UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended ~~September~~March 3031, ~~2011~~2012

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT For the transition period from N/A to N/A

Commission File No. 000-~~53388~~453388

FREEDOM ~~ENVRIONMENTAL~~ENVIRONMENTAL SERVICES, INC.

(Name of small business issuer as specified in its charter)

Delaware	27-3218629
( State or other jurisdiction of incorporation or organization)	( IRS Employer Identification No.)

11372 United Way, Orlando, Florida 32824

(Address of principal executive offices) (Zip Code)

(407) 905-5000

Registrant’s telephone number, including area code

Indicate by check mark whether the Registrant (1) has filed all reports required by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days:

Yes x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes o No x

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

Large accelerated filer o¨ Accelerated filer o¨ Non–Accelerated filer o¨ ~~Smaller~~Small reporting company x

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

Yes o No x

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

Class		Outstanding at ~~November~~July 2126, ~~2011~~2012
Common stock, $0.001 par value		~~128~~149,~~343~~768,~~334~~434

FREEDOM ENVIRONMENTAL SERVICES, INC.

INDEX TO FORM 10-Q FILING

FOR THE THREE ~~AND NINE~~ MONTHS ENDED ~~SEPTEMBER~~MARCH 3031, ~~2011~~2012 AND ~~2010~~2011

TABLE OF CONTENTS

		PAGE
PART I - FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements ~~(Unaudited)~~	1
	Consolidated Balance Sheets	2
	Condensed Consolidated Balance Sheets	2
	Consolidated Statements of Operations	3
	Condensed Consolidated Statements of Income	3
	Consolidated Statements of Cash Flows	4
	Condensed Consolidated Statement of Cash Flows	4
	Notes to Consolidated Financial Statements	5
	Notes to Condensed Consolidated Financial Statements	5
Item 2.	Management Discussion & Analysis of Financial Condition and Results of Operations	1814
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	23
Item 3	Quantitative and Qualitative Disclosures About Market Risk	19
Item 4.	Controls and Procedures	2319
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	2320
Item 1A.	Risk Factors	2421
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	2729
Item 3.	Defaults Upon Senior Securities	2829
Item 4.	Removed and Reserved	2829
Item 5.	Other information	28
Item 5	Other information	29
Item 6.	Exhibits	2829
CERTIFICATIONS

31.1	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act.
31.2	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act.
32.1	Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act.
32.2	Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act.

Table of Contents

PART I

FINANCIAL INFORMATION

Item 1.

Financial Statements

The accompanying reviewed interim consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q. Therefore, they do not include all information and footnotes necessary for a complete presentation of financial position, results of operations, cash flows, and stockholders' equity in conformity with generally accepted accounting principles. Except as disclosed herein, there has been no material change in the information disclosed in the notes to the consolidated financial statements included in the Company's Annual Report on Form 10-K for the year ended December 31, ~~2010~~2011. In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature. Operating results for the ~~nine~~three months ended ~~September~~March 3031, ~~2011~~2012 are not necessarily indicative of the results that can be expected for the year ending December 31, ~~2011~~2012.

Table of Contents

FREEDOM ENVIRONMENTAL SERVICES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS


	March 31,			December 31,
	2012			2011
	(unaudited)
ASSETS:
CURRENT ASSETS
Cash	$	264,679		$	73,664
Accounts receivable - net of allowance of $36,550 and $45,030		229,804			238,460
Inventory		-			-
Prepaid Expenses		7,929			6,247
Deposits		176,875			176,875
Total current assets		679,287			495,246

PROPERTY AND EQUIPMENT
Property and equipment, net of accumulated depreciation of
$744,792 and $627,519		1,865,089			1,725,075
Total property and equipment		1,865,089			1,725,075

OTHER ASSETS
Intangible asset (customer list), net of accumulated amortization
of $70,000 and $60,000		130,000			140,000
Loan costs, net of accumulated amortization of $4,880 and $1,420		2,864			6,324
Total other assets		132,864			146,324

TOTAL ASSETS	$	2,677,240		$	2,366,645

LIABILITIES & STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Bank overdraft	$	24		$	11,873
Accounts payable		348,671			343,842
Accrued expenses		104,382			124,409
Accrued interest (related parties $46,857 & $33,254)		72,741			47,548
Customer Deposits		36,100			-
Lines of credit		13,177			90,223
Notes payable - short term		141,345			930,646
Notes payable - current portion of long-term debt		117,217			29,057
Notes payable - related parties		492,755			492,755
Convertible notes payable		-			-
Total current liabilities		1,326,412			2,070,353

LONG TERM LIABILITIES
Convertible notes payable		770,000			220,000
Notes payable - long term debt less current portion		949,416			59,777
Total long term liabilities		1,719,416			279,777

TOTAL LIABILITIES		3,045,828			2,350,130

STOCKHOLDERS' EQUITY (DEFICIT)
Common stock subscribed, 1,000,000 and 1,000,000 shares as of
March 31, 2011 and December 2011, respectively		50,000			50,000
Preferred stock, $0.001 par value, 75,000,000 shares authorized:
Series A, Convertible - 5,736,333 issued and outstanding
as of March 31, 2012 and December 31, 2011		5,736			5,736
Common stock, $0.001 par value, 200,000,000 shares authorized:
133,568,434 and 133,443,434 issued and outsanding
as of March 31, 2012 and December 31, 2011, respectively		133,568			133,443
Additional paid-in capital		22,162,322			22,157,447
Accumulated deficit		(22,720,214	)		(22,330,111	)
Total stockholders' equity		(368,588	)		16,515

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	2,677,240		$	2,366,645

FREEDOM ENVIRONMENTAL SERVICES, INC.
CONSOLIDATED BALANCE SHEETS
(Unaudited)
	September 30, 2011			December 31, 2010
ASSETS:
CURRENT ASSETS
Cash	$	73,899		$	175,134
Accounts receivable - net of allowance of $71,617 and $45,300		274,259			238,618
Inventory		56,514			70,658
Prepaid expenses		-			5,230
Total current assets		404,672			489,640
Property and equipment, net of depreciation of $485,327 and $154,197		1,767,236			2,154,349
Deposit		175,000			-
Intangible assets - net of accumulated amortization of $50,291 and $20,000		151,652			181,943
TOTAL ASSETS	$	2,498,560		$	2,825,932
LIABILITIES AND STOCKHOLDERS' EQUITY:
CURRENT LIABILITIES:
Bank overdraft	$	12,682		$	-
Accounts payable		392,811			440,895
Accrued expenses		106,304			184,546
Accrued interest - related parties		36,891			30,938
Line of credit		99,230			13,177
Notes payable		344,000			749,000
Notes payable - related party		506,400			456,900
Current portion of long-term notes payable		110,265			320,031
Convertible notes payable		-			114,500
Other current liabilities		42,800			-
Total current liabilities		1,651,383			2,309,987
Long-term notes payable		701,127			-
TOTAL LIABILITIES		2,352,510			2,309,987
COMMITMENTS AND CONTINGENCIES		-			-
STOCKHOLDERS' EQUITY:
Preferred stock, $0.001 par value, 75,000,000 shares
authorized; Series A, convertible, 5,736,333 and 3,177,111 issued
and outstanding as of September 30, 2011 and December 31, 2010		5,736			3,177
Common stock, $0.001 par value, 200,000,000 shares authorized;
123,018,334 and 103,444,517 issued and outstanding
as of September 30, 2011 and December 31, 2010, respectively		123,018			103,445
Additional paid-in capital		21,288,618			20,888,927
Accumulated deficit		(21,271,322	)		(20,479,604	)
Total stockholders' equity		146,050			515,945
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	2,498,560		$	2,825,932
The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

FREEDOM ENVIRONMENTAL SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

	Three Months Ended
	March 31,
	2012			2011

Revenues	$	1,168,824		$	1,390,505
Total		1,168,824			1,390,505

COST OF SALES		976,926			941,021

GROSS PROFITS		191,898			449,484

OPERATING EXPENSES
General and administrative		514,964			763,674
Depreciation and amortization expense		15,508			10,097
Total operating expenses		530,472			773,771
OPERATING LOSS		(338,574	)		(324,287	)

OTHER INCOME (EXPENSES)
Other income		175			-
Insurance claim proceeds		-			-
Interest expense		(50,011	)		(31,793	)
Gain (loss) on disposal of assets		-			1,995
Legal settlement		-			-
Fines and penalties		(1,694	)		-
Total other expenses		(51,530	)		(29,798	)

NET LOSS	$	(390,104	)	$	(354,086	)

NET LOSS PER SHARE:
Basic and diluted	$	(0.00	)	$	(0.00	)

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
Basic and diluted	$	133,526,767		$	107,262,932

FREEDOM ENVIRONMENTAL SERVICES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2011			2010			2011			2010
REVENUE	$	1,422,018		$	1,001,093		$	4,378,747		$	1,137,215
COST OF SALES		1,110,311			142,096			3,004,779			195,786
GROSS PROFIT		311,707			858,997			1,373,968			941,429
OPERATING EXPENSES:
General and administrative		567,073			753,113			2,002,229			2,514,793
Depreciation and amortization		10,097			55,986			30,291			58,340
Gain on sale of assets		-			-			(1,995	)		-
Total operating expenses		577,170			809,099			2,030,525			2,573,133
OPERATING INCOME (LOSS)		(265,463	)		49,898			(656,557	)		(1,631,703	)
OTHER EXPENSES:
Interest expense		28,046			70,792			135,161			1,312,748
Total other expense		28,046			70,792			135,161			1,312,748
NET LOSS	$	(293,509	)	$	(20,894	)	$	(791,718	)	$	(2,944,451	)
NET LOSS PER SHARE:
Basic and diluted	$	(0.00	)	$	(0.00	)	$	(0.01	)	$	(0.09	)
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic and diluted		115,018,334			46,424,654			112,923,147			33,885,792
The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

FREEDOM ENVIRONMENTAL SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

	Three Months Ended
	March 31,
	2012			2011

Net loss	$	(390,104	)	$	(354,086	)
Adjustments to reconcile net loss to net cash
used in operating activities:
Bad debt expense		-			11,463
Depreciation		117,272			126,821
Amortization		16,324			4,088
Loss (gain) on disposal of assets		-			(1,995	)
Common stock issued for services		5,000			99,350
Changes in operating assets and liabilities:
Accounts receivable		8,657			2,577
Other assets		(1,682	)		5,230
Inventory		-			3,750
Accounts payable		(27,530	)		(144,050	)
Accrued expenses		(20,027	)		84,394
Accrued interest - related parties		25,193			(19,661	)
Unearned Revenue		36,100			-
Deferred Liabilitites		-			42,800
Net cash used in operating activities		(230,797	)		(139,319	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Deposit for business acquisition		-			(175,000	)
Purchase of equipment		(257,286	)		(39,108	)
Proceeds from sale of property plant and equipment		-			26,645
Net cash used in investing activities		(257,286	)		(187,463	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Bank overdraft		(11,849	)		14,332
Proceeds from convertible notes payable		550,000			-
Proceeds from note payable		1,015,162			606,106
Proceeds from note payable - related parties		-			67,300
Repayment of line of credit		(77,046	)		-
Repayment of note payable		(794,169	)		(475,423	)
Repayment of note payable - related parties		(3,000	)		-
Net cash provided by financing activities		679,098			212,315

NET INCREASE (DECREASE) IN CASH		191,015			(114,467	)

CASH, BEGINNING OF PERIOD		73,664			175,134
CASH, END OF PERIOD	$	264,679		$	60,667

SUPPLEMENTAL CASH FLOW INFORMATION

Interest paid	$	21,358		$	52,086
Taxes paid	$	-		$	-

NONCASH INVESTING AND FINANCING TRANSACTIONS
Issuance of common stock for the conversion of debt	$	-		$	86,000
Common stock issued for payables	$	5,000		$	32,704
Preferred stock issued for accrued compensation payable	$	-		$	17,915
Common stock issued for accrued compensation	$	-		$	10,615
Common stock issued for acquisition of equipment	$	-		$	15,240

FREEDOM ENVIRONMENTAL SERVICES, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
	Nine Months Ended
	September 30,
	2011			2010
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss	$	(791,718	)	$	(2,944,451	)
Adjustments to reconcile net loss to net cash
used in operating activities:
Bad debt expense		42,004			-
Depreciation and amortization		368,124			58,340
Gain on sale of assets		(1,995	)		-
Amortization of debt discount		32,704			112,500
Common stock issued for compensation		99,350			1,455,427
Common stock issued for interest expense		-			1,228,892
Changes in operating assets and liabilities:
Accounts receivable		(77,645	)		15,682
Prepaid expenses		5,230			(1,500	)
Inventory		14,144			(8,107	)
Accounts payable		(48,084	)		(80,057	)
Accrued expenses		59,287			207,591
Accrued interest - related parties		5,953			-
Other current liabilities		42,800			-
Net cash provided by (used in) operating activities		(249,846	)		44,317
CASH FLOWS FROM INVESTING ACTIVITIES:
Deposit for business acquisition		(175,000	)		-
Proceeds from sale of equipment		26,645			-
Purchase of equipment		(41,697	)		(58,674	)
Net cash used in investing activities		(190,052	)		(58,674	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Bank overdraft		12,682			(5,037	)
Proceeds from exercise of warrants		50,000			-
Repayment of notes payable		(559,026	)		-
Repayment of convertible note		(32,500	)		-
Repayment of notes payable - related parties		(14,300	)		-
Proceeds from line of credit		91,007			-
Proceeds from notes payable		722,000			-
Proceeds from notes payable - related parties		68,800			100,000
Cash received in acquisition		-			207,163
Net cash provided by financing activities		338,663			302,126
NET INCREASE (DECREASE) IN CASH		(101,235	)		287,769
CASH, BEGINNING OF PERIOD		175,134			-
CASH, END OF PERIOD	$	73,899		$	287,769
SUPPLEMENTAL CASH FLOW INFORMATION
Interest paid	$	145,178		$	-
Taxes paid	$	-		$	-
NONCASH INVESTING AND FINANCING TRANSACTIONS
Issuance of common stock for the conversion of debt	$	86,000		$	451,614
Common stock issued for accrued compensation	$	120,615		$	-
Common stock issued for the acquisition of equipment	$	15,240		$	-
Capital lease obligation	$	11,433		$	-
Common stock issued for note payable-debt discount	$	32,704		$	-
Preferred stock issued for accrued compensation	$	17,915		$	-
The accompanying notes are an integral part of these consolidated financial statements.

Table of Contents

FREEDOM ENVIRONMENTAL SERVICES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE THREE ~~AND NINE~~ MONTHS ENDED ~~SEPTEMBER~~MARCH 3031, ~~2011~~2012 AND ~~2010~~2011

NOTE 1 - DESCRIPTION OF BUSINESS

Freedom Environmental Services, Inc. (the “Company” or “Freedom”) provides wastewater management and recycling services to its customers through its different divisions. InOn July 16, 2010, the Company acquired the assets and certain liabilities of Brownies Waste Water Solutions, Inc. (“Brownies”). Brownies ~~which~~was ~~has~~originally ~~been~~purchased in a ~~staple~~Chapter 7 Bankruptcy proceeding in December of 2008, just 18 months before the Company acquired the assets and certain liabilities of Brownies Waste Water Solutions, Inc. Prior to its Bankruptcy proceeding in December of 2008, the business had been operating by unrelated third parties in the Central Florida market since 1948, providing commercial and residential septic services. These services include drain field installation, maintenance and repair; grease trap cleaning, maintenance, installation and repair; full service commercial and residential plumbing; sewer drain cleaning, backflow testing, repairs and certifications; lift station cleaning, maintenance, repairs, bio-solids transportation and recycling. Prior to the acquisition of Brownies, on July 5, 2010, Brownies purchased the equipment of Vac and Jet Services which was a defunct company with two Vactor trucks ~~purchased on July 5, 2010~~.

On December 13, 2010, Freedom purchased the equipment of Clean Fuel, LLC and placed that equipment into its wholly owned subsidiary, Grease Recovery Solutions, LLC (“Grease”). Grease handles all of the Company’s restaurant, resort and theme park services which include grease trap cleaning, sewer drain cleaning and waste cooking oil for recycling.

In February 2011, the Company entered into a letter of intent with David M. Hickman in Pennsylvania to purchase the equipment, inventory and customer list from a company owned by Mr. Hickman. The Company is in the process of due diligence and has escrowed a non-refundable deposit of $175,000 towards the purchase, which is classified in the accompanying balance sheet as a long-term deposit. Mr. Hickman has granted the Company an extension to complete the due diligence by ~~December~~May 31, ~~2011~~2012. ~~The~~Although the deadline has passed, negotiations between the Company and Mr. Hickman are ongoing and active and the Company anticipates entering into a definitive agreement bywithin the ~~end~~next ofseveral ~~2011~~months. Mr. Hickman provides sanitation services throughout Pennsylvania. Mr. Hickman’s company provides all aspects of commercial and residential services including septic system cleaning, maintenance and installation. WeThe ~~plan~~Company plans to expand that business to the current services lines that weit ~~provide~~provides in the State of Florida.

NOTE 2 - BASIS OF PRESENTATION

Interim Financial Statements

The accompanying interim unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In our opinion, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the ~~nine~~three months ended ~~September~~March 3031, ~~2011~~2012 are not necessarily indicative of the results that may be expected for the year ending December 31, ~~2011~~2012. While management of the Company believes that the disclosures presented herein are adequate and not misleading, these interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the footnotes thereto for the fiscal year ended December 31, ~~2010~~2011 as filed with the Securities and Exchange Commission in our Form 10-K.

NOTE 3 - GOING CONCERN

The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. However, the Company has a net loss for the nine months ended September 30, 2011 of $791,718, an accumulated deficit at September 30, 2011 of $21,271,322, cash flows used in operating activities of $249,846 and needs additional cash to maintain its operations.

~~Table~~NOTE of3 ~~Contents~~- GOING CONCERN ISSUES

The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. However, the Company has a net loss for the three months ended March 31, 2012 of $390,104, an accumulated deficit at March 31, 2012 of $22,720,214, cash flows used in operating activities of $230,797 and needs additional cash to maintain its operations.

These factors raise doubt about the Company’s ability to continue as a going concern. The accompanying financial statements do not include any adjustments that might result from the outcome of this uncertainty. The Company’s continued existence is dependent upon management’s ability to develop profitable operations, continued contributions from the Company’s executive officers to finance its operations and the ability to obtain additional funding sources to explore potential strategic relationships and to provide capital and other resources for the further development and marketing of the Company’s products and business.

NOTE 4 -– SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Company prepares its financial statements in accordance with accounting principles generally accepted in the United States of America. Significant accounting policies are as follows:

Use of Estimates and Assumptions

The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires management to make estimates and assumptions that affect (i) the reported amounts of assets and liabilities, (ii) the disclosure of contingent assets and liabilities known to exist as of the date the financial statements are published, and (iii) the reported amount of net revenues and expenses recognized during the periods presented. Adjustments made with respect to the use of estimates often relate to improved information not previously available. Uncertainties with respect to such estimates and assumptions are inherent in the preparation of financial statements; accordingly, actual results could differ from these estimates.

Revenue Recognition

Revenue includes provision of services. The Company recognizes revenue from provision of services at the time evidence of an arrangement exists, fees are contractually fixed or determinable, collection is reasonably assured through historical collection results and regular credit evaluations, and there are no uncertainties regarding customer acceptance.

Accounts Receivable and Allowance for Uncollectible Accounts

Substantially all of the Company’s accounts receivable balance is related to trade receivables. Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in its existing accounts receivable. The Company will maintain allowances for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments for services. Accounts with known financial issues are first reviewed and specific estimates are recorded. The remaining accounts receivable balances are then grouped in categories by the number of days the balance is past due, and the estimated loss is calculated as a percentage of the total category based upon past history. Account balances are charged off against the allowance when it is probable the receivable will not be recovered. The Company has reserved $7136,~~617~~550 as allowance for doubtful accounts at ~~September~~March 3031, ~~2011~~2012 and recorded $~~42,004~~0 of bad debt expense during the ~~nine~~three months ended ~~September~~March 3031, ~~2011~~2012.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. At ~~September~~March 3031, ~~2011~~2012, cash and cash equivalents include cash on hand and cash in the bank, and the FDIC insures these deposits up to $250,000.

Inventory

6The Company’s inventory is carried at the lower of cost or net realizable value using the first-in, first-out (“FIFO”) method. The Company’s inventory is comprised of supplies and parts used in the Company’s operations. The Company evaluates the need to record adjustments for obsolescence for inventory on a regular basis. At March 31, 2012, the Company’s inventory balance was $0 and at December 31, 2011, the Company’s inventory balance was $0.

Table of Contents

The Company’s inventory is carried at the lower of cost or net realizable value using the first-in, first-out (“FIFO”) method. The Company’s inventory is comprised of supplies and parts used in the Company’s operations. The Company evaluates the need to record adjustments for obsolescence for inventory on a regular basis. At September 30, 2011, the Company’s inventory balance was $56,514 and at December 31, 2010, the Company’s inventory balance was $70,658.

Property and Equipment

Property and equipment is recorded at cost and depreciated over the estimated useful life, ranging from three to ten years, using the straight-line method. When items are retired or otherwise disposed of, loss or gain is charged or credited for the difference between the net book value and proceeds realized. Ordinary maintenance and repairs are charged to expense as incurred, and replacements and betterments are capitalized.

Impairment of Long-Lived Assets

Property and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the estimated fair value of the asset.

Goodwill and Other Intangible Assets

Goodwill represents the excess of the purchase price and related costs over the value assigned to net tangible and identifiable intangible assets of businesses acquired and accounted for under the purchase method. Goodwill acquired in business combinations is assigned to reporting units that are expected to benefit from the synergies of the combination as of the acquisition date. Under this standard, goodwill and intangibles with indefinite useful lives are no longer amortized. The Company annually assesses goodwill and indefinite-lived intangible assets for impairment during the fourth quarter, or more frequently if events and circumstances indicate impairment may have occurred, in accordance with ASC Topic 350. If the carrying value of a reporting unit's goodwill exceeds its implied fair value, the Company records an impairment loss equal to the difference. ASC Topic 350 also requires that the fair value of indefinite-lived purchased intangible assets be estimated and compared to the carrying value. The Company recognizes an impairment loss when the estimated fair value of the indefinite-lived purchased intangible assets is less than the carrying value. The Company does not have any goodwill recorded at ~~September~~March 3031, ~~2011~~2012.

Intangible assets subject to amortization, which consist of customer lists, are amortized over their expected life of five years.

Management has assessed the Company’s intangible assets and has not recognized any impairment of assets for the ~~nine~~three months ended ~~September~~March 3031, ~~2011~~2012.

Income Taxes

Deferred income taxes are provided to reflect the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts based on enacted tax laws and statutory tax rates applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.

7The Company adopted the provisions of ASC Topic 740, Accounting For Uncertainty In Income Taxes-An Interpretation of ASC Topic 740 ("ASC Topic 740"). ASC Topic 740 contains a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not, that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount, which is more than 50% likely of being realized upon ultimate settlement. The Company considers many factors when evaluating and estimating the Company's tax positions and tax benefits, which may require periodic adjustments. At March 31, 2012, the Company did not record any liabilities for uncertain tax positions.

Table of Contents

The Company adopted the provisions of ASC Topic 740, Accounting For Uncertainty In Income Taxes-An Interpretation of ASC Topic 740 ("ASC Topic 740"). ASC Topic 740 contains a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is more likely than not, that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount, which is more than 50% likely of being realized upon ultimate settlement. The Company considers many factors when evaluating and estimating the Company's tax positions and tax benefits, which may require periodic adjustments. At September 30, 2011, the Company did not record any liabilities for uncertain tax positions.

Share-Based Compensation

The Company measures the cost of services received in exchange for an award of an equity instrument based on the grant-date fair value of the award. Compensation cost is recognized over the vesting or requisite service period. The Black-Scholes option-pricing model is used to estimate the fair value of options or warrants granted.

Basic and Diluted Net Loss Per Share

Basic income (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares outstanding during the reporting period. The weighted average number of shares is calculated by taking the number of shares outstanding and weighting them by the amount of time that they were outstanding. Diluted earnings per share reflects the potential dilution that could occur if stock options, warrants, and other commitments to issue common stock were exercised or equity awards vest resulting in the issuance of common stock that could share in the earnings of the Company.

Diluted loss per share is the same as basic loss per share during periods where net losses are incurred since the inclusion of the potential common stock equivalents would be anti-dilutive as a result of the net loss.

At ~~September~~March 3031, ~~2011~~2012, common stock equivalents consisted of 516,000,000 common stock warrants with an exercise price of $0.01, $0.05 and $0.10 per share. The Company’s price at March 31, ~~which~~2012 ~~exceeded~~was $0.05, so 7,000,000 of the ~~Company’s~~shares ~~stock~~at ~~price~~$0.01 aswere ofbelow ~~September~~the 30exercise amount, ~~2011~~4,000,000 at $0.05 were equal to the exercise amount and the remaining 5,000,000 at $0.10 exceeded the Company’s quarter-end closing stock price.

Concentration of Credit Risk

All of the Company’s cash and cash equivalents are maintained in regional and national financial institutions. The Company has exposure to credit risk to the extent that its cash and cash equivalents exceed amounts covered by the U.S. federal deposit insurance; however, the Company has not experienced any losses in such accounts. In management’s opinion, the capitalization and operating history of the financial institutions are such that the likelihood of material loss is remote.

Fair Value of Financial Instruments

The Company's financial instruments consist primarily of cash, accounts payable and accrued expenses, and debt. The carrying amounts of such financial instruments approximate their respective estimated fair value due to the short-term maturities and approximate market interest rates of these instruments.

The Company adopted ASC Topic 820, Fair Value Measurements (“ASC Topic 820”), which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements. The standard provides a consistent definition of fair value which focuses on an exit price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The standard also prioritizes, within the measurement of fair value, the use of market-based information over entity specific information and establishes a three-level hierarchy for fair value measurements based on the nature of inputs used in the valuation of an asset or liability as of the measurement date.

Table of Contents

The three-level hierarchy for fair value measurements is defined as follows:

o Level 1 – inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets; oliabilities 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 other than quoted prices, either directly or indirectly, including inputs in markets that are not considered to be active; oor directly or indirectly including inputs in markets that are not considered to be active;  Level 3 – inputs to the valuation methodology are unobservable and significant to the fair value measurement

Reclassifications

Certain prior period amounts have been reclassified to conform to current year presentations.

Recent Accounting Pronouncements

No accounting standards or interpretations issued recently are expected to a have a material impact on the Company’s consolidated financial position, operations or cash flows.

NOTE 5 - PROPERTY AND EQUIPMENT

The Company’s property and equipment as of ~~September~~March 3031, ~~2011~~2012 and December 31, ~~2010~~2011 are as follows:

	September 30,			December 31,
	March 31,			December 31,
	2011			2010
	2012			2011
Trucks and Autos	$	~~447~~512,~~114~~505		$	~~447~~512,~~114~~505
Large Equipment		1,~~051~~299,~~794~~446			1,~~150~~052,~~085~~996
Machinery and Equipment		~~545~~546,~~991~~106			~~503~~535,~~683~~269
Office Equipment		1427,~~146~~391			1427,~~146~~391
Electrical Equipment		193,518			193,518
Total property and equipment		2,252,563			2,308,546
Leasehold Improvements		30,915			30,915
Accumulated depreciation		(485,327	)		(154,197	)
Total property and equipment		2,609,581			2,352,594
Total	$	1,767,236		$	2,154,349
Accumulated depreciation		(744,492	)		(627,519	)
Total	$	1,865,089		$	1,725,075

Depreciation expense for the nine months ended September 30, 2011 and 2010 was $337,833 and $58,340, respectively; $337,833 and $0 of depreciation expense was included in cost of sales in the accompanying consolidated statements of operations for the nine months ended September 30, 2011 and 2010, respectively.

Depreciation expense for the three months ended September 30, 2011 and 2010 was $104,722 and $55,986, respectively; approximately $104,722 and $0 of depreciation expense was included in cost of sales in the accompanying consolidated statements of operations for the three months ended September 30, 2011 and 2010, respectively.

~~Table~~Depreciation expense for the three months ended March 31, 2012 and 2011 was $117,272 and $116,724, respectively; $111,764 and $116,724 of ~~Contents~~depreciation expense was included in cost of sales in the accompanying consolidated statements of operations for the three months ended March 31, 2012 and 2011, respectively.

NOTE 6 – NOTES PAYABLE

Notes payable are as follows:

	September 30, 2011			December 31, 2010
	March 31, 2012		December 31, 2011
Advance from an unrelated third party bearing no stated interest and due on demand.	$	220,000		$	100,000
Note payable from an unrelated third party bearing interest at 8% and due on September 1, 2013. The loan is convertible to Company stock at any time with a conversion price of $0.06.	$	220,000	$	220,000
Note payable to an unrelated third party, bearing interest at 10%, with principal and interest due on February 29, 2012. The note is secured by certain property and equipment of the Company		25,000			-
Note payable from an unrelated third party bearing interest at 8% and due on December 31, 2014. The loan is convertible to 6,500,000 shares of Company stock at any time at the discretion of the lender. The note is secured by otherwise unencumbered equipment owned by the Company with a value of approximately $1,100,000.		550,000		0
Line of credit with an unrelated third party bearing interest at LIBOR plus 3% and due on demand.		13,177			13,177
Note payable to an unrelated third party, bearing interest at 10%, with principal and interest due on May 15, 2012. The note is secured by certain property and equipment of the Company		25,000		25,000
Note payable to Reunion Bank bearing interest at prime (3.25% at September 30, 2011) plus 2% per annum, due and payable on October 28, 2015, with a monthly principal and interest payment of $6,295, secured by the assets of the Company and recorded liens on certain equipment of the Company, guaranteed by the Company’s president.		275,367			320,031
Note payable to an unrelated third party, bearing interest at 10%, with principal and interest due on February 29, 2012. The note is secured by certain property and equipment of the Company. The note has not been formally renewed, but installment payments have commenced and the note is expected to be retired soon without any penalty.		16,860		25,000
Note payable to Reunion Bank bearing interest at prime (3.25% at September 30, 2011) plus 2% per annum, due and payable on February 15, 2016 with a monthly principal and interest payment of $5,920, secured by the assets of the Company and recorded liens on certain equipment of the Company, guaranteed by the Company’s president.		525,149			-
Note payable to an unrelated third party, bearing interest at 12.99%, and due on demand.		5,685		8,685
Line of credit with an unrelated third party bearing interest at prime (3.25% at September 30, 2011) plus 2% per annum, due on demand with a monthly interest payment and secured by certain accounts receivable.		46,053			-
Note payable to Reunion Bank bearing interest at prime plus 2% per annum (3.25% at December 31, 2011), due and payable on October 28, 2015, with a monthly principal and interest payment of $6,295, secured by the assets of the Company and recorded liens on certain equipment of the Company, guaranteed by the Company’s CEO.		0		260,090
Line of credit with an unrelated third party bearing interest at prime (3.25% at September 30, 2011) plus 2% per annum, due on demand with a monthly interest payment.		40,000			-
Note payable to Reunion Bank bearing interest at prime plus 2% per annum (3.25% at December 31, 2011), due and payable on February 15, 2016 with a monthly principal and interest payment of $5,920, secured by the assets of the Company and recorded liens on certain equipment of the Company, guaranteed by the Company’s CEO.		0		518,072
Note payable to OCE Copier bearing no interest rate and due on April 13, 2016		10,876			-
Note payable to Reunion Bank bearing interest at prime plus 2% per annum (3.25% at March 31, 2012), due and payable on March 30, 2014 with a monthly principal and interest payment of $8,932, secured by the assets of the Company and recorded liens on certain equipment of the Company, guaranteed by the Company’s CEO.		832,512		0
Convertible note bearing interest at 8% per annum, maturity date in February 2011. The Company evaluated the terms of the note and recorded a beneficial conversion feature in the amount of $59,644 at the inception of the agreement. This note, together with accrued interest, was converted into 5,311,475 shares of the Company’s common stock in January 2011.		-			32,000
Line of credit with an unrelated third party bearing interest at prime (3.25% at December 31, 2011) plus 2% per annum, due on demand with a monthly interest payment and secured by certain accounts receivable.		0		47,046
Line of credit with an unrelated third party bearing interest at prime (3.25% at December 31, 2011) plus 2% per annum, due on demand with a monthly interest payment.		0		30,000
Line of credit with an unrelated third party bearing interest at LIBOR plus 3% and due on demand.		13,177		13,177
Note payable to OCE Copier bearing no interest rate and due on April 13, 2016		9,527		9,909
Promissory note with an unrelated third party, bearing no interest per annum, a monthly payment of $2,500 and maturing in June 2012. The Company disputes this note payable as representation of the fitness of the equipment purchased from Vac & Jet were not fully disclosed.		60,000		60,000
Note with an unrelated third party bearing no interest, a monthly payment of $1,500 and maturing in October 2012. The lawsuit was settled on May 7, 2012 and no further payments are required.		33,800		33,800
Note with an affiliated company bearing interest at 10% per annum and due on demand.		417,755		417,755
On March 13, 2011, the Company entered into a contract with Dr. Scott Levine, a related party, where Dr. Levine agreed to loan $75,000 in exchange for 1,000,000 restricted shares of common stock and 1,000,000 stock warrants. The relative fair value of the common stock and warrants was $32,704 in total resulting in an initial discount. For the year ended December 31, 2011, $28,616 related to the debt discount was amortized into interest expense. The note was due on July 15, 2011, bore interest at an annualized rate of 18% and was collateralized by 10,000,000 shares of the Company’s common stock. The 10,000,000 shares were issued to Mr. Levine and are considered outstanding. Mr. Levine has verbally agreed to extend the note until the Company secures financing. Mr. Levine exercised the warrants on May 17, 2011 for $50,000 in cash proceeds.		75,000		75,000
Vehicle loan note with Ford Credit bearing interest at 5.5%, secured by a vehicle and due on February 11, 2014.		6,663		8,906
Vehicle loan note with Ford Credit bearing interest at 10.0%, secured by a vehicle and due on April 9, 2014.		23,460		27,503
Equipment loan note with CNH Capital bearing interest at 5.9%, secured by an excavator and due on August 16, 2016.		41,316		42,516
Equipment loan note with Wells Fargo Equipment Finance Inc. bearing interest at 6.95%, secured by Freightliner 4,800 gallon pumping truck and due on March 5, 2017.		153,155		0
Total Notes and Line of Credit Payable		2,483,910		1,822,459
Less: Current Portion		(764,494)		(1,542,682)
Long-Term Portion	$	1,719,416	$	279,777

~~Table~~Principal payments for the long-term notes payable for each of ~~Contents~~the five succeeding years are as follows:

Convertible note bearing interest at 8% per annum, maturity date in August 2011. The Company evaluated the terms of the note and recorded a beneficial conversion feature in the amount of $29,500 at the inception of the agreement. This note was repaid in May 2011.		-	32,500
Twelve months ended March 31,	Amount
Convertible note bearing interest at 8% per annum, maturity date in April 2011. The Company evaluated the terms of the note and recorded a beneficial conversion feature in the amount of $50,000 at the inception of the agreement. This note, together with accrued interest, was converted into 4,945,802 shares of the Company’s common stock in February 2011.		-	50,000
2013	$	764,494
Promissory note with an unrelated third party, bearing no interest per annum, a monthly payment of $2,500 and maturing in June 2012. The Company disputes this note payable as representation of the fitness of the equipment purchased from Vac & Jet were not fully disclosed.		60,000	60,000
2014		1,589,920
Note with an unrelated third party bearing no interest, a monthly payment of $1,500 and maturing in October 2012. Currently in dispute.		39,000	39,000
2015		45,024
Note with an affiliated company bearing interest at 18% per annum and due on demand.		303,200	322,500
2016		45,076
Note with an affiliated company bearing interest at 18% per annum and due on demand.		128,200	59,400
2017		39,396
Note with a related party bearing interest at 18% per annum. The note was secured by 10,000,000 shares of the Company’s common stock. During 2011, this note was refinanced as noted below.		-	75,000
Total	$	2,483,910
On March 13, 2011, the Company entered into a contract with Dr. Scott Levine, a related party, where Dr. Levine agreed to loan $75,000 dollars in exchange for 1,000,000 restricted shares of common stock and 1,000,000 stock warrants. The relative fair value of the common stock and warrants was $32,704 in total resulting in an initial discount. For the nine months ended September 30, 2011, $28,616 related to the debt discount was amortized into interest expense. The note was due on July 15, 2011, bore interest at an annualized rate of 18% and was collateralized by 10,000,000 shares of the Company’s common stock. The 10,000,000 shares were issued to Mr. Levine and are considered outstanding. Mr. Levine has verbally agreed to extend the note until the Company secures financing. Mr. Levine exercised the warrants on May 17, 2011 for $50,000 in cash proceeds.		75,000	-

Note with an unrelated third party bearing no interest, due on March 31, 2011. During 2011, this note was paid in full.		-			550,000
Total Notes and Line of Credit Payable		1,761,022			1,653,608
Less: Current Portion		(1,059,895	)		(1,653,608	)
Long-Term Portion	$	701,127		$	-

Table of Contents

Principal payments (together with interest) for the long-term notes payable for each of the five succeeding years are as follows:

Year ended December 31,	Amount
2012	$	110,377
2013		116,302
2014		122,470
2015		114,055
2016		321,038
Total	$	784,242

Reunion Bank Loan Covenants

In October, 2010, the Company entered into a 5-year note agreement with Reunion Bank for the amount of $325,000 with a balance of $275,367 as of September 30, 2011. On February 16, 2011, the Company entered into another 5-year note agreement with a principal amount of $550,000 ($525,149 as of September 30, 2011) with a required balloon payment of $317,345 on the 60th payment. Reunion Bank loan covenants, which the Company believes it was in compliance with at September 30, 2011, are as follows:

· The Company is to maintain 1.25X Debt Coverage Ratio;

· Brownies is to maintain Tangible Net Worth of $400,000;

· The Company agrees that no dividends will be paid without Bank consent;

· The Company agrees to provide internally prepared financial statements quarterly;

· The Company will provide tax returns annually; and,

· Guarantors (Michael Borish individually and the Company) to provide tax returns and financial statements annually.

NOTE 7 – COMMITMENT AND CONTINGENCIES

As a result of the business combination with Brownies in 2010 (see Note 10 – Business Combination), the ~~Company~~sellers ~~assumed~~failed to disclose to the Company liabilities which included an outstanding invoice of $21,000 for required cleanup in Orange County, Florida, $18,000 of unpaid personal property taxes from 2008 and 2009, ~~and~~ a claim made by Shelly Septic for $57,000, and $99,214 in payroll taxes. The Company settled the $21,000 matter in Orange County. The Company acknowledged that, as a matter of statute, the $18,000 in personal property taxes would attach to the equipment acquired in the Brownies transaction and has made arrangements to pay these unpaid taxes. The Company is in negotiations to settle the matter with Shelley Septic. The Company’s corporate counsel is addressing to determine if the Company is obligated to these debts.

The Company iswas a Defendant in ~~a pending~~ litigation with Harvey Blonder, Gary Goldstein, and Robin Bailey v. Freedom Environmental Services, Inc., and Michael Borish, individually. This case iswas ~~pending~~ in ~~the~~ Circuit Court of the Ninth Judicial Circuit, in and for Orange County, Florida, Case No. 2010-CA-026477-0 related to the acquisition of Brownies Waste Water Solutions in July 17, 2010. The Original Complaint was dismissed on a Motion to Dismiss Failure to State a Claim and the Court allowed the Plaintiffs to file an Amended Complaint. The Amended Complaint was filed on June 3, 2011 which alleges – Declaratory Relief, Fraudulent Inducement to Enter a Contract, Negligent Misrepresentation, Breach of Contract Warranties, Accounting, and Rescission of Purchase Agreement. There ~~The~~are ~~Company~~currently ~~considered~~issues ~~this~~with that litigation ~~frivolous~~which ~~and~~are ~~vehemently~~being ~~denies~~evaluated ~~all~~by ~~allegations.~~counsel ~~The~~for ~~case in pending in State Court and~~ the Company, isincluding ~~vigorously litigating this case. The Company has not yet determined~~ the ~~range~~end of ~~any~~that ~~potential loss exposure related to this~~ litigation.

On May 2, 2012 Harvey Blonder, Gary Goldstein, and Robyn Bailey filed another law suit now in the United States District Court Middle District of Florida case No. 6:12-cv-665-ORL-22DAB making the same allegations in the prior complaints filed in state court. The Company considered this litigation frivolous and vehemently denies all allegations. The case is pending in District Court and the Company is vigorously litigating this case. The Company has not yet determined the range of any potential loss exposure related to this litigation.

~~Table~~On January 1, 2011, the Company entered into a one-year yellow grease purchase agreement with Delta Integrated Industries LLC (“Delta”). In that agreement the Company agreed to sell fifty thousand gallons of ~~Contents~~yellow grease per month to Delta. This agreement was voided because Delta submitted a check from an affiliate company for $67,000 that was drawn on an account with insufficient funds. Delta has filed a Complaint related to this voided agreement but has never served the summons on the Company which makes the Complaint invalid and will ultimately be dismissed by the court for lack of service. On May 7, 2012 the court issued a stipulation of dismissal ending the matter.

OnNOTE ~~January 1, 2011, the Company entered into a one~~8-~~year~~ yellow grease purchase agreement with Delta Integrated Industries LLC (“Delta”). In that agreement the Company agreed to sell fifty thousand galls of yellow grease per month to Delta. This agreement was void as Delta submitted a check from an affiliate company for $67,000 that was drawn on an account with insufficient funds. Delta has filed a Complaint related to this voided agreement but has never served the summons on the Company which makes the Complaint invalid and will ultimately be dismissed by the court for lack of service.EQUITY

NOTE 8– RELATED PARTY TRANSACTIONS

On January 7, 2011, the Company issued 800,000 and 1,759,000 preferred shares to Michael Ciarlone and Michael Borish for the settlement of $17,915 in accrued compensation.

On January 21, 2011, the Company issued 816,540 in common shares for the settlement of $10,615 in accrued compensation to its CEO and COO.

On March 13, 2011, the Company entered into a contract with Dr. Scott Levine, where as Dr. Levine agreed to loan $75,000 to the Company in exchange for one million restricted shares of common stock and warrants to acquire one million shares of the Company’s common stock at an exercise price of $0.05 per share. The note was originally due on July 15, 2011 and collateralized by 10,000,000 shares of the Company’s common stock. Mr. Levine exercised the warrants on May 17, 2011 for $50,000 in cash proceeds to the Company. See Note 6 for further information.

On April 28, 2011, the Company issued 2,000,000 of common shares (1,000,000 each to Michael Ciarlone and Michael Borish) in lieu of compensation and recorded $110,000 in compensation expense ($0.055 per share based upon the market price of the Company’s common stock on the date of grant).

NOTE 9- EQUITY

Preferred Stock

The Company authorized 75,000,000 shares of preferred stock, at $0.001 par value of which 5,736,333 are Series A Convertible preferred shares issued and outstanding as of ~~September~~March 3031, ~~2011~~2012. ~~The~~Each ~~Corporation~~share ~~established~~of ~~and~~the ~~designates~~Preferred ~~the~~Stock ~~rights~~shall ~~and~~have ~~preferences~~300 ofvotes aon ~~Series~~all Amatters ~~Convertible~~presented ~~Preferred~~to ~~Stock,~~be ~~and~~voted ~~reserves~~by ~~75,000,000~~the ~~shares~~holders of ~~preferred~~our common stock ~~against~~and ~~its~~is ~~issuance,~~convertible ~~such~~to ~~rights,~~common ~~preferences~~stock ~~and~~on ~~designations~~a one for one basis as of the origination date on October 31, 2010. ~~Each~~From ~~share~~that oftime forward, as the ~~Series~~corporation Aissues ~~Convertible~~additional ~~Preferred~~shares ~~Stock~~of ~~shall~~common ~~have~~stock ~~300~~the ~~votes~~conversion onratio ~~all~~of ~~matters~~the ~~presented~~preferred stock increases to bemaintain ~~voted~~the onshares byproportional ownership of the ~~holders~~Company. As of ~~common~~March ~~stock~~31, ~~and~~2012 the conversion rate is ~~convertible~~one ~~into~~share ~~common~~of preferred stock onfor a1.5 ~~one~~shares ~~for~~of ~~one~~common ~~basis~~stock. ~~During~~For the ~~nine~~ three months ended ~~September~~March 3031, 2012 and 2011, ~~the~~all ~~Company~~shares ~~issued~~of ~~1,759,000~~preferred ~~and 800,000~~stock ~~shares~~that ofhave ~~Series~~been Aissued ~~Convertible~~were ~~Preferred~~issued ~~Stock~~as compensation to ~~its~~the CEO ~~and~~& COO, ~~respectively,~~with ~~for~~0 and ~~settlement~~2,559,222 ofvalued ~~accrued~~at ~~compensation~~$0 inand ~~the amount of~~ $17,~~915~~914, respectively.

Common Stock

As of ~~September~~March 3031, ~~2011~~2012 the Company had authorized 200,000,000 shares of common stock, at $0.001 par value and ~~123~~133,~~018~~568,~~334~~434 shares are issued and outstanding.

During the ~~nine~~three months ended ~~September~~March 3031, ~~2011,~~2012 the Company issued ~~600~~125,000 common shares for ~~the acquisition of equipment from Clean Fuel LLC valued at~~ $~~15,240 ($0.025 per share based upon the market price at the date of issuance);~~ 5,~~900,~~000 ~~common~~of ~~shares for consulting~~ services ~~of $99,350, valued at the market price of the Company’s common stock on the date of issuance; 2,816,540 common shares to settle accrued compensation of $120,615;~~ and ~~10,257,277~~expenses ~~shares~~rendered ofby ~~common stock for principal and accrued interest on convertible debt in the amount of $86,000~~consultants.

1311

~~Table~~Shares ofsubscribed ~~Contents~~not issued

During the year ended December 31, 2011, the Company subscribed 1,000,000 shares of common stock for the exercise of warrants. The shares had not been issued as of March 31, 2012. Common subscribed shares consisted of the following:

Common Stock Subscribed, Not Issued

	Excercise of Warrants

December 31, 2011		1,000,000
Shares subscribed		-
Issuance of subscribed shares		-
Balance March 31, 2012		1,000,000

Warrants

The Company values all warrants using the Black-Scholes option-pricing model. Critical assumptions for the Black-Scholes option-pricing model include the market value of the stock price at the time of issuance, the risk-free interest rate corresponding to the term of the warrant, the volatility of the Company’s stock price, dividend yield on the common stock, as well as the exercise price and term of the warrant. The warrants are not subject to any form of vesting schedule and, therefore, are exercisable by the holders anytime at their discretion during the life of the warrant. No discounts were applied to the valuation determined by the Black Scholes option-pricing model.

The Company has 5,000,000 warrants but no options outstanding as of September 30, 2011. Outstanding warrants have a $0.10 exercise price, are fully vested, have a three year expected life, expire December 13, 2013 and were valued at $95,308 using the Black-Scholes option-pricing model. The following inputs and assumptions were used in the option-pricing model:

Expected Dividend yield	None
Volatility		287.81	%
Weighted average risk free interest rate		5.53	%
Weighted average expected life(in years)	3.00

In March 2011, in connection with the $75,000 Levine note discussed above in Note 6, the Company issued 1,000,000 warrants to purchase common stock of the Company at a $0.05 exercise price which are fully vested, have a three year expected life (expire March 1, 2014) and were valued at $28,991 using the Black-Scholes option-pricing model, which was treated as a discount to the related note. The following inputs and assumptions were used in the option-pricing model:

Expected Dividend yield	None
Volatility		419.40%	%
Weighted average risk free interest rate		0.75%	%
Weighted average expected life(in years)	3.00

The warrants issued in March 2011 were fully exercised in May 2011 for $50,000 of cash proceeds to the Company.

~~NOTE~~In December, 2010 the Company issued 5,000,000 warrants. These outstanding warrants have a $0.10 –exercise ~~BUSINESS~~price, ~~COMBINATION~~are fully vested, have a three year expected life, expire December 13, 2013 and were valued at $95,308 using the Black-Scholes option-pricing model. The following inputs and assumptions were used in the option-pricing model

On July 17, 2010, the Company entered into a purchase agreement (the “Asset Purchase Agreement”) with the owners of Brownies Waste Water Solutions, Inc., B&P Environmental Services LLC (Michael J. Ciarlone, Harvey Blonder and Gary A. Goldstein and Anita Goldstein, Robin and Robert Bailey, hereinafter referred to as the “Sellers”). Pursuant to the Asset Purchase Agreement, and upon the terms and subject to the conditions thereof, the Company purchased all of the Member Interests of B&P Environmental Services LLC and all of the issued and outstanding shares of Brownies Waste Water Solutions, Inc. (the “Acquisition”). The purchase price for the Acquisition consisted of the issuance of a net aggregate of 46,666,667 shares which includes 48,000,000 common shares issued in the transactions and the respectively 1,333,333 common shares cancelled in consideration (the “Share Consideration”) to the parties that comprise the holders of both/or Member Interests of B&P Environmental Services LLC and issued and outstanding shares of Brownies Waste Water Solutions, Inc.

Expected Dividend yield	None
Volatility		287.81%
Weighted average risk free interest rate		5.53%
Weighted average expected life(in years)	3.00

14On September 1, 2011 an investor provided a $220,000 convertible note with a conversion price of $0.06 per share, and received 7,000,000 warrants with a strike price of $0.01 per share and an expiration date of 2 years (September 1, 2013) for the original $100,000 loan that originated in December 2010. The lender was also issued 4,000,000 warrants with a strike price of $0.05 and an expiration of 3 years (September 1, 2014). The note carries interest at 8% and is due September 1, 2013.

~~Table of Contents~~12

~~There~~Pursuant ~~was~~to ~~not~~ASC ~~a pre~~470-~~existing~~20 ~~relationship~~Accounting ~~between~~for ~~the~~Convertible ~~sellers~~Securities ~~and~~with Beneficial Conversion Features or Contingently Adjustable Conversion Ratios, the Company ~~prior~~determined tothat a beneficial conversion feature is present for the ~~transaction. Brownies~~convertible ~~Waste~~notes ~~Water~~issued ~~Solutions~~during the year ended December 31, ~~Inc.~~2011 ~~was~~using the intrinsic value in ~~business~~the ~~for~~convertible ~~eighteen~~notes ~~months~~adjusted ~~prior~~for amounts allocated to the ~~acquisition~~warrant ~~and~~valuation. ~~had~~The ~~only~~intrinsic ~~operated~~value ~~for~~of ~~sixteen~~the ~~months~~convertible ~~before~~notes amounted to $164,339 based on the ~~acquisition~~fair market value of common stock on ~~July~~the ~~17,~~respective ~~2010~~dates of issuance.

~~The~~Since ~~Company~~the ~~acquired~~combined avalue ~~substantial~~of ~~amount~~the warrants ($164,939) plus the intrinsic value of ~~assets~~the inconvertible notes ($164,939) exceeds the ~~transaction~~fair value of the face value of the debt ($220,000), ~~which~~the ~~are~~Company ~~considered~~is limited to ~~meet~~ the ~~definition~~amount of athe ~~business~~proceeds inwhen ~~accordance~~recording ~~with~~the ~~FASB~~beneficial ~~codification~~conversion ~~Topic~~feature ~~805~~as debt discount. Using a pro rata contribution (relative fair value), ~~"Business~~the ~~Combinations"~~Company allocated the proceeds first to the warrant valuation in the amount of approximately $164,939 and asthe ~~such,~~remainder to the beneficial conversion feature in the amount of $55,061. The Company ~~accounted~~immediately amortized the debt discount of $220,000 for the ~~acquisition~~year asended aDecember ~~business~~31, ~~combination~~2011 since the debt was convertible upon issuance.

Management determined that the Company was the acquirer in the business combination in accordance with FASB codification Topic 805, "Business Combinations", based on the following factors: (i) there was not a change in control of the Company, since the Sellers did not obtain a controlling financial interest or the power to control the Company through a lesser percentage of ownership, by contract, lease, agreement with other stockholders, or by court decree; (ii) the Company was the entity in the transaction that issued its equity instruments, and in a business combination, the acquirer usually is the entity that issues its equity interests; (iii) the Company’s directors retained the largest relative voting rights of the Company post-transaction; and (iv) the composition of the Company’s board of directors and management did not change post-acquisition.

Warrant Amount	7,000,000		4,000,000
Expected Dividend yield	None		None
Volatility		399.84%	381.24%
Weighted average risk free interest rate		0.54%	0.61%
Weighted average expected life(in years)	2.00		3.00

The ~~reasons~~Company ~~for~~has ~~the acquisition were that the companies had similar business models that allow the company to expand its operations and services. Also~~16, ~~with the acquisition of Brownies~~000,000 ~~the~~warrants ~~Company~~but ~~can~~no ~~expand~~options ~~its~~outstanding ~~market~~as ~~share~~ of ~~the~~March ~~sewage~~31, ~~disposal market~~2012.

~~The~~NOTE ~~acquisition~~9– ~~gave~~SUBSEQUENT rise to goodwill which was impaired immediately and an intangible asset, a client list, with an estimated life of five years because of management’s belief that the client list had value but did not have an economic useful life longer than a period of five years.EVENTS

~~The~~In ~~net~~February ~~purchase~~2011, ~~price paid for~~ the ~~Acquisition~~Company ~~was~~entered ~~46,666,667~~into ~~restricted~~a ~~shares~~letter of ~~the~~intent ~~Company’s~~with ~~common~~David ~~stock~~M. ~~The~~Hickman ~~shares~~in ~~had~~Pennsylvania ato ~~quoted~~purchase ~~market~~the ~~price~~equipment, ofinventory ~~$0.025~~and ~~per~~customer ~~share~~list onfrom ~~July~~a ~~17,~~company ~~2010~~owned orby anMr. ~~aggregate~~Hickman. The ~~quoted~~Company ~~market~~is ~~value~~in the process of ~~approximately~~due ~~$1,166,667.~~diligence ~~The~~and ~~results~~has ofescrowed ~~Brownies’~~a ~~operations~~non-refundable ~~since~~deposit ~~July~~of 17$ 176,875 ~~2010~~toward ~~have~~the ~~been~~purchase, ~~included~~which is classified in the ~~consolidated~~accompanying ~~financial~~balance ~~statements. The~~sheet ~~following~~as ~~table~~a ~~summarizes~~current ~~the~~deposit. Mr. ~~consideration~~Hickman ~~paid~~has bygranted the Company ~~and~~an ~~the~~extension ~~amounts~~to ofcomplete the ~~assets~~due ~~acquired~~diligence ~~and~~until ~~liabilities~~May ~~assumed~~31, at2012 ~~the~~and ~~acquisition~~by ~~date. The~~mutual ~~purchase~~verbal ~~price~~consent ~~for~~ the ~~Acquisition~~deadline ~~consisted~~will ofbe ~~the~~extended ~~issuance~~again ofbeyond aMay ~~net aggregate of 46~~31,~~666,667~~ ~~shares~~2012 ~~which~~prior ~~includes~~to ~~48,000,000~~that ~~common~~time. Mr. ~~shares~~Hickman ~~issued~~provides insanitation ~~the~~services ~~transactions~~throughout ~~net~~Pennsylvania. Mr. ofHickman’s ~~the~~company ~~1,333,333~~provides ~~common~~all ~~shares~~aspects ~~cancelled~~of ~~(the~~commercial ~~“Share~~and ~~Consideration”)~~residential toservices ~~the~~including ~~parties~~septic ~~that~~system ~~comprise~~cleaning, ~~the~~maintenance ~~holders~~and ~~of both/or~~installation. We ~~Member~~plan ~~Interests~~to ofexpand ~~B&P~~that ~~Environmental~~business ~~Services~~to ~~LLC~~the ~~and~~current ~~issued~~services ~~and~~lines ~~outstanding~~that ~~shares~~we ofprovide ~~Brownies~~in ~~Waste~~the ~~Water~~State ~~Solutions,~~of ~~Inc~~Florida.

Purchase Price Allocation		July 17, 2010
Fair Value of Consideration:
Equity instruments (46,666,667 common shares of Freedom Environmental Services, Inc.)	$	1,166,667
Fair Value of Assets acquired:
Cash		207,163
Assets:
Equipment		1,308,390
Prepaid expense		1,625
Accounts receivables		297,219
Inventory		34,266
Client list		200,000
Total assets		2,048,663
Fair Value of Liabilities assumed:

On May 7, 2012 a lawsuit regarding a note payable in the amount of $33,800 was dismissed and the disputed liability released with no further payment.

15On May 2, 2012 Harvey Blonder, Gary Goldstein, and Robyn Bailey, purporting to act as the Board of Directors of the Company, filed another law suit now in the United States District Court Middle District of Florida case No. 6:12-cv-665-ORL-22DAB making the same allegations in the prior complaints filed in state court. The Company considered this litigation frivolous and vehemently denies all allegations. The Company’s legally authorized Board of Directors resolved on July 1, 2012 to dismiss the unauthorized lawsuit. The case was dismissed by District Court due to lack of subject matter jurisdiction on June 28, 2012. Since the case is closed, the Company has determined there is negligible potential loss exposure related to this litigation or any subsequent related action.

Table of Contents

Liabilities		1,014,591
Fair value of net assets		1,034,072
Goodwill		132,595
Total purchase price	$	1,166,667

Liabilities Assumed from the Seller:
Royal Bank of Canada note payable	$	13,177
Convertible Note Payable		50,000
Notes Payable - Vac & Jet		60,000
Notes Payable - Caterpillar		39,000
Notes Payable - Resort Marketing		322,500
Notes Payable - Security Fortress Ltd		264,800
Accounts Payable		265,114
Total Liabilities Assumed from the Seller	$	1,014,591

The following pro forma consolidated results of operations have been prepared as if the acquisition of Brownies occurred at the beginning of each period presented.

	Three months ended September 30, 2010			Nine months ended September 30, 2010
Revenues	$	1,198,107		$	3,577,863
Net loss	$	(4,625	)	$	(2,820,785	)
Net loss per share basic and diluted	$	(0.00	)	$	(0.04	)
Weighted average of shares outstanding		83,221,712			77,122,194

NOTE 11 – ASSETS PURCHASED

On December 13, 2010, the Company entered into an Asset Purchase Agreement (the “APA”) with Clean Fuel, LLC. The purchase price for the assets consisted of $850,000 in cash and 5,000,000 warrants at a $0.10 exercise price which are fully vested and have a three- year life at the date of closing of the APA. The value of the warrants based on Black Scholes was $95,308.

The equipment was put in Grease, a wholly-owned subsidiary of Freedom. This equipment purchased from Clean Fuel LLC was idle prior to the acquisition.

The fair value of the consideration and the assets acquired is based on the aggregate value of the cash and the Black Scholes value of the warrants that was exchanged for the property and equipment as shown below:

Table of Contents

		December 13, 2010
Fair Value of Consideration:
Cash	$	757,000
Equity instruments (5,000,000 warrants at a $.10 exercise price)		95,308

Equity instruments (600,000 common shares, $0.0254 per share)		15,240
Total Purchase Price	$	867,548
Fair Value of Assets acquired:
Property and Equipment	$	867,548
Fair Value of Assets	$	867,548

NOTE 11– SUBSEQUENT EVENTS

We have evaluated subsequent events through the date the consolidated financial statements were issued, and have determined that the following events are reasonably likely to impact the financial statements and require disclosure:

In October 2011, the Company issued 5,200,000 common shares for consulting service valued at $260,000, or $0.05 per share, based upon the market price of the Company’s stock on the date of agreement.

In August 2011, the Company issued a promissory note with principal amount of $25,000 to an unrelated party. The interest rate on the note is 10%, the note is unsecured and the maturity date is February 29, 2012. In connection with this note, in October, 2011, the Company also issued 125,000 common shares to the unrelated party valued at $5,000 or $0.04 per share, based upon the market price of the Company’s stock on the date of grant.

* * * * * * * * * * * *

1713

Table of Contents

In this Quarterly Report on Form 10-Q, “Company,” “our company,” “us,” and “our” refer to Freedom Environmental Services, Inc. and its subsidiaries, unless the context requires otherwise.

ITEM 2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

Management’s Discussion and Analysis contains various “forward looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, regarding future events or the future financial performance of the Company that involve risks and uncertainties. Certain statements included in this Form 10-Q, including, without limitation, statements related to anticipated cash flow sources and uses, and words including but not limited to “anticipates”, “believes”, “plans”, “expects”, “future” and similar statements or expressions, identify forward looking statements. Any forward-looking statements herein are subject to certain risks and uncertainties in the Company’s business, including but not limited to, reliance on key customers and competition in its markets, market demand, delayed payments of accounts receivables, technological developments, maintenance of relationships with key suppliers, difficulties of hiring or retaining key personnel and any changes in current accounting rules, all of which may be beyond the control of the Company. Management will elect additional changes to revenue recognition to comply with the most conservative SEC recognition on a forward going accrual basis as the model is replicated with other similar markets (i.e. SBDC). The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth therein.

~~Forward-looking~~Some ~~statements~~of ~~involve~~these ~~risks, uncertainties and other factors, which may cause our actual results, performance or achievements to be materially different from those expressed or implied by such~~ forward-looking statements. ~~Factors~~include ~~and risks that could affect our results and achievements and cause them to materially differ from those contained in the forward-looking~~ statements include those identified in the section titled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2010, as well as other factors that we are currently unable to identify or quantify, but that may exist in the future.of:

In· ~~addition,~~management's ~~the foregoing factors may affect generally our business~~plans, ~~results~~objectives ~~of operations~~ and ~~financial~~budgets ~~position.~~for ~~Forward-looking~~its ~~statements~~future ~~speak~~operations ~~only as of the date the statement was made. We do not undertake~~ and ~~specifically~~future ~~decline~~economic ~~any obligation to update any forward-looking statements.~~performance;

·	capital budget and future capital requirements;

·	meeting future capital needs;

·	realization of any deferred tax assets;

·	the level of future expenditures;

·	impact of recent accounting pronouncements;

·	the outcome of regulatory and litigation matters;

·	the assumptions described in this report underlying such forward-looking statements; and

Actual results and developments may materially differ from those expressed in or implied by such statements due to a number of factors, including:

·	those described in the context of such forward-looking statements;

·	future service costs;

·	changes in our incentive plans;

·	the markets of our domestic operations;

·	the impact of competitive products and pricing;

·	the political, social and economic climate in which we conduct operations; and

·	the risk factors described in other documents and reports filed with the Securities and Exchange Commission.

Forward-looking statements involve risks, uncertainties and other factors, which may cause our actual results, performance or achievements to be materially different from those expressed or implied by such forward-looking statements. Factors and risks that could affect our results and achievements and cause them to materially differ from those contained in the forward-looking statements include those identified in the section titled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011, as well as other factors that we are currently unable to identify or quantify, but that may exist in the future.

In addition, the foregoing factors may affect generally our business, results of operations and financial position. Forward-looking statements speak only as of the date the statement was made. We do not undertake and specifically decline any obligation to update any forward-looking statements

Our Company

WeFreedom ~~provide~~Environmental Services, Inc. provides wastewater management and recycling services to ~~our~~its customers ~~throughout~~through ~~our~~its different divisions. Brownies Waste Water Solutions is a staple in the Central Florida market since 1948, providing commercial and residential septic services. These services include drain field installation maintenance and repair; grease trap cleaning, maintenance, installation and repair; full service commercial and residential plumbing; sewer drain cleaning, backflow testing, repairs and certifications; lift station cleaning, maintenance, repairs, bio-solids transportation and recycling. Vac and Jet Services covers Freedom’s industrial, municipal and commercial customers. Grease Recovery Solutions handles all of our restaurant, resort and theme park services which include grease trap cleaning, sewer drain cleaning and waste cooking oil for recycling. David M Hickman sanitation services will soon be our Pennsylvania operations. This division handles all aspects of commercial and residential services including septic system cleaning, maintenance and installation.

Our principal executive offices are located at 11372 United Way, Orlando, Florida, 32824. The main phone number is: 407-841-4321 and the Company’s website is http://brownieswws.com.

On July 16, 2010, the Company acquired the assets and certain liabilities of Brownies Waste Water Solutions, Inc. (“Brownies”). Brownies was originally purchased in a Chapter 7 Bankruptcy proceeding in December of 2008, just 18 months before the Company acquired the assets and certain liabilities of Brownies Waste Water Solutions, Inc. Prior to its Bankruptcy proceeding in December of 2008, the business had been operating by unrelated third parties in the Central Florida market since 1948, providing commercial and residential septic services. These services include drain field installation, maintenance and repair; grease trap cleaning, maintenance, installation and repair; full service commercial and residential plumbing; sewer drain cleaning, backflow testing, repairs and certifications; lift station cleaning, maintenance, repairs, bio-solids transportation and recycling. On July 5, 2010 prior to the acquisition of Brownies, Brownies purchased the equipment of Vac and Jet Services which was a defunct company with two Vactor trucks.

In February 2011, the Company entered into a letter of intent with David M. Hickman in Pennsylvania to purchase the equipment, inventory and customer list from a company owned by Mr. Hickman. The Company is in the process of due diligence and has escrowed a non-refundable deposit of $176,875 toward the purchase, which is classified in the accompanying balance sheet as a current deposit. Mr. Hickman has granted the Company an extension to complete the due diligence until May 31, 2012 and by mutual verbal consent the deadline will be extended again beyond May 31, 2012 prior to that time. Mr. Hickman provides sanitation services throughout Pennsylvania. Mr. Hickman’s company provides all aspects of commercial and residential services including septic system cleaning, maintenance and installation. We plan to expand that business to the current services lines that we provide in the State of Florida.

Corporate History

We were incorporated under the laws of the State of Delaware on October 6, 1978 as United States Aircraft Corp. and we have undergone numerous name changes, the most recent being on June 11, 2008 when we amended our certificate of incorporation in order to change our name from BMXP Holdings, Inc. to Freedom Environmental Services, Inc.

Table of Contents

On June 24, 2008 we acquired 100% of the membership interests in Freedom Environmental Services, LLC (“FELC”), a Florida Limited Liability Company, for consideration consisting of 20,704,427 shares of our common stock.

As a result of this transaction, the former members of FELC held approximately 59% of our voting capital stock immediately after the transaction and the composition of our senior management became the senior management of FELC. For financial accounting purposes, this acquisition was treated a reverse acquisition of the Issuer by FELC under the purchase method of accounting, and was accounted for as a recapitalization, with FELC as the accounting acquirer.15

As a result of this transaction, the former members of FELC held approximately 59% of our voting capital stock immediately after the transaction and the composition of our senior management became the senior management of FELC. For financial accounting purposes, this acquisition was a reverse acquisition of the Issuer by FELC under the purchase method of accounting, and was accounted for as a recapitalization, with FELC as the accounting acquirer.

Principal products or services and their markets

~~Through~~We ~~Freedom, we~~ provide ~~Waste~~wastewater, ~~Water and Storm~~storm-water ~~System~~system ~~Management;~~management, ~~Grease~~grease and ~~Organics~~organics ~~Collection~~collection and ~~Disposition;~~disposition, ~~and~~commercial ~~Commercial~~plumbing ~~Plumbing~~ and ~~Water~~water ~~System~~system ~~Management~~management to the commercial, industrial, and municipal markets, ~~throughout Central Florida~~ as well as septic system maintenance and repair to the residential market throughout Central Florida.

~~Waste~~Wastewater ~~Water~~ and ~~Storm~~storm-water ~~System~~system ~~Management~~management includes providing services to the commercial and municipal sector, such as the installation and repair of the components of waste collection and disposition, potable water and exterior drainage systems.

Grease and ~~Organics~~organics ~~Collection~~collection and ~~Disposition~~disposition include the collection and disposal of grease waste from commercial restaurants and hotels, as well as raw sewerage from septic tanks, both residential and commercial.

Commercial ~~Plumbing~~plumbing services include pump systems installation, repairs, ~~and~~ maintenance and general activities related to the ~~profession of~~ plumbing profession.

New product or service

~~Currently,~~The ~~Freedom~~Company has been processing grease waste by collecting, transporting and distributing ~~those~~them ~~oil products~~ to dumping sites ~~for processing~~. WeAs ~~have~~a cost reduction measure Freedom entered into a letter of intent with a ~~Company~~company in Pennsylvania. ~~who~~The ~~has~~Pennsylvania company compliments our company as a processing center that will ~~reduce~~result ~~our~~in reduced cost of processing the Biofuel with third parties.

WeIt’s ~~intend~~the Company’s intention to develop and produce fuels and natural bio-organic products (such as fertilizer) derived from waste and byproducts.

Our plans in this area consist of attempting to develop a series of Vertical Organic Collection System platforms within regional and super-regional metropolitan areas by acquiring market leading operators as platforms and utilizing this business model in building regional facilities to produce high grade fuel and bio-organic nutrient products converted from commercial, industrial and residential waste products in the southeast and nationwide (“Biofuel”).

A Vertical Organic Collection System platform would be defined by us as a business enterprise which would control each step in the production of Biofuel.

It is anticipated that this enterprise would:

(a)	Collect raw waste (grease and septage) from customers which would constitute the raw material of Biofuel
(b)	Transport the raw materials to a processing facility controlled by the enterprise where waste convertible into Biofuel (“Feedstock”) would be separated from unusable waste which would be disposed of in an appropriate manner.
(c)	Convert the feedstock into Biofuel

It is our management’s belief that, by controlling each step of the Biofuel production process, we will be able to compete effectively due to economies of scale.

Table of Contents

Competitive business conditions, the issuer’s competitive position in the industry, and methods of competition

The industries in which we compete and intend to compete are highly competitive and, especially in the area of biofuel production, characterized by rapid technological advancement. Many of our competitors have greater resources than we do.

We compete in our current areas of operation by offering what we believe to be superior service at competitive prices. We also intend to be competitive by acquiring operating companies in the ~~Waste~~wastewater ~~Water~~services ~~Services~~ sector and developing commercial applications to convert the collected waste into fuel and organic nutrients (fertilizer).

Sources and availability of labor, raw materials and the names of principal suppliers

Labor required to provide these services are made available either through existing employees or by subcontractors, depending on the demands of the project and availability of resources.

The supplies and materials required to conduct our operations are available through a wide variety of sources and are currently obtained through, a wide variety of sources.

~~Capital~~Results ~~Resources~~of Operations for the Three Months ended March 31, 2012

WeRevenues ~~are~~for ~~party~~the tothree nomonths ~~binding~~ended ~~agreements~~March ~~which~~31, ~~would~~2012 ~~commit~~were us$1,168,824, toas ~~any~~compared ~~material capital expenditures. We plan~~ to ~~attempt~~$1,390,505 tofor ~~acquire~~the ~~operating~~three ~~companies~~months inended ~~the~~March ~~Wastewater~~31, ~~Services~~2011. ~~sector~~This ~~and~~decrease ~~develop~~was ~~commercial~~primarily ~~applications~~attributable to ~~convert~~several ~~our~~major ~~vertically~~projects ~~collected~~that ~~waste~~occurred toin ~~energy~~2011 and ~~organic~~similar ~~nutrients~~projects ~~(fertilizer)~~did ~~and~~not ~~build~~reoccur ~~and~~along ~~operate~~with adryer ~~significant~~weather ~~waste~~conditions ~~collection~~which ~~and~~reduces ~~treatment~~the ~~plant~~demand infor ~~Central Florida~~services.

WeCost ~~are~~of ~~currently~~goods ~~investigating~~sold ~~opportunities~~for ~~regarding~~ the ~~acquisition~~three ofmonths ~~companies~~ended inMarch ~~the~~31, ~~Wastewater~~2012 ~~Services~~was ~~sector~~$976,926, as ~~well~~compared asto $941,021 for the ~~leasing~~three ormonths ~~acquisition~~ended ofMarch ~~companies~~31, in2011. ~~the~~This ~~Wastewater~~increase ~~Services~~was ~~sector~~due primarily to increased disposal costs.

InGeneral ~~the~~and ~~event~~administrative ~~that~~expense wefor ~~enter~~the ~~into~~three amonths ~~binding~~ended ~~agreement~~March to31, ~~either~~2012 ~~(a)~~was ~~acquire~~$514,964, aas ~~company~~compared orto ~~companies~~$763,674 infor the ~~Wastewater~~three ~~Services~~months ~~sector~~ended orMarch ~~(b)~~31, ~~lease~~2011. orThe ~~acquire~~primary ~~companies~~reason in the ~~Wastewater~~expenses ~~Services~~decreased ~~sector~~was wethat ~~believe~~in 2011 we ~~will~~had bea ~~required~~substantial toamount ~~undertake~~of ~~significant capital expenditures. Historically~~non-cash, ~~our~~non-recurring ~~sources~~expenses ofrelated ~~liquidity~~to ~~have~~the ~~been~~issuance ~~(a)~~of ~~Revenues~~common ~~from~~stock ~~operations~~for ~~(b)~~marketing ~~Loans from senior officers~~ and ~~(c)~~consulting ~~Bank Line of Credit~~expense.

InInterest expense for the ~~event~~three ~~that~~months weended ~~are~~March ~~required~~31, to2012 ~~raise~~was ~~additional~~$50,011, ~~cash~~as ~~from~~compared ~~outside~~to ~~sources~~$31,793 wefor ~~may~~the ~~issue~~three ~~equity~~months ~~securities~~ended orMarch ~~incur~~31, ~~additional debt~~2011. During ~~There~~th390e isthree nomonths ~~assurance~~ended ~~that~~March ~~such~~31, ~~funding~~2012, ifthe ~~required~~Company borrowed over $1,500,000, ~~will~~restructuring benearly ~~available~~$900,000 toof usdebt, oracquiring over $250,000 ifof ~~available~~equipment, ~~will~~utilizing beover ~~available~~$230,000 ~~upon~~to ~~terms~~fund ~~favorable~~operations and increasing cash by nearly $200,000. The increase to usinterest expense corresponds to the additional debt incurred.

~~Results~~Net ofloss ~~Operations~~ for the ~~Three~~three ~~and~~months ~~Nine~~ended ~~Months~~March 31, 2012 was $390,104, as compared to $354,086 for the three months ended ~~September~~March 3031, 2011. The primary reason the losses increased was due to lower sales revenues in 2012 compared to 2011.

Revenues for the three months ended September 30, 2011 were $1,422,018, as compared to $1,001,093 for the three months ended September 30, 2010. Revenues for the nine months ended September 30, 2011 were $4,378,747, as compared to $1,137,215 for the nine months ended September 30, 2010. This increase was primarily attributable to our acquisition of Brownies Waste Water Solutions, Inc. and the purchase and deployment of a substantial amount of equipment from Clean Fuel LLC. The Clean Fuel LLC equipment acquisition allowed us to grow substantially. The Brownies business combination was effective in providing a strong presence in Florida; however, we had to update much of the business and revenue model to make Brownies a competitive business in this industry.

Cost of goods sold for the three months ended September 30, 2011 was $1,110,311, as compared to $142,096 for the three months ended September 30, 2010. Cost of goods sold for the nine months ended September 30, 2011 was $3,004,779, as compared to $195,786 for the nine months ended September 30, 2010. This increase was due to the major equipment purchase from Clean Fuel LLC, which increased our costs, and our acquisition of Brownies in July 2010, which expanded our business in 2011, but not the first six months of 2010. The revamping to make the Brownies business model competitive in the industry also contributed to the increase in 2011 costs.

Table of Contents

General and administrative expense for the three months ended September 30, 2011 was $567,073, as compared to $753,113 for the three months ended September 30, 2010. General and administrative expenses for the nine months ended September 30, 2011 were $2,002,229, as compared to $2,514,793 for the nine months ended September 30, 2010. The primary reason the expenses decreased was that in 2010 we had a substantial amount of non-cash, non-recurring expenses related to the issuance of common stock for marketing and consulting expense, which was partially offset by higher salary expense during the 2011 period.

Interest expense for the three months ended September 30, 2011 was $28,046, as compared to $70,792 for the three months ended September 30, 2010. Interest expense for the nine months ended September 30, 2011 was $135,161, as compared to $1,312,748 for the nine months ended September 30, 2010. During 2010, we issued shares of the Company to certain debt holders to satisfy outstanding notes payable and recorded additional interest of $46,401 and $856,146 of interest expense, which represented the excess of the fair market value of the shares issued over the carrying amount of the debt satisfied, during the three and nine months ended September 30, 2010. During the nine months ended September 30, 2010, we also recorded $112,500 of interest expense related to the amortization of debt discount, versus $32,704 during the same period of 2011.

Net loss for the three months ended September 30, 2011 was $293,509, as compared to $20,894 for the three months ended September 30, 2010. Net loss for the for the nine months ended September 30, 2011 was $791,718, as compared to $2,944,451 for the nine months ended September 30, 2010. The primary reason the losses decreased was that in 2010 we had a substantial amount of non-cash, non-recurring expenses related to the issuance of common stock as described above.

Liquidity and Capital Resources

~~Our~~The ~~cash~~Company ~~(used~~has ~~in)~~three ~~provided~~material bynotes, ~~operating~~one ~~activities~~from ~~was~~our ~~($249,846)~~Chief ~~and~~Executive ~~$44,317~~Officer for ~~the~~approximately ~~nine~~$418,000 ~~months~~and ~~ended~~two ~~September~~others ~~30,~~from ~~2011~~a ~~and~~traditional ~~2010~~banking relationship, ~~respectively. The~~Reunion ~~decrease~~Bank isfor ~~mainly~~a ~~attributable~~combined tobalance ~~the acquisition~~ of ~~Brownies~~ ~~Waste~~approximately ~~Water Solutions~~$778, ~~Inc~~000. The ~~and~~Company ~~the~~is ~~costs~~presently ~~incurred~~not toin ~~update~~compliance ~~much~~with of the ~~business~~debt ~~and~~coverage ~~revenue~~ratio ~~model to make Brownies a competitive business in this industry.~~loan

~~Cash used in investing activities was $190,052 and $58,674 for the nine months ended September 30, 2011 and 2010, respectively. We acquired new equipment for our company in 2011.~~17

~~Cash~~covenant ~~provided~~on bythe ~~financing~~Reunion ~~activities~~Bank ~~was~~debt ~~$338,663~~ and ~~$302,126~~has ~~for~~reclassified the ~~nine~~debt ~~months~~as ~~ended~~current ~~September~~due ~~30,~~to ~~2011~~its ~~and 2010, respectively~~non-compliance. ~~During~~The ~~the~~Company ~~nine~~is ~~months~~presently ~~ended~~making ~~September~~timely ~~30,~~monthly ~~2011,~~payments ~~we received proceeds from notes payable~~ and ~~lines~~is ofcurrent ~~credit~~with ofall ~~$813,007~~payment ~~from~~requirements ~~unrelated~~and ~~third~~Reunion ~~parties~~has ~~and~~not ~~$68,800~~demanded ~~from~~that ~~related~~the ~~parties,~~loan be repaid ~~notes~~as ~~payable and~~ a ~~convertible~~result ~~note~~ of ~~$605,826~~non-compliance ~~and~~with ~~received~~the ~~net~~debt ~~proceeds from warrant exercises of $50,000~~covenant.

~~The~~Our ~~Company~~cash ~~has~~(used ain) ~~net~~provided ~~loss~~by ~~for~~operating ~~the~~activities ~~nine~~was ~~months ended September 30~~($230,797) ~~2011~~and of $~~791~~(139,~~718,~~319) anfor ~~accumulated~~the ~~deficit~~three atmonths ~~September~~ended ~~30,~~March ~~2011 of $21~~31,~~271,322,~~ ~~cash~~2012 ~~flows~~and ~~used in operating activities of $249~~2011,~~846~~ ~~and~~respectively. ~~needs~~The ~~additional~~increase ~~cash~~is ~~flows~~mainly attributable to ~~maintain~~lower ~~its~~sales ~~operations~~revenue.

~~These~~Cash ~~factors~~used ~~raise~~in ~~doubt~~investing ~~about~~activities ~~the~~was ~~Company’s~~$257,286 ~~ability~~and to$187,463 ~~continue~~for ~~as a going concern. The accompanying financial statements do not include any adjustments that might result from~~ the ~~outcome~~three ofmonths ~~this~~ended ~~uncertainty.~~March ~~The Company’s continued existence is dependent upon management’s ability to develop profitable operations~~31, ~~continued~~2012 ~~contributions from the Company’s executive officers to finance its operations~~ and ~~the~~2011, ~~ability~~respectively. toWe ~~obtain~~acquired ~~additional~~new ~~funding~~equipment ~~sources to explore potential strategic relationships and to provide capital and other resources~~ for ~~the~~our ~~further~~company ~~development~~in ~~and marketing of the Company’s products and business~~2012.

Cash provided by financing activities was $679,098 and $212,315 for the three months ended March 31, 2012 and 2011, respectively. During the three months ended March 31, 2012, we received proceeds from notes payables of $1,565,162, repaid note payables and lines of credit in the amount of $886,064.

The Company has a net loss for the three months ended March 31, 2012 of $390,104, an accumulated deficit at March 31, 2012 of $22,720,214, cash flows used in operating activities of $230,797 and needs additional cash flows to maintain its operations.

The Company currently has negative working capital and will need additional funds through equity financing and borrowing. We anticipate that we will need $500,000 over the next 12 months to maintain the operations of the Company.

We plan to attempt to acquire operating companies in the waste water services sector and develop commercial applications to convert our vertically collected waste to energy and organic nutrients (fertilizer) and build and operate a significant waste collection and treatment plant in Central Florida.

We are currently investigating opportunities regarding the acquisition or leasing of companies in the waste water services sector.

In the event that we enter into a binding agreement to either (a) acquire a company or companies in the waste water services sector or (b) lease or acquire companies in the waste water services sector we believe we will be required to undertake significant capital expenditures. Historically, our sources of liquidity have been (a) Revenues from operations (b) Loans from senior officers and (c) Bank loans.

There is a strong possibility that, in attempting to accomplish the above, we may not be able to satisfy our cash requirements over the next twelve months and may be required to raise additional cash from outside sources.

In the event that we are required to raise additional cash from outside source, we may issue equity securities or incur additional debt. There is no assurance that such funding, if required will be available to us or, if available, will be available upon terms favorable to us.

Off-Balance sheet arrangements

Table of Contents

We have no off-balance sheet arrangements including arrangements that would affect the liquidity, capital resources, market risk support and credit risk support or other benefits.

WHERE YOU CAN FIND MORE INFORMATION

You are advised to read this Quarterly Report on Form 10-Q in conjunction with other reports and documents that we file from time to time with the SEC. In particular, please read our Quarterly Reports on Form 10-Q, Annual Report on Form 10-K, and Current Reports on Form 8-K that we file from time to time. You may obtain copies of these reports directly from us or from the SEC at the SEC’s Public Reference Room at 100 F. Street, N.E. Washington, D.C. 20549, and you may obtain information about obtaining access to the Reference Room by calling the SEC at 1-800-SEC-0330. In addition, the SEC maintains information for electronic filers at its website http://www.sec.gov.

2218

Table of Contents

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Our business is currently conducted principally in the United States. As a result, our financial results are not affected by factors such as changes in foreign currency exchange rates or economic conditions in foreign markets. We do not engage in hedging transactions to reduce our exposure to changes in currency exchange rates, although if the geographical scope of our business broadens, we may do so in the future.

We do not hold any derivative instruments and do not engage in any hedging activities.

ITEM 4. CONTROLS AND PROCEDURES

~~(a)~~ Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and that such information is accumulated and communicated to our Chief Executive Officer and ~~Principal~~Chief Financial Officer, as appropriate, to allow for timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Our disclosure controls and procedures were designed to provide reasonable assurance that the controls and procedures would meet their objectives. As required by SEC Rule 13a-15(b), our Chief Executive Officer and ~~Principal~~Chief Financial Officer carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this report. Based on the foregoing, our Chief Executive Officer and ~~Principal~~Chief Financial Officer concluded that our disclosure controls and procedures were not effective ~~since~~at the ~~Company~~reasonable ~~has~~assurance ~~been ineffective in filing timely~~level.

~~(b)~~Management’s ~~Changes~~Annual inReport on Internal ~~Controls~~Control ~~Over~~over Financial Reporting

~~There~~Our ~~have~~Chief ~~been~~Executive noOfficer ~~changes~~and inChief Financial Officer are responsible for establishing and maintaining adequate internal control over our financial reporting. In order to evaluate the effectiveness of internal ~~controls~~control over financial reporting, oras inrequired ~~other~~by ~~factors~~Section ~~that~~404 ~~could~~of ~~materially~~the ~~affect~~Sarbanes-Oxley Act, ormanagement ~~are~~has ~~reasonably~~conducted ~~likely~~an toassessment, ~~affect~~including testing, ~~our~~using the criteria in Internal Control — Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Our system of internal ~~controls~~control over financial reporting ~~during~~is designed to provide reasonable assurance regarding the ~~quarter~~reliability ~~ended~~of ~~September~~financial ~~30,~~reporting ~~2011~~and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. ~~There~~Because ~~have~~of its inherent limitations, internal control over financial reporting may not ~~been~~prevent ~~significant~~or ~~changes~~detect misstatements. Management has used the framework set forth in the ~~Company's~~report ~~critical~~entitled ~~accounting~~Internal ~~policies~~Control-Integrated ~~identified~~Framework ~~since~~published by the ~~Company~~Committee ~~filed~~of ~~its~~Sponsoring ~~Annual~~Organizations ~~Report~~of the Treadway Commission, known as COSO, to evaluate the effectiveness of our internal control over financial reporting. Based on ~~Form~~this ~~10-K~~assessment, our Chief Executive Officer and Chief Financial Officer have concluded that our internal control over financial reporting was not effective as of ~~December~~March 31, ~~2010~~2012.

An internal control material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the financial statements would not be prevented or detected on a timely basis by employees in the normal course of their work. Our management’s assessment is that the Company did not maintain effective internal control over financial reporting as of March 31, 2012 within the context of the framework established by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on our internal control over financial reporting as designed, documented and tested, we identified multiple material weaknesses primarily related to maintaining an adequate control environment.

The material weaknesses in our internal controls related to inadequate staffing within our accounting department and upper management, lack of controls regarding the assignment of authority and responsibility, lack of consistent policies and procedures, inadequate monitoring of controls and inadequate disclosure controls.

Management noted that there were no material weaknesses related to the policies and procedures that:

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

·	Provide reasonable assurance that the receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and

·	Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Changes in Internal Controls

There were no changes in our internal control over financial reporting that occurred during the first quarter of 2012 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitation of Internal Controls

It should be noted that any system of controls, however well designed and operated, can provide only reasonable and not absolute assurance that the objectives of the system are met. In addition, the design of any control system is based in part upon certain assumptions about the likelihood of certain events. Because of these and other inherent limitations of control systems, there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.

PART II

OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

We are currently not involved in any litigation ~~except noted below~~ that we believe could have a material adverse effect on our financial condition or results of operations. ~~Other~~There ~~than described below, there~~ is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the executive officers of our company or any of our subsidiaries, threatened against or affecting ~~the~~our ~~Company~~company, our common stock, any of our subsidiaries or of ~~the~~our ~~Company~~company’s or our company’s subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect except noted below.

23In September 2010, the Company became aware that one of the shareholders of Brownies Waste Water Solutions, Inc., Gary Goldstein, prior to the acquisition, allegedly misappropriated $15,000 of the Company’s funds (the “Funds”) by attempting to transfer or pass through funds of an unrelated bankrupt company through the Company’s bank accounts to disguise them as services Brownies was to perform when in fact it was an attempt to disguise it as legal services for the shareholder. The Company contacted Bank of America who was the single largest creditor in the unrelated bankrupt company and returned the funds to the bankruptcy court. The Company contacted the Bankruptcy Trustees Office as to the action of the shareholder and they are investigating the shareholder to determine the next course of action. The Company is investigating the accounting records to determine if there are additional improprieties prior to the purchase of Brownies and have reported this to the appropriate authorities.

~~Table of Contents~~20

The Company ~~became~~become aware ~~that one of~~ the ~~shareholders~~sellers of Brownies ~~Waste~~failed ~~Water~~to ~~Solutions,~~disclose ~~Inc.,~~in ~~Gary~~the ~~Goldstein,~~Asset ~~prior~~Purchase toAgreement ~~the~~additional ~~acquisition,~~liabilities ~~allegedly~~of ~~misappropriated~~ $15195,000; ofwhich ~~the~~included ~~Company’s~~an ~~funds~~outstanding ~~(the~~invoice ~~“Funds”) by attempting to transfer or pass through funds~~ of an$21,000 ~~unrelated~~for ~~bankrupt~~required ~~company~~cleanup ~~through the Company’s bank accounts to disguise them as services Brownies was to perform when~~ in ~~fact~~Orange itCounty, ~~was~~Florida, an$18,000 ~~attempt to disguise it as legal services for the shareholder. The Company contacted Bank~~ of ~~America~~unpaid ~~who~~personal ~~was~~property ~~the~~taxes, ~~single~~unemployment ~~largest~~taxes ~~creditor in the unrelated bankrupt company and returned the funds to the bankruptcy court. The Company contacted the Bankruptcy Trustees Office as to the action~~ of ~~the~~$99,144 ~~shareholder~~ and ~~they~~$57,000 ~~are~~owed ~~investigating the shareholder~~ to ~~determine~~Shelley ~~the~~Septic, ~~next course of action~~Inc. The Company is investigating ~~the accounting records to determine~~ if there are any additional ~~improprieties~~undisclosed ~~prior~~liabilities toin the ~~purchase~~acquisition of Brownies. ~~If the Company finds additional improprieties, the Company will contact the proper regulatory authorities.~~

The Company ~~became~~was ~~aware~~a ~~the~~Defendant ~~sellers~~in oflitigation ~~Brownies~~with ~~failed~~Harvey toBlonder, ~~disclose~~Gary inGoldstein, ~~the~~and ~~Asset~~Robin ~~Purchase~~Bailey ~~Agreement~~v. ~~additional~~Freedom ~~liabilities~~Environmental ofServices, ~~$89~~Inc.,~~000;~~ ~~which~~and ~~included~~Michael anBorish, ~~outstanding~~individually. This ~~invoice~~case was in Circuit Court of ~~$21,000~~the ~~for~~Ninth ~~required~~Judicial ~~cleanup~~Circuit, in and for Orange County, Florida, ~~$18,000~~Case No. 2010-CA-026477-0 related to the acquisition of ~~unpaid~~Brownies ~~personal~~Waste ~~property~~Water ~~taxes~~Solutions in July 17, 2010. The Original Complaint was dismissed on a Motion to Dismiss Failure to State a Claim and ~~$57,000~~the ~~owed~~Court allowed the Plaintiffs to ~~Shelley~~file ~~Septic,~~an ~~Inc.~~Amended Complaint. The ~~Company~~Amended isComplaint ~~investigating~~was iffiled ~~there~~on ~~are~~June ~~any~~3, ~~additional~~2011 ~~undisclosed~~which ~~liabilities~~alleges in– ~~the~~Declaratory ~~acquisition~~Relief, Fraudulent Inducement to Enter a Contract, Negligent Misrepresentation, Breach of ~~Brownies~~Contract Warranties, Accounting, and ~~has~~Rescission ~~sought~~of ~~legal~~Purchase ~~counsel~~Agreement. There toare ~~determine~~currently issues with that litigation which are being evaluated by counsel for the ~~next~~Company, ~~course~~including the end of ~~action~~that litigation.

~~Mr.~~On ~~Borish~~May 2, 2012 Harvey Blonder, Gary Goldstein, and ~~companies~~Robyn ~~under~~Bailey ~~his~~filed ~~control~~another ~~personally~~law ~~forgave~~suit now in the ~~following~~United ~~debt~~States ~~and~~District ~~other~~Court ~~liabilities~~Middle toDistrict ~~consummate~~of Florida case No. 6:12-cv-665-ORL-22DAB making the ~~acquisition~~same ofallegations ~~Brownies~~in ~~Waste~~the ~~Water~~prior ~~Solution,~~complaints ~~Inc~~filed in state court. The onCompany ~~July~~vehemently ~~17,~~denies ~~2010:~~all allegations and considers this litigation frivolous.

Notes Payable Shareholder	$	405,819
Notes Payable Resort Marketing		84,300
Accrued Interest		181,266
Accounts Payable		89,421
Visa RBC Centura 1702		5,934
RBC Centura 1694		7,079
Accrued Interest		362.
Accrued Compensation-CEO		368,183
Accrued Payroll – CEO		99,717
Advances by Shareholders		5,075
Total Debt Forgiven and Recognized as Additional Paid-In Capital in the Accompanying Consolidated Financial Statements	$	1,247,155

The Company is a Defendant in a pending litigation with Harvey Blonder, Gary Goldstein, and Robin Bailey v. Freedom Environmental Services, Inc., and Michael Borish, individually. This case is pending in the Circuit Court of the Ninth Judicial Circuit, in and for Orange County, Florida, Case No. 2010-CA-026477-0 related to the acquisition of Brownies Waste Water Solutions in July 17, 2010. The Original Complaint was dismissed on a Motion to Dismiss Failure to State a Claim and the Court allowed the Plaintiffs to file an Amended Complaint. The Amended Complaint was filed on June 3, 2011 which alleges – Declaratory Relief, Fraudulent Inducement to Enter a Contract, Negligent Misrepresentation, Breach of Contract Warranties, Accounting, and Rescission of Purchase Agreement. The Company considered this litigation frivolous and vehemently denies all allegations. The case in pending in State Court and the Company is vigorously litigating this case.

On January 1, 2011 the Company entered into a one year yellow grease purchase agreement with Delta Integrated Industries LLC ("Delta"). In that agreement the Company agreed to sell fifty thousand gallons of yellow grease per month to Delta. This agreement was voided as Delta submitted a check for $67,000 that was drawn on an account with insufficient funds. Delta has filed a Complaint related to this voided agreement but has never served the summons on the Company which makes the Complaint invalid and the Company believes it will ultimately be dismissed by the Court for lack of service.

ITEM 1A - RISK FACTORS

24As a smaller reporting company we are not required to provide a statement of risk factors. However, we believe this information may be valuable to our shareholders for this filing. We reserve the right to not provide risk factors in our future filings. Our primary risk factors and other considerations include:

~~Table~~We will incur increased costs and demands upon management as a result of ~~Contents~~complying with the laws and regulations that affect public companies, which could materially adversely affect our results of operations, financial condition, business and prospects.

~~You~~As ~~should~~a ~~carefully~~public ~~consider~~company ~~the~~and ~~following~~particularly ~~risk~~after ~~factors~~we ~~together~~cease ~~with~~to ~~the~~be ~~other~~an ~~information~~“emerging ~~contained~~growth ~~in this Interim Report on Form 10-Q~~company,” ~~and~~we inwill ~~prior~~incur ~~reports~~significant ~~pursuant to the Securities Exchange Act of 1934~~legal, asaccounting ~~amended~~ and ~~the~~other ~~Securities~~expenses ~~Act~~that ofwe ~~1933,~~did asnot ~~amended. If~~incur ~~any~~as ofa ~~the~~private ~~risks factors actually occur~~company, ~~our~~including ~~business,~~costs ~~financial~~associated ~~condition~~with orpublic ~~results~~company ofreporting ~~operations~~and ~~could~~corporate begovernance ~~materially adversely affected~~requirements. InThese ~~such~~requirements ~~cases,~~include ~~the~~compliance ~~trading~~with ~~price~~Section 404 ofand ~~our~~other ~~common~~provisions ~~stock~~of ~~could decline. We believe there are no changes that constitute material changes from~~ the ~~risk~~Sarbanes-Oxley ~~factors previously disclosed in the prior reports pursuant to the Securities Exchange~~ Act of ~~1934~~2002, asor ~~amended and~~ the ~~Securities~~Sarbanes-Oxley Act, ofas ~~1933~~well ~~and~~as ~~include~~rules orimplemented ~~reiterate~~by the ~~following risk factors:~~SEC.

The increased costs associated with operating as a public company will decrease our net income or increase our net loss, and may require us to reduce costs in other areas of our business. Additionally, if these requirements divert our management’s attention from other business concerns, they could have a material adverse effect on our results of operations, financial condition, business and prospects.

However, for as long as we remain an “emerging growth company” as defined in the Jumpstart our Business Startups Act of 2012, or JOBS Act, we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We may take advantage of these reporting exemptions until we are no longer an “emerging growth company.”

If the market value of our common stock that is held by non-affiliates exceeds $700 million as of any June 30, we would cease to be an “emerging growth company” as of the following June 30, or if we issue more than $1 billion in non-convertible debt in a three-year period, we would cease to be an “emerging growth company” immediately.

We are an “emerging growth company” and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors.

We are an “emerging growth company,” as defined in the JOBS Act, and we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging growth companies” including not being required to comply with the auditor attestation requirements of section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and shareholder approval of any golden parachute payments not previously approved. We cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.

In addition, Section 107 of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards. An “emerging growth company” can therefore delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. However, we are choosing to “opt out” of such extended transition period, and as a result, we will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. Section 107 of the JOBS Act provides that our decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable.

The Report Of Our Independent Registered Public Accounting Firm Contains Explanatory Language That Substantial Doubt Exists About Our Ability To Continue As A Going Concern

The independent auditor’s report on our financial statements contains explanatory language that substantial doubt exists about our ability to continue as a going concern. We have a net loss for the year ended December 31, 2011 of $1,850,507, an accumulated deficit at December 31, 2011 of $22,330,111, cash flows used in operating activities of $176,759 and need additional cash flows to maintain our operations. We depend on the continued contributions of our executive officers to finance our operations and need to obtain additional funding sources to explore potential strategic relationships and to provide capital and other resources for the further development and marketing of our products and business. If we are unable to obtain sufficient financing in the near term or achieve profitability, then we would, in all likelihood, experience severe liquidity problems and may have to curtail or cease our operations altogether. If we curtail our operations or cease our operations, we may be placed into bankruptcy or undergo liquidation, the result of which will adversely affect the value of our common shares.

Our business strategy, in part, depends upon our ability to complete and manage acquisitions of assets and/or of other companies.

Our business strategy, in part, is to grow through acquisition of assets and/or other businesses, which depend on our ability to identify, negotiate, complete and integrate suitable acquisitions. (See Item 1 Business.)

Even if we complete an acquisition we may experience:

difficulties in integrating any assets and/or acquired companies, personnel and products into our existing business;

delays in realizing the benefits of the acquired company or products;

significant demands on the Company’s management, technical, financial and other resources; diversion of our management’s time and attention to unexpected problems;

higher costs of integration than we anticipated;

difficulties in retaining key employees of the acquired businesses who are necessary to manage these acquisitions; and/or

anticipated benefits of acquisitions may not materialize as planned.

We depend significantly upon the continued involvement of our present management.

The Company’s success depends significantly upon the involvement of our present management, who is in charge of our strategic planning and operations. We may need to attract and retain additional talented individuals in order to carry out our business objectives. The competition for individuals with expertise in this industry could be intense and there are no assurances that these individuals will be available to us.

Our Common Stock Is Subject To Penny Stock Regulation

Our shares are subject to the provisions of Section 15(g) and Rule 15g-9 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), commonly referred to as the "penny stock" rule. Section 15(g) sets forth certain requirements for transactions in penny stocks and Rule 15g-9(d)(1) incorporates the definition of penny stock as that used in Rule 3a51-1 of the Exchange Act. The Commission generally defines penny stock to be any equity security that has a market price less than $5.00 per share, subject to certain exceptions. Rule 3a51-1 provides that any equity security is considered to be penny stock unless that security is: registered and traded on a national securities exchange meeting specified criteria set by the Commission; authorized for quotation on the NASDAQ Stock Market; issued by a registered investment company; excluded from the definition on the basis of price (at least $5.00 per share) or the registrant's net tangible assets; or exempted from the definition by the Commission. Since our shares are deemed to be "penny stock", trading in the shares will be subject to additional sales practice requirements on broker/dealers who sell penny stock to persons other than established customers and accredited investors.

~~FINRA~~3a51-1 ~~Sales~~provides ~~Practice~~that ~~Requirements~~any ~~May~~equity ~~Also~~security ~~Limit~~is Aconsidered ~~Stockholder~~to be penny stock unless that security is: registered and traded on a national securities exchange meeting specified criteria set by the Commission; authorized for quotation on the NASDAQ Stock Market; issued by a registered investment company; excluded from the definition on the basis of price (at least $5.00 per share) or the registrant's ~~Ability~~net Totangible ~~Buy~~assets; ~~And~~or ~~Sell~~exempted ~~Our~~from ~~Stock~~the definition by the Commission. Since our shares are deemed to be "penny stock", trading in the shares will be subject to additional sales practice requirements on broker/dealers who sell penny stock to persons other than established customers and accredited investors.

InCurrent ~~addition~~economic torecession the “penny stock” rules described above, the Financial Industry Regulatory Authority (FINRA) has adopted rules that require that in recommending an investment to a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Prior to recommending speculative low priced securities to their non-institutional customers, broker-dealers must make reasonable efforts to obtain information about the customer's financial status, tax status, investment objectives and ~~other~~political ~~information.~~turmoil ~~Under~~could ~~interpretations~~materially ofadversely ~~these~~affect rules, FINRA believes that there is a high probability that speculative low priced securities will not be suitable for at least some customers. FINRA requirements make it more difficult for broker-dealers to recommend that their customers buy our common stock, which may limit your ability to buy and sell our stock and have an adverse effect on the ~~market for our shares~~Company.

WeThe ~~May~~Company’s ~~Not~~future ~~Have~~operations ~~Access~~and Toperformance ~~Sufficient~~depend ~~Capital~~significantly Toon ~~Pursue~~worldwide ~~Our~~economic ~~Business~~and ~~And~~political ~~Therefore~~conditions. ~~Would~~Uncertainty Beabout ~~Unable~~current Toglobal ~~Achieve~~economic ~~Our~~conditions ~~Planned~~poses ~~Future~~a ~~Growth~~risk as consumers and businesses have postponed spending in response to tighter credit, negative financial news and/or declines in income or asset values, which could have a material negative effect on the demand for our potential energy resources, of which there are no assurances such exist in economically feasible quantities or qualities, and a resulting drop in the prices of such items, actual demand for energy and natural resources could also differ materially from the Company’s expectations. Other factors that could influence demand include continuing increases in fuel and other energy costs, conditions in the residential real estate and mortgage markets, the financial crisis, labor and healthcare costs, access to credit, consumer confidence, and other macroeconomic factors. These and geopolitical events such as war and terrorist actions could have a material adverse effect on demand for the Company’s products and services and on the Company’s financial condition, operating results, and cash flows.

We intend to pursue a growth strategy that includes development of the Company business and technology. Currently we have limited capital which is insufficient to pursue our plans for development and growth. Our ability to implement our growth plans will depend primarily on our ability to obtain additional private or public equity or debt financing. We are currently seeking additional capital. Such financing may not be available at all, or we may be unable to locate and secure additional capital on terms and conditions that are acceptable to us. Our failure to obtain additional capital will have a material adverse effect on our business.23

~~Because~~Climate Wechange ~~Are~~and ~~Quoted~~related Onregulatory ~~The~~responses ~~OTCBB~~may ~~Pink~~impact ~~Sheets~~our ~~Instead Of An Exchange Or National Quotation System, Our Investors May Have A Tougher Time Selling Their Stock Or Experience Negative Volatility On The Market Price Of Our Stock~~business.

Climate change as a result of emissions of greenhouse gases is a significant topic of discussion and may generate U.S. federal and other regulatory responses in the near future. It is impracticable to predict with any certainty the impact of climate change on our business or the regulatory responses to it, although we recognize that they could be significant. However, it is too soon for us to predict with any certainty the ultimate impact, either directionally or quantitatively, of climate change and related regulatory responses.

To the extent that climate change increases the risk of natural disasters or other disruptive events in the areas in which we operate, we could be harmed. While we maintain business recovery plans that are intended to allow us to recover from natural disasters or other events that can be disruptive to our business, our plans may not fully protect us from all such disasters or events.

Compliance with changing regulation of corporate governance and public disclosure will result in additional expenses and pose challenges for our management.

Changing laws, regulations and standards relating to corporate governance and public disclosure, including the Dodd-Frank Wall Street Reform and Consumer Protection Act and the rules and regulations promulgated there under, the Sarbanes-Oxley Act and SEC regulations, have created uncertainty for public companies and significantly increased the costs and risks associated with accessing the U.S. public markets. Our management team will need to devote significant time and financial resources to comply with both existing and evolving standards for public companies, which will lead to increased general and administrative expenses and a diversion of management time and attention from revenue generating activities to compliance activities.

If we are unable to hire, retain or motivate qualified personnel, consultants and advisors, we may not be able to grow effectively.

Our performance will be largely dependent on the talents and efforts of highly skilled individuals. Our future success depends on our continuing ability to identify, hire, develop, motivate and retain highly qualified personnel for all areas of our organization. Competition for such qualified employees is intense. If we do not succeed in attracting excellent personnel or in retaining or motivating them, we may be unable to grow effectively. In addition, our future success will depend in large part on our ability to retain key consultants and advisors. Our inability to retain their services could negatively affect our business and our ability to execute our business strategy.

Risks Related to our Securities

The market price for our common stock may be volatile, and you may not be able to sell our stock at a favorable price or at all.

Many factors could cause the market price of our common stock to rise and fall, including:

·	actual or anticipated variations in our quarterly results of operations;

·	changes in market valuations of companies in our industry;

·	changes in expectations of future financial performance;

·	fluctuations in stock market prices and volumes;

·	issuances of dilutive common stock or other securities in the future;

·	the addition or departure of key personnel;

·	announcements by us or our competitors of acquisitions, investments or strategic alliances; and

It is possible that the proceeds from sales of our common stock may not equal or exceed the prices you paid for the shares after including the costs and fees of making the sales

Substantial sales of our common stock, or the perception that such sales might occur, could depress the market price of our common stock.

We cannot predict whether future issuances of our common stock or resale in the open market will decrease the market price of our common stock. The consequence of any such issuances or resale of our common stock on our market price may be increased as a result of the fact that our common stock is thinly, or infrequently, traded. The exercise of any options, or the vesting of any restricted stock that we may grant to directors, executive officers and other employees in the future, the issuance of common stock in connection with acquisitions and other issuances of our common stock may decrease the market price of our common stock.

Holders of our common stock have a risk of potential dilution if we issue additional shares of common stock in the future.

Although our Board of Directors intends to utilize its reasonable business judgment to fulfill its fiduciary obligations to our then existing stockholders in connection with any future issuance of our common stock, the future issuance of additional shares of our common stock would cause immediate, and potentially substantial, dilution to the net tangible book value of those shares of common stock that are issued and outstanding immediately prior to such transaction. Any future decrease in the net tangible book value of our issued and outstanding shares could have a material adverse effect on the market value of our shares.

We do not intend to pay cash dividends to our stockholders, so you will not receive any return on your investment in our Company prior to selling your interest in the Company.

The Company has never paid any cash dividends to our stockholders. We currently intend to retain any future earnings for funding growth and, therefore, do not expect to pay any cash dividends in the foreseeable future. As a result, you will not receive any return on your investment prior to selling your shares in our Company and, for the other reasons discussed in this “Risk Factors” section, you may not receive any return on your investment even when you sell your shares in our Company.

Certain shares of our common stock are restricted from immediate resale. The lapse of those restrictions, coupled with the sale of the related shares in the market, or the market’s expectation of such sales, could result in an immediate and substantial decline in the market price of our common stock.

Most of our shares of common stock are restricted from immediate resale in the public market. The restricted shares are restricted in accordance with Rule 144, which states that if unregistered, restricted securities are to be sold, a minimum of one year must elapse between the later of the date of acquisition of the securities from the issuer or from an affiliate of the issuer, and any resale of those securities in reliance on Rule 144. The Rule 144 restrictive legend remains on the stock until the holder of the stock holds the stock for longer than six months (unless an affiliate) and meets the other requirements of Rule 144 to have the restriction removed. The sale or resale of those shares in the public market, or the market’s expectation of such sales, may result in an immediate and substantial decline in the market price of our shares. Such a decline will adversely affect our investors, and make it more difficult for us to raise additional funds through equity offerings in the future.

Our common stock is subject to restrictions on sales by broker-dealers and penny stock rules, which may be detrimental to investors.

Our common stock is subject to Rules 15g-1 through 15g-9 under the Exchange Act, which imposes certain sales practice requirements on broker-dealers who sell our common stock to persons other than established customers and “accredited investors” (as defined in Rule 501(a) of the Securities Act). For transactions covered by this rule, a broker-dealer must make a special suitability determination for the purchaser and have received the purchaser’s written consent to the transaction prior to the sale. This rule adversely affects the ability of broker-dealers to sell our common stock and purchasers of our common stock to sell their shares of our common stock.

~~Table~~Additionally, our common stock is subject to SEC regulations applicable to “penny stocks.” Penny stocks include any non-Nasdaq equity security that has a market price of ~~Contents~~less than $5.00 per share, subject to certain exceptions. The regulations require that prior to any non-exempt buy/sell transaction in a penny stock; a disclosure schedule proscribed by the SEC relating to the penny stock market must be delivered by a broker-dealer to the purchaser of such penny stock. This disclosure must include the amount of commissions payable to both the broker-dealer and the registered representative and current price quotations for our common stock. The regulations also require that monthly statements be sent to holders of a penny stock that disclose recent price information for the penny stock and information of the limited market for penny stocks. These requirements adversely affect the market liquidity of our common stock.

Our common stock is traded on the OTCBB (“pink sheets”). The OTCBB (“pink sheets”) is often highly illiquid. There is a greater chance of volatility for securities that trade on the OTCBB (“pink sheets”) as compared to a national exchange or quotation system. This volatility may be caused by a variety of factorsAnti-Takeover, ~~including~~Limited ~~the~~Liability ~~lack of readily available price quotations, the absence of consistent administrative supervision of bid~~ and ~~ask~~Indemnification quotations, lower trading volume, and market conditions. Investors in our common stock may experience high fluctuations in the market price and volume of the trading market for our securities. These fluctuations, when they occur, have a negative effect on the market price for our securities. Accordingly, our stockholders may not be able to realize a fair price from their shares when they determine to sell them or may have to hold them for a substantial period of time until the market for our common stock improves.Provisions

~~Operating~~Certificate ~~History~~of ~~And~~Incorporation ~~Lack~~and ~~Of Profits Which Could Lead To Wide Fluctuations In Our Share Price~~By-laws. The Price At Which You Purchase Our Common Shares May Not Be Indicative Of The Price That Will Prevail In The Trading Market. You May Be Unable To Sell Your Common Shares At Or Above Your Purchase Price, Which May Result In Substantial Losses To You. The Market Price For Our Common Shares Is Particularly Volatile Given Our Status As A Relatively Unknown Company With A Small And Thinly Traded Public Float, Limited

~~The~~Under ~~market for~~ our ~~common~~certificate ~~shares~~of ~~is characterized by significant price volatility when compared to seasoned issuers~~incorporation, ~~and we expect that~~ our ~~share~~Board ~~price~~of ~~will~~Directors ~~continue~~may toissue beadditional ~~more~~shares ~~volatile~~of ~~than~~common aor ~~seasoned~~preferred ~~issuer for the indefinite future~~stock. ~~The~~Any ~~volatility~~additional inissuance ~~our share price is attributable to a number~~ of ~~factors. First, as noted above, our~~ common ~~shares~~or ~~are~~preferred ~~sporadically~~stock ~~and~~could ~~thinly~~have ~~traded.~~the Aseffect ~~a consequence~~ of ~~this~~impeding ~~lack~~or ofdiscouraging ~~liquidity,~~ the ~~trading~~acquisition of ~~relatively~~control ~~small quantities~~ of ~~shares~~us by ~~our~~means ~~shareholders may disproportionately influence the price~~ of ~~those~~a ~~shares in either direction. The price for our shares could~~merger, ~~for~~tender ~~example~~offer, ~~decline~~proxy ~~precipitously~~contest inor ~~the~~otherwise, ~~event~~including ~~that~~ a ~~large~~transaction ~~number~~in ofwhich our ~~common~~stockholders ~~shares~~would ~~are~~receive ~~sold~~a onpremium over the market ~~without~~price ~~commensurate~~for ~~demand,~~their ~~as compared to a seasoned issuer which could better absorb those sales without adverse impact on its share price. Secondly~~shares, ~~we are a speculative or “risky” investment due to our limited operating history~~ and ~~lack~~thereby ofprotects ~~profits~~the tocontinuity ~~date, and uncertainty~~ of ~~future market acceptance for~~ our ~~potential products~~management. ~~As a consequence of this enhanced risk~~Specifically, ~~more~~if ~~risk-adverse~~in ~~investors may, under~~ the ~~fear~~due ofexercise ~~losing all or most~~ of ~~their~~its ~~investment~~fiduciary inobligations, the ~~event~~Board of ~~negative~~Directors ~~news~~were ~~or lack of progress, be more inclined~~ to ~~sell~~determine ~~their~~that ~~shares on the market more quickly and at greater discounts than would be the case with the stock of~~ a ~~seasoned~~takeover ~~issuer.~~proposal ~~Many~~was ofnot ~~these~~in ~~factors are beyond~~ our ~~control~~best ~~and may decrease the market price of our common shares~~interest, ~~regardless of our operating performance. We cannot make any predictions or projections as to what the prevailing market price for our common~~ shares ~~will~~could be atissued ~~any~~by ~~time, including as to whether~~ our ~~common~~Board ~~shares~~of ~~will~~Directors ~~sustain~~without ~~their~~stockholder ~~current~~approval ~~market~~in ~~prices,~~one or asmore totransactions ~~what~~that ~~effect~~might ~~that~~prevent ~~the~~or ~~sale~~render ofmore ~~shares~~difficult or costly the ~~availability~~completion of ~~common shares for sale at any time will have on~~ the ~~prevailing~~takeover ~~market price.~~by:

~~Shareholders~~· ~~should~~diluting ~~be aware that, according to SEC Release No. 34-29093,~~ the ~~market~~voting ~~for penny stocks has suffered in recent years from patterns of fraud and abuse. Such patterns include (1) control of the market for the security by one~~ or aother ~~few~~rights ~~broker-dealers that are often related to the promoter or issuer; (2) manipulation~~ of prices through prearranged matching of purchases and sales and false and misleading press releases; (3) boiler room practices involving high-pressure sales tactics and unrealistic price projections by inexperienced sales persons; (4) excessive and undisclosed bid-ask differential and markups by selling broker-dealers; and (5) the ~~wholesale~~proposed ~~dumping~~acquirer of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, along with the resulting inevitable collapse of those prices and with consequent investor losses. Our management is aware of the abuses that have occurred historically in the penny stock market. Although we do not expect to be in a position to dictate the behavior of the market or ofinsurgent ~~broker-dealers~~stockholder ~~who participate in the market~~group, management will strive within the confines of practical limitations to prevent the described patterns from being established with respect to our securities. The occurrence of these patterns or practices could increase the volatility of our share price.

We· ~~Depend~~putting ~~Upon~~a ~~Key~~substantial ~~Management~~voting ~~Personnel~~bloc ~~and~~in ~~the~~institutional ~~Loss~~or ofother ~~Any~~hands ofthat ~~Them~~might ~~Would~~undertake ~~Seriously~~to ~~Disrupt~~support ~~Our~~the ~~Operations.~~incumbent Board of Directors, or

~~The~~· ~~success~~effecting ofan ~~our~~acquisition ~~company~~that ismight ~~largely~~complicate ~~dependent on the personal efforts of Michael Borish and other key executives. The loss of the services of Michael Borish~~ or ~~other~~preclude key executives would have a material adverse effect on our business and prospects. In addition, in order for us to undertake our operations as contemplated, it will be necessary for us to locate and hire experienced personnel who are knowledgeable in the ~~alternative fuel business~~takeover. ~~Our failure to attract and retain such experienced personnel on acceptable terms will have a material adverse impact on our ability to grow our business.~~

Our certificate of incorporation also allows our Board of Directors to fix the number of directors in the bylaws. Cumulative voting in the election of directors is specifically denied in our certificate of incorporation. The effect of these provisions may be to delay or prevent a tender offer or takeover attempt that a stockholder may determine to be in his or its best interest, including attempts that might result in a premium over the market price for the shares held by the stockholders

Delaware Anti- Takeover Law.

We are subject to the provisions of Section 203 of the Delaware General Corporation Law concerning corporate takeovers. This section prevents many Delaware corporations from engaging in a business combination with any interested stockholder, under specified circumstances. For these purposes, a business combination includes a merger or sale of more than 10% of our assets, and an interested stockholder includes a stockholder who owns 15% or more of our outstanding voting stock, as well as affiliates and associates of these persons. Under these provisions, this type of business combination is prohibited for three years following the date that the stockholder became an interested stockholder unless:

·	the transaction in which the stockholder became an interested stockholder is approved by the Board of Directors prior to the date the interested stockholder attained that status;

·	on consummation of the transaction that resulted in the stockholders becoming an interested

~~Table~~· stockholder, the interested stockholder owned at least 85% of ~~Contents~~the voting stock of the corporation outstanding at the time the transaction commenced, excluding those shares owned by persons who are directors and also officers; or

~~Volatility~~· inon ~~our~~or ~~common~~subsequent ~~share~~to ~~price~~that ~~may~~date, ~~subject~~the usbusiness tocombination ~~securities~~is ~~litigation,~~approved ~~thereby~~by ~~diverting~~the ~~our~~Board ~~resources~~of ~~that~~Directors ~~may~~and ~~have~~authorized aat ~~material~~an ~~effect~~annual onor ~~our~~special ~~profitability~~meeting ~~and~~of ~~results~~stockholders by the affirmative vote of ~~operations~~at least two-thirds of the outstanding voting stock that is not owned by the interested stockholder.

AsThis ~~discussed~~statute incould ~~the~~prohibit ~~preceding~~or ~~risk~~delay ~~factors,~~mergers ~~the~~or ~~market~~other ~~for~~takeover ~~our~~or ~~common~~change ~~shares~~in iscontrol ~~characterized~~attempts ~~by significant price volatility when compared to seasoned issuers~~and, ~~and we expect that our share price will continue to be more volatile than a seasoned issuer for the indefinite future. In the past~~accordingly, ~~plaintiffs have often initiated securities class action litigation against a company following periods of volatility in the market price of its securities. We~~ may indiscourage ~~the~~attempts ~~future~~to beacquire ~~the target of similar litigation~~us. ~~Securities litigation could result in substantial costs and liabilities and could divert management’s attention and resources.~~

~~Compliance~~Limited ~~with~~Liability ~~changing regulation of corporate governance~~ and ~~public disclosure will result in additional expenses and pose challenges for our management team~~Indemnification.

~~Changing~~Our ~~laws,~~certificate ~~regulations~~of ~~and~~incorporation ~~standards~~eliminates ~~relating~~the topersonal ~~corporate~~liability ~~governance~~of ~~and~~our ~~public~~directors ~~disclosure,~~for ~~including~~monetary ~~the~~damages ~~Dodd-Frank~~arising ~~Wall~~from ~~Street~~a ~~Reform~~breach ~~and~~of ~~Consumer~~their ~~Protection~~fiduciary ~~Act~~duty ~~and~~as ~~the~~directors ~~rules~~to ~~and regulations promulgated thereunder,~~ the ~~Sarbanes-Oxley~~fullest ~~Act~~extent ~~and SEC~~permitted ~~regulations,~~by ~~have~~Delaware ~~created~~law. ~~uncertainty~~This ~~for~~limitation ~~public~~does ~~companies~~not ~~and~~affect ~~significantly increased~~ the ~~costs~~availability ~~and~~of ~~risks~~equitable ~~associated~~remedies, ~~with~~such ~~accessing~~as ~~the~~injunctive ~~U.S.~~relief ~~public~~or ~~markets~~rescission. Our ~~management~~certificate ~~team~~of ~~will~~incorporation ~~need~~requires us to ~~devote~~indemnify ~~significant~~our ~~time~~directors and ~~financial~~officers ~~resources~~ to ~~comply~~the ~~with~~fullest ~~both~~extent ~~existing~~permitted ~~and~~by ~~evolving~~Delaware ~~standards for public companies~~law, ~~which~~including ~~will~~in ~~lead~~circumstances toin ~~increased~~which ~~general and~~indemnification ~~administrative~~is ~~expenses~~otherwise ~~and~~discretionary aunder ~~diversion~~Delaware ~~of management time and attention from revenue generating activities to compliance activities~~law.

Under Delaware law, we may indemnify our directors or officers or other persons who were, are or are threatened to be made a named defendant or respondent in a proceeding because the person is or was our director, officer, employee or agent, if we determine that the person:

·	conducted himself or herself in good faith, reasonably believed, in the case of conduct in his or her official capacity as our director or officer, that his or her conduct was in our best interests, and, in all other cases, that his or her conduct was at least not opposed to our best interests; and

·	in the case of any criminal proceeding, had no reasonable cause to believe that his or her conduct was unlawful.

These persons may be indemnified against expenses, including attorneys fees, judgments, fines, including excise taxes, and amounts paid in settlement, actually and reasonably incurred, by the person in connection with the proceeding. If the person is found liable to the corporation, no indemnification will be made unless the court in which the action was brought determines that the person is fairly and reasonably entitled to indemnity in an amount that the court will establish. Insofar as indemnification for liabilities under the Securities Act may be permitted to directors, officers or persons controlling us under the above provisions, we have been informed that, in the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable

If we experience delays and/or defaults in customer payments, we could be unable to recover all expenditures.

Because of the nature of our contracts, at times we commit resources to projects prior to receiving payments from the customer in amounts sufficient to cover expenditures on projects as they are incurred. Delays in customer payments may require us to make a working capital investment. If a customer defaults in making their payments on a project in which we have devoted resources, it could have a material negative effect on our results of operations.

Our recent and future acquisitions may not be successful.

We expect to continue pursuing selective acquisitions of businesses. We cannot assure you that we will be able to locate acquisitions or that we will be able to consummate transactions on terms and conditions acceptable to us, or that acquired businesses will be profitable. Acquisitions may expose us to additional business risks different than those we have traditionally experienced. We also may encounter difficulties integrating acquired businesses and successfully managing the growth we expect to experience from these acquisitions.

We may choose to finance future acquisitions with debt, equity, cash or a combination of the three. We can give no assurances that any future acquisitions will not dilute earnings or disrupt the payment of a stockholder dividend. To the extent we succeed in making acquisitions, a number of risks will result, including:

•	The possible assumption of material liabilities (including for environmental-related costs);

•	Failure of due diligence to uncover situations that could result in legal exposure or to quantify the true liability exposure from known risks;

•	The diversion of management's attention from the management of daily operations to the integration of operations;

•	Difficulties in the assimilation and retention of employees and difficulties in the assimilation of different cultures and practices, as well as in the assimilation of broad and geographically dispersed personnel and operations, as well as the retention of employees generally;

•	The risk of additional financial and accounting challenges and complexities in areas such as tax planning, treasury management, financial reporting and internal controls; and

•	We may not be able to realize the cost savings or other financial benefits we anticipated prior to the acquisition.

The failure to successfully integrate acquisitions could have an adverse effect on our business, financial condition and results of operations.

If we do not effectively manage our growth, our existing infrastructure may become strained, and we may be unable to increase revenue growth.

Our past growth that we have experienced, and in the future may experience, may provide challenges to our organization, requiring us to expand our personnel and our operations. Future growth may strain our infrastructure, operations and other managerial and operating resources. If our business resources become strained, our earnings may be adversely affected and we may be unable to increase revenue growth. Further, we may undertake contractual commitments that exceed our labor resources, which could also adversely affect our earnings and our ability to increase revenue growth.

SHOULD ONE OR MORE OF THE FOREGOING RISKS OR UNCERTAINTIES MATERIALIZE, OR SHOULD THE UNDERLYING ASSUMPTIONS PROVE INCORRECT, ACTUAL RESULTS MAY DIFFER SIGNIFICANTLY FROM THOSE ANTICIPATED, BELIEVED, ESTIMATED, EXPECTED, INTENDED OR PLANNED

~~Special Note Regarding Forward-Looking Statements~~28

This filing contains forward-looking statements about our business, financial condition and prospects that reflect our management’s assumptions and good faith beliefs based on information currently available. We can give no assurance that the expectations indicated by such forward-looking statements will be realized. If any of our assumptions should prove incorrect, or if any of the risks and uncertainties underlying such expectations should materialize, our actual results may differ materially from those indicated by the forward-looking statements.

The key factors that are not within our control and that may have a direct bearing on operating results include, but are not limited to, acceptance of our proposed services and the products we expect to market, our ability to establish a customer base, managements’ ability to raise capital in the future, the retention of key employees and changes in the regulation of our industry.

There may be other risks and circumstances that management may be unable to predict. When used in this filing, words such as, “believes,” “expects,” “intends,” “plans,” “anticipates,” “estimates” and similar expressions are intended to identify and qualify forward-looking statements, although there may be certain forward-looking statements not accompanied by such expressions.

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

The Company issued 11,073,817 shares of common stock to its debt holders for the conversion of their debt and accrued interest, and issued 5,900,000 shares of common stock to consultants. The Company issued 600,000 common shares related to the acquisition of its assets (See Note 9 to the Financial Statements). The offer and sale of such shares of our common stock were effected in reliance on the exemptions for sales of securities not involving a public offering, as set forth in Rule 506 promulgated under the Securities Act of 1933 and in Section 4(2) of the Securities Act of 1933. A legend was placed on the certificates representing each such security stating that it was restricted and could only be transferred if subsequent registered under the Securities Act of 1933 or transferred in a transaction exempt from registration under the Securities Act of 1933.

Table of Contents

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

There were no defaults upon senior securities during the period ended ~~September~~March 3031, 2011.

ITEM 4. REMOVED AND RESERVED.

ITEM 5. OTHER INFORMATION

There is no information with respect to which information is not otherwise called for by this form.

ITEM 6. EXHIBITS

Exhibits filed herein for ~~September~~March 3031, ~~2011~~2012

10.2	Asset Purchase Agreement Schedule
31.1	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act
10.3	Security Fortress LLC Promissory Note
10.4	CEO Employment Agreement
10.5	COO Employment Agreement
31.1	Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act.
31.2	Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act.
32.2	Certification of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley Act.
32.2	Certification of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act.

2829

Table of Contents

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934 the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Freedom Environmental Services, Inc.
Registrant Date: July 26, 2012		Freedom Environmental Services, Inc. By: /s/ Michael Borish
Date: December 1, 2011	By:	/s/ Michael Borish
		Michael Borish
		Michael Borish
		Chief Executive Officer (Principal Executive Officer)
		Chief Executive Officer (Principal Executive Officer)

	Freedom Environmental Services, Inc.
Registrant Date: July 26, 2012		Freedom Environmental Services, Inc. By: /s/ Michael Borish
Date: December 1, 2011	By:	/s/ Michael Ciarlone
		Michael Borish
		Michael Ciarlone
		Chief Financial Officer (Principal Financial Officer)
		Principal Financial Officer

2930

Filing Compare · Freedom Environmental Services, Inc.