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 30, 2009
 
  ̈
              TRANSITION
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934
 
 For the
transition period from _______________ to _______________
 
 Commission
file number: 333-146744
 
 
 
 MACH ONE
CORPORATION
 (Exact
name of registrant as specified in its charter)
 
 Nevada
              
              88-0338837(State
      or other jurisdiction of
              
              (I.R.S.
      Employer Identification No.)Incorporation
      or organization)
 
 974 Silver Beach Road,
Belgium, WI 53004
 (Address
of principal executive offices)
 
 (888)
400-7179
 (Issuer's
telephone number)
 
 
 6430 Congress Drive, West
Bend, WI 53095
 (Former
name, former address and former fiscal year, if applicable)
 
  Check
whether the registrant (1) filed all reports required to be filed by Section 13
or 15(d) of the Exchange Act of 1934 during the past 12 months (or for such
shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days.  
Yes x  
No  ̈
 
 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  ̈No  ̈
 
 Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company.
  Large
      accelerated filer
               ̈
              Accelerated
      filer
              oNon-accelerated
      filer
               ̈
              Smaller
      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
 
 As of
November 17, 2009, 172,021,946 shares of common stock were
outstanding.
 
 
 
  
  
 MACH
ONE CORPORATION
 
 Index
 
 Part
      I - FINANCIAL INFORMATIONItem
      1
              Financial
      StatementsConsolidated
      Balance Sheets at September 30, 2009 (unaudited) and December 31, 2008
      (audited)
              2Consolidated
      Statements of Operations for the three and nine months ended September 30,
      2009 and 2008 (unaudited)
              3Consolidated
      Statements of Cash Flows for the nine months ended September 30, 2009 and
      2008 (unaudited)
              4Notes
      to Consolidated Financial Statements (unaudited)
              5Item
      2
              Management’s
      Discussion and Analysis or Plan of Operations
              16Item
      3
              Qualitative
      and Quantitative Disclosures about Market Risk
              19Item
      4T
              Controls
      and Procedures
              19Part
      II OTHER INFORMATIONItem
      1
              Legal
      Proceedings
              19Item
      1A
              Risk
      Factors
              19Item
      2
              Unregistered
      Sales of Equity Securities and Use of Proceeds
              19Item
      3
              Defaults
      Upon Senior Securities
              20Item
      4
              Submission
      of Matters of a Vote of Security Holders
              20Item
      5
              Other
      Information
              21Item
      6
              Exhibits
              21SignaturesExhibits
 
 
  
  
   
 MACH
ONE CORPORATION
 CONSOLIDATED
BALANCE SHEETS (unaudited)


September
      30,
            
            
            December
      31,2009
            
            
            2008ASSETSCURRENT
      ASSETSCash
            
            $
            79,332
            
            
            $
            635,334Accounts receivable
            
            
            849,578
            
            
            
            44,603Accounts receivable pledged as collateral
            
            
            170,954
            
            
            
            -Marketable
      securities
            
            
            68,391
            
            
            
            483,900Inventory
            
            
            1,372,892
            
            
            
            520,020Other current assets
            
            
            84,490
            
            
            
            43,395Total
      Current Assets
            
            
            2,625,637
            
            
            
            1,727,252Property and equipment, net
            
            
            1,080,187
            
            
            
            771,030Goodwill
            
            
            280,232
            
            
            
            3,438,466Intangible assets, net
            
            
            2,772,060
            
            
            
            80,000Prepaid management fees
            
            
            157,500
            
            
            
            180,000TOTAL
      ASSETS
            
            $
            6,915,616
            
            
            $
            6,196,748LIABILITIES
      AND STOCKHOLDERS' EQUITYCURRENT
      LIABILITIESAccounts payable
            
            $
            2,760,137
            
            
            $
            7,577Accrued expenses
            
            
            707,726
            
            
            
            401,327Short-term notes payable and other debt
            
            
            519,218
            
            
            
            815,000Deferred revenue
            
            
            51,921
            
            
            
            -Current portion of long-term debt obligations
            
            
            21,806
            
            
            
            -Total
      Current Liabilities
            
            
            4,060,808
            
            
            
            1,223,904Long-term
      debt, net of current portion
            
            
            3,408,482
            
            
            
            3,164,268STOCKHOLDERS'
      EQUITY (DEFICIT)Preferred stock, $.05 par value, 10,500,000 shares authorized, 8,500,000
      and 5,420,000 sharesissued
      and outstanding at September 30, 2009 and December 31, 2008, respectively,
      liquidation
              preference of
      $4,500,000 and $0 at September 30, 2009 and December 31, 2008,
      respectively
            
            
            425,000
            
            
            
            271,000Common stock, $.001 par value, 239,500,000 shares authorized, 172,021,946
      and111,094,054 shares issued and outstanding
      at September 30, 2009 and December 31, 2008, respectively
            
            
            172,021
            
            
            
            111,093Treasury stock
            
            
            (283,425
            )
            
            
            (143,456
            )Additional paid-in capital
            
            
            10,756,771
            
            
            
            5,314,699Accumulated deficit
            
            
            (11,308,068
            )
            
            
            (3,744,760
            )Accumulated other comprehensive loss
            
            
            (237,271
            )
            
            
            -Total
      Mach One Corporation Stockholders' Equity (Deficit)
            
            
            (474,972
            )
            
            
            1,808,576Non-controlling
      interest in variable interest entity
            
            
            (78,702
            )
            
            
            -Total
      Stockholders' Equity (Deficit)
            
            
            (553,674
            )
            
            
            1,808,576TOTAL
      LIABILITIES AND STOCKHOLDERS' EQUITY
            
            $
            6,915,616
            
            
            $
            6,196,748




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








MACH
ONE CORPORATION
 CONSOLIDATED
STATEMENTS OF OPERATIONS (unaudited)


Three Months Ended September
      30,
            
            
            Nine months ended September
    30,2009
            
            
            2008
            
            
            2009
            
            
            2008Sales,
      net
            
            $
            1,579,693
            
            
            $
            1,646
            
            
            $
            4,074,297
            
            
            $
            84,073Cost
      of goods sold
            
            
            1,529,223
            
            
            
            4,737
            
            
            
            3,696,030
            
            
            
            42,862Gross
      profit
            
            
            50,470
            
            
            
            (3,091
            )
            
            
            378,267
            
            
            
            41,211Operating
      expenses
            
            
            1,398,375
            
            
            
            162,138
            
            
            
            3,971,865
            
            
            
            840,557Goodwill
      impairment
            
            
            -
            
            
            
            -
            
            
            
            3,438,466
            
            
            
            -Loss
      from operations
            
            
            (1,347,905
            )
            
            
            (165,229
            )
            
            
            (7,032,064
            )
            
            
            (799,346
            )Other
      expense:Realized
      gain (loss) on sale of marketable securities
            
            
            33,438
            
            
            
            -
            
            
            
            (33,662
            )
            
            
            -Interest
      expense
            
            
            (139,672
            )
            
            
            -
            
            
            
            (576,284
            )
            
            
            (52,882
            )Total
      other expense
            
            
            (106,234
            )
            
            
            -
            
            
            
            (609,946
            )
            
            
            (52,882
            )Loss
      before provision for income taxes
            
            
            (1,454,139
            )
            
            
            (165,229
            )
            
            
            (7,642,010
            )
            
            
            (852,228
            )Income
      tax provision
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -Net
      loss
            
            
            (1,454,139
            )
            
            
            (165,229
            )
            
            
            (7,642,010
            )
            
            
            (852,228
            )Less:
      Net loss attributable to non-controlling interest in variable interest
      entity
            
            
            4,127
            
            
            
            -
            
            
            
            78,702
            
            
            
            -Net
      loss attributable to Mach One Corporation
            
            $
            (1,450,012
            )
            
            $
            (165,229
            )
            
            $
            (7,563,308
            )
            
            $
            (852,228
            )Net
      loss per common share (basic and diluted)
            
            $
            (0.01
            )
            
            $
            (0.00
            )
            
            $
            (0.06
            )
            
            $
            (0.01
            )Weighted
      average shares outstanding:Basic
      and diluted
            
            
            163,986,263
            
            
            
            78,633,909
            
            
            
            136,244,588
            
            
            
            77,239,613




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












MACH ONE
CORPORATION


CONSOLIDATED
STATEMENTS OF CASH FLOWS (Unaudited)





Nine Months Ended September
    30,2009
            
            
            2008Cash
      flows from operating activities:Net loss
            
            $
            (7,642,010
            )
            
            $
            (852,228
            )Adjustments
      to reconcile net loss to net cash used in operating
      activities:Depreciation
      and amortization
            
            
            246,663
            
            
            
            55,750Amortization of
      deferred financing costs
            
            
            200,500
            
            
            
            -Amortization of
      prepaid management fees
            
            
            22,500
            
            
            
            -Loss on
      sale of marketable securities
            
            
            33,662Goodwill
      impairment
            
            
            3,438,466
            
            
            
            -Common
      stock issued for services
            
            
            521,792
            
            
            
            282,500(Increase)
      decrease in operating assets (net of acquisitions):
            
            
            
            
            
            
            -Accounts receivable
            
            
            (372,602
            )
            
            
            (31,570
            )Inventory
            
            
            306,832
            
            
            
            -Other current assets
            
            
            (33,455
            )
            
            
            -Increase in
      operating liabilities (net of acquisitions):Accounts payable and accrued expenses
            
            
            1,414,073
            
            
            
            34,764Deferred revenue
            
            
            46,722
            
            
            
            -Total
      adjustments
            
            $
            5,825,153
            
            
            $
            341,444Net
      cash used in operating activities
            
            $
            (1,816,857
            )
            
            $
            (510,784
            )Cash
      flows from investing activities:Proceeds from
      the sale of marketable securities
            
            
            144,576
            
            
            
            -Acquisitions,
      net of cash acquired
            
            
            30,674
            
            
            
            -Purchase of
      property and equipment, net
            
            
            (331,636
            )
            
            
            (172,880
            )Net
      cash used in investing activities
            
            $
            (156,386
            )
            
            $
            (172,880
            )Cash
      flows from financing activities:Proceeds from
      short term notes payable
            
            
            1,640,403
            
            
            
            681,671Payments on
      short term notes payable
            
            
            (52,000
            )
            
            
            -Payments on
      long-term debt
            
            
            (17,948
            )
            
            
            -Proceeds from
      the sale of treasury stock
            
            
            148,909
            
            
            
            -Purchase of
      treasury stock
            
            
            (302,123
            )
            
            
            -Net
      cash provided by financing activities
            
            $
            1,417,241
            
            
            $
            681,671Net
      decrease in cash
            
            $
            (556,002
            )
            
            $
            (1,993
            )Cash,
      beginning of period
            
            
            635,334
            
            
            
            6,928Cash,
      end of period
            
            $
            79,332
            
            
            $
            4,935Supplemental
      cash and non-cash flow informationCommon
      stock issued for conversion of short term notes payableand related accrued interest
            
            $
            2,224,485
            
            
            $
            -Conversion of
      preferred stock into common stock
            
            $
            271,000
            
            
            $
            -Unrealized loss
      on marketable securities
            
            $
            237,271
            
            
            $
            -Cash
      paid for interest
            
            $
            37,410
            
            
            $
            -Common
      stock issued for payment of long-term debt
            
            $
            23,467
            
            
            $
            50,000Loss on
      sale of treasury stock
            
            $
            13,245
            
            
            $
            -Liability for
      license agreement
            
            $
            243,700
            
            
            $
            -

















Note
1.  Basis of Presentation and Nature of Operations





Basis of
Presentation: The interim Consolidated Financial Statements of Mach
One Corporation (Mach One, the Company, we, us or our) are unaudited but, in the
opinion of management, reflect all adjustments necessary for a fair statement of
financial position, results of operations and cash flows for the periods
presented. Except as otherwise disclosed herein, these adjustments consist of
normal, recurring items. The results of operations for any interim period are
not necessarily indicative of full year results. The Consolidated Financial
Statements and Notes are presented in accordance with the requirements for
Quarterly Reports on Form 10-Q and do not contain certain information included
in our annual Consolidated Financial Statements and Notes.




The
preparation of the interim Consolidated 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 interim Consolidated Financial Statements and the
reported amounts of revenue and expenses for the reporting periods. Despite our
intention to establish accurate estimates and use reasonable assumptions, actual
results may differ from our estimates.




The
December 31, 2008 Consolidated Balance Sheet data was derived from the audited
Consolidated Financial Statements but does not include all disclosures required
by accounting principles generally accepted in the United States of America.
This Form 10-Q should be read in conjunction with our Consolidated Financial
Statements and Notes included in our Annual Report on Form 10-K for the year
ended December 31, 2008.




Nature of
Business:  Mach One Corporation is a global wellness solutions
company with operations in Animal Wellness; Organics & Sustainables; and
BioPharm Process Systems. Through its Animal Wellness Group, the Company focuses
on major opportunities for positive, long-term health and longevity benefits for
disease-threatened animals in the commercial livestock and poultry industries,
especially the beef and dairy sectors. The Organics & Sustainables Group,
through its flagship company Ceres Organic Harvest, Inc. (Ceres), addresses the
growing needs of food manufacturers in the organic foods market which are
challenged to increase production capacity for organic raw commodities and feed
stocks that go into the finished products. The BioPharm Process Systems Group
provides documentation, process modules, process skids, custom tanks and vessels
and custom stainless steel fabrication to the biopharmaceutical industry, and
also will be integral in setting up and servicing the projected three U.S.-based
laboratories for production of Mach One's Animal Wellness Group BridgeTM product
line.




Note 2.
Summary of Significant Accounting Policies





Principles of
Consolidation:  The accompanying consolidated financial
statements include the accounts of the Company and its wholly owned
subsidiaries.  The wholly owned subsidiaries include Ceres, Pacific
Rim Foods, Ltd. (Pacific Rim) and Modular Process Constructors, LLC (MPS). All
inter-company transactions and balances have been eliminated in the
consolidation.





The
Company includes in its consolidated financial results entities determined to be
variable interest entities (VIEs), for which the Company is deemed to be the
VIE’s primary beneficiary.





Variable Interest
Entity:  During the nine months ended September 30, 2009, the
Company was considered the primary beneficiary of Progressive Formulations, Inc.
(PFI). PFI is an importer and distributor of soy-based organic food products
whose initial capitalization was provided in the form of loans and inventory by
the Company. PFI is wholly-owned by a shareholder of the Company. Refer to Note 4. Consolidation of Variable
Interest Entity for further information on our consolidated
VIE.





Management
Estimates:  The preparation of consolidated financial
statements in conformity with US generally accepted accounting principles
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 consolidated financial statements and the
reported amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates. The Company regularly evaluates
estimates and assumptions related to the realizability of accounts receivable,
inventory valuation, impairment of long-lived assets, and deferred income tax
asset valuation allowances. The Company bases its estimates and assumptions on
current facts, historical experience and various other factors that it believes
to be reasonable under the circumstances, the results of which form the basis
for making judgments about the carrying values of assets and liabilities and the
accrual of costs and expenses that are not readily apparent from other sources.
The actual results experienced by the Company may differ materially and
adversely from the Company’s estimates. To the extent there are material
differences between the estimates and the actual results, future results of
operations will be affected.





Cash and Cash
Equivalents:  For purposes of reporting cash flows, the Company
considers all cash accounts which are not subject to withdrawal restrictions or
penalties, and certificates of deposit with original maturities of 90 days or
less to be cash or cash equivalents.





Marketable
Securities: Marketable securities consist of equity securities, are
classified as available for sale and are expected to be redeemed within one
year.












Available
for sale securities are stated at fair value, with unrealized gains and losses
reported as accumulated other comprehensive income (loss), a separate component
of stockholders’ equity, until realized. These fair values are primarily
determined using quoted market prices. The carrying amount of securities, for
the purpose of computing unrealized gains and losses, are determined by specific
identification. The cost of securities sold is determined by specific
identification.





Customer Concentrations and
Accounts Receivable:  Accounts receivable arise in the normal
course of business in selling products to customers.  Concentrations
of credit risk with respect to accounts receivable arise because the Company
grants unsecured credit in the form of trade accounts receivable to its
customers.





Accounts
are written off as they are deemed uncollectible based upon a periodic review of
the accounts.  As of September 30, 2009 and December 31, 2008,
management has estimated that accounts receivable are fully collectible, and
thus, has established no allowance for doubtful accounts.





Inventory:  The
Company maintains its inventory on a perpetual basis utilizing the first-in
first-out (FIFO) method.  Inventories have been valued at the lower of
cost or market. As of September 30, 2009 and December 31, 2008, management has
not established an obsolescence reserve for inventory, as we believe that all
inventory is usable and that market values of all inventories exceed
cost.





Property and
Equipment:  Property and equipment is reported at cost less
accumulated depreciation.  Maintenance and repairs are charged to
expense as incurred.  The cost of property and equipment is
depreciated over the following estimated useful lives of the related
assets:





Building                                                               
39 years


Furniture &
Fixtures                                             7
years


Machinery &
Equipment                                     5
years





Long-Lived
Assets:  The Company periodically evaluates the carrying value
of long-lived assets to be held and used, including but not limited to, capital
assets, when events and circumstances warrant such a review.  The
carrying value of a long-lived asset is considered impaired when the anticipated
undiscounted cash flow from such asset is less than its carrying
value.  In that event, a loss is recognized based on the amount by
which the carrying value exceeds the fair value of the long-lived
asset.  Fair value is determined primarily using the anticipated cash
flows discounted at a rate commensurate with the risk
involved.  Losses on long-lived assets to be disposed of are
determined in a similar manner, except that fair values are reduced for the cost
to dispose.  The Company has reviewed long-lived assets and certain
intangible assets with estimable useful lives and determined that the carrying
value is recoverable in future periods.





Revenue
Recognition:  The Company recognizes revenue when persuasive
evidence of an arrangement exists, transfer of title has occurred, the selling
price is fixed or determinable, collection is reasonably assured and delivery
has occurred per the contract terms. For certain contracts of MPS, the Company
recognizes revenue based on the percentage of completion method. Revenue is
deferred when customer billings exceed revenue earned.





Segment
Reporting:  The Company operates and manages the business under
one reporting segment. Currently, neither Animal Wellness nor BioPharm Process
Systems has generated significant revenues or acquired significant assets. As
such, the Company operates and manages the business under one reporting
segment.





Goodwill:  Goodwill
is the excess of cost of an acquired entity over the amounts assigned to assets
acquired and liabilities assumed in a business combination. Goodwill is not
amortized. We evaluate the carrying value of goodwill annually during the
quarter ending December 31, and between such annual evaluations if events occur
or circumstances change that would indicate a possible impairment. We use a
discounted cash flow model based on management’s judgment and assumptions to
determine the estimated fair value of the Company. An impairment loss generally
would be recognized when the carrying amount of the Company’s net assets exceeds
the estimated fair value of the reporting unit.





Fair Value of Financial
Instruments:  The respective carrying value of certain
on-balance sheet financial instruments approximates their fair
values.  These financial instruments include cash, accounts
receivable, accounts payable and accrued liabilities, and notes
payable.  Fair values were assumed to approximate cost or carrying
values as most of the debt was incurred recently and the assets were acquired
within one year.  Management is of the opinion that the Company is not
exposed to significant interest, credit or currency risks arising from these
financial instruments.





Income
Taxes:  The Company provides for income taxes using an asset
and liability approach.  Deferred tax assets and liabilities are
recorded based on the differences between the financial statement and tax bases
of assets and liabilities and the tax rates in effect when these differences are
expected to reverse.  Deferred tax assets are reduced by a valuation
allowance if, based on the weight of the available evidence, it is more likely
than not that some or all of the deferred tax assets will not be
realized.  For all periods presented, the Company has recorded a full
valuation allowance against its deferred tax assets.





The
Company recognizes a financial statement benefit of a tax position only after
determining that the relevant tax authority would more likely than not sustain
the position following an audit.  For tax positions meeting the
more-likely-than-not threshold, the amount recognized in the financial
statements is the largest benefit that has a greater than fifty percent
likelihood of being realized upon ultimate settlement with the relevant tax
authority.












Comprehensive Income
(Loss): Comprehensive Income (Loss) includes net loss and items defined
as other comprehensive income. Items defined as other comprehensive income
include unrealized gains (losses) on marketable securities. The Company had
$(237,271) of other comprehensive income (loss) for the nine months ended
September 30, 2009. There were no other comprehensive income (loss) items for
the nine months ended September 30, 2008.





Recent Accounting
Developments:In June 2009, the FASB issued guidance to eliminate the
quantitative approach previously required for determining the primary
beneficiary of a variable interest entity and require ongoing qualitative
reassessments of whether an enterprise is the primary beneficiary of a variable
interest entity. This guidance is effective for fiscal years beginning after
November 15, 2009. The Company does not expect the adoption of this standard to
have any current impact on the Company's financial statements.





Note 3.
Going Concern Uncertainty





The
accompanying financial statements have been prepared on the basis that the
Company will continue as a going concern, which assumes the realization of
assets and the satisfaction of liabilities in the normal course of business.
Since inception, until the acquisition of Ceres and MPS in February of 2009, the
Company had primarily been engaged in product development and pre-operational
activities.  Minimal revenue has been generated to date and the
Company has accumulated losses totaling $11,308,068 from inception through
September 30, 2009, and a net working capital deficit of
$1,435,171.  The uncertainty related to these conditions raises
substantial 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.





Although
we recently completed a convertible debt financing with gross proceeds of
approximately $2,250,000 in November 2008 and January 2009, we will eventually
require significant additional funding in order to achieve our business plan.
Over the next 18 months, in order to have the capability of achieving our
business plan, we believe that we will require at least $3,000,000 in additional
funding to pay down certain payables and accruals and to provide working
capital. Should we be unable to obtain additional funding in the next 3 months,
we would be required to further cut expenses in our Organics and Sustainables
group and temporarily halt operations in our Animal Wellness group until such
funding is obtained. We are currently attempting to raise these funds by means
of one or more public or private offerings of debt or equity securities or both.




However,
at this point, we have not specifically identified the type or sources of this
funding.  We also are exploring commercial and joint venture financing
opportunities.





Note 4.
Consolidation of Variable Interest Entity





The
Company identifies variable interest entities and determines when we should
include the assets, liabilities, non-controlling interests and results of
activities of a VIE in its consolidated financial statement.





In
general, a VIE is a corporation, partnership, limited liability company, trust,
or any other legal structure used to conduct activities or hold assets that
either (1) has an insufficient amount of equity to carry out its principal
activities without additional subordinated financial support, (2) has a group of
equity owners that are unable to make significant decisions about its
activities, or (3) has a group of equity owners that do not have the obligation
to absorb losses or the right to receive returns generated by its
operations.





The
Company determined they are required to consolidate PFI as a VIE. Therefore, as
of and for the three and nine months ended September 30, 2009, the consolidated
balance sheet, consolidated statements of operations and cash flows, and the
related footnotes of the Company have been presented on a consolidated basis to
include its variable interest in PFI.  More specifically, as of and
for the three and nine months ended September 30, 2009, PFI amounts included in
the consolidated financial statements of the Company consist of; total assets of
$50,886, total liabilities of $21,728 and selling, general and administrative
expenses of $4,127 and $78,702, respectively. PFI had no sales during this
period. All significant intercompany accounts and transactions have been
eliminated in consolidation. No amounts from PFI are included in the
consolidated balance sheet as of December 31, 2008 or the consolidated
statements of operations and cash flows for the nine months ended September 30,
2008 as PFI is a VIE of Ceres, which was not then acquired by the
Company.












Note
5.  Product License and Asset Purchase





On August
11, 2009, the Company entered into an exclusive license and distribution
agreement to acquire the formulations and worldwide marketing rights to a suite
of products that promote joint and bone health in horses, dogs and humans. These
formulas and related rights are being acquired from Platte Valley State Bank
(Platte Valley), who currently owns all rights pertaining to these products. The
products were previously developed, manufactured and distributed by Clark
Biotechnology, Inc. (CBI). CBI discontinued operations in 2008 due to the death
of its founder.





The
agreement calls for minimum royalties totaling $350,000 to be paid as
follows:





$30,000                 September
11, 2010


$80,000                 September
11, 2011


$80,000                 September
11, 2012


$80,000                 September
11, 2013


$80,000                 September
11, 2014





The
Company has imputed interest on these installments at a rate of 12%, which is
equivalent to the Company’s estimated borrowing rate as of the date of the
agreement. The discounted value of the licensed asset totals $243,700 and has
been included in intangible assets on our consolidated balance sheet and a
corresponding liability included in current portion of long-term debt and
long-term debt (See Note 12) as of September 30, 2009.
 The
Company is treating these minimum royalty payments as a purchase of the related
formulations and marketing rights as once these minimum royalty payments are
made, the Company will have sole title to the formulations and marketing
rights.
 In
addition, the Company is required to pay additional royalties of 4% of net sales
of the products that exceed $2,000,000 in each year of the agreement. These
royalties will be recorded as incurred.





On August
11, 2009, the Company also purchased certain related equipment from Platte
Valley for $50,000. We allocated $29,589 to assets that we intend to sell, which
is included in other current assets as of September 30, 2009. The remaining
$20,411 is included in property and equipment as of September 30, 2009. On
November 9, 2009, the Company sold all of the assets held for sale for $50,000,
resulting in a gain of $20,411.





Note
6.  Acquisitions


On
December 31, 2008, pursuant to a Plan and Agreement of Reorganization between
the Company, Pacific Rim Foods, Ltd. (Pacific Rim) and certain shareholders of
Pacific Rim, the Company issued 28,000,000 shares of its common stock, valued at
$3,500,000, and Five Year Zero Coupon Convertible Promissory Notes in the
aggregate amount of $1,500,000 (collectively the “Exchange Securities”) in
exchange for of all of the issued and outstanding capital stock of Pacific Rim.
Pacific Rim is a development stage company with interests in the food and energy
sector in China and Australia. These interests include equity, debt, options,
insurance and intellectual property. The underlying commodities represented by
these interests include corn and oil and gas.  The development stage
of Pacific Rim reflects its early interests in acquiring and controlling a
number of shelf stable food processing facilities in China with the intent of
growing and processing a broad range of commodities. Its initial interests have
focused on sweet corn and its platform interests include Jilin Jimei Foods Ltd,
which is the oldest sweet corn joint venture in China. The interests in Jilin
Jimei Foods Ltd include options, debt instruments (inventory loans) and
intellectual property (trademark and brands). For reasons noted further below in
this footnote, the Company intends to liquidate the assets of Pacific Rim to
obtain cash for financing other operations of the Company. We are, however,
undecided as to the ultimate disposition of the brand trademark as we believe
that it is either salable or licensable. We intend to fully liquidate all other
assets by December 31, 2010.
 
 On
February 18, 2009, the Company consummated the acquisition and purchase from
Thomsen Group, LLC (Thomsen) of all of the assets of Modular Process
Constructors, LLC (MPS). Pursuant to the Agreement for Purchase and Sale of
Business, in exchange for the MPS assets the Company issued to Thomsen 500,000
shares of restricted Series B Convertible Preferred Stock (Series B Preferred
Stock), valued at $150,000. Each share of Series B Preferred Stock is
convertible into two shares of the Company’s common stock. In addition to the
issuance of Series B Preferred Stock, the Company executed an Earn-Out Agreement
with Thomsen for the issuance of up to 35% of the Company’s issued and
outstanding common stock based upon the percentage of MPS net income to total
consolidated net income of the Company for the three year period ending December
31, 2011.  Under current accounting guidance, contingent consideration
arrangements such as these are to be recorded as a liability or equity at its
estimated fair value at the time of the acquisition.  As of September 30,
2009, the Company has not yet determined if the contingent consideration is
probable or reasonably estimable.  In the event the Company is not able to
determine if the contingent consideration is probable and reasonably estimable
by the end of the measurement period (i.e. December 31, 2009), the fair value of
the contingent consideration will be recognized in a subsequent reporting period
when and if the issuance of additional shares of common stock to the sellers is
probable and reasonably estimable.   MPS designs and builds
process equipment used by the biopharmaceutical industry. MPS's skid based
solutions offer componentized fabrication for small and large projects reducing
lead time, transport cost, and installation time. MPS provides entire project
solutions including documentation, process modules, custom stainless steel
fabrication, and electronic controls to the biopharmaceutical
markets.
 
 On
February 20, 2009, pursuant to a Plan and Agreement of Reorganization between
the Company and Ceres Organic Harvest, Inc. (Ceres), the Company completed the
acquisition of all of the issued and outstanding capital stock of Ceres in
exchange for 8,000,000 shares of the Company’s common stock and 8,000,000 shares
of Series C Convertible Preferred Stock (Series C Preferred Stock), valued at
$2,500,000. Each share of Series C Preferred Stock is convertible into one share
of Mach One common stock. Ceres and its subsidiary Organic Grain and Milling,
Inc. supply organic grain and grain-based ingredients to the food, feed and
dairy industries, including varieties of wheat, flour, oats, corn, flax, barley
and other products.
 
 Due to
the nature and timing of these transactions, as of March 31, 2009, the Company
made a good-faith estimate as to the value of the consideration paid for Pacific
Rim, MPS and Ceres and the fair value of acquired assets and assumed
liabilities, including identifiable intangibles, and recorded a preliminary
purchase price allocation, which was further refined in the quarter ended June
30, 2009.  The Company finalized these estimates, with the exception
of the MPS Earn-Out agreement, and the purchase price allocation during the
quarter ended September 30, 2009, noting only minor
adjustments.


















As of
December 31, 2008, the Company expected to exploit the assets that Pacific Rim
holds in China, such as the brand trademark and options to acquire joint
ventures. As of June 30, 2009, the Company had reconsidered these options and is
focusing its efforts on the Company’s mission to develop bio-solutions to
provide and promote human and animal wellness. As such, the Company determined
the goodwill initially recorded of approximately $3.4 million was impaired and
was charged to operating expenses in the Company’s consolidated statement of
operations.





The
following table summarizes the final allocation of the purchase price to the
fair values of the assets acquired and liabilities assumed at the date of
acquisition, in accordance with the purchase method of accounting, as of
September 30, 2009:





Ceres
            
            
            MPS
            
            
            Pacific
      Rim
            
            
            TotalCurrent
      assets
            
            $
            1,950,349
            
            
            $
            3,015
            
            
            $
            1,514,834
            
            
            $
            3,468,198Identifiable
      intangible assets
            
            
            2,490,000
            
            
            
            100,000
            
            
            
            80,000
            
            
            
            2,670,000Goodwill
      subsequently impaired
            
            
            -
            
            
            
            -
            
            
            
            3,438,466
            
            
            
            3,438,466Goodwill
            
            
            178,048
            
            
            
            102,184
            
            
            
            -
            
            
            
            280,232Other
      long-term assets
            
            
            82,544
            
            
            
            -
            
            
            
            180,000
            
            
            
            262,544Total
      assets acquired
            
            
            4,700,941
            
            
            
            205,199
            
            
            
            5,213,300
            
            
            
            10,119,440_Current
      liabilities
            
            
            2,137,207
            
            
            
            55,199
            
            
            
            213,300
            
            
            
            2,405,706Long-term
      liabilities
            
            
            63,734
            
            
            
            -
            
            
            
            -
            
            
            
            63,734Total
      liabilities assumed
            
            
            2,200,941
            
            
            
            55,199
            
            
            
            213,300
            
            
            
            2,469,440Total
      purchase consideration
            
            $
            2,500,000
            
            
            $
            150,000
            
            
            $
            5,000,000
            
            
            $
            7,650,000_________





Identifiable
intangible assets acquired in the acquisition of Ceres is comprised of; a
proprietary product license, an exclusive import supplier relationship and a
customer list, valued at $980,000, $660,000 and $850,000, respectively and
estimated to have useful lives of 15, 5 and 5 years, respectively. The Company
amortizes these intangible assets using a method that reflects the pattern in
which the assets are expected to be consumed.





Identifiable intangibleassets acquired in the acquisition of MPS are comprised of engineering
methodology and a customer list that the Company estimates has a useful life of
5 years. The Company
amortizes these intangible assets using a method that reflects the pattern in
which the assets are expected to be consumed.





Identifiable intangibleassets acquired in the acquisition of Pacific Rim are comprised of a
brand trademark that the Company estimates has a useful life of 15 years. While
the trademark is currently in use, we have not currently determined the ultimate
disposition and have recorded no amortization as of September 30,
2009.





The
Company has recorded the results of the operations of Pacific Rim, Ceres and MPS
in the Company’s consolidated statement of operations beginning with the
effective date of each respective acquisition.





Note 7.
Intangible Assets and Goodwill





Intangible
assets at September 30, 2009 and December 31, 2008 consisted of the
following:


September
      30,
                2009
              
              
              December
      31,
                2008Brand
      trademark
              
              $
              80,000
              
              
              $
              80,000Proprietary
      product license
              
              
              980,000
              
              
              
              -Supplier
      relationship
              
              
              660,000
              
              
              
              -Customer
      list
              
              
              850,000
              
              
              
              -Engineering
      methodology and customer list
              
              
              100,000
              
              
              
              -Licensed
      assets (See Note 5)
              
              
              243,700
              
              
              
              -Less:
      accumulated amortization
              
              
              2,913,700
              
              
              
              80,000(141,640
              )
              
              
              -$
              2,772,060
              
              
              $
              80,000










Amortization
of $60,702 and $141,640 was recorded for the three and nine months ended
September 30, 2009, respectively.





We
periodically reassess the carrying value, useful lives and classification of
identifiable intangible assets. Estimated aggregate amortization expense based
on current intangibles for the next five years is expected to be as follows:
$60,700 for the remainder of 2009, $390,100 in 2010 and $510,300 in 2011,
$560,900 in 2012 and 690,500 in 2013.





Note 8.
Inventories





Inventory
at September 30, 2009 and December 31, 2008 consisted of the
following:




September
      30, 2009
              
              
              
              December
      31, 2008Raw
      materials
              
              $
              22,747
              
              
              $
              -Finished
      goods
              
              
              1,350,145
              
              
              
              520,000$
              1,372,892
              
              
              $
              520,020


Note
9.   Composition of Certain Financial Statement
Captions





Other
current assets at September 30, 2009 and December 31, 2008 consisted of the
following:




September
      30, 2009
              
              
              
              December
      31, 2008Loans
      receivable
              
              $
              -
              
              
              $
              4,000Assets
      held for sale (See Note 5)
              
              
              29,589
              
              
              
              -Prepaid
      expenses and other
              
              
              54,901
              
              
              
              39,395$
              84,490
              
              
              
              43,395





Note 10.
Property and Equipment





Property
and equipment at September 30, 2009 and December 31, 2008 consisted of the
following:




September
      30 2009
              
              
              
              December
      31, 2008Machinery
      & equipment
              
              $
              1,016,600
              
              
              $
              821,879Building
              
              
              94,355
              
              
              
              -Leasehold
      improvements
              
              
              99,507
              
              
              
              21,790Computer
      equipment
              
              
              53,706
              
              
              
              10,322Furniture
      & fixtures
              
              
              10,517
              
              
              
              5,287Vehicles
              
              
              3,606
              
              
              
              -Land
              
              
              1,536
              
              
              
              -Livestock
              
              
              48,871
              
              
              
              55,240Less:
      accumulated depreciation
              
              
              1,328,698
              
              
              
              914,518(48,511
              )
              
              
              (43,488
              )$
              1,080,187
              
              
              $
              771,030




Depreciation
expense related to property and equipment was $45,187 and $105,023 for the three
and nine months ended September 30, 2009, respectively and $14,263 and $55,750
for the three and nine months ended September 30, 2008,
respectively.




Note 11.
Short-term Notes Payable and Other Debt




Short-term
notes payable and other debt at September 30, 2009 and December 31, 2008
consisted of the following:


September
      30, 2009
              
              
              
              December
      31, 2008Short-term
      convertible notes payable
              
              $
              267,500
              
              
              $
              715,000Transfac
      Financing Agreement
              
              
              130,630
              
              
              
              -Note
      payable at 10%, due 12/31/2009
              
              
              100,000
              
              
              
              100,000Short-term
      loans and lines of credit
              
              
              21,088
              
              
              
              -$
              519,218
              
              
              $
              815,000







Short-term
Convertible Notes Payable





The
Company entered into two rounds of financing through Commonwealth Capital during
the quarters ended December 31, 2008 and March 31, 2009.





The first
round (Commonwealth One) was closed in the quarter ended December 31, 2008.
Proceeds from the notes were $550,000. Interest at 12.0% is due with the
principal on various dates in June 2009. The notes are unsecured and are
convertible into shares of the Company’s common stock at $0.045 per share at any
time during the term of the notes.





The
second round (Commonwealth Two) was closed partially in December 2008, and the
remainder in the quarter ended March 31, 2009. Proceeds from the notes were
$95,000 and $1,602,984 during the quarters ended December 31, 2008 and March 31,
2009, respectively. Interest at 12.0% is due with the principal on various dates
in June 2009. The notes are unsecured and are convertible into shares of the
Company’s common stock at $0.075 per share at any time during the term of the
notes.




During
the three months ended September 30, 2009, $350,000 of the Commonwealth One and
$1,575,484 of the Commonwealth Two notes were converted into 7,777,778 and
21,006,453 shares of the Company’s common stock, respectively.  During
the three months ended June 30, 2009, $100,000 of the Commonwealth One and
$60,000 of the Commonwealth Two notes were converted into 2,222,222 and 800,000
shares of the Company’s common stock, respectively. Subsequent to September 30,
2009, and as of the date of this report, all notes have either been converted or
verbally extended until further notice by the note holders.
 
 The
Company also entered into loan agreements with an unrelated individual (Plant
Notes). Proceeds from the agreements were $70,000 and $35,000 during the
quarters ended December 31, 2008 and March 31, 2009, respectively. Interest at
5.0% is due with the principal on demand. The notes are unsecured and are
convertible into shares of the Company’s common stock at $0.50 per share at any
time during the term of the notes.





The
Company has recorded accrued interest on the short-term notes convertible
payable of $163,040 and $13,667, as of September 30, 2009 and December 31, 2008,
respectively. Accrued interest is included in accrued expenses on the Company’s
consolidated balance sheet herein.





The
conversion prices of these convertible notes were established at, or above, the
then current market price of the Company’s common stock and therefore, no
beneficial conversion feature discount has been recorded.





A summary
table of short-term convertible notes payable follows:




September
      30, 2009
              
              
              
              December
      31, 2008Commonwealth
      One
              
              $
              100,000
              
              
              $
              550,000Commonwealth
      Two
              
              
              62,500
              
              
              
              95,000Plant
      Notes
              
              
              105,000
              
              
              
              70,000Total
              
              $
              267,500
              
              
              $
              715,000




Transfac
Financing Agreement




In
connection with the acquisition of Ceres, the Company has an accounts receivable
financing agreement (the “Agreement”) with Transfac Capital, LLC
(“Transfac”).  The original Agreement term is one year from the
effective date of June 2, 2008 and is cancelable immediately upon notice by
Transfac, or within ten days of notice by the Company if the Company secures
financing from an FDIC insured institution.  Upon the acquisition of
Ceres by the Company, the term changed to month-to-month and is cancelable
within ten days of notice by Ceres. Under the terms of the Agreement, the
Company may offer to sell its accounts receivable to Transfac each month during
the term of the Agreement, up to a maximum amount outstanding at any time of
$1.5 million in gross receivables submitted, or $1.2 million in net amounts
funded based upon an 80.0% advance rate. The Company is obligated to offer
accounts totaling a minimum of $300,000 in each month, and Transfac has the
right to decline to purchase any offered accounts (invoices).




The
Agreement provides for the sale, on a revolving basis, of accounts receivable
generated by specified debtors. The purchase price paid by Transfac reflects a
discount that is generally 0.7% for the first twenty days, plus an aging fee of
0.034% for each day after the first twenty days. The Company continues to be
responsible for the servicing and administration of the receivables purchased.
Transfac fees are reported in the Company’s consolidated statement of operations
as interest expense and were $11,874 and $30,680 for the three and nine months
ended September 30, 2009, respectively. There were no fees incurred for the
three and nine months ended June 30, 2008 as the Agreement is with Ceres, which
was not acquired until the first quarter of fiscal 2009.












The
Company accounts for the sale of receivables under the Agreement as a secured
borrowing with a pledge of the subject receivables as collateral. Accounts
Receivable pledged as collateral on the accompanying consolidated balance sheets
in the amount of $170,954 as of September 30, 2009, represents the gross
receivables that have been designated as “sold” and serve as collateral for
short-term debt in the amount of $130,630 as of September 30, 2009.




Note 12.
Long-term Debt





Long-term
debt at September 30, 2009 and December 31, 2008 consisted of the
following:


September
      30, 2009
              
              
              December
      31, 2008Zero
      Coupon Convertible Subordinated Note Payable, interest at 5.0%,
      principaland
      interest due December 12, 2013, convertible to shares of
      commonstock
      of the Company at $0.125 per share at any time, unsecured
              
              $
              1,535,000
              
              
              $
              1,535,000Zero
      Coupon Convertible Subordinated Note Payable, interest at 5.0%,
      principaland
      interest due December 12, 2013, convertible to shares of
      commonstock
      of the Company at $0.125 per share at any time, unsecured
              
              
              1,500,000
              
              
              
              1,500,000Liability
      for license agreement (See Note 5)
              
              
              243,700
              
              
              
              -Unsecured
      note payable, related party (See Note 14)
              
              
              105,861
              
              
              
              105,801Variable
      interest bank note at prime plus 2.75%, 6.0% at September 30,
      2009,due
      January 31, 2012, principal and interest due monthly, secured by the
      assetsof
      Ceres
              
              
              45,727
              
              
              
              -Other
              
              
              -
              
              
              
              23,4673,430,288
              
              
              
              3,164,268Less
      current portion:
              
              
              (21,806
              )
              
              
              -Total
      long-term debt
              
              $
              3,408,482
              
              
              $
              3,164,268
  The
conversion prices of the Zero Coupon Convertible notes were established at, or
above, the then current market price of the Company’s common stock and
therefore, no beneficial conversion feature discount has been recorded.
Additionally, the conversion price is subject to weighted-average anti-dilution
adjustments in the event we issue common stock at a price below the
then-applicable conversion price other than common stock issuances or option
grants to the Company's employees, directors or officers.  Under current
accounting guidance, if the terms of a contingent conversion option does not
permit an issuer to compute the number of shares that the holder would receive
if the contingent event occurs and the conversion price is adjusted, an issuer
shall wait until the contingent event occurs and then compute the resulting
number of shares that would be received pursuant to the new conversion price.
 The number of shares that would be received upon conversion based on the
adjusted conversion price would then be compared with the number that would have
been received before the occurrence of the contingent event. The excess number
of shares multiplied by the commitment date stock price equals the incremental
intrinsic value that results from the resolution of the contingency and the
corresponding adjustment to the conversion price. That incremental amount shall
be recognized when the triggering event occurs.
  Future
minimum payments on long-term debt at September 30, 2009 are as
follows:




Years
      ending December 31,$
            $8702009,
      remaining
            
            
            21,8062010
            
            
            71,8972011
            
            
            59,6422012
            
            
            3,276,0732013$
            3,430,288




Note 13.
Basic and Diluted Earning Per Share





The
Company computes earnings per share under two different methods, basic and
diluted, and presents per share data for all periods in which statements of
operations are presented.  Basic earnings per share are computed by
dividing net income by the weighted average number of shares of common stock
outstanding.  Diluted earnings per share are computed by dividing net
income by the weighted average number of common stock and common stock
equivalents outstanding.





As of
September 30, 2009, the Company had (i) 9,000,000 shares of common stock
issuable under convertible preferred stock arrangements, (ii) 200,000 shares of
common stock issuable upon the exercise of outstanding warrants and (iii)
27,545,555 shares of common stock issuable under convertible debt arrangements.
 As of September 30, 2008, the Company had (i) 25,420,000 shares of common
stock issuable under convertible preferred stock arrangements. These 36,745,555
and 25,420,000 shares as of September 30, 2009 and 2008, respectively, which
would be reduced by applying the treasury stock method, were excluded from
diluted weighted average outstanding shares amount for computing the net loss
per common share, because the net effect would be antidilutive for each of the
periods presented.










Note 14.
Related Party Transactions





We lease
our office and warehouse facility in Belgium, Wisconsin from Monte B. Tobin, our
Chairman, and his wife, (the Tobins) under a five-year net lease. The facility
consists of approximately 3,500 square feet of office space and 1,000 square
feet of warehouse space, with an option to increase the warehouse space by up to
500 feet. We currently pay a base rent of approximately $4,300 per month. The
Tobins hold a note receivable from the Company representing unpaid rent and
interest from 2005 and 2006 totaling $105,861. Interest accrues at 12% per
year.





Note 15.
Stockholders’ Equity





Common
Stock





The
Company is authorized to issue 239,500,000 shares of $.001 par value common
stock. The Company has 172,021,946 shares of its common stock issued and
outstanding at September 30, 2009. Dividends may be paid on outstanding shares
as declared by the Board of Directors. Each share of common stock is entitled to
one vote.





Preferred
Stock





The
Company is authorized to issue 10,500,000 shares of $0.05 par value preferred
stock.





As of
December 31, 2008, there were 5,420,000 Series A Convertible Preferred shares
outstanding. Of these outstanding shares, 420,000 are convertible at any time
into common shares at a ratio of one (1) common share for each Series A
Preferred share and 5,000,000 are convertible at any time into common shares at
a ratio of five (5) common shares for each Series A Preferred
share.  In addition, each Series A Preferred share has one vote for
each common share outstanding. There is no liquidation preference relative to
Series A Preferred shares.





During
the three months ended March 31, 2009, the Company executed an agreement with
the Series A Convertible Preferred Shareholders for a return to the Company of
4,420,000 Series A Preferred shares in return for an undetermined number of
shares of common stock. The preferred shares were returned to the Company in
February 2009. The Company finalized the agreement during the three months ended
September 30, 2009.In accordance with the agreement, the Company issued 2,500,000 shares of its
common stock.





During
the three months ended June 30, 2009, the remaining 1,000,000 Series A
Convertible Preferred shares outstanding at December 31, 2008, were converted
into 5,000,000 shares of the Company’s common stock.





Pursuant
to the acquisition of MPS, the Company issued 500,000 shares of Series B
Preferred Stock. The Series B Preferred Stock shares are convertible at any time
into common shares at a ratio of two common shares for each preferred share. In
addition, each preferred share has one vote for each common share outstanding
and has a liquidation preference of $1.00 per share, totaling
$500,000.





Pursuant
to the acquisitions of Ceres, the Company issued 8,000,000 shares of Series C
Preferred Stock. The Series C Preferred Stock shares are convertible at any time
into common shares at a ratio of one common share for each preferred share. In
addition, each Preferred share has one vote for each common share outstanding
and has a liquidation preference of $.50 per share, totaling
$4,000,000 .




Stock
Issuances





During
the three months ended September 30, 2009, the Company issued:





·
            31,488,072
      shares of common stock, at prices of $0.045 and $0.075 per share, for the
      conversion of $1,922,384 of short term notes payable and $183,555 of
      related accrued interest under the terms of the
  agreements.


·
            2,500,000
      shares of common stock, at approximately $0.09 per share, for the
      conversion of 4,420,000 shares of Series A Convertible Preferred Stock
      under the terms of the agreements.


·
            1,010,284
      shares of common stock valued at $105,292 (approximately $0.10 per share)
      for consulting services provided during the three months ended September
      30, 2009. This resulted in a charge to operating expenses in the Company’s
      consolidated statement of
operations.


·
            500,000
      shares of common stock for a retention bonus to an employee of the
      Company. This amount was recorded as compensation expense in the Company’s
      consolidated statement of
operations.














During
the three months ended June 30, 2009, the Company issued:





·
            5,000,000
      shares of common stock, at $0.01 per share, for the conversion of
      1,000,000 shares of Series A Convertible Preferred Stock, valued at
      $50,000, under the terms of the
agreements.


·
            3,189,505
      shares of common stock, at prices of $0.045 and $0.075 per share, for the
      conversion of $160,000 of short term notes payable and $8,546 of related
      accrued interest under the terms of the
  agreements.


·
            2,220,000
      shares of common stock valued at $166,500 ($0.075 per share) for
      consulting services provided during the three months ended June 30, 2009.
      This resulted in a charge to operating expenses in the Company’s
      consolidated statement of
operations.


·
            2,346,698
      shares of common stock valued at $23,467 ($0.01 per share) for the
      conversion of a note payable under the terms of the original
      agreement.


·
            2,000,000
      shares of common stock valued at $200,000 ($0.10 per share) for the
      retention of an investment banking firm for services performed during the
      quarter. This resulted in a charge to operating expenses in the Company’s
      consolidated statement of
operations.


·
            400,000
      shares of common stock valued at $30,000 ($0.075 per share) for
      professional services related to the issuance of the short-term
      convertible note payable. This amount was recorded as deferred financing
      costs and was amortized ratably to interest expense over the term of the
      related note.





During
the three months ended March 31, 2009, the Company issued:





·
            2,273,333
      shares of common stock valued at $170,500 ($0.075 per share) for
      professional services related to the issuance of the short-term
      convertible note payable. This amount was recorded as deferred financing
      costs and was amortized ratably to interest expense over the term of the
      related note.


·
            8,000,000
      shares of common stock and 8,000,000 shares of Series C Convertible
      Preferred Stock, with an estimated value of $2,500,000 were issued to the
      shareholders’ of Ceres in exchange for their shares in Ceres under the
      acquisition agreement between the parties and the
  Company.


·
            500,000
      shares of Series B Convertible Preferred Stock, with an estimated value of
      $150,000 were issued to Thomsen in exchange for its share ownership in MPS
      under the acquisition agreement between Thomsen and the
      Company.





Treasury
Stock





With the
acquisition of Pacific Rim in fiscal 2008, the Company acquired 1,103,500 shares
of its own common stock that was valued at $143,456, at an average price of
$0.13 per share. During the quarter ended March 31, 2009, the Company purchased
1,113,000 shares of its common stock for $302,123 in cash, at an average price
of $0.27 per share. During the three months ended June 30, 2009, the Company
sold 402,800 shares of its common stock held in treasury for $63,246 in cash, at
an average price of $0.16 per share. During the three months ended September 30,
2009, the Company sold 754,000 shares of its common stock held in treasury stock
for $85,663 in cash, at an average price of $0.11.




Note 16.
Commitments and Contingencies





The
Company enters into forward contracts for a certain portion of its future grain
requirements. At September 30, 2009, the Company had outstanding commitments for
grain purchases totaling approximately  $2,500,000 related to forward
purchase contracts. These contracts are set price contracts to deliver grain to
the Company, and are not derivative in nature as they have no net settlement
provision and are not transferable.





Pursuant
to a warehouse agreement, the Company is obligated to minimum monthly storage
and handling amounts of $1,000, totaling $12,000 for the year ending December
31, 2009.





The
Company periodically is subject to claims and lawsuits that arise in the
ordinary course of business.  It is the opinion of management that the
disposition or ultimate resolution of such claims and lawsuits will not have a
material adverse effect on the financial position of the Company.




Note 17.
Fair Value Measurements




The
Company values its marketable securities based on a three-level fair value
hierarchy. The fair value hierarchy gives the highest priority to quoted prices
in active markets for identical assets or liabilities (Level 1). The next
highest priority is based on quoted prices for similar assets or liabilities in
active markets or quoted prices for identical or similar assets or liabilities
in non-active markets or other observable inputs (Level 2). The lowest priority
is given to unobservable inputs (Level 3).






























The
following table provides information regarding fair value measurements for our
marketable securities as of September 30, 2009 according to the three-level fair
value hierarchy:







Fair
      Value Measurements at Reporting Date UsingBalance
              September
      30, 2009
            
            Quoted
      Prices in
              Active
      Markets for
              Identical
      Assets
              (Level
      1)
            
            Significant
      Other
              Observable
              Inputs
              (Level
      2)
            
            Significant
              Unobservable
              Inputs
              (Level
      3)Equity
      securities
            $
            
            68,391
            
            $
            
            —
            
            $
            
            68,391
            
            $
            
            —




Equity
securities as of September 30, 2009 are comprised of stock holdings in one
company that is traded on the Over-The-Counter Bulletin Board.




Note 18.
Subsequent Events





The
Company has evaluated for disclosure subsequent events that have occurred up to
November 23, 2009, the date the consolidated financial statements were available
for issuance.


























Item 2.Management’s Discussion and Analysis
or Plan of Operation





NOTE
REGARDING FORWARD-LOOKING STATEMENTS





Sections
of this Form 10-Q, including the Management's Discussion and Analysis or Plan of
Operation, contain “forward-looking statements” within the meaning of Section
27A of the Securities Act of 1933, as amended (the “Securities Act”), Section
21E of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”),
and the Private Securities Litigation Reform Act of 1995, as amended. These
forward-looking statements are subject to risks and uncertainties and other
factors that may cause our actual results, performance or achievements to be
materially different from the results, performance or achievements expressed or
implied by the forward-looking statements. You should not unduly rely on these
statements. Forward-looking statements involve assumptions and describe our
plans, strategies, and expectations. You can generally identify a
forward-looking statement by words such as “may,”  “should,” “would,”
“could,” “plan,” “goal,” “potential,” “expect,” “anticipate,” “estimate,”
“believe,” “intend,” “project,” and similar words and variations thereof. This
Quarterly Report on Form 10-Q contains forward-looking statements that address,
among other things,





CRITICAL ACCOUNTING POLICIES AND ESTIMATES:





The
preparation of the financial information contained in this 10-Q requires us to
make estimates and judgments that affect the reported amounts of assets,
liabilities, revenues and expenses, and related disclosure of contingent assets
and liabilities.  We evaluate these estimates on an ongoing basis,
including those related to allowances for doubtful accounts and returns,
inventory valuation, the carrying value and any impairment of goodwill and
intangible assets, and income taxes. These critical accounting policies are
discussed in more detail in the Management’s Discussion and Analysis of
Financial Condition and Results of Operations contained in our Annual Report on
Form 10-K for the year ended December 31, 2008.





RECENT
ACCOUNTING DEVELOPMENTS





See Note
2 to the accompanying interim consolidated financial statements for a summary of
recent accounting developments.





Plan
of Operation





Overview





Ceres
Organic Harvest Inc. (Ceres) —an acquisition that closed Feb. 20, 2009, is now
part of the Mach One Organics and Sustainables Group (OSG). Along with its
subsidiary, Organic Grain and Milling Inc. (OGM), Ceres and OGM supply organic
grain and grain-based ingredients to the food, feed and dairy industries,
including varieties of wheat, flour, oats, corn, flax, barley and other
products. Ceres is currently launching a new line of oat-based products using a
proprietary oat cultivar with substantially higher fiber and beta-glucan
content, which was developed in a cooperative breeding program between the North
Dakota State University and the United States Department of Agriculture’s (USDA)
Agricultural Research Service. Ceres and OGM operate a grain elevator in North
Dakota, with corporate offices in St. Paul, Minnesota. The integration of
organic foods and animal feeds to the Mach One package of global wellness
solutions extends Mach One’s reach as well as its ability to expand its success
in sustainable bio-solutions. OSG is headquartered in Minneapolis,
Minnesota.





Modular
Process Constructors, LLC (dba MPS-BioPharm)—an acquisition that closed Feb. 19,
2009— is now part of Mach One’s BioPharm Process Systems Group and engages in
the design and manufacture of constructed systems for the biopharmaceutical
industry. It offers process modules and skids, custom tanks and vessels, and
sanitary stainless steel flow equipment, along with professional project
management, design qualifications, detail design, component procurement,
schedule metrics and reporting. With the addition of MPS-BioPharm, it enables
Mach One to accelerate production of biopharmaceutical, Nutraceutical, and
BridgeTM Iggs on a global basis. The BioPharm Process Systems Group is
headquartered in Kenosha, Wisconsin.





Today
Mach One and its three Operating Groups—Animal Wellness, Organics and
Sustainables, and BioPharm Process Systems—offer a broad range of solutions to
global health problems, from helping calves develop immunity at birth to
carefully managing organic grain crops, to testing equipment that helps detect
compromised food products long before they can cause a problem. Currently,
neither Animal Wellness nor BioPharm Process Systems has generated significant
revenues or acquired significant assets. As such, the Company operates and
manages the business under one reporting segment.





We have
not generated significant operating revenues, and as of September 30, 2009 we
had incurred a cumulative consolidated net loss from inception of
$11,308,068.





For the
nine month periods ended September 30, 2009 and 2008, our consolidated net
losses were $7,563,308 and $852,228 respectively. Our current liabilities as of
September 30, 2009 exceed current assets by $1,435,171.












Although
we recently completed a convertible debt financing with gross proceeds of
approximately $2,250,000 in November 2008 and January 2009, we will eventually
require significant additional funding in order to achieve our business plan. We
believe that our current cash position will be able to sustain our proposed
operations for 2-3 months. Should we be unable to obtain additional funding in
the next 3 months, we would be required to cut expenses in our Organics and
Sustainables group and temporarily halt operations in our Animal Wellness group
until such funding is obtained. Over the next 18 months, in order to have the
capability of achieving our business plan, we believe that we will require at
least $3,000,000 in additional funding to pay down certain accounts payable and
accruals and to provide working capital. We will attempt to raise these funds by
means of one or more public or private offerings of debt or equity securities or
both.





Results
of Operations





Quarter
Ending September 30, 2009 Compared to Quarter Ending September 30,
2008





Net sales
for the quarter ended September 30, 2009 were $1,579,693 compared to $1,646 for
the same period last year. Net sales increased due to increased revenues from
the acquisition of Ceres (approximately $1,497,000) and MPS (approximately
$69,000), and to increased sales at Animal Wellness of approximately
$10,000.





Cost of
goods sold were $1,529,223 for the quarter ended September 30, 2009 compared to
$4,737 for the quarter ended September 30, 2008. This increase was primarily due
to acquisition of Ceres (approximately $1,527,000). There were no significant
changes in cost of goods sold of Animal Wellness between the periods
presented.





Gross
profit for the quarter ended September 30, 2009 was $50,470 compared to a
negative gross profit of $3,091 for the same period last year. Gross profit
increased due to increased sales with the acquisition of Ceres (approximately
$12,000) and MPS (approximately $23,000); and, increased gross profit at Animal
Wellness (approximately $15,000).





Operating
expenses increased to $1,398,375 in the quarter ended September 30, 2009 from
$162,138 in the same quarter in 2008. The increase is due to costs associated
with additional employees and facilities from the acquisition of Ceres and
MPS.




Interest
expense for the quarter ended September 30, 2009 was $139,672. There was no
interest expense in the same period last year. Interest expense increased due to
the issuance of short term notes payable during the quarters ended December 31,
2008 and March 31, 2009 and due to debt issued in connection with the
acquisition of Pacific Rim.
  Nine
Months Ending September 30, 2009 Compared to Nine Months Ending September 30,
2008





Net sales
for the nine months ended September 30, 2009 were $4,074,297 compared to $84,073
for the same period last year. Net sales increased due to increased revenues
from the acquisition of Ceres (approximately $3,855,000) and MPS (approximately
$150,000). This was offset by a slight decrease (approximately $15,000) in sales
at Animal Wellness.





Cost of
goods sold were $3,696,030 for the nine months ended September 30, 2009 compared
to $42,862 for the nine months ended September 30, 2008. This increase was
primarily due to acquisition of Ceres (approximately $3,630,000) and MPS
(approximately $50,000). There were no significant changes in cost of goods sold
of Animal Wellness between the periods presented.





Gross
profit for the nine months ended September 30, 2009 was $378,267 compared to
$41,211 for the same period last year. Gross profit increased due to increased
sales with the acquisition of Ceres (approximately $247,000) and MPS
(approximately $100,000). This was offset by a slightly lower gross profit for
Animal Wellness in the current period.


Operating
expenses increased to $7,410,331, including a goodwill impairment, in the nine
months ended September 30, 2009 from $840,557 in the same period in 2008. The
increase is due to the impairment of goodwill of $3,438,466 and additional
personnel in Animal Wellness and costs associated with additional employees and
facilities from the acquisition of Ceres and MPS.
 
 Interest
expense for the nine months ended September 30, 2009 was $576,284 compared to
$52,882 for the same period last year. Interest expense increased due to the
issuance of short term notes payable during the  quarters ended
December 31, 2008 and March 31, 2009 and due to the debt incurred with the
acquisition of Ceres.


Liquidity
and Capital Resources





We had a
cash balance of $79,332 as of September 30, 2009 and a cash balance of $635,334
as of December 31, 2008.





The value
of our marketable securities on September 30, 2009 decreased to $68,391 from
$483,900 as of market close on December 31, 2008. The decrease is due to the
decline in market values and sales of approximately $145,000 worth of
securities.





Accounts
receivable as of September 30, 2009 increased to $1,020,532 from $44,603 at
December 31, 2008 due to the acquisition of Ceres (approximately $907,000) and
MPS (approximately $71,000) as of September 30, 2009.





Inventory
as of September 30, 2009 increased to $1,372,892 from $520,020 at December 31,
2008 due to the acquisition of Ceres (approximately $810,000) and MPS
(approximately $42,000) as of September 30, 2009.












Total
assets at September 30, 2009 are $6,915,616 compared to $6,196,748 at December
31, 2008. This increase is attributable to the acquisitions of Ceres and MPS
offset by an impairment to goodwill of approximately $3,400,000.





As of
September 30, 2009, we have current liabilities totaling $4,062,808 compared to
$1,223,904 at December 31, 2008. The increase is due to; an increase in accounts
payable, which is due to an increase at Animal Wellness (approximately
$345,000), the acquisition of Ceres (approximately $2,364,000) and MPS
(approximately $50,000) as of September 30, 2009, an increase in accrued
expenses at Animal Wellness of approximately $220,000, and deferred revenues of
approximately $51,000 from the acquisition of MPS. These increases were
partially offset by a decrease in short-term notes payable of approximately
$295,000.





Long term
debt as of September 30, 2009 is $3,408,482 compared to $3,164,268 at December
31, 2008.


Operating
Activities
 
 Net cash
used in operations increased to $1,816,857 during the nine months ended
September 30, 2009 from $510,784 during the nine months ended September 30,
2008. The decrease in operating cash flows was primarily due to the acquisition
of Ceres and MPS, the use of funds to establish operations for the Animal
Wellness Group, an increase in net loss and significant changes in working
capital levels from the prior year. More specifically, the changes in working
capital in the nine months ended September 30, 2009 included increases in
accounts receivable, and accounts payable and accrued expenses, and a decrease
in inventory, net of the acquisition of Ceres and MPS. Accounts receivable
increased due to sales at Ceres and MPS. The decrease in inventory, net of
acquisitions is primarily a result of a reduction of inventory levels to
generate working capital. The increase in accounts payable and accrued expenses,
net of acquisitions was driven by our current lack of capital.
 
 Investing
Activities
 
 Net cash
used in investing activities decreased to $156,386 during the nine months ended
September 30, 2009 from $172,880 during the nine months ended September 30,
2008. The decrease was due to proceeds from the sales of marketable securities
partially offsetting purchases of property and equipment.
 
 Financing
Activities
 
 Net cash
provided by financing activities during the nine months ended September 30, 2008
was $1,417,241, compared to $681,671 during the nine months ended September 30,
2008. The primary reason for the increase in cash provided by financing
activities was the cash provided from the issuance of the Commonwealth Two
Notes, which was partially offset by the net purchases of the Company’s stock
for Treasury and by payments made on short term notes payable and long term
debt.


Our
longer-term working capital and capital requirements will depend upon numerous
factors, including revenue and profit generation, the cost of filing,
prosecuting, defending, and enforcing patent claims and other intellectual
property rights, competing technological and market developments, collaborative
arrangements. Additional capital will be required in order to attain our goals.
We cannot assure you that funds from our future operations or funds
provided by our current financing activities will meet the requirements of our
operations, and in that event, we will continue to seek additional sources
of financing to maintain liquidity. We are actively pursuing all potential
financing options as we look to secure additional funds both to stabilize and to
grow our business operations. Our management will review any financing options
at their disposal, and will judge each potential source of funds on its
individual merits. We cannot assure you that we will be able to secure
additional funds from debt or equity financing, as and when we need to, or if we
can, that the terms of this financing will be favorable to us or our
stockholders.

















Item
3. Qualitative and Quantitative Disclosures About Market Risk.





None.





Item
4T.  Controls and Procedures.





Evaluation
of Disclosure Controls and Procedures





We
maintain disclosure controls and procedures designed to provide reasonable
assurance that information required to be disclosed in our reports filed
pursuant to the Securities Exchange Act of 1934 is recorded, processed,
summarized and reported within the time periods specified in the SEC’s rules and
forms, and that such information is accumulated and communicated to our
management, including our Chief Executive Officer and Chief Financial Officer as
appropriate, to allow timely decisions regarding required disclosures.  A
control system, no matter how well conceived and operated, can provide only
reasonable, not absolute, assurance that the objectives of the control system
are met.





As of
September 30, 2009, our Chief Executive Officer and Chief Financial Officer
carried out an evaluation of the effectiveness of our disclosure controls and
procedures as such term is defined in Rule 13a-15(e) under the Securities and
Exchange Act of 1934 (The “Exchange Act”). Based on that evaluation, the Chief
Executive Officer and Chief Financial Officer concluded that our disclosure
controls and procedures were not effective as of September 30, 2009 in ensuring
that information required to be disclosed by us in the reports that we file or
submit under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in applicable rules and forms and that such
information is accumulated and communicated to our management, including our
Chief Executive Officer and Chief Financial Officer, in a manner that allows
timely decisions regarding required disclosure because of those material
weaknesses relating to internal controls that are described in Item 4 (T) of the
Company’s Form 10-Q for the quarter ended March 31, 2009.





Notwithstanding
the material weaknesses that existed as of September 30, 2009, our Chief
Executive Officer and Chief Financial Officer have concluded that the financial
statements included in this report present fairly, in all material respects, the
financial position, results of operations and cash flows of the Company in
conformity with accounting principles generally accepted in the United States of
America.





Changes
in Internal Controls





During
the fiscal quarter ended September 30, 2009, there were no changes in our
internal control over financial reporting (as defined in Rule 13a-15(f) under
the Exchange Act) that have materially affected, or are reasonably likely to
materially affect, our internal control over financial reporting.
 Management has concluded that the material weaknesses in internal control,
as described in Item 4 (T) of our Form 10-Q for the quarter ended March 31,
2009, have not been fully remediated.  We are committed to finalizing our
remediation action plan and implementing the necessary enhancements to our
policies and procedures to fully remediate the material weaknesses discussed
above. Due to our lack of sufficient capital, we expect these material
weaknesses to continue until our capital needs are met.





PART
II—OTHER INFORMATION





Item
1.   Legal Proceedings.





Not
Applicable.





Item
1A.   Risk Factors.





The
Company is a smaller reporting company as defined by Rule 12b-2 of the Exchange
Act and is not required to provide the information required under this
item.





Item 2.Unregistered Sales of Equity
Securities and Use of Proceeds.





On
February 17, 2009, pursuant to an agreement, 2,273,333 shares of common stock
valued at $170,500 ($0.075 per share) for professional services related to the
issuance of the short-term convertible note payable.




On
February 18, 2009, Mach One issued 500,000 shares of Series B Convertible
Preferred Stock (the “Series B Preferred Stock”) to the Thomsen Group, LLC
(“Thomsen”) for the purchase of all of the assets of Modular Process
Contractors, LLC (“MPC”). Each share of Series B Preferred Stock is convertible
into two shares of Mach One common stock. In addition to the issuance of the
Series B Preferred Stock, Mach One entered into an Earn-Out Agreement with
Thomsen, providing for Thomsen to acquire up to an additional 35% of issued and
outstanding common stock of Mach One on December 31, 2011, based upon the
combined net income of MPC for the years ending December 31, 2009, 2010, and
2011.




On
February 20, 2009, pursuant to a Plan and Agreement of Reorganization, Mach One
issued 8,000,000 shares of its common stock and 8,000,000 shares of Series C
Convertible Preferred Stock (“Series C Preferred Stock”) in exchange for all of
the issued and outstanding common stock of Ceres Organic Harvest, Inc. (Ceres).
Each share of Series C Preferred Stock is convertible into one share of Mach
One’s common stock.












On April
13, 2009, pursuant to an agreement, Mach One issued 400,000 shares of common
stock valued at $30,000 ($0.075 per share) for professional services related to
the issuance of the short-term convertible note payable.





On May
13, 2009, Mach One issued 2,346,698 shares of common stock valued at $23,467
($0.01 per share) for the conversion of a note payable under the terms of the
original agreement.





On May
20, 2009, Mach One issued 2,000,000 shares of common stock valued at $200,000
($0.10 per share) for the retention of an investment banking firm for services
performed during the quarter. This resulted in a charge to operating expenses in
the Company’s consolidated statement of operations.





On June
2, 2009, Mach One issued 5,000,000 shares of common stock for the conversion of
1,000,000 shares of Series A Convertible Preferred Stock, valued at $50,000
($0.01 per share), under the terms of the agreements.





On
various dates during three months ended June 30, 2009, Mach One issued 3,189,505
shares of common stock (at prices of $0.045 and $0.075 per share) for the
conversion of $160,000 of short-term notes payable and $8,546 of related accrued
interest under the terms of the agreements.





On
various dates during three months ended June 30, 2009, Mach One issued 2,220,000
shares of common stock valued at $166,500 for consulting services provided
during the three months ended June 30, 2009. This resulted in a charge to
operating expenses in the Company’s consolidated statement of
operations.





On July
31, 2009, Mach One issued 500,000 shares of common stock valued at $50,000
($0.10 per share), to an employee of the Company as a retention
bonus.





On July
31, 2009, Mach One issued 2,500,000 shares of common stock for the conversion of
4,420,000 shares of Series A Convertible Preferred Stock, valued at $221,000
(approximately $0.09 per share), under the terms of the agreements.





On
various dates during three months ended September 30, 2009, Mach One issued
31,488,072 shares of common stock  (at prices of $0.045 and $0.075 per
share) for the conversion of $1,922,384 of short-term notes payable and $183,555
of related accrued interest under the terms of the agreements.





On
various dates during three months ended September 30, 2009, Mach One issued
1,010,284 shares of common stock valued at $105,292 (at approximately $0.10 per
share) for consulting services provided during the three months ended June 30,
2009. This resulted in a charge to operating expenses in the Company’s
consolidated statement of operations.




All of
the investors above are sophisticated individuals who had the opportunity to
review all of the Company’s SEC filings and to discuss with the officers and
directors of the Company the business and financial activities of the Company.
All of the investors acquired their Common Stock and/or Preferred Stock (the
“Securities”) for investment and not with a view toward distribution. All of the
stock certificates issued, or to be issued upon conversion, to the thirty
Pacific Rim shareholders and the stock certificates issued to Thomsen and to the
nine Ceres shareholders have been, affixed with an appropriate legend
restricting sales and transfers. Therefore, based on the foregoing, the Company
issued the Securities in reliance upon the exemptions from registration provided
by Section 4(2) of the Securities Act of 1933 and/or Regulation D, there
under.





Item 3.Defaults Upon Senior
Securities.





Not
Applicable.





Item 4.Submission of Matters of a Vote of
Security Holders





None.





Item
5.  Other Information





Not
Applicable.












Item
6.   Exhibits





(a)
Exhibits: The following exhibits are filed with this report:





31.1
Certification pursuant to Rule 13a-14(a) or 15d-14(a) under The Securities
Exchange Act of 1934 as amended. *





31.2
Certification pursuant to Rule 13a-14(a) or 15d-14(a) under The Securities
Exchange Act of 1934 as amended. *





32.
Certifications pursuant to 18 U.S.C section 1350, as adopted pursuant to Section
906 of the Sarbanes-Oxley Act of 2002. *


___________________________


* The
Exhibit attached to this Form 10-Q shall not be deemed "filed" for purposes of
Section 18 of the Securities Exchange Act of 1934 (the "Exchange Act") or
otherwise subject to liability under that section, nor shall it be deemed
incorporated by reference in any filing under the Securities Act of 1933, as
amended, or the Exchange Act, except as expressly set forth by specific
reference in such filing.

















SIGNATURES





In
accordance with the requirements of the Securities Exchange Act of 1934, as
amended, the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.





Mach
      One CorporationDate:
      November 23, 2009
            By:
            /s/
      Tad M. BallantyneTad
      M. Ballantyne,
              Chief
      Executive OfficerBy:
            /s/
      Patrick G. SheridanPatrick
      G. Sheridan,
              Chief
      Financial Officer