Us Farms, Inc - Series B Preferred Stock, $0.001 par value,...

Us Farms, Inc - Recent Material Event

Item 1. Financial Statements


US Farms, Inc.
Consolidated Balance Sheets
			September 30,	December 31,
			2007	2006
			(unaudited)	(audited)
Assets
Current Assets
	Cash		$ 284,403	$ 2,468
	Accounts Receivable		1,512,201	73,358
	Inventories		728,610	-
	Prepaid Expenses & Other Assets		106,334	6,000
		Total Current Assets	2,631,548	81,826

Property & Equipment, Net			359,672	6,667
Other Assets			501,377	750
Total Assets			$ 3,492,597	$ 89,243

Liabilities & Stockholders' Equity (Deficit)
Current Liabilities
	Accounts Payable		$ 1,652,853	$ 774,941
	Accrued Expenses		735,507	572,407
	Accrued Interest Payable		230,025	567,719
	Convertible Debenture		500,000	500,000
	Notes Payable		352,580	597,381
		Total Current Liabilities	3,470,965	3,012,448

Notes Payable			125,856	-
Commitments & Contingencies			-	-

Stockholders' Equity (Deficit)
	Series B Preferred Stock, $0.001 par value, 1,000,000 shares authorized, 88,500 shares issued and outstanding		89	89

	Common Stock, $0.001 par value, 500,000,000 shares
	authorized, 38,760,552 and 17,685,613 issued and
	outstanding, respectively		38,761	17,686
	Additional Paid-in Capital		21,297,869	14,514,894
	Other Comprehensive Loss		(18,000)	(14,000)
	Treasury Stock, at cost		(280)	(280)
	Accumulated Deficit		(21,422,663)	(17,441,594)
		Total Stockholders' Equity (Deficit)	(104,224)	(2,923,205)

Total Liabilities & Stockholders' Equity (Deficit)			$ 3,492,597	$ 89,243
*The accompanying notes are an integral part of these financial statements.*


US Farms, Inc.
Consolidated Statements of Operations
Unaudited
			For the Three Months Ended		For the Nine Months Ended
			September 30,	September 30,	September 30,	September 30,
			2007	2006	2007	2006

Sales, net			$ 2,726,294	$ 214,509	$ 6,802,764	$ 214,509

Cost of Good Sold			2,575,544	194,425	5,881,858	194,425

Gross Profit			150,750	20,084	920,906	20,084

Operating Expenses
	Selling, General and Administrative		1,388,050	1,337,522	4,791,841	2,796,406
	Depreciation and Amortization		17,834	46	34,450	1,000
	Total Operating Expenses		1,405,884	1,337,568	4,826,291	2,797,406

Income (Loss) from Operations			(1,255,134)	(1,317,484)	(3,905,385)	(2,777,322)

Other Income (Expense)
	Gain on Extinguishment of Debt		-	98,256	-	98,256
	Interest Expense		(29,536)	(30,478)	(75,684)	(98,549)
		Total Other Income (Expense)	(29,536)	67,778	(75,684)	(293)

Income (Loss) Before Income Taxes			(1,284,670)	(1,249,706)	(3,981,069)	(2,777,615)

Provision for Income Taxes			-	-	-	-

Net Income (Loss)			$ (1,284,670)	$ (1,249,706)	$ (3,981,069)	$ (2,777,615)

Income (Loss) Per Share-Basic & Diluted			$ (0.03)	$ (0.12)	$ (0.13)	$ (0.30)

Weighted Average Number of Shares			38,194,474	10,842,470	30,497,897	9,246,392

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


US Farms, Inc.
Consolidated Statements of Cash Flows
Unaudited

			For the Nine Months Ended	For the Nine Months Ended
			September 30,	September 30,
			2007	2006
Cash Flows from Operating Activities
	Net Loss		$ (3,981,069)	$ (2,777,615)

	Adjustments to reconcile net loss to net cash used in operating activities:

		Common Stock Issued for Services	2,518,211	2,102,180
		Depreciation & Amortization	34,450	1,000
		Gain on Extinguishment of Debt	-	98,256
		Non-Cash Loss on Marketable Equity Securities	4,000	-

		Changes in operating assets and liabilities:
		Accounts Receivable	(1,438,843)	(96,841)
		Inventories	(728,610)	-
		Prepaid Expenses & Other Current Assets	(100,334)	-
		Other Assets	(500,627)	(5,000)
		Accounts Payable	877,912	174,208
		Accrued Expenses	163,100	33,998
		Accrued Interest Payable	(337,694)	42,723
		Total adjustments	491,565	2,350,524

	Net Cash Used in Operating Activities		(3,489,504)	(427,091)

Cash Flows from Investing Activities
	Purchase of Property and Equipment		(387,455)	(8,000)

	Net Cash Used in Investing Activities		(387,455)	(8,000)

Cash Flows from Financing Activities
	Proceeds from Issuance of Promissory Notes		142,250	-
	Payments on Promissory Notes		(269,196)	(79,197)
	Stock Issued for Cash		3,923,049	400,944
	Common Stock Issued for Conversion of Promissory Notes		362,791	130,852
	Net Cash Provided by Financing Activities		4,158,894	452,599

	Net Increase (Decrease) in Cash		281,935	17,508

	Cash Beginning of Period		2,468	-

	Cash at End of Period		$ 284,403	$ 17,508



	Supplemental Disclosure of Cash Flow Information:
		Cash Paid during the period for interest	$ 8,750	$ -
		Cash Paid during the period for Income Taxes	-	-

	Supplemental Disclosure of Non-Cash Items:
		Notes Payable Issued for Inventory and Equipment	$ 250,000	$ -
		Common Stock Issued for Services	2,518,211	-
		Common Stock Issued for Conversion of Promissory Notes	362,791	130,852
		Common Stock Issued for Property and Equipment	-	8,000

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

US FARMS, INC.

NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

SEPTEMBER 30, 2007

NOTE 1 -

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization

US Farms, Inc. (formerly International Sports and Media Group, Inc. from December 19, 2003 through July 14, 2006 and formerly San Diego Soccer Development Corporation from December 12, 1995 through December 18, 2003), (“the Company”) was incorporated on December 12, 1995, under the laws of the state of Nevada under the name Roller Coaster, Inc. The Company engaged in no operations prior to February 10, 2000.

On February 10, 2000, the Company issued 52,844 shares (post reverse split) of its previously un-issued common stock to the shareholders of San Diego Soccer Development Corporation, a California company (SDSDC) in exchange for all of the issued and outstanding shares of SDSDC. Immediately following the acquisition of SDSDC, the Company changed its name to San Diego Soccer Development Corporation, and changed its state of domicile from California to Nevada.

At the time of acquisition of SDSDC, the Company was completely inactive, with no operations, assets, or liabilities. Additionally, the exchange of the Company’s common stock for the common stock of SDSDC resulted in the former shareholders of SDSDC obtaining control of the Company. Accordingly, SDSDC was treated as the continuing entity for accounting purposes, and the Company being the continuing entity for legal purposes. The transaction was accounted for as a recapitalization of SDSDC, with no adjustment to the basis of SDSDC’s assets acquired or liabilities assumed.

SDSDC was incorporated on August 22, 1997 in the state of California, and was engaged for a time in the management and marketing of professional soccer teams, as well as the publication of a soccer magazine. The majority of the Company’s revenues have been generated from corporate sponsorships, ticket sales, and advertising.

On December 19, 2003, shareholders of the Company elected to change the Company’s corporate name to International Sports and Media Group, Inc.

On July 14, 2006, shareholders of the Company elected to change the Company’s corporate name to US Farms, Inc., to adequately reflect the Company’s current business model.

The Company presently has eleven wholly owned subsidiaries: American Nursery Exchange, Inc. (ANE); California Management Solutions, Inc. (CMS); California Produce Exchange, Inc. (CPE); American Aloe Vera Growers, Inc. (AAVG); Imperial Ethanol, Inc. (IE); Sammy’s Produce, Inc. (SPI); US Ag Transportation, Inc (USAT); US Produce, Inc. (USPI); Texas Garlic & Spice, Inc. (TGS); US Trading Group, Inc. (USTG); and World Garlic & Spice, Inc. (WGS).

These subsidiaries grow and sell the various farm products the Company is now producing. ANE, CPE, AAVG, and IE are the four primary operating business segments.

Accounts Receivable

The Company reviews its accounts receivable periodically in terms of allowance for doubtful accounts. At September 30, 2007, the Company has reserved $60,000 for doubtful accounts.

Inventory

The Company values its inventory under the average method costing under the lower of cost or market method. Inventory at September 30, 2007 consisted of finished goods and raw materials.

Basic Loss Per Share

The computation of basic loss per share of common stock is based on the weighted average number of shares outstanding during the period.


		For the Nine Months Ended
		September 30,
		2007

Profit (Loss) (numerator)		$ (3,981,069)

Shares (denominator)		30,497,897

Per share amount		$ (0.13)

Property and Equipment

Property and equipment is recorded at cost. Major additions and improvements are capitalized. The cost and related accumulated depreciation of equipment retired or sold are removed from the accounts and any differences between the un-depreciated amount and the proceeds from the sale are recorded as a gain or loss on sale of equipment. Depreciation is computed using the straight-line method over the estimated useful life of the assets.

Estimates

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

Advertising and Promotion

The Company follows the policy of charging the costs of advertising and promotion to expense as incurred. Advertising and promotion expense for the nine month period ended September 30, 2007 was $82,016.

Revenue Recognition

The Company recognized revenue upon shipment of its products to its customers.

Recent Accounting Pronouncements

In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities.” SFAS 159 permits entities to choose to measure many financial instruments, and certain other items, at fair value. SFAS 159 applies to reporting periods beginning after November 15, 2007. The adoption of SFAS 159 is not expected to have a material impact on the Company’s financial condition or results of operations.

NOTE 2 -

PROPERTY AND EQUIPMENT

Property and equipment consists of the following:


	September 30,	December 31,
	2007	2006
Machinery & Equipment	$ 51,460	$ -
Vehicles	62,333	8,000
Office Furniture & Equipments	11,919	-
Leasehold Improvements	7,969	-
Buildings & Greenhouses	102,638	-
Capitalized Aloe Crop Costs	159,137	-
Accumulated Depreciation and Amortization	(35,784)	(1,333)
Net Property and Equipment	$ 359,672	$ 6,667

We capitalize crop costs prior to the aloe crop becoming productive. These costs consist primarily of the costs of the crops and expenditures related to labor and materials to prepare the land. Amortization of such costs is done over the straight line basis estimated over 5 years. During the nine months ended September 30, 2007, the Company recorded depreciation and amortization expenses of $34,450.

NOTE 3 -

CONVERTIBLE DEBENTURES AND NOTES PAYABLE

As of September 30, 2007, the Company had convertible and other third party debt obligations, excluding related accrued interest, totaling $978,436 as follows:

Convertible debenture of $500,000, bearing 5% interest per annum repayable in cash or shares of the Company at the option of the note holder. As of September 30, 2006, this bond has matured and is in default.

Multiple unsecured convertible notes of $252,000, bearing various annual interest rates repayable in cash or shares of the Company at the option of the note holders. As of September 30, 2007, $146,000 of these notes have matured and are in default.

On March 22, 2007 the Company, through its wholly owned subsidiary American Nursery, Exchange, Inc., issued a $250,000 promissory note payable to Kurth Nurseries, Inc. for the acquisition of all of the existing plant inventory and equipment of Palm Mountain Nursery located in Vista, California. The four year note bears interest at the rate of 7% per annum with interest and principal due and payable monthly. As of the period ended September 30, 2007, the balance owed Kurth Nurseries under the agreement was $183,936.

Non-convertible note payable of $42,500, bearing 10% interest per annum. As of September 30, 2007, this note has matured and is in default.

NOTE 4 – ACCRUED EXPENSES

As of September 30, 2007, accrued expenses consisted of the following:


	September 30,	December 31,
	2007	2006
Accrued Payroll and Payroll Taxes	$ 357,560	$ 257,560
Accrued Legal & Audit Fees	50,000	-
Accrued Penalties and Interest	158,199	158,199
Other Accrued Expenses	169,748	156,648
Total Accrued Expenses	$ 735,507	$ 572,407

NOTE 5 -

STOCKHOLDERS’ EQUITY (DEFICIT)

Common Stock

During the three months ended September 30, 2007, the Company issued 104,000 shares of restricted common stock for cash at $0.25 per share, 455,850 shares of restricted common stock for cash at $0.40 per share and 534,000 shares of restricted common stock as consideration for $293,980 in services rendered (an average of $0.55 per share).

Preferred Stock

The Company’s Board of Directors have created and authorized the issuance of up to 1,000,000 shares of Series B preferred stock, at $0.001 par value. The Board further resolved to create the preferred stock such that in the event of liquidation, the Series B Holders would be entitled to convert their respective shares, at any time, into three shares of the Company’s common stock. As of September 30, 2007, the Company had 88,500 shares of Series B preferred stock issued and outstanding.

NOTE 6 - SEGMENT INFORMATION

The Company adopted SFAS No.131 “Disclosures About Segments of an Enterprise and Related Information” in respect of its operating segments. The Company’s reportable segments, their subsidiaries, are managed separately because each segment requires different technology and marketing strategies. The Company evaluates performance based on operating earnings of the respective business units. The accounting policies of the segments are the same as those described in the summary of significant accounting policies. The corporate assets consist of cash, accounts receivable, inventory, other assets and fixed assets. In determining operating income and loss by reportable segment, general corporate expenses and other income and expense items of a non reporting nature are not considered, as such items are not allocated to the Company’s segments. Segment information at September 30, 2007 is as follows:


	For the Nine Months Ended
	September 30, 2007

	AAVG	ANE	CPE	IE
Sales, net	$ 542,099	$ 127,046	$ 6,124,898	$ -
Cost of Good Sold	362,170	57,442	5,443,653	-
Gross Profit	179,929	69,604	681,245	-
Operating Expenses	127,955	180,823	692,660	26,912
Operating Income (Loss)	$ 51,974	$ (111,219)	$ (11,415)	$ (26,912)

The segments have $244,188 in cash, $1,504,411 in receivables, $728,610 in inventories, other current assets of $70,185, net fixed assets of $343,900 and Other Assets of $501,377. Accounts payable equaled $1,488,497 and a note payable for $183,937.

NOTE 7 -

GOING CONCERN

As reported in the financial statements, the Company has an accumulated deficit of $21,297,869 at September 30, 2007 and has incurred a significant loss from operations for the period then ended. In addition, the Company was in default on certain of its promissory notes as of September 30, 2007.

These factors create uncertainty about the Company’s ability to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital it could be forced to cease operations.

In order to continue as a going concern and achieve a profitable level of operations, the Company will require, among other things, additional capital resources. Management’s plans to obtain such resources for the Company include (1) raising additional capital through the sale of common stock; (2) continuing the practice of issuing common stock as consideration for certain employee and marketing services; and (3) converting promissory notes into common stock. Management cannot provide any assurances that the Company will be successful in accomplishing any of its plans.

The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

During the next twelve months the Company’s plan of operation is to raise approximately $5,000,000 which the Company intends to invest in its farming and nursery operations, which includes acquiring plant inventory, hiring consultants/employees and for marketing purposes.

NOTE 8 -

COMMITMENTS AND CONTINGENCIES

In December 2004, collection attorneys for a former law firm of the Company contacted the Company regarding an unpaid balance of $22,774 for legal services. The Company has worked out a payment plan of $250 per month.

The Company has a judgment from one of its note holders in the amount of $6,000.

The Company also has a judgment filed against it by AA One Litho in San Diego Superior Court for services rendered in the amount of $15,522.80, including interest and related costs at December 31, 2005.

The Company also has a judgment filed against it by Fox Sports World for services rendered in the amount of $11,000.

During the third quarter of 2005, a judgment was filed in San Diego Superior Court in the amount of $33,747.36, including interest and related costs by McCullough and Associates, the Company's former counsel.

During 2006, the Company entered into a one year lease agreement for a 5 acre nursery/greenhouse facility for its ANE potted plants in Valley Center, California at $4,500 per month. This agreement is in the process of renewal and is currently operating on a month to month basis.

During 2007, the Company renewed a one year lease agreement for 70 acres of farm land for its AAVG aloe vera crop in Calipatria, California at $1,750 per month.

During 2007, the Company entered into a five year lease agreement for 13.5 acres of nursery land for its ANE palms, cycads and jade plants in Rainbow, California at $1,200 per month.

During 2007, the Company entered into a one year lease agreement for a 1,440 square foot office trailer in Rainbow, California at $700 per month.

During 2007, the Company entered into a one year lease agreement for 140 acres of farm land for its CPE asparagus crop in Calipatria, California at $3,500 per month.

During 2007, the Company entered into a master lease agreement for trucks and trailers for its USAT trucking operations in San Diego, California at $3,000 per month.

During 2007, the Company entered into a three year lease agreement for its Corporate Offices in San Diego, California at $1,550 per month.

NOTE 9 – SUBSEQUENT EVENTS

Subsequent to the quarter ended September 30, 2007, we issued a total of 190,000 shares of our common stock to 9 accredited individuals for $76,000 in cash received. We sold the shares at $0.40 per share.

Subsequent to the quarter ended September 30, 2007, we issued a total of 6,000 shares of our common stock to 1 individual for $3,000 in services rendered. We value the shares at $0.50 per share.

Subsequent to the quarter ended September 30, 2007, we issued a total of 15,983 shares of our common stock to 1 individual for debt reduction of $6,393 ($0.40 per share).

In October 2007, the Company entered into a five year sub lease agreement for a 20,000 square foot refrigerated warehouse/dry storage/office facility for its CPE produce operations in Los Angeles, California, at $16,000 per month.

In October, 2007, the Company entered into a five year lease agreement for 5 acres of nursery land for its ANE jade operations in Fallbrook, California at $900 per month.

FORWARD-LOOKING STATEMENTS

This document contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including, but not limited to, any projections of earnings, revenue or other financial items; any statements of the plans, strategies and objections of management for future operations; any statements concerning proposed new services or developments; any statements regarding future economic conditions or performance; any statements or belief; and any statements of assumptions underlying any of the foregoing.

Forward-looking statements may include the words “may,” “could,” “estimate,” “intend,” “continue,” “believe,” “expect” or “anticipate” or other similar words. These forward-looking statements present our estimates and assumptions only as of the date of this report. Accordingly, readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the dates on which they are made. We do not undertake to update forward-looking statements to reflect the impact of circumstances or events that arise after the dates they are made. You should, however, consult further disclosures we make in future filings of our Annual Report on Form 10-KSB, Quarterly Reports on Form 10-QSB and Current Reports on Form 8-K.

Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to change and inherent risks and uncertainties. The factors impacting these risks and uncertainties include, but are not limited to:

our ability to successfully compete in the agricultural products industry;

unexpected natural disasters such as fires or earthquakes that may delay or impact operations and/or facilities located in Southern California;

actions and initiatives taken by both current and potential competitors;

inability to raise additional financing for working capital;

loss of customers or sales weakness;

deterioration in general or regional economic conditions;

the fact that our accounting policies and methods are fundamental to how we report our financial condition and results of operations, and they may require management to make estimates about matters that are inherently uncertain;

adverse state or federal legislation or regulation that increases the costs of compliance, or adverse findings by a regulator with respect to existing operations;

inability to efficiently manage our operations;

inability to achieve future sales levels or other operating results;

the unavailability of funds for capital expenditures;

the ability of our management to implement our business strategy;

our ability to recruit and hire key employees; and

the other risks and uncertainties detailed in this report.

For a detailed description of these and other factors that could cause actual results to differ materially from those expressed in any forward-looking statement, please see “Factors That May Affect Our Results of Operations” in this document and in our Annual Report on Form 10-KSB for the year ended December 31, 2006.

Item 2. Management’s Discussion and Analysis

OVERVIEW AND OUTLOOK

US Farms, Inc. (formerly International Sports and Media Group, Inc. and San Diego Soccer Development Corporation), (“US Farms”) was incorporated on December 12, 1995, under the laws of the state of Nevada under the name Roller Coaster, Inc. We engaged in no operations prior to February 10, 2000. On July 14, 2006, shareholders elected to change the corporate name to US Farms, Inc., to adequately reflect our current business model expansion into the agricultural business.

US Farms is a diversified agricultural company. We currently grow, market and distribute agricultural products through a number of wholly-owned subsidiaries. The agricultural products are sold through supermarkets, home centers, retail merchandisers, garden centers, re-wholesalers, and landscapers throughout the United States. Through internal growth and strategic acquisitions we are expanding the market share in our nursery and specialty produce segments.

CURRENT OPERATIONS

US Farms presently has eleven wholly-owned subsidiaries of which nine are currently operational at this point in time. However, in order to simplify our operations and accurately describe our business segments we have divided operations into 4 reportable business segments (American Aloe Vera Growers, American Nursery Exchange, California Produce Exchange, and Imperial Ethanol) which are described below in greater detail. We believe separating the business segments better aligns our operations with other food and agricultural companies as well as assists in the internal management reporting procedures and practices.

AAVG

American Aloe Vera Growers (AAVG) farms and sells domestically grown aloe vera potted plants, aloe vera boxed produce and bulk aloe vera leaves to brokers, wholesalers and directly to retailers. The AAVG segment currently operates a 70 acre farm in Imperial County, California where produce and bulk product are packaged then shipped. Aloe pups are picked then shipped to AAVG’s 100,000 square foot greenhouse facility in San Diego, County where they are potted, grown to various sizes and staged for delivery.

The competition for AAVG’s aloe leaf is primarily from Mexican growers. Competition for its potted aloe plants is from very small regional growers. Management believes AAVG has significant competitive advantages in this segment due to climate, an irrigated crop which provides superior product, and logistics of the aloe being grown in Southern California.

ANE

American Nursery Exchange (ANE) grows and sells palms, jade, cycads and other potted plants to grocery stores, garden centers, landscapers, home improvement centers and via mail order. In March of 2007, ANE acquired the existing plant inventory and other specific assets of Palm Mountain Nursery located in San Diego County, California. The company leases a 14 acre property in San Diego County, California where the palms, jade, cycads and other potted plants are grown and shipped. ANE has completed the construction of a two acre shade house for the nursery facility in San Diego County. Subsequent to the quarter ended September 30, 2007, ANE entered into a 5 year lease for a nursery facility in Southern California, which will be used for the jade plant production and stock fields. The competition for the nursery products offered through ANE is significant; however, management believes that its focus on high end palms and cycads for landscape/interscape and jade plants will provide competitive advantages.

CPE

California Produce Exchange (CPE) distributes a variety of bulk vegetables and fruits to brokers, distributors, food converters and grocery stores. CPE Asparagus was grown on approximately 210 acres in the Imperial Valley of California under an agreement with Phrixus Holdings, Inc. This agreement has been terminated with the Company currently growing approximately 140 acreas of asparagus under an agreement with Vail Ranches, LLC. The asparagus sales for the first quarter of 2007 were transacted though an arrangement with Five Crowns Marketing, Inc. which may or may not be continued for fiscal 2008. Under this business segment we intend to operate our subsidiaries of Sammy’s Produce, Inc. and World Garlic & Spice, Inc. Additionally, subsequent to the quarter ended September 30, 2007, we executed a sublease for a warehouse facility in Los Angeles, which includes freezer storage and will be used exclusively for our produce business. The competition for CPE’s produce products is intense on the local, regional and international arenas. Management believes that its experienced sales staff, customer service levels and geographic location will help provide competitive advantages.

Imperial Ethanol (IE) is in the due diligence and developmental process of establishing a corn-based dry-mill fuel ethanol production facility in Southern California. Imperial Ethanol has initiated the due diligence process on the Ethanol industry and has received favorable results from a feasibility study conducted on its proposed dry-mill corn-based fuel ethanol production facility in Southern California. The report was conducted by BBI International, a Salida, Colorado based independent Biofuels service fi