----

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| Delaware                 |   | 13-3545304                           |
|--------------------------|--------|--------------------------------------|
| (State of Incorporation) |   | (I.R.S. Employer Identification No.) |

| Intercontinental Business Park           |   |       |
|------------------------------------------|--------|------------|
| 15402 Vantage Parkway East, Suite 322    |   |       |
| Houston, Texas                           |   | 77032      |
| (Address of Principal Executive Offices) |   | (Zip Code) |

| Large Accelerated Filer   ̈ | Accelerated Filer   ̈ | Non-Accelerated Filer   ̈ | Smaller Reporting Company þ |
|-------------------------------------------|-------------------------------------|-----------------------------------------|----------------------------------|

----

----

----

LAPOLLA INDUSTRIES, INC

|              |   |                  |   |                                                                                        | Page   |
|-------------------|--------|-----------------------|--------|---------------------------------------------------------------------------------------------|--------|
|              |   |                  |   |                                                                                        |   |
| PART I            |   | FINANCIAL INFORMATION |   |
|              |   |                  |   |                                                                                        |   |
|              |   | Item 1                |   | Financial Statements                                                                        | 1      |
|              |   |                  |   |                                                                                        |   |
|              |   | Item 2                |   | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 8      |
|              |   |                  |   |                                                                                        |   |
|              |   | Item 3                |   | Quantitative and Qualitative Disclosures About Market Risk                                  | 12     |
|              |   |                  |   |                                                                                        |   |
|              |   | Item 4                |   | Controls and Procedures                                                                     | 12     |
|              |   |                  |   |                                                                                        |   |
| PART II           |   | OTHER INFORMATION     |   |
|              |   |                  |   |                                                                                        |   |
|              |   | Item 1                |   | Legal Proceedings                                                                           | 13     |
|              |   |                  |   |                                                                                        |   |
|              |   | Item 1A               |   | Risk Factors                                                                                | 13     |
|              |   |                  |   |                                                                                        |   |
|              |   | Item 2                |   | Unregistered Sales of Equity Securities and Use of Proceeds                                 | 13     |
|              |   |                  |   |                                                                                        |   |
|              |   | Item 3                |   | Defaults Upon Senior Securities                                                             | 13     |
|              |   |                  |   |                                                                                        |   |
|              |   | Item 4                |   | Submission of Matters to a Vote of Security Holders                                         | 13     |
|              |   |                  |   |                                                                                        |   |
|              |   | Item 5                |   | Other Information                                                                           | 13     |
|              |   |                  |   |                                                                                        |   |
|              |   | Item 6                |   | Exhibits                                                                                    | 13     |
|              |   |                  |   |                                                                                        |   |
| SIGNATURES        | 14     |
|              |   |                  |   |                                                                                        |   |
| INDEX OF EXHIBITS | 15     |

----

Index

Item 1.  Financial 

| CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)                |                                              |
|------------------------------------------------------------------|---------------------------------------------------|
|                                                             |                                              |   |
|                                                             | June 30, 2009 and December 31, 2008               | 2 |
|                                                             |                                              |   |
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)      |                                              |
|                                                             |                                              |   |
|                                                             | Three and Six Months Ended June 30, 2009 and 2008 | 3 |
|                                                             |                                              |   |
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)      |                                              |
|                                                             |                                              |   |
|                                                             | Six Months Ended June 30, 2009 and 2008           | 4 |
|                                                             |                                              |   |
| NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) | 5                                                 |

----

Index

|                                                                                                                                                                                                             |   | June 30, 2009 |        |   | December 31, 2008 |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------|-------------|--------|-------------------|--------|
| Assets                                                                                                                                                                                                           |   |          |        |   |              |   |
| Current Assets:                                                                                                                                                                                                  |   |          |        |   |              |   |
| Cash                                                                                                                                                                                                             |   | $             | 244,729     |   |              | $      | 42,845 |   |
| Trade Receivables, Net                                                                                                                                                                                           |   |          | 8,369,150   |   |              |   | 8,502,679 |   |
| Inventories                                                                                                                                                                                                      |   |          | 4,763,623   |   |              |   | 4,764,937 |   |
| Prepaid Expenses and Other Current Assets                                                                                                                                                                        |   |          | 915,658     |   |              |   | 1,425,551 |   |
| Total Current Assets                                                                                                                                                                                             |   |          | 14,360,703  |   |              |   | 14,736,012 |   |
|                                                                                                                                                                                                             |   |          |        |   |              |   |   |   |
| Property, Plant and Equipment, Net                                                                                                                                                                               |   |          | 2,499,896   |   |              |   | 2,623,388 |   |
|                                                                                                                                                                                                             |   |          |        |   |              |   |   |   |
| Other Assets:                                                                                                                                                                                                    |   |          |        |   |              |   |   |   |
| Goodwill                                                                                                                                                                                                         |   |          | 3,741,167   |   |              |   | 3,741,167 |   |
| Other Intangible Assets, Net                                                                                                                                                                                     |   |          | 1,600,911   |   |              |   | 1,695,907 |   |
| Deposits and Other Non-Current Assets                                                                                                                                                                            |   |          | 140,911     |   |              |   | 133,252 |   |
| Total Other Assets                                                                                                                                                                                               |   |          | 5,482,989   |   |              |   | 5,570,326 |   |
|                                                                                                                                                                                                             |   |          |        |   |              |   |   |   |
| Total Assets                                                                                                                                                                                                     |   | $             | 22,343,588  |   |              | $      | 22,929,726 |   |
|                                                                                                                                                                                                             |   |          |        |   |              |   |   |   |
| Liabilities and Stockholders' Equity (Deficit)                                                                                                                                                                   |   |          |        |   |              |   |   |   |
| Current Liabilities:                                                                                                                                                                                             |   |          |        |   |              |   |   |   |
| Accounts Payable                                                                                                                                                                                                 |   | $             | 4,860,928   |   |              | $      | 6,827,059 |   |
| Accrued Expenses and Other Current Liabilities                                                                                                                                                                   |   |          | 1,964,449   |   |              |   | 2,336,058 |   |
| Loan Payable – Related Party                                                                                                                                                                               |   |          | 4,900,000   |   |              |   | 800,000 |   |
| Current Portion of Convertible Term Note, Net                                                                                                                                                                    |   |          | 1,000,000   |   |              |   | 500,000 |   |
| Current Portion of Long-Term Debt                                                                                                                                                                                |   |          | 104,054     |   |              |   | 104,001 |   |
| Total Current Liabilities                                                                                                                                                                                        |   |          | 12,829,431  |   |              |   | 10,567,118 |   |
|                                                                                                                                                                                                             |   |          |        |   |              |   |   |   |
| Other Liabilities:                                                                                                                                                                                               |   |          |        |   |              |   |   |   |
| Revolving Credit Note, Net                                                                                                                                                                                       |   |          | 7,810,081   |   |              |   | 7,550,995 |   |
| Non-Current Portion of Convertible Term Note, Net                                                                                                                                                                |   |          | 1,549,539   |   |              |   | 1,872,222 |   |
| Non-Current Portion of Derivative Liability – Warrants                                                                                                                                                     |   |          | 734,193     |   |              |   | — |   |
| Non Current Portion of Long-Term Debt                                                                                                                                                                            |   |          | 204,977     |   |              |   | 180,175 |   |
| Total Other Liabilities                                                                                                                                                                                          |   |          | 10,298,790  |   |              |   | 9,603,392 |   |
|                                                                                                                                                                                                             |   |          |        |   |              |   |   |   |
| Total Liabilities                                                                                                                                                                                                |   |          | 23,128,221  |   |              |   | 20,170,510 |   |
|                                                                                                                                                                                                             |   |          |        |   |              |   |   |   |
| Stockholders' Equity (Deficit):                                                                                                                                                                                  |   |          |        |   |              |   |   |   |
| Preferred Stock, $1.00 Par Value; 2,000,000 Shares Authorized, of which Designations:                                                                                                                            |   |          |        |   |              |   |   |   |
| Series A Convertible, 750,000 Shares Authorized; 62,500 Issued and Outstanding (Less Offering Costs of $7,465) and $62,500 aggregate liquidation preference at June 30, 2009 and December 31, 2008, respectively |   |          | 55,035      |   |              |   | 55,035 |   |
| Series D, 25,000 Shares Authorized;  8,176 Issued and Outstanding and $8,176,000 aggregate liquidation preference at June 30, 2009 and December 31, 2008, respectively                                 |   |          | 8,176       |   |              |   | 8,176 |   |
| Common Stock, $.01 Par Value; 98,000,000 Shares Authorized; 63,944,803                                                                                                                                           |   |          |        |   |              |   |   |   |
| Issued and Outstanding at June 30, 2009 and December 31, 2008, respectively                                                                                                                                      |   |          | 639,448     |   |              |   | 639,448 |   |
| Additional Paid-In Capital                                                                                                                                                                                       |   |          | 76,193,410  |   |              |   | 78,106,472 |   |
| Accumulated (Deficit)                                                                                                                                                                                            |   |          | (77,680,702 | )      |              |   | (76,049,915 | ) |
| Total Stockholders' Equity (Deficit)                                                                                                                                                                             |   |          | (784,633    | )      |              |   | 2,759,216 |   |
|                                                                                                                                                                                                             |   |          |        |   |              |   |   |   |
| Total Liabilities and Stockholders' Equity                                                                                                                                                                       |   | $             | 22,343,588  |   |              | $      | 22,929,726 |   |

----

Index

|                                                 |   | Three Months Ended June 30, |       |   | Six Months Ended June 30, |   |
|------------------------------------------------------|--------|-----------------------------|------------|--------|---------------------------|--------|
|                                                 |   | 2009                        |       |   | 2008                      |   |   | 2009 |   |   | 2008 |   |
| Sales                                                |   | $                           | 10,939,501 |   |                      | $      | 12,033,485 |   |   | $ | 20,679,581 |   |   | $ | 20,206,728 |   |
|                                                 |   |                        |       |   |                      |   |   |   |   |   |   |   |   |   |   |   |
| Cost of Sales                                        |   |                        | 8,004,188  |   |                      |   | 9,296,825 |   |   |   | 15,438,515 |   |   |   | 15,969,044 |   |
|                                                 |   |                        |       |   |                      |   |   |   |   |   |   |   |   |   |   |   |
| Gross Profit                                         |   |                        | 2,935,313  |   |                      |   | 2,736,660 |   |   |   | 5,241,066 |   |   |   | 4,237,684 |   |
|                                                 |   |                        |       |   |                      |   |   |   |   |   |   |   |   |   |   |   |
| Operating Expenses:                                  |   |                        |       |   |                      |   |   |   |   |   |   |   |   |   |   |   |
| Selling, General and Administrative                  |   |                        | 3,303,936  |   |                      |   | 2,699,863 |   |   |   | 5,992,529 |   |   |   | 4,837,917 |   |
| Professional Fees                                    |   |                        | 198,875    |   |                      |   | 198,506 |   |   |   | 334,095 |   |   |   | 415,289 |   |
| Depreciation and Amortization                        |   |                        | 148,076    |   |                      |   | 45,484 |   |   |   | 279,701 |   |   |   | 90,969 |   |
| Consulting Fees                                      |   |                        | 53,074     |   |                      |   | 23,212 |   |   |   | 114,799 |   |   |   | 35,546 |   |
| Interest Expense                                     |   |                        | 264,679    |   |                      |   | 147,165 |   |   |   | 524,363 |   |   |   | 306,295 |   |
| Interest Expense – Related Party               |   |                        | 58,085     |   |                      |   | 39,272 |   |   |   | 80,441 |   |   |   | 43,348 |   |
| Interest Expense – Amortization of Discount    |   |                        | 222,839    |   |                      |   | 46,935 |   |   |   | 436,403 |   |   |   | 91,263 |   |
| (Gain) Loss on Extinguishment of Debt                |   |                        | —    |   |                      |   | (481,833 | ) |   |   | — |   |   |   | (481,833 | ) |
| (Gain) Loss on Derivative Liability – Warrants |   |                        | (30,614    | )      |                      |   | — |   |   |   | (156,096 | ) |   |   | — |   |
| Other (Income) Expense                               |   |                        | —    |   |                      |   | (50,633 | ) |   |   | — |   |   |   | (50,633 | ) |
| Total Operating Expenses                             |   |                        | 4,218,950  |   |                      |   | 2,667,971 |   |   |   | 7,606,236 |   |   |   | 5,288,161 |   |
|                                                 |   |                        |       |   |                      |   |   |   |   |   |   |   |   |   |   |   |
| Net Income (Loss)                                    |   |                        | (1,283,637 | )      |                      |   | 68,689 |   |   |   | (2,365,170 | ) |   |   | (1,050,477 | ) |
| Dividends on Preferred Stock                         |   |                        | (203,840   | )      |                      |   | (203,840 | ) |   |   | (405,440 | ) |   |   | (407,123 | ) |
| Net (Loss) Available to Common Stockholders          |   |                        | (1,487,477 | )      |                      |   | (135,151 | ) |   |   | (2,770,610 | ) |   |   | (1,457,600 | ) |
|                                                 |   |                        |       |   |                      |   |   |   |   |   |   |   |   |   |   |   |
| Net (Loss) Per Share-Basic and Diluted               |   | $                           | (0.023     | )      |                      | $      | (0.002 | ) |   | $ | (0.043 | ) |   | $ | (0.025 | ) |
|                                                 |   |                        |       |   |                      |   |   |   |   |   |   |   |   |   |   |   |
| Weighted Average Shares Outstanding                  |   |                        | 63,944,803 |   |                      |   | 59,227,776 |   |   |   | 63,944,803 |   |   |   | 59,209,198 |   |

----

Index

|                                                                                       |   | Six Months Ended June 30, |       |
|--------------------------------------------------------------------------------------------|--------|---------------------------|------------|
|                                                                                       |   | 2009                      |       |   | 2008 |   |
| Cash Flows From Operating Activities                                                       |   |                      |       |   |   |   |
| Net Loss                                                                                   |   | $                         | (2,365,170 | ) |   | $ | (1,050,477 | ) |
| Adjustments to Reconcile Net Loss to Net Cash Used in Operating Activities:                |   |                      |       |   |   |   |   |   |
| Depreciation and Amortization                                                              |   |                      | 341,183    |   |   |   | 192,464 |   |
| Provision for Losses on Accounts Receivable                                                |   |                      | (850,204   | ) |   |   | 67,383 |   |
| Amortization of Discount on Convertible Term and Revolving Credit Notes                    |   |                      | 436,403    |   |   |   | 91,263 |   |
| Share Based Compensation Expense                                                           |   |                      | 47,798     |   |   |   | 851,544 |   |
| Gain on Extinguishment of Debt                                                             |   |                      | —    |   |   |   | (481,833 | ) |
| Gain on Change in Derivative Liability – Warrants                                    |   |                      | (156,096   | ) |   |   | — |   |
| Changes in Assets and Liabilities:                                                         |   |                      |       |   |   |   |   |   |
| Trade Receivables                                                                          |   |                      | 916,190    |   |   |   | (4,575,112 | ) |
| Inventories                                                                                |   |                      | 1,314      |   |   |   | (392,633 | ) |
| Prepaid Expenses and Other Current Assets                                                  |   |                      | 509,893    |   |   |   | (73,113 | ) |
| Deposits and Other Non Current Assets                                                      |   |                      | (7,659     | ) |   |   | (78,359 | ) |
| Accounts Payable                                                                           |   |                      | (1,966,131 | ) |   |   | 2,884,419 |   |
| Accrued Expenses and Other Current Liabilities                                             |   |                      | (767,049   | ) |   |   | 495,326 |   |
| Other Liabilities                                                                          |   |                      | —    |   |   |   | (1,514,791 | ) |
| Net Cash Used in Operating Activities                                                      |   |                      | (3,859,528 | ) |   |   | (3,583,919 | ) |
|                                                                                       |   |                      |       |   |   |   |   |   |
| Cash Flows From Investing Activities                                                       |   |                      |       |   |   |   |   |   |
| Additions to Property, Plant and Equipment                                                 |   |                      | (48,490    | ) |   |   | (17,868 | ) |
| Net Cash Used in Investing Activities                                                      |   | $                         | (48,490    | ) |   | $ | (17,868 | ) |
|                                                                                       |   |                      |       |   |   |   |   |   |
| Cash Flows From Financing Activities                                                       |   |                      |       |   |   |   |   |   |
| Principal Repayments to Convertible Term Note                                              |   |                      | —    |   |   |   | (400,000 | ) |
| Proceeds from Loans Payable – Related Party                                          |   |                      | 4,100,000  |   |   |   | 3,800,000 |   |
| Principal Repayments on Long Term Debt                                                     |   |                      | (49,350    | ) |   |   | (60,022 | ) |
| Payment of Preferred Stock Dividends                                                       |   |                      | (10,000    | ) |   |   | (10,000 | ) |
| Net Cash Provided by Financing Activities                                                  |   |                      | 4,040,650  |   |   |   | 3,329,978 |   |
|                                                                                       |   |                      |       |   |   |   |   |   |
| Net Effect of Exchange Rate Changes on Cash                                                |   |                      | 69,252     |   |   |   | — |   |
|                                                                                       |   |                      |       |   |   |   |   |   |
| Net Increase In Cash                                                                       |   | $                         | 201,884    |   |   | $ | (271,809 | ) |
| Cash at Beginning of Period                                                                |   |                      | 42,845     |   |   |   | 339,855 |   |
| Cash at End of Period                                                                      |   | $                         | 244,729    |   |   | $ | 68,046 |   |
|                                                                                       |   |                      |       |   |   |   |   |   |
| Supplemental Disclosure of Cash Flow Information:                                          |   |                      |       |   |   |   |   |   |
| Cash Payments for Income Taxes                                                             |   | $                         | —    |   |   | $ | — |   |
| Cash Payments for Interest                                                                 |   | $                         | 524,363    |   |   | $ | 306,295 |   |
|                                                                                       |   |                      |       |   |   |   |   |   |
| Supplemental Schedule of Non Cash Investing and Financing Activities:                      |   |                      |       |   |   |   |   |   |
| Property, Plant and Equipment acquired from Issuance of Long Term Debt                     |   | $                         | 78,265     |   |   | $ | — |   |
| Common Stock Issued-Exercise of Warrants for Principal Repayments to Revolving Credit Note |   |                      | —    |   |   |   | 67,500 |   |
| Common Stock Issued-Exercise of Warrants for Principal Repayments to Term Note             |   |                      | —    |   |   |   | 33,766 |   |
| Common Stock Issued-Exercise of Warrants for Interest on Term Note                         |   |                      | —    |   |   |   | 33,734 |   |
| Common Stock Issued-Conversion of Term Note for Principal Repayments to Term Note          |   |                      | —    |   |   |   | 3,850 |   |
| Common Stock Issued-Cancel Debt for Principal Repayments to Loan Payable-Related Party     |   |                      | —    |   |   |   | 2,000,000 |   |

----

Index

----

Index

|                                  |   | June 30, 2009 |      |   | December 31, 2008 |   |
|---------------------------------------|--------|---------------|-----------|--------|-------------------|--------|
| Trade Receivables                     |   | $             | 8,898,734 |   |              | $      | 8,995,130 |   |
| Less: Allowance for Doubtful Accounts |   |          | (529,584  | )      |              |   | (492,451 | ) |
| Trade Receivables, Net                |   | $             | 8,369,150 |   |              | $      | 8,502,679 |   |

|           |   | June 30, 2009 |      |   | December 31, 2008 |   |
|----------------|--------|---------------|-----------|--------|-------------------|--------|
| Raw Materials  |   | $             | 1,172,108 |   |              | $      | 1,850,850 |   |
| Finished Goods |   |          | 3,591,515 |   |              |   | 2,914,087 |   |
| Total          |   | $             | 4,763,623 |   |              | $      | 4,764,937 |   |

----

Index

|                                        |   |                                |       |   |                              |   |
|---------------------------------------------|--------|-------------------------------------|------------|--------|-----------------------------------|--------|
|                                        |   | For The Three Months Ended June 30, |       |   | For The Six Months Ended June 30, |   |
|                                        |   | 2009                                |       |   | 2008                              |   |   | 2009 |   |   | 2008 |   |
|                                        |   |                                |       |   | Per Share                         |   |   |   |   |   | Per Share |   |   |   |   |   | Per Share |   |   |   |   |   | Per Share |   |
|                                        |   | Amount                              |       |   | Amount                            |   |   | Amount |   |   | Amount |   |   | Amount |   |   | Amount |   |   | Amount |   |   | Amount |   |
| Net Income (Loss)                           |   | $                                   | (1,283,637 | )      |                              | $      | (0.020 | ) |   | $ | 68,689 |   |   | $ | 0.001 |   |   | $ | (2,365,170 | ) |   | $ | (0.037 | ) |   | $ | (1,050,477 | ) |   | $ | (0.018 | ) |
| Weighted Average Common Shares Outstanding  |   |                                | 63,944,803 |   |                              |   |   |   |   |   | 63,965,631 |   |   |   |   |   |   |   | 63,944,803 |   |   |   |   |   |   |   | 59,209,198 |   |   |   |   |   |
| Dividends on Preferred Stock                |   |                                | (203,840   | )      |                              |   | (0.003 | ) |   |   | (203,840 | ) |   |   | (0.003 | ) |   |   | (405,440 | ) |   |   | (0.006 | ) |   |   | (407,123 | ) |   |   | (0.007 | ) |
| Net (Loss) Available to Common Stockholders |   | $                                   | (1,487,477 | )      |                              | $      | (0.023 | ) |   | $ | (135,151 | ) |   | $ | (0.002 | ) |   | $ | (2,770,610 | ) |   | $ | (0.043 | ) |   | $ | (1,457,600 | ) |   | $ | (0.025 | ) |
| Weighted Average Common Shares Outstanding  |   |                                | 63,944,803 |   |                              |   |   |   |   |   | 59,227,776 |   |   |   |   |   |   |   | 63,944,803 |   |   |   |   |   |   |   | 59,209,198 |   |   |   |   |   |

|                            |   | Three Months Ended June 30, |       |
|---------------------------------|--------|-----------------------------|------------|
|                            |   | 2009                        |       |   | 2008 |   |
|                            |   | Foam                        |       |   | Coatings |   |   | Totals |   |   | Foam |   |   | Coatings |   |   | Totals |   |
| Sales                           |   | $                           | 8,934,404  |   |   | $ | 2,005,097 |   |   | $ | 10,939,501 |   |   | $ | 9,110,929 |   |   | $ | 2,922,556 |   |   | $ | 12,033,485 |   |
| Cost of Sales                   |   |                        | 6,431,062  |   |   |   | 1,573,126 |   |   |   | 8,004,188 |   |   |   | 7,302,090 |   |   |   | 1,994,735 |   |   |   | 9,296,825 |   |
| Gross Profit                    |   |                        | 2,503,343  |   |   |   | 431,970 |   |   |   | 2,935,313 |   |   |   | 1,808,838 |   |   |   | 927,822 |   |   |   | 2,736,660 |   |
| Depreciation and Amortization   |   |                        | 108,842    |   |   |   | 24,427 |   |   |   | 133,269 |   |   |   | 30,994 |   |   |   | 9,942 |   |   |   | 40,936 |   |
| Interest Expense                |   |                        | 222,800    |   |   |   | 50,002 |   |   |   | 272,802 |   |   |   | 132,519 |   |   |   | 42,509 |   |   |   | 175,028 |   |
| Segment Profit (Loss)           |   |                        | (57,241    | ) |   |   | (142,686 | ) |   |   | (199,927 | ) |   |   | 297,669 |   |   |   | 493,709 |   |   |   | 791,378 |   |
| Segment Assets (1)              |   |                        | 16,727,957 |   |   |   | 4,913,073 |   |   |   | 21,641,030 |   |   |   | 10,768,487 |   |   |   | 5,340,668 |   |   |   | 16,109,155 |   |
| Expenditures for Segment Assets |   | $                           | 20,935     |   |   | $ | 4,698 |   |   | $ | 25,634 |   |   | $ | — |   |   | $ | 17,868 |   |   | $ | 17,868 |   |

|                            |   | Six Months Ended June 30, |       |
|---------------------------------|--------|---------------------------|------------|
|                            |   | 2009                      |       |   | 2008 |   |
|                            |   | Foam                      |       |   | Coatings |   |   | Totals |   |   | Foam |   |   | Coatings |   |   | Totals |   |
| Sales                           |   | $                         | 17,394,188 |   |   | $ | 3,285,393 |   |   | $ | 20,679,581 |   |   | $ | 15,175,004 |   |   | $ | 5,031,724 |   |   | $ | 20,206,728 |   |
| Cost of Sales                   |   |                      | 12,840,617 |   |   |   | 2,597,899 |   |   |   | 15,438,516 |   |   |   | 12,367,295 |   |   |   | 3,601,749 |   |   |   | 15,969,044 |   |
| Gross Profit                    |   |                      | 4,553,571  |   |   |   | 687,494 |   |   |   | 5,241,065 |   |   |   | 2,807,709 |   |   |   | 1,429,975 |   |   |   | 4,237,684 |   |
| Depreciation and Amortization   |   |                      | 211,733    |   |   |   | 39,998 |   |   |   | 251,731 |   |   |   | 61,485 |   |   |   | 20,387 |   |   |   | 81,872 |   |
| Interest Expense                |   |                      | 438,029    |   |   |   | 82,574 |   |   |   | 520,604 |   |   |   | 248,336 |   |   |   | 82,343 |   |   |   | 330,680 |   |
| Segment Profit (Loss)           |   |                      | (221,454   | ) |   |   | (222,295 | ) |   |   | (443,749 | ) |   |   | (67,332 | ) |   |   | 527,303 |   |   |   | 459,971 |   |
| Segment Assets (1)              |   |                      | 16,727,957 |   |   |   | 4,913,073 |   |   |   | 21,641,030 |   |   |   | 10,768,487 |   |   |   | 5,340,668 |   |   |   | 16,109,155 |   |
| Expenditures for Segment Assets |   | $                         | 37,526     |   |   | $ | 13,240 |   |   | $ | 50,767 |   |   | $ | — |   |   | $ | 17,868 |   |   | $ | 17,868 |   |

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Index

|                                         |   | Three Months Ended June 30, |       |   | Six Months Ended June 30, |   |
|----------------------------------------------|--------|-----------------------------|------------|--------|---------------------------|--------|
| Profit or Loss                               |   | 2009                        |       |   | 2008                      |   |   | 2009 |   |   | 2008 |   |
| Total Profit or Loss for Reportable Segments |   | $                           | (199,927   | )      |                      | $      | 791,378 |   |   | $ | (443,749 | ) |   | $ | 459,971 |   |
| Unallocated Amounts:                         |   |                        |       |   |                      |   |   |   |   |   |   |   |   |   |   |   |
| Corporate Expenses                           |   |                        | (1,083,710 | )      |                      |   | (722,689 | ) |   |   | (1,921,420 | ) |   |   | (1,510,448 | ) |
| Income (Loss) Before Income Taxes            |   | $                           | (1,283,637 | )      |                      | $      | 68,689 |   |   | $ | (2,365,170 | ) |   | $ | (1,050,477 | ) |

| Assets                                   |   | June 30, 2009 |       |   | December 31, 2008 |   |
|------------------------------------------|--------|---------------|------------|--------|-------------------|--------|
| Total Assets for Reportable Segments (1) |   | $             | 21,641,030 |   |              | $      | 22,174,105 |   |
| Other Unallocated Amounts (2)            |   |          | 702,557    |   |              |   | 755,621 |   |
| Consolidated Total                       |   | $             | 22,343,588 |   |              | $      | 22,929,726 |   |

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| (1) | Segment assets are the total assets used in the operation of each segment. |
|-----|----------------------------------------------------------------------------|

| (2) | Includes corporate assets which are principally cash and cash equivalents. |
|-----|----------------------------------------------------------------------------|

Item 2.  Management’s 

|   |   | 2009 |       |   | 2008   |   |
|--------|--------|------|------------|--------|--------|--------|
| Sales  |   | $    | 10,939,501 |   |   | $      | 12,033,485 |   |

----

Index

----

Index

| Segments |   | 2009   |      |   | 2008   |   |
|----------|--------|--------|-----------|--------|--------|--------|
| Foam     |   | $      | 8,934,404 |   |   | $      | 9,110,929 |   |
| Coatings |   |   | 2,005,097 |   |   |   | 2,922,556 |   |

|   |   | 2009 |       |   | 2008   |   |
|--------|--------|------|------------|--------|--------|--------|
| Sales  |   | $    | 20,679,581 |   |   | $      | 20,206,728 |   |

----

Index

----

Index

| Segments |   | 2009   |       |   | 2008   |   |
|----------|--------|--------|------------|--------|--------|--------|
| Foam     |   | $      | 17,394,188 |   |   | $      | 15,175,004 |   |
| Coatings |   |   | 3,285,393  |   |   |   | 5,031,724 |   |

Item 3.  Quantitative 

Ite

----

Index

Item 1.  Legal Proceedings

Item 1A.  Risk Factors.

Item 2.  Unregistered 

Item 3.  Defaults Upon Senior 

Item 4.  Submission 

Item 5.  Other 

Item 6.  Exhibits

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Index

SIGNA

|                  | LAPOLLA INDUSTRIES, INC. |
|-----------------------|--------------------------|
|                  |                     |   |
|                  |                     |   |
|                  |                     |   |
| Date: August 14, 2009 | By:                      | /s/  Douglas J. Kramer, CEO |
|                  | Name:                    | Douglas J. Kramer |
|                  | Title:                   | CEO and President |
|                  |                     |   |
|                  |                     |   |
|                  | LAPOLLA INDUSTRIES, INC. |
|                  |                     |   |
|                  |                     |   |
| Date: August 14, 2009 | By:                      | /s/  Paul Smiertka, CFO |
|                  | Name:                    | Paul Smiertka |
|                  | Title:                   | CFO and Treasurer |

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Index

INDEX OF EXHIBITS

| Exhibit Number |   | Description                                                                                                                        |
|----------------|--------|------------------------------------------------------------------------------------------------------------------------------------|
| 31.1           |   | Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                            |
| 31.2           |   | Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.                            |
| 32             |   | Certification of Principal Executive Officer and Principal Financial Officer pursuant to § 906 of Sarbanes-Oxley Act of 2002. |

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