Directors since inception. He is also a member of the Executive Committee. Prior to such time, he was president and co-managing member of Garden Connections, LLC, from its inception in 2002. From 1999 to 2001, Mr. Jeffries was Eastern Regional Sales Manager and area manager for Etera Corporation, a wholesale garden products distributor based in Mount Vernon, Washington. His responsibilities included sales, management, forecasts, hiring, computer training, new accounts, budgeting, advertising and promotions. From 1992 to 2000, Mr. Jeffries owned and operated Jeffries Horticultural Sales and Jeffries Landscape and Design, based in Franklin, Massachusetts. In 1984, Mr. Jeffries received his Bachelor of Science degree in environmental design from the University of Massachusetts at Amherst. He minored in arboriculture. He was also a certified Occupational Education instructor at the Norfolk County Agricultural High School, Walpole, MA. He is the first cousin of Stephen B. Jeffries, a director.

Joanne L.H. Anderson, Director, Vice President and member of the Executive Committee. She has been a director of the Company since May, 2005 and is utilizing her artistic designing talents in creating our logos, labels, packaging and our websites. She also oversees the Company's advertising and marketing. Since 1980, Joanne has been employed as an artist, designer, and head of the art department of North American Carrousel Company located in Minneapolis, Minnesota. She is experienced in website design and graphic and commercial art. She is trained as an artistic painter, sculptor and art conservationist. She apprenticed for four years with leading portrait artist Jerome Ryan. She majored in art at Hamline University in Saint Paul, Minnesota and has restored paintings and ceilings in the Minnesota State Capital and St. Paul Courthouse.

Len Colt, has been our director since the inception. Since 1993, he has been owner of Pegasus Marketing & Sales based in Little Compton, Rhode Island. Pegasus is in the packaging consultancy firm and sales representative for various packaging manufacturers. In 1958, Mr. Colt received his bachelor of arts degree in history from Middlebury College located in Middlebury, Vermont.

Jerry Adelstein, has been a director since the inception and is a member of the Audit Committee and the Executive Committee. Since 1968, he has been the president of H&J Associates, a textile sales company, based in Long Island, New York. In 1953, he received a bachelor of science in economics from Alfred University, in New York State. In 1957, he received a Masters degree in business administration with a major in economics from New York University.

Stephen B. Jeffries, has been a director since the inception. He is also on the Audit Committee. He has been the owner of S.B. Jeffries Consultants since 1990. S.B. Jeffries Consultants is based in Boston, Massachusetts, and is in the business of equity analysis and financial portfolio and estate management. In 1983, he received a Bachelor of Arts in Economics from the University of Chicago. He has completed the C.F.A. Level 1 Examination and C.F.P. Level 1 Examination.

Laurie Basch-Levy, Director and a member of the Audit Committee. She has been a textile designer, creating designs widely used by major fashion designers in New York City until 1982 when she became treasurer of The George Basch Co. In January 2001 she became President and CEO of The George Basch Co., a privately owned manufacturer and global distributor of the product Nevr-Dull Metal Polish, which was formed in and has operated since 1929. This may give rise to a potential conflict inasmuch as the Company has a business relationship with Nevr-Dull and has a licensing agreement with them (see "Business of the Company", above). Ms. Basch-Levy and the Company will endeavor to avoid any such conflict by excluding her from any decision making or Board votes referable to Nevr-Dull. She received her degree from the Fashion Institute of Technology in New York City.

Michael Ernst, Director, since the inception. He has been Senior Energy Consultant, Tetra Tech Ec Inc., an engineering and consulting firm since 2006; Vice President of Permitting and Siting for TransEnergie U.S. Ltd. 2001-2006 specializing in environmental engineering; Associate Attorney, Rubin & Rudman, Boston, specializing in environmental law; General Counsel and Legislative Director of the Massachusetts Department of Telecommunications and Energy, 1992-2001; Hearing Officer for the Massachusetts Energy Facilities Siting Board, 1990-1992; Counsel to the Joint Committee on Energy of the Massachusetts Legislature, 1984-1990; Safe Energy Advocate, MASSPIRG, 1981-1983. He received his degrees from Northeastern University School of Law, J.D., and Davidson College, B.S.

~~Mark~~Keith JD. ~~McEvoy~~ Lowey was elected Treasurer and Chief Financial Officer on ~~November~~May 156, ~~2006.~~ 2010. He has ~~practiced~~been in ~~the~~public ~~accounting profession for 32 years, during which period he owned~~ and ~~operated~~private anpractice ~~Accounting~~in ~~and~~the ~~Tax~~accounting ~~practice~~field ~~from~~for ~~1986 to 1996~~24 years. He ~~graduated~~ ~~from~~joined ~~Bentley~~his ~~College~~current infirm ~~1977~~as ~~with~~ a ~~Bachelor's~~Principal ~~degree~~ in ~~Accounting.~~ ~~Immediately~~1990. He ~~prior~~has towide-ranging ~~joining~~expertise ~~the~~in ~~Company he served 5 years as the CFO of WareRite Distributors~~accounting, ~~Inc.~~consulting ~~a fabricator of~~ and business ~~distributor~~advisory ofservices ~~laminate countertop~~across ~~products~~many industries.

B. Significant Employees.

We intend to enter into employment agreements with our officers and significant employees, but we have not yet done so.

C. Family Relationships. Samuel F.H. Jeffries and Stephen B. Jeffries are first cousins.

D. Involvement in Certain Legal Proceedings. None

E.	The Executive Committee and the Audit Committee of the Board are separate committees.

The Executive Committee consists of our independent directors. Its principal functions are to advise and make recommendations to our Board of Directors regarding matters relating to the compensation of officers and senior management.

The Audit Committee consists of Stephen B. Jeffries, Jerry Adelstein and Laurie Basch-Levy. The Board of Directors has determined that all three members are independent directors as (1) defined in Rule 10A-3(b)(i)(ii) under the Securities Exchange Act of 1934 (the "Exchange Act") and (ii) under Section 121 B(2)(a) of the AMEX Company Guide (although our securities are not listed on the American Stock Exchange or any other national exchange). Stephen B. Jeffries serves as the financial expert as defined in Securities and Exchange Commission rules relating to the Audit Committee.

We believe Messrs. Adelstein and Jeffries and Ms. Basch-Levy to be independent of management and free of any relationship that would interfere with their exercise of independent judgment as members of this committee. The principal functions of the Audit Committee are to (i) assist the Board in fulfilling its oversight responsibility relating to the annual independent audit of our consolidated financial statements, the engagement of the independent registered public accounting firm and the evaluation of the independent registered public accounting firm's qualifications, independence and performance (ii) review the reports or statements as may be required by the securities laws, (iii) assist the Board in fulfilling its oversight responsibility relating to the integrity of our financial statements and financial reporting process and our system of internal accounting and financial controls, (iv) discuss the financial statements and reports with management, including any significant adjustments, management judgments and estimates, new accounting policies and disagreements with management, and (v) review disclosures by independent accountants concerning relationships with us and the performance of our independent accountants.

F.	Meetings of the Board and Committees.

Our Board of Directors is responsible for the management and direction of our company and for establishing broad corporate policies. A primary responsibility of the Board is to provide effective governance over our affairs for the benefit of our stockholders. In all actions taken by the Board, the Directors are expected to exercise their business judgment in what they reasonably believe to be the best interests of our company. In discharging that obligation, Directors may rely on the honest and integrity of our senior executives and our outside advisors and auditors.

The Board of Directors and the Audit Committee of the board meet periodically throughout the year to receive and discuss operating and financial reports presented by our executive officers as reports by experts and other advisors.

The Board held meetings during the fiscal year ended September 30, ~~2009~~2010 in person and telephonically and acted by unanimous written consent on one ~~occasions~~occasion. In ~~fiscal~~ ~~2009~~fiscal 2010, the Audit Committee met telephonically on ~~February~~May 256, ~~2009~~ 2010.

G.	Compliance with Section 16(a) of The Securities Exchange Act of 1934.

To our knowledge, during the fiscal year ended September 30, ~~2009~~2010, based solely on a review of such materials as are required by the Securities and Exchange Commission, no officer, director or beneficial holder of more than ten percent of our issued and outstanding shares of Common Stock failed to timely file with the Securities and Exchange Commission any form or report required to be so filed pursuant to Section 16(a) of the Securities Exchange Act of 1934.

3533

ITEM 11.

EXECUTIVE COMPENSATION.

The following table sets forth the aggregated compensation awarded to, earned by or paid to our Chief Executive Officer and our other executive officers as a group, or to directors for all services rendered in all capacities.

SUMMARY COMPENSATION TABLE

												Change in
Name and Principal		Salary		Bonus		Stock Awards		Option Awards		Non-Equity Incentive plan Compensation		Change in Pension Value and Nonqualified Deferred Compensation Earnings		All Other Compensation		Total
												Pension Value
												and Nonqualified
										Non-Equity		Deferred
Name and						Stock		Option		Incentive plan		Compensation		All Other
Principal		Salary		Bonus		Awards		Awards		Compensation		Earnings		Compensation		Total
Position	Year	($)		($)		($)		($)		($)		($)		($)		($)
(a)	(b)	(c)		(d)		(e)		(f)		(g)		(h)		(i)		(j)
Sam Jeffries	2010		14,107		-0-		-0-		-0-		-0-		-0-		-0-		14,107
Sam Jeffries	2009		51,108		-0-		-0-		-0-		-0-		-0-		6,000		57,108
Sam Jeffries	2008		73,049		-0-		-0-		-0-		-0-		-0-		6,000		79,049

All officers and directors as a group were paid in the aggregate $~~160~~51,~~901~~276 for the fiscal year ended September 30, ~~2009~~2010.

36ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

~~ITEM~~The following 12table sets forth, as of December 2, 2010 certain information with respect to the beneficial ownership of the common stock by (1) each person known by us to beneficially own more than 5% of our outstanding shares, (2) each of our directors, (3) each named executive officer and (4) all of our executive officers and directors as a group. Except as otherwise indicated, each person ~~SECURITY~~listed ~~OWNERSHIP~~below OFhas ~~CERTAIN~~sole ~~BENEFICIAL~~voting ~~OWNERS~~and ~~AND~~investment ~~MANAGEMENT~~power with respect to the shares of common stock set forth opposite such person's name.

The following table sets forth, as of December 17, 2008 certain information with respect to the beneficial ownership of the common stock by (1) each person known by us to beneficially own more than 5% of our outstanding shares, (2) each of our directors, (3) each named executive officer and (4) all of our executive officers and directors as a group. Except as otherwise indicated, each person listed below has sole voting and investment power with respect to the shares of common stock set forth opposite such person's name.

Name	Shares		% of O/S Stock
Samuel F.H. Jeffries		1,390,500		10.0	%
Stephen B. Jeffries		732,203		5.3	%
Leonard B. Colt, Jr.		171,938		1.2	%
Jerry Adelstein		1,158,565		8.4	%
Joanne L.H. Anderson		256,940		1.9	%
Laurie Basch-Levy		355,000		2.6	%
Michael Ernst.		62,000		0.4	%
Keith D. Lowey		200,000		1.4	%

All Executive Officers and Directors as a Group (8 persons)		4,327,146		31.3	%

Samuel F.H. Jeffries	1,390,500	13.9	%
Stephen B. Jeffries	732,203	7.3	%
Leonard B. Colt, Jr.	171,938	1.7	%
Jerry Adelstein	1,158,565	11.6	%
Joanne L.H. Anderson	256,940	2.6	%
Laurie Basch-Levy	355,000	3.6	%
Michael Ernst.	62,000	.6	%
All Executive Officers and Directors
as a Group (7 persons)	4,127,146	41.3	%

(1) Beneficial ownership so determined in accordance with the rules of the Securities and Exchange Commission. Unless otherwise indicated, this column reflects amounts as to which the beneficial owner has sole voting power and sole investment power.

Applicable percentage of ownership is based on 913,~~990~~840,~~072~~722 shares of our common stock outstanding on December 1531, ~~2009~~2010.

The address of each of the executive officers and directors is care of Organic Sales and Marketing, Inc. 114 Broadway, Raynham, MA 02767.

The Company has not granted any of the following during or after its fiscal year ended September 30, ~~2009~~2010:

Grants of Plan-Based Awards

Equity Awards

Nonqualified Deferred Compensation

The Company anticipates that its Executive Committee will develop and establish clear compensation policies and procedures for disclosing these policies.

37ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

~~ITEM~~Jerry Adelstein, 13a director of the company, held a demand note dated March 1, 2007 with a principal balance due as of January 21, 2010 of $116,197. On January 21, ~~CERTAIN~~2010, ~~RELATIONSHIPS~~the ~~AND~~Company’s ~~RELATED~~Board ~~TRANSACTIONS~~authorized the conversion of $102,000 of principal and accrued interest to common stock and issued a new promissory note for balance in the amount of $14,197. The new promissory note of $14,197 carries an interest rate of 8% per annum, is payable monthly at $1,000 per month beginning February 21, 2010, matures March, 2012 and is unsecured. Monthly payments on the note were not made through September 30, 2010. Total principal payments during the period were $300. As of September 30, 2010, accrued interest owed on the new promissory note was $809. As of September 30, 2010, accrued interest and principal owed on the Note was $14,706.

~~We pay~~Leonard $1Colt,~~000~~ ~~per~~a ~~year~~director toof ~~Jeffries~~the ~~Landscape~~company, &holds ~~Design (~~a ~~company~~demand ~~owned~~note bydated March 15, ~~Samuel~~2008 with a Fprincipal balance due as of September 30, 2010 of $10,855.H. ~~Jeffries)~~This ~~for~~note is payable monthly by the ~~storage~~Company in the amount of ~~certain~~$1,020 ~~products~~with weinterest ~~sell~~at the rate of 6% per annum. As of September 30, 2009, interest and principal owed on the Note was $12,544.

~~Jerry~~Laurie ~~Adelstein~~Basch-Levy, a director of the company, holds a ~~demand~~12 month promissory note dated December ~~March~~ 1, 2007 with a principal balance due as of September 30, ~~2009~~2010 of $~~103~~175,~~747~~000. ~~This~~Interest ~~note~~accrues isat 12% per annum. Accrued interest and principal was ~~payable~~due ~~monthly~~at bymaturity, December 1, 2009, however, the ~~Company~~note inholder has agreed to extend the ~~amount~~maturity ofdate ~~$1,000~~given ~~with~~the ~~interest~~same atterms and conditions as the ~~rate~~original note. ofEarly 6%indications ~~per~~are ~~annum~~that the maturity date will be extended for an additional twelve months subject to Board approval in January 2011. As of September 30, ~~2009,~~2010 ~~accrued~~ interest and principal owed on the ~~Note~~note was $~~114~~250,~~078~~900.

~~Leonard Colt~~Samuel Jeffries, aCEO ~~director~~and Chairman of the Board of Directors of the company, ~~holds~~held a demand note dated ~~March~~January 151, ~~2008~~ 2009 with a principal balance due as of ~~September~~January 3021, ~~2009~~2010 of $10363,~~855~~356. On ~~This~~January 21, ~~note~~2010, isthe ~~payable monthly~~Company’s byBoard authorized the ~~Company~~conversion of $266,000 of principal and accrued interest to common stock and issued a new promissory note for the balance in the amount of $197,~~020~~356. ~~with~~The ~~interest~~new atpromissory ~~the~~note of $97,356 carries an interest rate of 68% per annum., is payable monthly at $1,558 per month beginning February 21, 2010, matures January, 2017 and is unsecured. As of September 30, ~~2009~~2010, interest and principal owed on the Note was $11246,~~815~~436.

Laurie Basch-Levy, a director of the company, holds a 12 month promissory note dated December 1, 2007 with a principal balance due as of September 30, 2009 of $175,000. Interest accrues at 12% per annum. Accrued interest and principal was due at maturity, December 1, 2008, however, the note holder has agreed to extend the maturity date for an additional twelve months given the same terns and conditions as the original note. Early indications are that the maturity date will be extended for an additional twelve months subject to Board approval in January 2010. As of September 30, 2009 interest and principal owed on the note was $222,533.35

~~Samuel Jeffries,~~ITEM ~~CEO and Chairman of the Board of Directors of the company, holds a demand note dated January 1, 2009 with a principal balance due as of September 30, 2009 of $206,134~~14. ~~Monthly payments are not required and interest~~ ~~accrues~~PRINCIPAL atACCOUNTING 6%FEES ~~per~~AND ~~annum~~SERVICES. ~~The note matures on January 30, 2010. As of September 30, 2009, interest and principal owed on the Note was $208,608.~~

38All audit and professional services provided by Certified Public Accountants will be approved in advance by the Audit Committee to assure such services do not impair the auditor's independence from us. The aggregate fees billed by Morrill & Associates were $29,332 for the fiscal year ended September 30, 2010 and by the previous audit firm of $31,632 for the fiscal year ended September 30, 2009.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

Description of Fees	2010		2009
Audit Fees	$	29,332	$	31,632
Audit-Related Fees		-		-
Tax Fees		-		-
All Other Fees		-		-
Total	$	29,332	$	31,632

All audit and professional services provided by Certified Public Accountants will be approved in advance by the Audit Committee to assure such services do not impair the auditor's independence from us. The aggregate fees billed by Chisholm, Bierwolf, Nilson & Morrill were $31,632 and $9,278 for the fiscal years ended September 30, 2009 and 2008, respectively.

Description of Fees	2009		2008
Audit Fees	$	31,632	$	9,278
Audit-Related Fees		-0-		-0-
Tax Fees		-0-		-0-
All Other Fees		-0-		-0-
Total	$	31,632	$	9,278

Audit Fees

Represent fees for professional services provided for the audit of our annual financial statements, services that are performed to comply with generally accepted auditing standards, and review of our financial statements included in our quarterly reports and services in connection with statutory and regulatory filings.

Audit-Related Fees

Represent the fees for assurance and related services that are reasonably related to the performance of the audit or review of our financial statements. ~~The Board of Directors considers to be well qualified to serve as our independent public accountants.~~

The Audit Committee will pre-approve all auditing services and the terms thereof {which may include providing comfort letters in connection with securities underwriting) and non-audit services (other than non-audit services prohibited under Section 10A{g) of the Exchange Act or the applicable rules of the SEC or the Public Company Accounting Oversight Board) to be provided to us by the independent auditor; provided, however, the pre-approval requirement is waived with respect to the provisions of non-audit services for us if the "de minimus" provisions of Section 10A(i) (1)(B) of the Exchange Act are satisfied. This authority to pre-approve non-audit services may be delegated to one or more members of the Audit Committee, who shall present all decisions to pre-approve an activity to the full Audit Committee at its first meeting following such decision. The Audit Committee may review and approve the scope and staffing of the independent auditors' annual audit plan.

Tax Fees

This represents professional services rendered for tax compliance, tax advice and tax planning.

All Other Fees

~~Chisholm, Bierwolf,~~Morrill & ~~Nilson~~Associates ~~& Morrill~~ was paid no other fees for professional services during the ~~fiscal~~ fiscal years September 30, ~~2009~~2010 and ~~2008~~2009.

39The Audit Committee will pre-approve all auditing services and the terms thereof {which may include providing comfort letters in connection with securities underwriting) and non-audit services (other than non-audit services prohibited under Section 10A{g) of the Exchange Act or the applicable rules of the SEC or the Public Company Accounting Oversight Board) to be provided to us by the independent auditor; provided, however, the pre-approval requirement is waived with respect to the provisions of non-audit services for us if the "de minimus" provisions of Section 10A(i) (1)(B) of the Exchange Act are satisfied. This authority to pre-approve non-audit services may be delegated to one or more members of the Audit Committee, who shall present all decisions to pre-approve an activity to the full Audit Committee at its first meeting following such decision. The Audit Committee may review and approve the scope and staffing of the independent auditors' annual audit plan.

PART IV

ITEM 15. EXHIBITS

1.1	Certificate of Incorporation of Garden Connections, Inc.
2.2	Amendment of Certificate of Incorporation Changing name from Garden Connections, Inc. to Organic Sales and Marketing, Inc.
2.3	Amended and Restated By-Laws
3.2	2008 Stock Option Plan
3.3	Microbial Technologies Licensing Agreement
10.16	Nu Vision Holdings Consulting Agreement
10.17	EC Desmond Sales Representation Agreement
10.18	CA Fortune Specialty Foods Brokerage Agreement
10.19	WHYN Radio Contract (Springfield, MA)
10.20	WBAE Radio Contract (Portland, ME)
10.21	WGIR Radio Contract (Manchester, NH)
10.22	Kehe Foods Vendor Buying Agreement
Exhibit 1.1- 10.22 referred to above may be found attached to the September 30, 2008 Form 10KSB which is incorporated by reference herein.
10.23	Tree of Life, Inc acquisition by KEHE Food Distributors, Inc
10.24	USDA letter notifying OSM that we are Bio-Preferred program participants
10.25	Fresh Direct Press Release
10.26	USDA Bio-Preferred Press Release
10.26	WTKK Radio Agreement
31.1	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 from the Company's Chief Executive Officer.
31.2	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 from the Company's Chief Financial Officer.
32.1	Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 from the Company's Chief Executive Officer.
32.2	Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 from the Company's Chief Financial Officer.

10.29	Consulting Agreement (LOI) - Sadler

10.30	Sales Agent Agreement – Land O’Lakes Purina Feed

31.1	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 from the Company's Chief Executive Officer.

31.2	Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 from the Company's Chief Financial Officer.

32.1	Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 from the Company's Chief Executive Officer.

32.2	Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 from the Company's Chief Financial Officer.

~~In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.~~37

ORGANIC SALES AND MARKETING, INC.
By	/s/ Samuel F.H. Jeffries
	Samuel F.H. Jeffries, Chairman,
	President and Chief Executive Officer
Date January 13, 2010

SIGNATURES

In accordance with the requirements of the Exchange Act, ~~this~~the registrant caused this report ~~has~~to ~~been~~be signed ~~below by the following persons~~ on its behalf ofby the ~~registrant~~undersigned, ~~and~~thereunto ~~in the capacities on the dates~~duly ~~indicated~~authorized.

By	/s/ Mark J. McEvoy
	ORGANIC SALES AND MARKETING, INC.
	Mark J. McEvoy, Treasurer and Chief
	(Registrant)
	Financial Officer
February 11, 2011	/s/ Samuel F.H. Jeffries
Date January 13, 2010
Date	SAMUEL F.H. JEFFRIES
	CEO AND CHAIRMAN
February 11, 2011	/s/_Keith D. Lowey
Date	KEITH D. LOWEY
	CHIEF FINANCIAL OFFICER

4138

Organic Sales and Marketing, Inc.

Financial Statements for the Years Ended

September 30, ~~2009~~2010 and ~~2008~~2009

And ~~Report~~Reports of Independent Registered

Public Accounting ~~Firm~~Firms

F-1

CONTENTS

Report of Independent Registered Public Accounting Firm		3
Reports of Independent Registered Public Accounting Firms	F-3
Balance Sheets	F-5	4
Statements of Operations	F-7	6
Statements of Stockholders’ (Deficit)	F-8	7
Statements of Cash Flows	F-9	8
Notes to the Financial Statements	F-10	9

F-2

Morrill & Associates, LLC

Certified Public Accountants

563 West 500 South, Suite 425

Bountiful, Utah 8401

801-292-8756 Phone; 801-292-3558 Fax

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To The Audit Committee

Organic Sales and Marketing, Inc.

Raynham, Massachusetts 02767

We have audited the accompanying balance sheet of Organic Sales and Marketing, Inc. as of September 30, 2010, and the related statements of operations, stockholders' deficit, and cash flows for the year then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Organic Sales and Marketing, Inc. as of September 30, 2010, and the results of its operations and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 14 to the financial statements, the Company has incurred recurring substantial losses from operations, recurring negative working capital, negative cash flows from operations, and has limited sales of its products which raises substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 14. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ Morrill & Associates

Morrill & Associates, LLC

Bountiful, Utah

February 11, 2011

F-3

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To The Audit Committee

Organic Sales and Marketing, Inc.

Raynham, Massachusetts 02767

We have audited the accompanying balance sheets of Organic Sales and Marketing, Inc. as of September 30, 2009 and 2008, and the related statements of operations, stockholders' deficit, and cash flows for the years then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Organic Sales and Marketing, Inc. as of September 30, 2009 and 2008, and the results of its operations and its cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 14 to the financial statements, the Company has incurred recurring substantial losses from operations, recurring negative working capital, negative cash flows from operations and has limited sales of its products which raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 14. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ Chisholm, Bierwolf, Nilson & Morrill, LLC Chisholm, Bierwolf, Nilson & Morrill, LLC Bountiful, Utah January 13, 2010

~~Chisholm, Bierwolf, Nilson & Morrill, LLC~~F-4

Bountiful, Utah

January 13, 2010

ORGANIC SALES AND MARKETING, INC.

Balance Sheets

ASSETS

	September 30,		September 30,
	2009		2008
	2010		2009
CURRENT ASSETS
Cash and cash equivalents	$	2446,~~547~~237	$	2724,~~838~~547
Accounts receivable, net		822,~~090~~939		268,~~710~~090
Inventories		~~109~~90,~~581~~797		~~149~~109,~~386~~581
Prepaid expense		716,~~479~~160		537,~~932~~479
Total current assets		149,697		257,866
Total Current Assets		176,133		149,697
PROPERTY AND EQUIPMENT, NET		94,~~383~~481		149,~~284~~383
OTHER ASSETS
Deposits		200		200
Total other assets		200		200
Total Other Assets		200		200
TOTAL ASSETS	$	~~159~~180,~~280~~814	$	~~272~~159,~~350~~280

The accompanying notes are an integral part of these ~~consolidated~~ financial statements.

4F-5

ORGANIC SALES AND MARKETING, INC.

Balance Sheets (Continued)

LIABILITIES AND STOCKHOLDERS' (DEFICIT)

	September 30,			September 30,
	2009			2008
	2010			2009
CURRENT LIABILITIES
Accounts payable - trade	$	581,215		$	480,483
Accounts payable-trade	$	523,598		$	581,215
Accounts payable - related party		3,986			-
Accounts payable-related party		19,098			3,986
Accrued expenses		335,~~807~~444			4133,~~185~~807
Accrued interest payable		6185,~~620~~347			2661,~~923~~620
Line of credit		7267,~~054~~387			7472,~~807~~054
Notes payable - related parties		~~495~~439,~~736~~334			~~262~~495,~~102~~736
Total current liabilities		1,248,418			885,500
Total Current Liabilities		1,140,208			1,248,418
Total liabilities		1,248,418			885,500
Total Liabilities		1,140,208			1,248,418
COMMITMENTS		-			-
STOCKHOLDERS' (DEFICIT)
Common stock, $0.0001 par value; 100,000,000 shares authorized; 10,088,794 and 6,799,494 shares issued and outstanding, respectively		1,009			680
Common stock, $0.0001 par value; 100,000,000 shares authorized, 13,709,494 and 10,088,794 shares issued and outstanding, respectively		1,371			1,009
Additional paid-in capital		56,~~669~~493,~~969~~112			35,~~738~~669,~~959~~969
Accumulated (deficit)		(6,760,116	)		(4,352,789	)
Accumulated (Deficit)		(7,453,877	)		(6,760,116	)
Total stockholders' (deficit)		(1,089,138	)		(613,150	)
Total Stockholders' (Deficit)		(959,394	)		(1,089,138	)
TOTAL LIABILITIES AND STOCKHOLDERS' (DEFICIT)	$	159,280		$	272,350
TOTAL LIABILITIES AND
STOCKHOLDERS' (DEFICIT)	$	180,814		$	159,280

The accompanying notes are an integral part of these ~~consolidated~~ financial statements.

5F-6

ORGANIC SALES AND MARKETING, INC.

Statements of Operations

	For the Years Ended
	September 30,
	2009			2008
	2010			2009
REVENUES
Product sales, net	$	~~184~~197,~~789~~375		$	~~321~~184,~~851~~789
Radio advertising		4027,~~210~~305			2540,~~260~~210
Total revenues		224,999			347,111
Total Revenues		224,680			224,999
COST OF SALES		~~183~~131,~~511~~086			~~243~~183,~~386~~511
GROSS PROFIT		4193,~~488~~594			~~103~~41,~~725~~488
OPERATING EXPENSES
Advertising expense		~~265~~69,~~687~~790			~~457~~311,~~087~~362
Payroll and compensation expense		~~332~~254,~~121~~751			~~378~~332,~~522~~121
Selling expense		~~172~~62,~~838~~688			~~195~~115,~~678~~428
General and administrative		~~488~~168,~~740~~958			~~159~~500,~~929~~474
Legal and accounting		~~187~~172,~~487~~634			~~179~~187,~~718~~488
Total operating expenses		1,446,873			1,370,934
Total Operating Expenses		728,821			1,446,873
LOSS FROM OPERATIONS		(1635,~~405,385~~227	)		(1,~~267~~405,~~209~~385	)
OTHER INCOME (EXPENSE)
Interest income		~~1,311~~-			31,~~019~~311
Interest expense		(4858,~~416~~534	)		(5948,~~108~~416	)
Debt settlement expense related to issuance of stock at a discount		-			(685,421	)
Valuation of warrants granted for financing costs		-			(954,837	)
Valvation of warrants granted for financing costs		(954,837	)		0
Total Other Income (Expense)		(58,534	)		(1,001,942	)
Valuation of warrants granted in settlement of debt		-			(239,549	)
NET LOSS BEFORE INCOME TAXES		(693,761	)		(2,407,327	)
Total other income (expense)		(1,001,942	)		(981,059	)
NET LOSS BEFORE INCOME TAXES		(2,407,327	)		(2,248,268	)
INCOME TAX EXPENSE		-			-
NET LOSS	$	(2693,~~407,327~~761	)	$	(2,~~248~~407,~~268~~327	)
LOSS PER SHARE-
Basic and Diluted	$	(0.2606	)	$	(0.3726	)
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING-
Basic and Diluted		912,~~124~~159,~~777~~856			69,~~002~~124,~~421~~777

The accompanying notes are an integral part of these ~~consolidated~~ financial statements.

6F-7

ORGANIC SALES AND MARKETING, INC.

Statements of Stockholders' ~~Equity/~~(Deficit)

For the period October 1, ~~2007~~2008 through ~~September~~Septmeber 30, ~~2009~~2010

										Total
					Additional					Stockholders'
	Common Stock				Paid-In		Accumulated			Equity
	Shares		Amount		Capital		(Deficit)			(Deficit)
Balance, October 1, 2007		5,388,569	$	539	$	1,898,410	$	(2,104,521	)	$	(205,572	)
Balance, September 30, 2008		6,799,494	$	680	$	3,738,959	$	(4,352,789	)	$	(613,150	)
Shares issued for cash at $.50/share		870,000		87		434,913					435,000
Shares issued for cash at $.25/share		1,440,000		144		359,856		-			360,000
Shares issued for cash at $1.00/share		33,123		3		33,120					33,123
Shares issued for cash at $.15/share		1,296,800		130		194,390		-			194,520
Shares issued for debt and payables at $1.00/share		139,562		14		139,548					139,562
Shares issued for services rendered at $.40/share		450,000		45		179,955		-			180,000
Shares issued for conversion of debt at $.50/share		368,240		37		184,083					184,120
Shares issued for services rendered at $.10/share		50,000		5		4,995		-			5,000
Debt settlement expense related to issuance of stock at a discount						685,420					685,420
Shares issued for services rendered at $.18/share		50,000		5		8,995		-			9,000
Valuation of options and warrants granted						363,465					363,465
Shares issued for services rendered at $.14/share		2,500		-		350		-			350
Net loss for the year ended September 30, 2008								(2,248,268	)		(2,248,268	)
Valuation of options and warrants granted		-		-		1,182,469		-			1,182,469
Balance, September 30, 2008		6,799,494	$	680	$	3,738,958	$	(4,352,789	)	$	(613,150	)
Net loss for the year ended September 30, 2009		-		-		-		(2,407,327	)		(2,407,327	)
Shares issued for cash at $.25/share		1,440,000		144		359,856					360,000
Balance, September 30, 2009		10,088,794	$	1,009	$	5,669,969	$	(6,760,116	)	$	(1,089,138	)
Shares issued for cash at $.15/share		1247,~~296,800~~317		~~130~~25		~~194~~37,~~390~~071		-			~~194~~37,~~520~~096
Shares issued for services rendered at $.40/share		450,000		45		179,955					180,000
Shares issued for cash at $.10/share		920,050		92		91,911		-			92,003
Shares issued for services rendered at $.10/share		50,000		5		4,995					5,000
Shares issued for conversion of debt at $.15/share		2,453,333		245		367,753		-			367,998
Shares issued for services rendered at $.18/share		50,000		5		8,995					9,000
Valuation of options and warrants granted		-		-		326,408		-			326,408
Shares issued for services rendered at $.14/share		2,500		-		350					350
Net loss for the year ended September 30, 2010		-		-		-		(693,761	)		(693,761	)
Valuation of options granted and warrants granted						1,182,470					1,182,470
Balance, September 30, 2010		13,709,494	$	1,371	$	6,493,112	$	(7,453,877	)	$	(959,394	)
Net loss for the year ended September 30, 2009								(2,407,327	)		(2,407,327	)
Balance, September 30, 2009		10,088,794		1,009		5,669,969		(6,760,116	)		(1,089,138	)

The accompanying notes are an integral part of these ~~consolidated~~ financial statements.

7F-8

ORGANIC SALES AND MARKETING, INC.

Statements of Cash Flows

	For the Years Ended
	September 30,
	2009			2008
	2010			2009
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss	$	(2693,~~407,327~~761	)	$	(2,~~248~~407,~~268~~327	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense		4,~~901~~902			4,~~250~~901
Shares issued for services rendered		~~194,350~~-			-194,350
Valuation of options and warrants granted		1326,~~182,470~~408			~~363~~1,~~465~~182,470
Debt settlement expense related to issuance of stock at a discount		-			685,421
Stock issued for accrued interest		19,732			-
Change in operating assets and liabilities:
Accounts receivable-trade		18(14,~~620~~849	)		318,~~892~~620
Inventories		3918,~~805~~784			~~(38~~39,~~082~~805	)
Prepaid expense		46(8,~~453~~681	)		~~(35~~46,~~039~~453	)
Accounts payable - trade		100,732			257,672
Accounts payable-trade		(57,617	)		100,732
Accounts payable - related party		3,986			-
Accounts payable-related party		15,112			3,986
Accrued expenses		(728,~~378~~363	)		(87,~~201~~378	)
Accrued interest payable		3423,~~697~~727			5034,~~138~~697
Net Cash Used in Operating Activities		(~~788~~394,~~691~~606	)		(~~964~~788,~~752~~691	)
CASH FLOWS FROM INVESTING ACTIVITIES		-			-
Purchase of property and equipment		-			(5,783	)
Net Cash Used in Investing Activities		-			(5,783	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of common stock		~~554~~129,~~520~~099			~~468~~554,~~123~~520
Proceeds from line of credit		1510,~~827~~000			8215,~~500~~827
Payments on line of credit		(1814,~~580~~667	)		(718,~~693~~580	)
Proceeds from bridge loans		-			175,000
Proceeds from notes payable - related party		304,800			233,633
Proceeds from notes payable - related party		233,633			87,102
Payments on notes payable - related party		(12,940	)		-
Net Cash Provided by Financing Activities		~~785~~416,~~400~~292			~~805~~785,~~032~~400
NET INCREASE (DECREASE) IN CASH		(321,~~291~~686	)		(~~165~~3,~~503~~291	)
CASH, BEGINNING OF PERIOD		2724,~~838~~547			~~193~~27,~~341~~838
CASH, END OF PERIOD	$	2446,~~547~~233		$	2724,~~838~~547
SUPPLEMENTAL DISCLOSURES:
Cash paid for interest	$	137,~~524~~776		$	913,~~026~~524
Cash paid for income taxes	$	-		$	-
Cash paid for taxes	$	-		$	-
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Shares issued for conversion of notes payable and accrued interest	$	-368,000		$	~~256,682~~-
Shares issued for services rendered	$	~~194,350~~-		$	-194,350
Shares issued for accounts payable and accrued expenses	$	-		$	67,000
Valuation of options and warrants granted	$	326,408		$	1,182,470
Valuation of options and warrants granted	$	1,182,470		$	363,465

The accompanying notes are an integral part of these ~~consolidated~~ financial statements.

8F-9

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, ~~2009~~2010 and ~~2008~~2009

Note 1 – Organization and Principle Activities of the Company

Business Description

Organic Sales and Marketing, Inc. was incorporated in the state of Delaware on August 23, 2003. On September 8, 2003, a security exchange agreement was entered into with Garden Connections, LLC. Garden Connections, LLC partners received all of the issued and outstanding common stock of Organic Sales and Marketing, Inc. in exchange for their interests in Garden Connections, LLC.

The Company is located in Raynham, Massachusetts and is engaged in the sale and marketing of a wide variety of all natural, non-food products for distribution and sale to major distributors and retail outlets throughout the United States. The Company continues to expand their market penetration by acquiring or developing consumer products that have organic origins that can be private labeled. The Company currently has private label all natural, non-food products that have been modified to meet applications in other industries including costume jewelry, sporting goods, grocery, optical, health and beauty, footwear, museum stores, historical preservation groups, funeral homes, quilting and boating.

Note 2 – Summary of Significant Accounting Policies

Financial statements have been prepared in accordance with accounting principles generally accepted in the United States.

Principles of Accounting

9Use of Estimates

F-10

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, ~~2009~~2010 and ~~2008~~2009

Note 2 – Summary of Significant Accounting Policies (Continued)

Use of Estimates

Revenue Recognition

Revenue from garden and cleaning products is recognized upon shipment of the product. The distribution of products is governed by purchase orders or direct sale agreements which fix the price and delivery date. The Company records a provision for product returns and price markdowns as a reduction of gross sales at the time the product passes to these retailers or consumers. The provision for anticipated product returns and price markdowns is primarily based upon the Company’s analysis of historical product return and price markdown results. Should product sell-through results at retail store locations fall significantly below anticipated levels this allowance may be insufficient. The Company will review the adequacy of its allowance for product returns and price markdowns and if necessary will make adjustments to this allowance on a quarterly basis. In accordance with ASC ~~GAAP~~605-45 “Accounting for Shipping and Handling Fees and Costs,” distribution costs charged to customers are recognized as revenue when the related product is shipped. Advance payments are recorded on the balance sheet as deferred revenue until the revenue recognition criteria is met.

Cash and Cash Equivalents

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, 2009 and 2008

Note 2 – Summary of Significant Accounting Policies (Continued)

Accounts Receivable

The Company carries its accounts receivable at cost less an allowance for doubtful accounts. Periodically, the Company evaluates its accounts receivable and establishes an allowance for doubtful accounts, based on a history of past write-offs and collections and current credit conditions. The Company feels that the entire balance of Accounts Receivable as of September 30, ~~2009~~2010 and September 30, ~~2008~~2009 are collectable and, therefore, no allowance has been taken. The full value of accounts receivable is held as collateral for the Company’s Line of Credit.

Inventory

The inventory is stated at the lower of cost (first-in-first-out method) or market. Inventory items consist of raw material and finished goods. Raw materials consist of labels, bottles, sprayers, fertilizers and shipping materials. Finished goods consist of fertilizer bags and bottles of organic cleaning products ready for shipment. The inventory consists of newly purchased items; therefore, there is currently no allowance for excess or obsolete inventory. The full value of inventory is held as collateral for the Company’s Line of Credit.

Prepaid Expenses

Business expenses, including consulting expenses, that are paid for in advance of services being rendered are treated as prepaid expenses. On occasion, the Company pays for prepaid expenses with common stock. When these transactions occur, they are identified as negative components of stockholders’ equity.

F-11

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, 2010 and 2009

Note 2 – Summary of Significant Accounting Policies (Continued)

Fixed Assets

Fixed assets are stated at cost less accumulated depreciation. The Company has elected to capitalize and depreciate any fixed asset item costing in excess of $1,000. Expenditures for minor replacements, maintenance and repairs which do not increase the useful lives of the property and equipment are charged to operations as incurred. Major additions and improvements are capitalized. Depreciation and amortization are computed using the straight-line method over estimated useful lives of three to seven years. The full value of fixed assets is held as collateral for the Company's Line of Credit.

Advertising

The Company follows the policy of charging the costs of advertising to expense as incurred. Advertising expense primarily consists of the Company’s three hour weekly Garden Guys radio call in program with Greater Media and Citadel Communications, slotting fee expense, display case costs, samples and trade show participation. The total advertising expense for the radio show contracts was $~~209~~54,~~615~~200 and $~~282~~209,~~682~~615 for the twelve months ended September 30, ~~2009~~2010 and September 30, ~~2008~~2009, respectively. In addition, the Company advertises its products on its own website and in numerous trade and industry publications. Total advertising, including radio contracts for the years ended September 30, ~~2009~~2010 and ~~2008~~2009 was $~~265~~69,~~687~~790 and $~~457~~311,~~087~~362, respectively.

Income Taxes

Fair Value of Financial Instruments

Level 1 inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

Level 3 inputs to valuation methodology are unobservable and significant to the fair measurement.

~~Stock~~F-~~Based Compensation~~ 12

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, ~~2009~~2010 and ~~2008~~2009

Note 2 – Summary of Significant Accounting Policies (Continued)

Stock-Based Compensation

Recently Issued Accounting Standards

In ~~June~~May ~~2006~~2009, FASB issued FASB ASC ~~740~~855-10 (Prior authoritative literature: ~~FASB~~ ~~Interpretation~~SFAS No. 48165, "Subsequent ~~“Accounting~~Events"). ~~for~~FASB ~~Uncertainty~~ASC in855-10 ~~Income Taxes—an~~establishes ~~interpretation~~principles ofand ~~FASB~~requirements for ~~Statement~~the ~~No.~~reporting ~~109”). This Interpretation~~of ~~clarifies~~events ~~the~~or ~~accounting~~transactions ~~for~~that ~~uncertainty~~occur inafter ~~income~~the ~~taxes~~balance sheet ~~recognized~~date, inbut anbefore ~~enterprise’s~~ financial statements inare ~~accordance~~issued ~~with~~or ~~FASB~~are ~~No. 109,~~available ~~“Accounting~~to ~~for~~be ~~Income Taxes”~~issued. FASB ASC ~~740~~855-10 ~~prescribes~~ ais ~~recognition~~effective ~~threshold~~for ~~and~~financial ~~measurement~~statements ~~attribute~~issued for ~~the~~fiscal ~~financial~~years ~~statement recognition~~ and ~~measurement~~interim ofperiods aending ~~tax~~after ~~position~~June ~~taken~~15, ~~or expected to be taken in a tax return~~2009. ~~FIN~~As ~~48 also provides guidance on de-recognition~~such, ~~classification,~~ ~~interest~~the ~~and~~Company ~~penalties, accounting in interim periods,~~adopted ~~disclosure,~~these ~~and~~provisions ~~transition.~~at ~~FASB~~the ~~ASC~~beginning ~~740-10~~of isthe ~~effective~~interim ~~for~~period ~~fiscal~~ended ~~years beginning~~June ~~after December 15~~30, ~~2006~~2009. Adoption ~~The adoption~~ of FASB ASC ~~740~~855-10 did not have a material ~~impact~~effect on ~~the~~our ~~Company’s~~ financial ~~position, results of operations, or~~ ~~cash flows~~statements.

In ~~September~~ ~~2006~~June 2009, the FASB ~~issued FASB~~ ASC ~~820~~860-10 (Prior authoritative literature: ~~FASB~~ ~~Statement~~issued ~~157,~~SFAS ~~“Fair Value Measurements”)~~No. 166, ~~FASB~~“Accounting ~~ASC~~for ~~820-10~~Transfers ~~defines~~of ~~fair~~Financial ~~value~~Assets, ~~establishes~~an aAmendment ~~framework~~of ~~for~~FASB ~~measuring fair~~Statement ~~value~~No. ~~under~~140”), ~~GAAP~~which ~~and~~eliminates ~~expands~~the ~~disclosures~~concept ~~about~~of ~~fair~~a ~~value~~qualifying ~~measurements.~~special-purpose ~~FASB ASC~~entity ~~820-10~~(“QSPE”), ~~applies~~clarifies ~~under~~and ~~other~~amends ~~accounting~~the ~~pronouncements~~de-recognition ~~that~~criteria ~~require~~for ora ~~permit~~transfer ~~fair~~to be ~~value~~accounted ~~measurements.~~for ~~Accordingly~~as a sale, ~~FASB~~amends ~~ASC~~and ~~820-10~~clarifies ~~does~~the ~~not~~unit ~~require~~of ~~any~~account ~~new~~eligible ~~fair~~for ~~value~~sale ~~measurements.~~accounting ~~However,~~and ~~for~~requires ~~some~~that ~~entities,~~a ~~the~~transferor ~~application~~initially ofmeasure ~~FASB~~at ~~ASC~~fair value ~~820-10~~and ~~will~~recognize ~~change~~all ~~current~~assets ~~practice.~~obtained ~~The~~and ~~changes~~liabilities toincurred ~~current~~as ~~practice~~a ~~resulting from~~result ~~the~~of ~~application~~a transfer of ~~FASB~~an ~~ASC~~entire ~~820-10~~financial ~~relate~~asset toor ~~the~~group ~~definition~~ of ~~fair~~financial ~~value,~~assets accounted for ~~the~~as ~~methods~~a ~~used~~sale. toThis ~~measure~~standard ~~fair~~is ~~value~~effective ~~and~~for ~~the~~fiscal ~~expanded~~years ~~disclosures~~beginning ~~about~~after ~~fair~~November ~~value~~15, ~~measurements~~2009. The ~~provisions~~Company ofis ~~FASB~~currently ~~ASC~~evaluating ~~820-10~~the ~~are~~potential ~~effective~~impact as of this ~~January~~standard 1,on ~~2008~~its financial statements, ~~with~~but ~~the~~does ~~cumulative~~not ~~effect~~expect ofit ~~the~~to ~~change~~have ina ~~accounting~~material ~~principle~~effect.

12In June 2009, the FASB issued FASB ASC 810-10-65 (Prior authoritative literature: SFAS No. 167, “Amendments to FASB Interpretation No. 46(R)”) which amends the consolidation guidance applicable to a variable interest entity (“VIE”). This standard also amends the guidance governing the determination of whether an enterprise is the primary beneficiary of a VIE, and is therefore required to consolidate an entity, by requiring a qualitative analysis rather than a quantitative analysis. Previously, the standard required reconsideration of whether an enterprise was the primary beneficiary of a VIE only when specific events had occurred. This standard is effective for fiscal years beginning after November 15, 2009, and for interim periods within those fiscal years. Early adoption is prohibited. The Company is currently evaluating the potential impact of the adoption of this standard on its financial statements, but does not expect it to have a material effect.

F-13

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, ~~2009~~2010 and ~~2008~~2009

Note 2 – Summary of Significant Accounting Policies (Continued)

Recently Issued Accounting Standards (Continued)

~~recorded~~In June as2009, anFASB ~~adjustment~~issued toASC ~~opening~~105-10 ~~retained~~(Prior ~~earnings~~authoritative literature: SFAS No. ~~However~~168, ~~delayed~~"The FASB ~~application~~Accounting Standards Codification TM and the Hierarchy of Generally ~~this~~Accepted ~~statement~~Accounting isPrinciples ~~permitted~~- ~~for~~a ~~nonfinancial~~replacement ~~assets~~of ~~and~~FASB ~~nonfinancial~~Statement No. 162").FASB ~~liabilities,~~ASC ~~except~~105-10 ~~for~~establishes ~~items~~the ~~that~~FASB ~~are~~Accounting Standards Codification TM (Codification) as the source of authoritative accounting principles recognized by orthe ~~disclosed~~FASB atto ~~fair~~be ~~value~~applied by nongovernmental entities in the preparation of financial statements onin aconformity ~~recurring~~with ~~basis~~GAAP. ~~(at~~FASB ~~least~~ASC ~~annually),~~105-10 ~~until~~is ~~fiscal~~effective for financial statements issued for fiscal years ~~beginning~~and ~~after~~interim ~~November~~periods ending after September 15, ~~2008~~2009. As such, ~~and~~the ~~interim~~Company ~~periods~~is ~~within~~required ~~those~~to ~~fiscal~~adopt these provisions ~~years.~~at ~~The~~the ~~adoption~~beginning of ~~FASB~~the fiscal year ending September 30, 2009. Adoption of FASB ASC ~~820~~105-10 did not have a material ~~impact~~effect on the Company’s financial ~~position, results of operations, or cash flows~~ statements.

In ~~February~~October ~~2007~~2009, the Financial Accounting Standards Board (“FASB”) ~~ASC~~issued Accounting ~~825~~Standards Update (“ASU”) 2009-1013, Revenue Recognition (~~Prior~~Topic ~~authoritative literature~~605): ~~Statement~~ Multiple-Deliverable ofRevenue ~~Financial~~Arrangements—a ~~Accounting~~consensus ~~Standards~~of ~~No.~~the ~~159,~~FASB Emerging Issues Task Force (“ASU ~~The~~2009-13”). ~~Fair~~ASU ~~Value~~2009-13 ~~Option~~changes accounting for certain ~~Financial~~multiple ~~Assets~~deliverable ~~and~~arrangements. ~~Financial~~ASU ~~Liabilities~~2009-~~Including~~13 anaddresses ~~Amendment~~the separation of deliverables ~~FASB~~and how to measure and allocate the arrangement consideration to ~~Statement~~one Noor more units of accounting in multiple deliverable arrangements. ~~115~~ Currently,”) under ~~was~~the ~~issued.~~residual ~~This~~method ~~standard~~of ~~allows~~allocation, ~~a company~~we touse ~~irrevocably~~objective ~~elect~~and reliable evidence of the fair value asof the ~~initial~~undelivered ~~and~~elements ~~subsequent~~to separate deliverables in ~~measurement~~multiple ~~attribute~~deliverable ~~for~~arrangements. ~~certain~~ASU ~~financial~~2009-13 ~~assets~~eliminates the residual method and ~~financial~~requires ~~liabilities~~that ~~on a~~consideration ~~contract-by-contract~~from ~~basis,~~the ~~with~~arrangement ~~changes~~be inallocated ~~fair~~to ~~value~~all deliverables ~~recognized~~using inthe ~~earnings~~relative selling price method. ASU 2009-13 requires ~~The~~additional ~~provisions~~disclosures ofrelated ~~this~~to ~~standard~~multiple ~~were~~deliverable revenue arrangements upon adoption and is effective asfor offiscal ~~the~~years beginning ofafter ~~fiscal year~~June ~~2008~~15, 2010. In addition, ASU 2009-13 may be early adopted. It may be implemented with either prospective or retrospective application; however, if early adoption ~~permitted.~~is ~~The~~chosen, the ~~adoption~~entity must either adopt at the beginning of ~~FASB~~its ~~ASC~~fiscal ~~825-10~~year, ~~did~~or adopt using ~~not~~retrospective ~~have~~application. aWe ~~material~~are ~~impact~~currently onevaluating the ~~Company’s~~impact ASU 2009-13 will have on our financial position, and results of operations, orwhether ~~cash~~to ~~flows~~early adopt and which implementation method to use upon adoption if not prescribed.

In ~~March~~ ~~2007~~October 2009, the FASB ~~ASC~~issued ~~715~~ASU 2009-6014, Software (~~Prior~~Topic ~~authoritative literature~~985): ~~EITF~~ ~~Issue~~Certain ~~No.~~Revenue ~~06-10,~~Arrangements ~~"Accounting~~That ~~for Collateral~~Include ~~Assignment~~Software ~~Split-Dollar~~Elements—a ~~Life~~consensus ~~Insurance~~of ~~Agreements~~the FASB Emerging Issues Task Force (“ASU 2009-14”). ~~FASB~~ASU ~~ASC 715~~2009-6014 ~~provides~~changes ~~guidance~~the accounting for revenue ~~determining~~arrangements athat ~~liability~~include ~~for~~both ~~the~~tangible ~~postretirement benefit~~products ~~obligation~~and assoftware ~~well~~elements. Tangible asproducts ~~recognition~~containing software components and ~~measurement~~non-software ofcomponents that function together to deliver the ~~associated~~tangible product’s essential functionality ~~asset~~is onno longer within the ~~basis~~scope of the ~~terms~~software ofrevenue guidance. Under prior guidance such arrangements were accounted for as software if the ~~collateral~~software ~~assignment~~was determined ~~agreement~~to be more than incidental. ~~FASB~~ASU ~~ASC 715~~2009-6014 requires that any hardware components of such arrangements be excluded from software revenue guidance and that any essential software that is sold with or embedded within the product also be excluded from software revenue guidance. This ASU is effective for fiscal years beginning after ~~December~~June 15, ~~2007~~2010. ~~The~~In addition, ASU 2009-14 may be early adopted. ASU 2009-14 may be implemented with either prospective or retrospective application; however, if early adoption is chosen, the entity must either adopt at the beginning of ~~FASB~~its ~~ASC~~fiscal ~~715~~year, or adopt using retrospective application. Further, ASU 2009-6014 ~~did~~must ~~not~~be ~~have~~adopted ain ~~material~~the ~~impact~~same onperiod and with the ~~Company’s~~same implementation method as ASU 2009-13. We are currently evaluating the impact ASU 2009-14 will have on our financial position, and results of operations, orwhether ~~cash~~to ~~flows~~early adopt and which implementation method to use upon adoption if not prescribed.

In December, 2007, the FASB issued FASB ASC 805 (Prior authoritative literature: SFAS No. 141(R), “Business Combinations”), which established the principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, any nonF-controlling interest in the acquiree and the goodwill acquired. FASB ASC 805 also establishes disclosure requirements to enable the evaluation of the nature and financial effects of the business combination. FASB ASC 805 is effective the first annual reporting period beginning on or after December 15, 2008 and is not expected to have any impact on the Company’s financial statements.14

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, ~~2009~~2010 and ~~2008~~2009

Note 2 – Summary of Significant Accounting Policies (Continued)

Recently Issued Accounting Standards (Continued)

In ~~March~~ ~~2008~~January 2010, the FASB issued ~~FASB~~ASU ~~ASC~~No. ~~815~~2010-1006 ~~(Prior~~regarding ~~authoritative~~fair ~~literature:~~value ~~SFAS No.~~measurements ~~161,~~and ~~“Disclosures~~disclosures ~~about Derivative~~and ~~Instruments~~improvement ~~and~~in ~~Hedging~~the ~~Activities”),~~disclosure ~~which~~about isfair ~~effective~~value measurements. ~~January~~This 1,ASU requires ~~2009.~~additional disclosures ~~FASB~~regarding ~~ASC~~significant transfers ~~815-10~~in ~~requires~~and ~~enhanced~~out ~~disclosures~~of ~~about~~Levels ~~derivative instruments~~1 and ~~hedging~~2 ~~activities~~of tofair ~~allow~~value ~~for~~measurements, including a ~~better~~description ~~understanding~~ of ~~their~~ the reasons for the ~~effects~~ transfers. Further, onthis anASU ~~entity’s~~requires ~~financial~~additional ~~position,~~disclosures ~~financial~~for ~~performance,~~the activity ~~and~~in ~~cash flows.~~Level ~~Among~~3 ~~other~~fair ~~things~~value measurements, ~~this~~requiring ~~standard~~presentation ~~requires~~of information ~~disclosures~~about ofpurchases, ~~the~~sales, ~~fair~~issuances, and ~~values~~settlements in ofthe reconciliation for fair value ~~derivative~~measurements. ~~instruments~~This ~~and~~ASU is ~~associated~~effective ~~gains~~for ~~and~~fiscal ~~losses~~years inbeginning aafter ~~tabular~~December ~~formant. This~~15, ~~standard~~2010, isand ~~not~~for ~~currently~~interim periods ~~applicable~~within tothose ~~the~~fiscal ~~Company~~years. ~~since~~The weadoption doof ASU ~~not~~2010-06 did ~~have~~not ~~derivative~~have ~~instruments~~a ormaterial ~~engage~~impact inon ~~hedging~~the ~~activity~~Company’s consolidated financial statements.

In ~~May~~ ~~2008~~February 2010, the FASB issued ~~FASB~~Accounting ~~ASC~~Standards ~~944~~Update ~~(Prior authoritative literature: SFAS~~ No. ~~163,~~ ~~"Accounting~~2010-09 ~~for Financial~~(“ASU ~~Guarantee~~2010-09”) ~~Insurance~~as ~~Contracts~~amendments -to ancertain ~~interpretation~~recognition ofand ~~FASB~~disclosure ~~Statement No~~requirements. ~~60").~~The ~~FASB~~amendments ~~ASC~~remove ~~944~~the ~~interprets~~requirement ~~Statement~~for 60an ~~and~~SEC ~~amends~~filer ~~existing~~to ~~accounting pronouncements~~disclose toa ~~clarify~~date ~~their~~in ~~application~~both issued toand ~~the~~revised financial ~~guarantee~~statements. ~~insurance contracts~~Revised ~~included~~financial ~~within~~statements ~~the~~include financial ~~scope~~statements ofrevised ~~that~~as ~~Statement. This~~a ~~standard~~result ~~is effective~~of ~~for~~either ~~financial~~correction ~~statements~~of ~~issued~~an ~~for~~error ~~fiscal years beginning after~~or ~~December~~retrospective ~~15,~~application ~~2008,~~of ~~and~~U.S. ~~all~~GAAP. ~~interim~~Those ~~periods~~amendments ~~within~~remove ~~those fiscal~~potential ~~years. As~~conflicts ~~such,~~with the ~~Company~~SEC’s isliterature. ~~required~~All toof ~~adopt~~the ~~these~~amendments ~~provisions~~in ~~at the~~ASU ~~beginning~~2010-09 ofwere effective ~~the~~upon ~~fiscal~~issuance ~~year~~for ~~ended~~interim ~~March~~and ~~31,~~annual ~~2009~~periods. The ~~Company~~adoption ~~does~~of ASU 2010-09 did not ~~believe this standard will~~ have ~~any~~a material impact on the ~~financial~~Company’s consolidated financial statements.

~~In April, 2009, the FASB issued FASB ASC 810~~F-10-65 (Prior authoritative literature: SFAS No. 164, “Not-for-Profit Entities: Mergers and Acquisitions”) which governs the information that a not-for-profit entity should provide in its financial reports about a combination with one or more other not-for-profit entities, businesses or nonprofit activities and sets out the principles and requirements for how a not-for-profit entity should determine whether a combination is in fact a merger or an acquisition. This standard is effective for mergers occurring on or after Dec. 15, 2009 and for acquisitions where the acquisition date is on or after the beginning of the first annual reporting period, beginning on or after Dec. 15, 2009. This standard does not apply to the Company since the Company is considered a for-profit entity

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, ~~2009~~2010 and ~~2008~~2009

Note 2 – Summary of Significant Accounting Policies (Continued)

Recently Issued Accounting Standards (Continued)

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, 2009 and 2008

Note 3 – Net Income/(Loss) per Share

Basic net income (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding. Diluted net income (loss) per share is computed by dividing net income (loss) by the weighted average number of common shares outstanding and dilutive potential common shares, which includes the dilutive effect of stock options and warrants granted. Dilutive potential common shares for all periods presented are computed utilizing the treasury stock method. Common stock options of 12,~~140~~355,145 were considered, but ~~were~~ not included in the computation of loss per share because ~~their~~ their effect is anti-dilutive. Common stock warrants of 2,920,920 were considered, but not included in the computation of loss per share because their effect is also anti-dilutive.

	For the Years Ended
	September 30,
	2009			2008
	2010			2009
Basic and Diluted
Net Loss - Numerator	$	(2693,~~407,327~~761	)	$	(2,~~248~~407,~~268~~327	)
Weighted Average Shares - Denominator		912,~~124~~159,~~777~~856			69,~~002~~124,~~421~~777
Per Share Amount	$	(0.2606	)	$	(0.3726	)

Note 4 – Income Taxes

The Financial Accounting Standards Board (FASB) has issued FASB ASC 740-10 (Prior authoritative literature: Financial Interpretation No. 48, "Accounting for Uncertainty in Income Taxes - An Interpretation of FASB Statement No. 109 (FIN 48)). FASB ASC 740-10 clarifies the accounting for uncertainty in income taxes recognized in an enterprise's financial statements in accordance with prior literature FASB Statement No. 109, Accounting for Income Taxes. This standard requires a company to determine whether it is more likely than not that a tax position will be sustained will be sustained upon examination based upon the technical merits of the position. If the more-likely-than- not threshold is met, a company must measure the tax position to determine the amount to recognize in the financial statements. As a result of the implementation of this standard, the Company performed a review of its material tax positions in accordance with recognition and measurement standards established by FASB ASC 740-10.

Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.

F-16

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, ~~2009~~2010 and ~~2008~~2009

Note 4 – Income Taxes (Continued)

Deferred tax assets and the valuation account are as follows:

	For the Years Ended
	September 30,
	2009			2008
	2010			2009
Deferred tax asset:
Net operating loss carryforward	$	1,~~633~~777,~~824~~092		$	1,~~156~~633,~~130~~824
Valuation allowance		(1,~~633~~777,~~824~~092	)		(1,~~156~~633,~~130~~824	)
	$	-		$	-

The components of income tax expense are as follows:

	For the Years Ended
	September 30,
	2009			2008
	2010			2009
Current Federal tax	$	-		$	-
Current State tax		-			-
Change in NOL benefit		~~477~~143,~~695~~268			~~467~~477,~~759~~695
Change in valuation allowance		(~~477~~143,~~695~~268	)		(~~467~~477,~~759~~695	)
	$	-		$	-

The Company has adopted FASB ASC 740-10 to account for income taxes. The Company currently has no issues creating timing differences that would mandate deferred tax expense. Net operating losses would create possible tax assets in future years. Due to the uncertainty of the utilization of net operating loss carry forwards, an evaluation allowance has been made to the extent of any tax benefit that net operating losses may generate. A provision for income taxes has not been made due to net operating loss carry-forwards of $4,~~189~~556,~~293~~645 and $24,~~964~~189,~~435~~293 as of September 30, ~~2009~~20010 and September 30, ~~2008~~2009, respectively, which may be offset against future taxable income through 2029. No tax benefit has been reported in the financial statements.

17A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

	For the Years Ended
	September 30,
	2010		2009

Beginning Balance	$	-	$	-
Additions based on tax positions related to current year		-		-
Additions for tax positions of prior years		-		-
Reductions for tax positions of prior years		-		-
Reductions in benefit due to income tax expense		-		-

Ending Balance	$	-	$	-

F-17

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, ~~2009~~2010 and ~~2008~~2009

Note 4 – Income Taxes (Continued)

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:

	For the Years Ended
	September 30,
	2009		2008
Beginning Balance	$	-	$	-
Additions based on tax positions related to current year		-		-
Additions for tax positions of prior years		-		-
Reductions for tax positions of prior years		-		-
Reductions in benefit due to income tax expense		-		-
Ending Balance	$	-	$	-

The Company did not have any tax positions for which it is reasonably possible that the total amount of unrecognized tax benefits will significantly increase or decrease within the next 12 months.

The Company includes interest and penalties arising from the underpayment of income taxes in the consolidated statements of operations in the provision for income taxes. As of September 30, ~~2009~~2010 and ~~2008~~2009, the Company had no accrued interest or penalties related to uncertain tax positions.

The tax years that remain subject to examination by major taxing jurisdictions are for the years ended December 31, ~~2008~~2009, ~~2007~~2008 and ~~2006~~2007.

Note 5 – Inventories

Inventories consisted of the following as of:

	September 30,		September 30,
	2009		2008
	2010		2009
Raw materials	$	7078,~~179~~182	$	~~105~~70,~~107~~179
Finished goods		3912,~~402~~615		4439,~~279~~402
Totals	$	~~109~~90,~~581~~797	$	~~149~~109,~~386~~581

At September 30, ~~2009~~2010 and September 30, ~~2008~~2009, no provision for obsolete inventory was recorded by the Company.

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, 2009 and 2008

Note 6 – Property and Equipment

Property and Equipment consisted of the following as of:

	September 30,			September 30,
	2009			2008
	2010			2009
Property and equipment	$	21,900		$	21,900
Less: accumulated depreciation		(1217,~~517~~419	)		(712,~~616~~517	)
Property and equipment, net	$	94,~~383~~481		$	149,~~284~~383

Depreciation expense on property and equipment was $4,~~901~~902 and $4,~~250~~901 for the years ended September 30, ~~2009~~2010 and September 30, ~~2008~~2009, respectively.

F-18

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, 2010 and 2009

Note 7 – Stock Options

On February 28, 2008, our Board of Directors approved the 2008 Stock Option and Purchase Plan. Under the terms of this plan, options may be granted to officers, directors, employees, consultants and independent contractors to purchase up to an aggregate of 1,350,000 shares of common stock at an exercise price of $1.00 per share. Options are exercisable and vest over a four year period at a rate of 25% per year.

~~As of~~On ~~September~~January 3021, ~~2009~~2010, ~~there~~the ~~were~~Board ~~1,140,145~~of ~~options~~Directors ~~outstanding~~approved ~~under this plan at~~ the ~~exercise~~granting ~~price~~ of $1~~.00~~,155,000 common ~~per~~stock ~~share.~~option ~~The~~shares ~~issuance~~to ofofficers, ~~these~~directors, ~~options~~employees ~~was~~and independent ~~approved~~contractors. byUnder ~~holders of~~ the ~~majority~~terms of the ~~Company’s~~grants ~~outstanding~~approved, ~~common~~shares ~~stock. The~~carry ~~total~~an ~~amount~~exercise price of ~~option~~$.15 ~~expense~~per ~~recorded~~share, ~~for~~vest ~~the~~over ~~twelve~~a ~~months~~four ~~ended September~~year ~~30,~~period ~~2009~~at ~~was~~a ~~$227,631,~~rate of ~~which,~~25% ~~$93,863~~per ~~was recorded as payroll and~~year ~~compensation expense~~ and ~~$133,768~~only ~~was~~vested ~~recorded~~options ascan ~~legal and accounting expense. The amount of option expense to~~ be ~~charged~~exercised over ~~the~~a ~~remainder~~ten ofyear ~~the exercise~~ period ~~is $549,701~~.

~~The Company~~On ~~has~~May ~~determined~~6, 2010, the ~~estimated~~Board ~~value~~ of Directors approved the ~~stock~~granting ~~options~~of ~~granted~~60,000 bycommon ~~using~~stock option ~~the~~shares ~~Black-Scholes~~to ~~pricing~~employees ~~model~~and ~~using~~independent ~~the~~contractors. ~~following~~Under ~~assumptions:~~the ~~expected~~terms ~~life~~ of 10the ~~years~~grants approved, ashares ~~risk~~carry ~~free~~an ~~interest~~exercise ~~rate~~price of 1$.~~66-3.71%,~~15 aper ~~dividend~~share, ~~yield~~vesting ~~of 0~~100% ~~and~~in one ~~volatility~~year ~~that~~and ~~ranged~~only ~~from~~vested ~~75%~~options incan ~~2008~~be toexercised ~~192%~~over ina ~~2009~~four year period.

19As of September 30, 2010, under this plan, there were 1,140,145 options outstanding at the exercise price of $1.00 per share and 1,215,000 options outstanding at the exercise price of $.15 per share. The issuance of these options was approved by holders of the majority of the Company’s outstanding common stock. The total amount of option expense recorded for the Twelve Months ended September 30, 2010 was $326,408, of which, $193,431 was recorded as payroll and compensation expense and $132,977 was recorded as legal and accounting expense. The amount of option expense to be charged over the remainder of the exercise period is $380,014.

The Company has determined the estimated value of the stock options granted by using the Black-Scholes pricing model with the following assumptions: expected life of 4 or 10 years, a risk free interest rate of 2.46-3.71%, a dividend yield of 0% and volatility ranging from 75% in 2008, 154% to 192% in 2009 and 190% in 2010.

Outstanding common stock options as of September 30, 2010 are summarized below:

	Number of Shares			Weighted Average Exercise Price
Stock Options Outstanding, October 1, 2007		-		$	-

Options Granted		1,126,250		$	1.00
Options Exercised		-		$	-
Options Canceled		-		$	-

Stock Options Outstanding, September 30, 2008		1,126,250		$	1.00

Stock Options Exercisable, September 30, 2008		148,619		$	1.00

Options Granted		29,000		$	1.00
Options Exercised		-		$	-
Options Canceled		(15,105	)	$	1.00

Stock Options Outstanding, September 30, 2009		1,140,145		$	1.00

Stock Options Exercisable, September 30, 2009		438,057		$	1.00

Options Granted		1,215,000		$	0.15
Options Exercised		-			.
Options Canceled		-		$	-

Stock Options Outstanding, September 30, 2010		2,355,145		$	0.56

Stock Options Exercisable, September 30, 2010		1,517,627		$	0.58

F-19

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, ~~2009~~2010 and ~~2008~~2009

Note 7 – Stock Options (Continued)

Outstanding common stock options as of September 30, 2009 and September 30, 2008 are summarized below:

	Number of Shares			Weighted Average Exercise Price
Stock Options Outstanding, October 1, 2007		-		$	-
Options Granted		1,126,250		$	1.00
Options Exercised		-		$	-
Options Canceled		-		$	-
Stock Options Outstanding, September 30, 2008		1,126,250		$	1.00
Stock Options Exercisable, September 30, 2008		148,619		$	1.00
Options Granted		29,000		$	1.00
Options Exercised		-		$	-
Options Canceled		(15,105	)	$	1.00
Stock Options Outstanding, September 30, 2009		1,140,145		$	1.00
Stock Options Exercisable, September 30, 2009		438,057		$	1.00

The following table summarizes the changes in options outstanding and the related prices for the shares of the Company’s common stock options issued to both employees and non-employees of the Company.

	Options Outstanding						Options Exercisable
					Weighted
			Number		Average				Weighted
	Exercise		Shares		Contractual		Number		Average
Year	Price		Outstanding		Life (Years)		Exercisable		Exercise Price
February 2008	$	1.00		861,145		8.42		346,848	$	1.00
February-08	$	1.00		861,145		7.41		583,230	$	1.00
May 2008	$	1.00		250,000		8.67		88,542	$	1.00
May-08	$	1.00		250,000		7.67		151,042	$	1.00
January 2009	$	1.00		5,000		10.25		938	$	1.00
January-09	$	1.00		5,000		8.34		2,188	$	1.00
April 2009	$	1.00		10,000		8.42		1,146	$	1.00
April-09	$	1.00		10,000		8.58		3,750	$	1.00
August 2009	$	1.00		14,000		9.83		583	$	1.00
August-09	$	1.00		14,000		8.92		4,083	$	1.00
				1,140,145				438,057
January-10	$	0.15		1,155,000		9.34		756,667	$	0.15
May-10	$	0.15		60,000		9.60		16,667	$	0.15
				2,355,145				1,517,627

The aggregate intrinsic value of stock options outstanding and exercisable at September 30, ~~2009~~2010 and ~~2008~~2009 totaled $-0- and $-0- and $-0- and $-0-, respectively. The weighted average grant date fair value of options granted during the period ended September 30, ~~2009~~2010 and ~~2008~~2009 is $0.2713 and $ 0.8127, respectively. The fair value of vested options ~~vested~~as ~~during~~of the ~~period~~periods ended September 30, ~~2009~~2010 and ~~2008~~2009 totaled $~~122~~151,~~656~~763 and $59122,~~448~~656, respectively.

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, 2009 and 2008

Note 8 – Common Stock Purchase Warrants

On ~~May~~ 30October 3, 2008, the Company ~~extended~~commenced a ~~Conversion~~private ~~offer~~stock tooffering, ~~nine~~whereby ~~bridge loan note~~it ~~holders~~authorized ~~who had loaned~~ the ~~Company~~issuance ~~funds during the 3rd Quarter~~ of ~~2007. In exchange for their notes~~1,440,000 ~~the~~units ~~note~~consisting ~~holders~~of ~~were~~one ~~offered~~share ~~two shares~~ of ~~stock~~its ~~for~~common ~~each~~stock ~~dollar of debt~~ and ~~accrued interest they were owed through June 30, 2008. In addition, they were offered~~ one common stock purchase warrant for ~~each~~a ~~dollar of~~total ~~debt~~raise ~~and~~of ~~accrued~~$360,000. ~~interest~~The common atstock anpurchase ~~exercise~~warrants ~~price~~are ofexercisable at $21.00 per share and acarrying ~~two~~a five year exercise period. The ~~total~~offering ~~number~~was ofclosed ~~warrants~~as ~~granted~~of ~~was~~November ~~184~~30,~~120~~ ~~which~~2008. All ~~vested~~1,440,000 ~~entirely~~units ~~upon~~were ~~grant.~~issued ~~Warrant~~and ~~expense~~$360,000 in ~~the~~cash was received. The amount of ~~$239,548~~warrant ~~was recognized~~expense inrelated ~~the~~to ~~statements~~this ofoffering ~~operations~~ for the ~~fiscal~~Twelve ~~year~~Months ~~ended September~~ending September 30, ~~2008~~2009 was $593,484.

On ~~October~~January 328, ~~2008~~2009, the Company commenced a private stock offering, whereby it authorized the issuance of 1,~~440~~750,000 units, each consisting of one share of its ~~common~~ common stock and one common stock purchase warrant for a total raise of $~~360~~262,~~000~~500. The common stock purchase warrants are exercisable at $1.00 per share and ~~carrying~~carry a five year exercise period. The offering was closed ason ofMarch ~~November 30~~31, 2009, ~~2008.~~at ~~All~~ which time 1,~~440~~296,~~000~~800 ~~units~~unit shares were issued and $~~360~~194,~~000~~520 in cash was received. The amount of warrant expense related to this offering for the Twelve Months ending September 30, 2009 was $361,353.

~~The~~Total ~~amount of~~ warrant expense ~~related~~charged toas ~~this~~financing ~~offering~~costs for the ~~twelve~~Twelve ~~months~~Months ~~ending September~~ended September 30, 2010 and 2009 was $~~593~~-0- and $954,~~484~~837, respectively.

On January 28, 2009, the Company commenced a private stock offering, whereby it authorized the issuance of 1,750,000 units, each consisting of one share of its common stock and one common stock purchase warrant for a total raise of $262,500. The common stock purchase warrants are exercisable at $1.00 per share and carry a five year exercise period. The offering was closed on March 31, 2009 at which time 1,296,800 unit shares were issued and $194,520 in cash was received. The amount of warrant expense related to this offering for the twelve months ending September 30, 2009 was $361,353.F-20

Total warrant expense charged as financing costs for the twelve months ended September 30, 2009 and 2008 was $954,837 and $-0-, respectively.

Total warrant expense charged as settlement of debt costs for the twelve months ended September 30, 2009 and 2008 was $-0- and $239,549, respectively.

The Company has determined the estimated value of warrants granted during the twelve months ended September 30, 2009 using the Black-Scholes pricing model with the following assumptions: expected life of 5 years; a risk free interest rate of 1.66%-2.71%; a dividend yield of 0% and volatility of 149.62%-172.61%.

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, ~~2009~~2010 and ~~2008~~2009

Note 8 – Common Stock Purchase Warrants (Continued)

~~Outstanding~~The ~~common~~Company ~~stock~~has ~~purchase~~determined ~~warrants~~the asestimated value of warrants granted during the Twelve Months ending September 30, 2009 ~~and~~using ~~September~~the ~~30,~~Black-Scholes ~~2008 are~~pricing ~~summarized~~model ~~below~~with the following assumptions: expected life of 5 years; a risk free interest rate of 1.66%-2.71%; a dividend yield of 0% and volatility of 149.62%-172.61%.

	Number of Warrants		Weighted Average Exercise Price
Warrants Outstanding, October 1, 2007		-	$	-
Warrants Granted		184,120	$	2.00
Warrants Exercised		-	$	-
Warrants Canceled		-	$	-
Warrants Outstanding and Exercisable, September 30, 2008		184,120	$	2.00
Warrants Granted		2,736,800	$	1.00
Warrants Exercised		-	$	-
Warrants Canceled		-	$	-
Warrants Outstanding and Exercisable, September 30, 2009		2,920,920	$	1.06

Outstanding common stock purchase warrants as of September 30, 2010 are summarized below:

	Number of Warrants		Weighted Average Exercise Price
Warrants Outstanding, October 1, 2007		-	$	-

Warrants Granted		184,120	$	2.00
Warrants Exercised		-	$	-
Warrants Canceled		-	$	-
Warrants Outstanding and Exercisable, September 30, 2008		184,120	$	2.00

Warrants Granted		2,736,800	$	1.00
Warrants Exercised		-	$	-
Warrants Canceled		-	$	-

Warrants Outstanding and Exercisable, September 30, 2009		2,920,920	$	1.06

Warrants Granted		-	$	-
Warrants Exercised		-	$	-
Warrants Canceled		-	$	-
Warrants Outstanding and Exercisable, September 30, 2010		2,920,920	$	1.06

The following table summarizes the changes in warrants outstanding and the related prices for the shares of the Company’s common stock issued to the note holders referenced above.

	Warrants Outstanding						Warrants Exercisable
					Weighted
			Number		Average				Weighted
	Exercise		Shares		Contractual		Number		Average
Year	Price		Outstanding		Life (Years)		Exercisable		Exercise Price
2008	$	2.00		184,120		0.75		184,120	$	2.00
Jun-08	$	2.00		184,120		1.75		184,120	$	2.00
2009	$	1.00		2,736,800		4.59		2,736,800	$	1.00
Oct-08	$	1.00		40,000		3.08		40,000	$	1.00
Nov-08	$	1.00		1,400,000		3.17		1,400,000	$	1.00
Feb-09	$	1.00		666,667		3.41		666,667	$	1.00
Mar-09	$	1.00		630,133		3.50		630,133	$	1.00
				2,920,920				2,920,920

The aggregate intrinsic value of stock warrants outstanding and exercisable at September 30, ~~2009~~2010 and ~~2008~~2009 totaled $-0- and $-0- and $-0- and $-0-, respectively. The weighted average grant date fair value of stock warrants granted during the period ended September 30, ~~2009~~2010 and ~~2008~~2009 is $0~~.35~~ and $10.3035, respectively. The fair value of stock warrants vested during the period ended September 30, ~~2009~~2010 and ~~2008~~2009 totaled $~~766,304~~0 and $73766,~~648~~304, respectively.

22F-21

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, ~~2009~~2010 and ~~2008~~2009

Note 9 – Line of Credit

In August 2006, the Company entered into a Line of Credit / Overdraft Protection Agreement (“LOC Agreement”) with a financial institution to borrow up to $75,000. Interest accrues at the Wall Street Journal Prime Rate (“WSJ Prime Rate”) less 1% for the first six months and at the WSJ Prime Rate, thereafter. All amounts due on the line of credit are due on demand. The balance outstanding at September 30, ~~2009~~2010 and September 30, ~~2008~~2009 was $7267,~~054~~387 and $7472,~~807~~054 respectively. Accrued interest payable at September 30, ~~2009~~2010 and September 30, ~~2008~~2009 was $~~322~~180 and $~~512~~322, respectively. The LOC Agreement is guaranteed by an officer of the Company and is secured by all assets of the Company.

Note 10 – Equity Transactions

On ~~February~~December 1816, ~~2008~~2009, the Company commenced a private stock offering, whereby it authorized the issuance of ~~100~~3,~~000~~333,334 shares of its common stock for ~~cash~~a oftotal raise of $50500,000. The offering was closed ason of March 31, ~~2008~~2010 and 50 $37,~~000~~097 ~~shares~~ of ~~common~~ ~~stock~~the ~~were~~$500,000 ~~actually~~was ~~issued~~raised ~~during~~and ~~the~~247,317 ~~period~~shares ~~presented~~of incommon ~~exchange~~stock ~~for~~were ~~cash of $25,000~~issued.

On ~~February~~January 2021, ~~2008~~2010, the ~~Company~~Board ~~commenced~~of aDirectors ~~private~~approved ~~stock offering, whereby it authorized~~ the issuance of 501,~~000~~ 773,333 shares of ~~its~~ common stock ~~for~~in ~~cash~~satisfaction of $260,000 in related party notes payable and $506,000. ~~The~~in ~~offering~~accrued ~~was~~interest ~~closed~~to asa director of ~~March~~the ~~31,~~Company. ~~2008~~As ~~and~~part 33of the agreement,~~123~~ ~~shares~~the remaining balance of the related party note of $100,000 (See ~~common~~Note ~~stock~~11) ~~were~~will ~~actually~~be ~~issued~~due ~~during~~and payable over the ~~period~~next ~~presented~~7 inyears ~~exchange~~at ~~for cash~~an interest rate of ~~$33,123~~8% per annum.

On ~~February~~January 2821, ~~2008~~2010, ~~our~~the Board of Directors approved the issuance of ~~139~~680,~~562~~ 000 shares of atcommon astock ~~price~~in satisfaction of $~~1.00~~90,000 ~~per~~in ~~share~~related party notes payable and $12,000 in ~~settlement~~accrued interest to a director of ~~Notes~~the Company. As part of the agreement, the remaining balance of the related party note of $14,000 (See Note 11) will be due and ~~Accounts~~payable over the next 2 years at an interest rate of 8% per ~~Payable~~annum.

On ~~April 11,~~May ~~2008~~1, 2010 the Company commenced a private stock offering, whereby it authorized ~~the~~ the issuance of ~~820~~5,000,000 shares of its common stock for ~~cash~~a oftotal raise of $~~410~~500,000. As ~~The offering~~of ~~was~~September ~~closed~~30, as2010 $92,005 of ~~April~~the 30$500,000 ~~2008.~~was ~~All~~raised and ~~820~~920,~~000~~050 shares of common stock were issued.

On May 30, 2008, the Company extended a Conversion offer to nine bridge loan note holders who had loaned the Company funds during the 3rd Quarter of 2007. In exchange for their notes, the note holders were offered two shares of stock for each dollar of debt and accrued interest they were owed through June 30, 2008. Debt settlement expense associated with these transactions was $685,421 and was recorded in the Company’s statement of operations for the twelve months ending September 30, 2008. Note ~~holders~~11 ~~were~~– ~~also~~Notes ~~offered one common stock warrant for~~Payable- ~~each~~Related dollar of debt and accrued interest at an exercise price of $2.00 per share and a two year exercise period. The warrant expense associated with this transaction was $239,549 for the twelve months ending September 30, 2008.Parties

OnThrough ~~October~~September 330, ~~2008~~2007, a director of the ~~Company~~company ~~commenced~~loaned athe ~~private~~Company ~~stock~~a ~~offering~~total of $32,026 ~~whereby~~at itan interest rate of 6% per annum. During the fiscal year ended ~~authorized~~September 30, 2008 the ~~issuance~~Company issued 30,779 shares of 1common stock in relief of $30,~~440~~779 in debt. This director advanced $75,000 ~~Units~~during ~~consisting~~fiscal year 2008. During the fiscal year ended September 30, 2009, the director advanced the Company an additional $27,499, bringing the total principal balance due as of ~~one~~January ~~share~~20, 2010 to $103,747. This note was payable monthly in the amount of ~~its~~$1,000 ~~common~~plus ~~stock~~interest, however, no scheduled payments were made through January 20, 2010 by the Company. On January 21, 2010, the Company’s Board authorized the conversion of $102,000 of principal and ~~one~~accrued interest to common stock ~~purchase~~and ~~warrant~~issued a new promissory note for abalance ~~total~~in ~~raise~~the amount of $~~360~~14,~~000~~197. The new promissory note of ~~common~~$14,197 ~~stock~~carries ~~purchase~~an ~~warrants~~interest ~~are~~rate ~~exercisable~~of 8% per annum, is payable monthly at $1~~.00~~ ,000 per ~~share~~month ~~and~~beginning ~~carrying~~February a21, 2010, matures March, 2012 and is ~~five~~unsecured. Total ~~year~~principal ~~exercise~~payments during the period were $300. Monthly ~~The~~payments ~~offering~~on ~~was~~the ~~closed~~note aswere ofnot ~~November~~made through September 30, ~~2008~~2010 and the note was considered in default. ~~All 1~~As of September 30,~~440~~ 2010,~~000~~ accrued ~~units~~interest ~~were~~owed ~~issued~~on ~~and~~the ~~$360,000~~new inpromissory ~~cash~~note was ~~received~~$510.

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, ~~2009~~2010 and ~~2008~~2009

Note 10 11 – ~~Equity~~Notes Payable- ~~Transactions~~Related Parties (Continued)

~~During~~Through September 30, 2007, the CEO and Chairman of the Board of the Company advanced the Company $20,000. During the fiscal year ended September 30, ~~2009~~2008 the Company issued ~~450~~a total of 20,000 shares of common stock toin satisfaction of $20,000 in Nudebt. ~~Vision~~As ~~Holdings~~of January 20, ~~LLC~~2010 total principal owed on the note was $356,068. Monthly ~~valued~~payments were not required and interest accrued at 6% per annum. On January 21, 2010, the Company’s Board authorized the conversion of $~~180~~266,000 ~~for~~of principal ~~consulting~~and ~~services~~accrued ~~rendered~~interest to common stock and issued a new promissory note for the ~~Company~~balance in the amount of $97,356. The ~~contract~~new ~~expired~~promissory note of $97,356 carries an interest rate of 8% per annum, is payable monthly at $1,558 per month beginning February 21, 2010, matures January, 2017 and is unsecured. Scheduled payments were made on ~~April~~the 7new note through September 30, ~~2009~~2010, including principal payments of $4,694. Since January 21, 2010, additional funds of $136,800 have been advanced by the CEO to the Company and added to the promissory note. As of September 30, 2010 total principal owed on the note was $239,582 and accrued interest owed was $6,854.

~~During~~Through September 30, 2008, a director of the ~~year~~company ~~ended~~advanced ~~September~~a 30total of $12,772 ~~2009~~in the form ~~Company~~of ~~issued~~a ~~102~~demand note dated March 15,~~500~~ 2008. During the 2008 fiscal year end 1,917 shares of common stock towere issued in satisfaction of $1,917 in andebt, ~~individual~~resulting atin ana ~~aggregate~~principal ~~value~~balance due as of September 30, 2010 and 2009, of $1410,~~350~~855. ~~for~~This ~~services~~note ~~rendered~~is topayable monthly by the Company in ~~connection~~the amount of $1,020 with interest at the ~~Garden~~rate ~~Guys~~of ~~radio~~6% ~~talk~~per ~~show~~annum. AnDuring ~~issuance~~the ofTwelve Months ending 50September 30,~~000~~ ~~shares~~2010, ~~was~~no ~~issued~~scheduled onpayments ~~July~~were 1,made ~~2009;~~and ~~50,000~~the ~~shares~~note ~~were~~was ~~issued~~considered in ondefault. ~~August~~As ~~1, 2009~~of ~~and~~September 230,~~500~~ ~~shares~~2010, ~~were~~accrued ~~issued~~interest owed on ~~September~~the Note was $1, ~~2009~~503.

~~Note~~Through September 1130, –2008, ~~Notes~~a ~~Payable-~~director of the company, advanced $175,000 to the Company. ~~Related~~Interest ~~Parties~~accrues at 12% per annum. Accrued interest and principal was due at maturity, December 1, 2008, however, the note holder agreed to extend the maturity date for an additional twelve months given the same terms and conditions as the original note. Through the period September 30, 2010, no payments were made and the note was considered in default. As of September 30, 2010, accrued interest owed on the Note was $68,426.

Through September 30, 2007, a director of the company, loaned the Company a total of $32,026 at a interest rate of 6%. During the fiscal year ended September 30, 2008 the Company issued 30,779 shares of common stock in relief of $30,779 in debt. This director advanced $75,000 during fiscal year 2008. During the fiscal year ended September 30, 2009 the director advance the Company an additional $27,499 bringing the total principal balance due as of September 30, 2009 to $103,747. This note is payable monthly by the Company in the amount of $1,000 with interest During the fiscal years ending September 30, 2009 and 2008, no scheduled payments were made. As of September 30, 2009, accrued interest owed on the Note was $10,331.F-23

Through September 30, 2008, a director of the company, advanced a total of $12,772 in the form of a demand note dated March 15, 2008. During the 2008 fiscal year end 1,917 shares of common stock were issued in satisfaction of $1,917 in debt, resulting in a principal balance due as of September 30, 2009 and 2008, of $10,855. This note is payable monthly by the Company in the amount of $1,020 with interest at the rate of 6% per annum. During the fiscal year ending September 30, 2009 and 2008, no scheduled payments were made. As of September 30, 2009, accrued interest owed on the Note was $960.

Through September 30, 2008, a director of the company, advanced $175,000 to the Company. Interest accrues at 12% per annum. Accrued interest and principal was due at maturity, December 1, 2008, however, the note holder agreed to extend the maturity date for an additional twelve months given the same terms and conditions as the original note. Early indications are that the maturity date will be extended for an additional twelve months subject to Board approval in January 2010. As of September 30, 2009 accrued interest owed on the note was $47,533.

Through September 30, 2007, the CEO and Chairman of the Board of Directors of the Company advanced the Company $20,000. During the fiscal year ended September 30, 2008 the Company issued a total of 20,000 shares of common stock in satisfaction of $20,000 in debt. At September 30, 2009 this individual has advanced an aggregate of $206,133. Monthly payments are not required and interest accrues at 6% per annum. The note matures on January 30, 2010. As of September 30, 2009, accrued interest owed on the Note was $2,474.

Notes payable-related parties consisted of the following at:

	September 30,			September 30,
	2009			2008
Note payable with a director of the Company, interest at 6% per annum, payments of $1,000 due monthly beginning April 1, 2007, matures March 2010, unsecured.	$	103,747		$	76,247
Note payable with a director of the Company, interest at 6% per annum, payments of $1,020 due monthly beginning April 15, 2008, matures April, 2009, unsecured.	$	10,855			10,855
Note payable with a director of the Company, interest at 12% per annum. No monthly payments are required. All accrued interest and principal is paid at maturity, December 1, 2008, unsecured	$	175,000			175,000
Note payable with a director of the Company, interest at 6% per annum, no monthly payments are required. All accrued interest and principal is due at maturity, January 30, 2010, unsecured		206,134			-
Total Notes Payable - Related Parties	$	495,735		$	262,102
Less: Current Portion		(495,735	)		(262,102	)
Long-Term Notes Payable - Related Parties	$	-		$	-

Total accrued interest at September 30, 2009 and September 30, 2008 was $61,298 and $26,411.

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, ~~2009~~2010 and ~~2008~~2009

Note 11 – Notes Payable- Related Parties (Continued)

~~Annual~~Notes ~~maturities of notes~~ payable-related parties ~~are~~consisted asof ~~follows~~the following at:

Years Ending September 30,
	September 30,			September 30,
~~2010~~	2010	~~495,736~~		2009
2011		-
Note payable with a director of the Company, interest at 8% per annum, payments of $1,000 is due monthly beginning February 21, 2010, matures January, 2012, unsecured	$	13,897		$	103,747
2012		-
Note payable with a director of the Company, interest at 8% per annum, payments of $1,558.62 is due monthly beginning January 21, 2010, matures January, 2017, unsecured		239,582			206,134
2013		-
Note payable with a director of the Company, interest at 6% per annum, payments of $1,020 due monthly beginning April 15, 2008, matures April, 2009, unsecured, in default		10,855			10,855
2014		-
Note payable with a director of the Company, interest at 12% per annum. No monthly payments are required. All accrued interest and principal was due at maturity, December 1, 2009, in default		175,000			175,000
Thereafter		-
Total Notes Payable - Related Parties	$	439,334		$	495,736
Less: Current Portion		(439,334	)		(495,736	)
Long-Term Notes Payable - Related Parties	$	-		$	-

Total accrued interest at September 30, 2010 and September 30, 2009 was $73,813 and $61,620, respectively.

F-24

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, 2010 and 2009

Note 12 – Commitments and Contingencies

Leases

The Company leases facilities for its corporate offices at $600 per month. The lease expired in fiscal 2007 and was then converted to a month-to-month basis. ~~In addition, the company leased warehouse space at $500 per month through January, 2008.~~ Rental expense for fiscal ~~2009~~2010 and ~~2008~~2009 was $97,~~087~~200 and $69,~~800~~087, respectively. The Company also has a 60 month equipment lease on its office copier machine that costs $240 per month and expires on August 30, 2011 and rents a small storage unit on a month to month basis for $~~129~~147 per month.

The future minimum annual lease commitments as of September 30, ~~2009~~2010 are as follows:

Years Ending September 30,	Amount
2010		2,880
2011		2,640
2012		-
2013		-
2014		-
2015		-
Thereafter		-
	$	5,520

Agreements

As of September 30, ~~2009~~2010, the Company had ~~two~~one active radio station syndication ~~agreements.~~agreement ~~One~~under ~~station~~which ~~was paid currently and~~ the ~~second~~company ~~was~~ owed $64,700.~~950.~~ The ~~agreements~~ ~~range~~agreement expires in ~~length from~~ one ~~month to two years~~ year and the Company intends to renew ~~them~~it at the end of ~~each~~the ~~respective~~ term. As of September 30, ~~2009~~ 2010, the monthly cost of our radio ~~shows~~show is $75,500 in a ~~four week~~ month ~~and $8,000 in a five week month~~. ~~During the fiscal year, the Company had six other radio syndication agreements which were not renewed and as of September 30, 2009 the Company owed $ 127,717 which was included in accounts payable.~~

On May 3, 2008, the Company entered into a ten year licensing agreement with Microbial Technologies Ltd. (“MTL”) for the purposes of obtaining the right to use the proprietary formulations owned by MTL. The cost of the licensing agreement will be $100,000 per year, which will be billed quarterly to the Company, and a 5% royalty on net sales of any MTL product formulations sold. If the Company does not use MTL formulations, the licensing fee and royalties are not required to be paid. ~~As of the year ended September 30, 2008 no royalties were paid and none were due.~~ The total amount owed ~~for~~under ~~the~~this agreement at September 30, ~~2009~~2010, is $~~109~~142,905 from the use of the MTL technology, and has been included in accounts payable. ~~Royalties for the year ended September 30, 2009 were $6,200 and have been paid.~~

25Note 12 – Commitments and Contingencies (Continued)

The future minimum annual contractual obligations as of September 30, 2010 are as follows:

Years Ending September 30,	Amount

2011		16,500
2012		-
2013		-
2014		-
2015		-
Thereafter		-
	$	16,500

F-25

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, ~~2009~~2010 and ~~2008~~2009

Note 12 – Commitments and Contingencies (Continued)

The future minimum annual contractual obligations as of September 30, 2009 are as follows:

Years Ending September 30,	Amount
2010		79,111
2011		16,500
2012		-
2013		-
2014		-
Thereafter		-
	$	95,611

Note 13 – Concentration of Credit Risk

Major Customers

The Company had ~~two~~one ~~customers~~customer who represented 10% or more of total sales for the ~~year~~ year ended September 30, ~~2009~~2010 at 19.1% of total sales.

	September 30, 2009			September 30, 2008
Customer A		10.6	%		—
Customer B		10.0	%		—

As of September 30, 2010 the Company’s accounts receivable was due from this customer was $2,798. The loss of this customer, although not anticipated, could have a material impact on the Company’s present and future operations.

As of September 30, 2009 none of the Company’s accounts receivable was due from these two customers. The loss of these customers, although not anticipated, could have a material impact on the Company’s present and future operations.

Major Suppliers

The Company had two vendors who represented 10% or more of the total material purchases for the year ended September 30, ~~2009~~2010 at 64.7% and 13.1% respectively.

	September 30, 2009			September 30, 2008
Vendor A		54.2	%		39.6	%
Vendor B		30.4	%		—

Due to capabilities, pricing and geographic location, these vendors are considered sole source vendors by the Company. The loss of these sole source vendors could have a temporary impact on operations; however, alternate suppliers are readily available that the Company feels could quickly fill the void, should it ever need to.

ORGANIC SALES AND MARKETING, INC.

Notes to the Financial Statements

September 30, 2009 and 2008

Note 14 – Going Concern

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company is poorly capitalized and has had recurring operating losses, negative cash flows from operations and recurring negative working capital for the past several years and is dependent upon financing to continue operations. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. It is management's plan to continue to implement their strategy of acquiring new customers and accepting reorders from existing customers. As the Company's revenues become more established, management expects to report net income. With the expansion of sales, management believes that the Company will eventually generate positive cash flow from operations. In the interim, management believes that shortfalls in cash flow will be satisfied with funds raised from bridge loans, convertible debt and additional private stock offerings that are in compliance with Securities and Exchange Commission rules and regulations governing the same.

Note 15 – Subsequent Events

OnSubsequent ~~December~~to ~~16,~~September ~~2009~~30, ~~the~~2010 ~~Company~~and ~~commenced~~through athe ~~private~~date ~~stock~~its ~~offering,~~financial ~~whereby~~statements ~~it authorized~~were issued, the ~~issuance~~Company ofissued 3an additional 130,~~333,334~~000 shares of ~~its~~ common stock ~~for~~as apart ~~total raise~~ of ~~$500,000. The offering is expected to be completed by March~~the ~~31,~~ongoing ~~2010~~private ~~and~~stock ~~the company expects that all shares will be sold. There can be no assurance~~offering, ~~however,~~for ~~that~~an ~~this~~additional ~~will happen. As of January 10, 2010~~ $3613,000 of the $500,000 discussed ~~has~~in ~~been~~Note ~~raised and 240,000 shares have been issued~~10.

~~Subsequent~~Organic toSales ~~September~~and 30Marketing, ~~2009,~~Inc. ~~and~~has ~~through~~evaluated ~~January~~subsequent 13events for the period September 30, 2010, through the ~~Company’s~~date ~~CEO~~its financial statements were issued, and ~~Chairman~~concluded ofthere ~~the~~were ~~Board~~no ~~has~~other ~~advanced~~events ~~the~~or ~~Company~~transactions anoccurring ~~aggregate~~during ~~amount~~this period that required recognition of ~~$145,000 as~~disclosure ~~operating~~in ~~capital~~its financial statements.

Organic Sales and Marketing, Inc. has evaluated subsequent events for the period September 30, 2009 through January 13, 2010, the date its financial statements were issued, and concluded there were no other events or transactions occurring during this period that required recognition of disclosure in its financial statements.F-26

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