UNITED STATES
               SECURITIES AND EXCHANGE COMMISSION
                    WASHINGTON, D.C.   20549

                          FORM 10-QSB/A

(Mark One)

     (x)  QUARTERLY  REPORT  PURSUANT  TO SECTION 13 OR 15(D) OF THE  SECURITIES
     EXCHANGE ACT OF 1934.

     For the quarterly period ended October 31, 1999

     ( )  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: 0 -17072

                       WINDSWEPT ENVIRONMENTAL GROUP, INC.
       (Exact name of small business issuer as specified in its charter)

                         Delaware                           11-2844247
               (State of other jurisdiction of              (IRS Employer
               incorporation or organization)             Identification Number)

                100 Sweeneydale Avenue, Bay Shore, New York 11706
                    (Address of principle executive offices)

                                 (631) 434-1300
                           (Issuer's telephone number)

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

Yes    X         No___

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

Common Stock, Par Value $.0001                        38,456,254
--------------------------------------------------------------------------------
(Title of Each Class)                   (Outstanding at December 15, 1999)

Transitional Small Business Disclosure Format (check one): Yes___     No   X

<PAGE>
PART I - FINANCIAL INFORMATION
Item 1.  Financial Statements
                       WINDSWEPT ENVIRONMENTAL GROUP, INC.
                           CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                                     October 31,
                                                                         1999            April 30,
                                                                     (Unaudited)            1999
                                                                   ---------------     -------------
                                     ASSETS
<S>                                                                <C>                 <C>
CURRENT ASSETS
  Cash                                                             $   2,150,849       $     46,336
  Accounts receivable, net of allowance for doubtful
   accounts of $210,000 and $100,000, respectively                     2,965,192          2,249,198
  Due from officer                                                          -               100,000
  Inventories                                                            153,193            129,620
  Costs and estimated earnings in excess of billings
   on uncompleted contracts                                               93,589            157,000
  Prepaid and other current assets                                       454,967            379,970
                                                                   --------------      -------------
     Total current assets                                              5,817,790          3,062,124

PROPERTY AND EQUIPMENT, net of accumulated depreciation of
    $3,248,476 and $2,798,662, respectively                            1,966,191          2,333,530

OTHER ASSETS
  Goodwill, net of accumulated amortization of $50,653
   and $45,994, respectively                                              71,373             76,032
  Notes receivable, net of current portion of  $107,853 and
   $105,764, respectively                                                 84,469            110,912
  Other assets                                                           186,084            162,524
                                                                   --------------      -------------
  TOTAL ASSETS                                                     $   8,125,907       $  5,745,122
                                                                   ==============      =============

                      LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES
<S>                                                                <C>                 <C>
Accounts payable and accrued expenses                              $   4,170,642       $  3,558,041
  Notes payable - other                                                  229,725               -
  Note payable to affiliate                                              100,000               -
  Revolving credit note payable                                             -             1,200,596
  Billings in excess of costs and estimated earnings on
   uncompleted contracts                                                 176,460            226,000
  Payroll taxes payable                                                  126,426            107,570
  Sales taxes payable                                                    581,703            481,826
  Current portion of long-term debt                                      388,963          1,033,502
  Obligations of unconsolidated subsidiary, net                          210,007            196,112
                                                                   -------------       -------------
     Total current liabilities                                         5,983,926          6,803,647

OTHER LIABILITIES
  Convertible notes                                                    2,680,000            790,000
  Long-term debt, net of current portion                                 154,580            198,732
                                                                   --------------      -------------
     Total liabilities                                                 8,818,506          7,792,379
                                                                   --------------      -------------
COMMITMENTS AND CONTINGENCIES

SERIES A REDEEMABLE CONVERTIBLE PREFERRED STOCK
 par value $.01; 1,300,000 shares issued
 and outstanding                                                       1,300,000          1,300,000
                                                                   --------------      -------------
REDEEMABLE COMMON STOCK                                                  152,096                  -
                                                                   --------------      -------------
STOCKHOLDERS' DEFICIT
  Preferred Stock, 10,000,000 shares authorized -
   1,300,000 Series A; 50,000 Series B; 8,650,000
   not designated
   Series B, par value $.01 issued
   and outstanding 9,346 and -0- shares, respectively                         93               -
  Common Stock, $.0001 par value,
   50,000,000 shares authorized; 38,443,254 and
   14,135,073 shares issued and outstanding,
   respectively                                                            3,844              1,414
  Additional paid-in capital                                          31,839,076         28,948,201
  Accumulated deficit                                                (33,987,708)       (32,296,872)
                                                                   --------------      -------------
     Total stockholders' deficit                                      (2,144,695)        (3,347,257)
                                                                   --------------      -------------

TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT                        $   8,125,907       $  5,745,122
                                                                   ==============      =============
<FN>
          See accompanying notes to consolidated financial statements.
</FN>
</TABLE>
                                       -2-
<PAGE>

                       WINDSWEPT ENVIRONMENTAL GROUP, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                           FOR THE THREE MONTHS ENDED
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                      October 31,       October 31,
                                                                         1999              1998
                                                                     ------------      ------------
<S>                                                                  <C>               <C>
Revenues                                                             $ 3,186,392       $ 4,516,847
Cost of revenues                                                       2,680,776         3,206,378
                                                                     ------------      ------------
     Gross profit                                                        505,616         1,310,469

Selling, general and administrative expenses                           1,702,586           864,755
                                                                     ------------      ------------

     (Loss) income from operations                                    (1,196,970)          445,714
                                                                     ------------      ------------

Other income (expense):
   Interest expense                                                     (364,760)         (157,745)
   Other, net                                                             10,690            12,500
                                                                     ------------      ------------
     Total other (expense)                                              (354,069)         (145,245)
                                                                     ------------      ------------

     (Loss) income before extraordinary item and
          income tax benefit                                          (1,551,039)          300,469
Income tax benefit                                                          -             (275,000)
                                                                     ------------      ------------

     Net (loss) income before extraordinary item                      (1,551,039)          575,469
Extraordinary item:
     Loss on extinguishment of debt                                      100,000              -
                                                                     ------------      ------------
     Net (loss) income                                                (1,651,039)          575,469

Dividends on Series A Convertible Preferred Stock                         19,500            19,500
                                                                     ------------      ------------

     Net (loss) income attributable to common shareholders           $(1,670,539)      $   555,969
                                                                     ============      ============

Basic net (loss) income per common share
     before extraordinary item                                       $      (.09)      $       .04
Extraordinary item                                                          (.01)             -
                                                                     ------------      ------------
Basic net (loss) income per share                                    $      (.10)      $       .04
                                                                     ============      ============

Diluted net (loss) per common share                                  $      (.10)      $       .03
                                                                     ============      ============

Weighted average number of  common shares outstanding:
     Basic                                                            16,453,166        12,800,778
                                                                     ============      ============
     Diluted                                                          16,453,166        17,562,677
                                                                     ============      ============

<FN>
          See accompanying notes to consolidated financial statements.
</FN>
</TABLE>
                                      -3-

<PAGE>


                       WINDSWEPT ENVIRONMENTAL GROUP, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                            FOR THE SIX MONTHS ENDED
                                   (Unaudited)
<TABLE>
<CAPTION>
                                                                      October 31,        October 31,
                                                                         1999               1998
                                                                     ------------      --------------
<S>                                                                  <C>               <C>
Revenues                                                             $ 5,967,923       $  7,760,310
Cost of revenues                                                       4,668,489          5,527,535
                                                                     ------------      -------------
     Gross profit                                                      1,299,434          2,432,775

Selling, general and administrative expenses                           2,353,928          1,703,350
                                                                     -----------       -------------

     (Loss) income from operations                                    (1,054,494)           729,425
                                                                     ------------      -------------
Other income (expense):
     Interest expense                                                   (547,213)          (434,051)
     Other, net                                                           10,871             27,832
                                                                     ------------      -------------
          Total other (expense)                                         (536,342)          (406,219)

          (Loss) income before extraordinary item and
               income tax benefit                                     (1,590,836)           323,206
Income tax benefit                                                          -              (275,000)
                                                                     ------------      -------------
          Net (loss) income before extraordinary item                 (1,590,836)           598,206
Extraordinary item
          Loss on extinguishment of debt                                 100,000               -
                                                                     ------------      -------------
          Net (loss) income                                           (1,690,836)           598,206

Dividends on Series A Convertible Preferred Stock                         39,000             39,000
                                                                     ------------      -------------
          Net (loss) income attributable to common shareholders      $(1,729,836)      $    559,206
                                                                     ============      =============

Basic net (loss) income per common share
          before extraordinary item                                  $      (.10)      $        .04
Extraordinary item                                                          (.01)             -
                                                                     ------------      -------------
Basic net (loss) income per share                                    $      (.11)      $        .04
                                                                     ============      =============
Diluted net (loss) per common share                                  $      .(11)      $        .04
                                                                     ============      =============
Weighted average number of common shares outstanding:

     Basic                                                            15,558,485         12,463,486
                                                                     ============      =============
     Diluted                                                          15,558,485         17,192,329
                                                                     ============      =============

<FN>
  See accompanying notes to consolidated financial statements.
</FN>
</TABLE>
                                      -4-

<PAGE>


                       WINDSWEPT ENVIRONMENTAL GROUP, INC.
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                    FOR THE SIX MONTHS ENDED OCTOBER 31, 1999
                                   (Unaudited)
<TABLE>
<CAPTION>



                                             Common Stock         Preferred Stock
                                             ------------         ---------------      Additional
                                          Number of      Par     Number of    Par        Paid-in       Accumulated
                                           Shares       Value      Shares    Value       Capital          Deficit         Total
                                         ----------    -------   ---------   -----     ----------      ------------    ------------

<S>                                      <C>           <C>         <C>        <C>    <C>               <C>             <C>
Balance at April 30, 1999                14,135,073    $ 1,414                       $  28,948,201     $(32,296,872)   $(3,347,257)

Proceeds from private placements of
common and preferred stock               23,167,017      2,317      9,346      93        2,639,940                       2,642,350

Exercise of stock option                      7,000          1                               2,624                           2,625

Issuance of common stock for services       863,450         86                             201,723                         201,809

Issuance of common stock for employee
and director compensation                    25,000          2                               5,076                           5,078

Compensation related to officer options                                                    138,080                         138,080

Issuance of common stock for accrued
preferred stock dividends and related
interest                                    225,714         22                              70,514                          70,536

Note conversion                              20,000          2                               9,998                          10,000

Dividends on preferred stock                      -          -                             (39,000)                        (39,000)

Net loss                                          -          -                                   -       (1,690,836)    (1,690,836)
                                         ----------    -------     ------    -----  --------------    --------------   ------------
Balance at October 31, 1999              38,443,254    $ 3,844      9,346    $  93  $   31,839,076    $ (33,987,708)   $(2,144,695)
                                         ==========    =======     ======    =====  ==============    ==============   ============

<FN>
          See accompanying notes to consolidated financial statements.
</FN>
</TABLE>
                                      -5-

<PAGE>


                       WINDSWEPT ENVIRONMENTAL GROUP, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                            FOR THE SIX MONTHS ENDED
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                                       October 31,      October 31,
                                                                                          1999              1998
                                                                                       -----------      -----------
CASH FLOWS FROM OPERATING ACTIVITIES
<S>                                                                                   <C>              <C>
    Net (loss) income                                                                 $(1,690,836)     $  598,206
    Adjustments  to  reconcile  net (loss)  income to net cash
    used by operating activities:
      Depreciation and amortization                                                       473,998         505,886
      Provision for doubtful accounts                                                     110,000          15,393
      Issuance of common stock for director compensation                                    5,078            -
      Compensation related to officer options and redeemable
        common stock                                                                      152,096            -
      Issuance of common stock for services                                               201,809          59,662
      Issuance of common stock for dividends and
        related interest on redeemable preferred stock                                     70,536            -
      Gain on disposal of equipment                                                          -            (15,332)
      Deferred income taxes                                                                  -           (275,000)
     Changes in operating assets and liabilities:
      Accounts receivable                                                                (825,994)       (541,015)
      Due from officer                                                                    100,000            -
      Inventories                                                                         (23,573)         (2,267)
      Costs and estimated earnings in excess of billings on uncompleted contracts          63,411          17,352
      Prepaid and other current assets                                                    (74,997)         92,525
      Accounts payable and accrued expenses                                               612,601         131,721
      Payroll and sales taxes payable                                                     118,733        (533,803)
      Obligations of unconsolidated subsidiary                                             13,895            -
      Billings in excess of costs and estimated earnings  on uncompleted contracts        (49,540)       (103,500)
                                                                                      ------------     -----------
NET CASH USED IN OPERATING ACTIVITIES                                                    (742,783)        (50,172)
                                                                                      ------------     -----------

CASH FLOWS FROM INVESTING ACTIVITIES
   Collection of notes receivable                                                          26,443          28,137
   Other assets                                                                           (43,085)           -
   Proceeds from insurance settlement                                                        -             20,332
   Purchases of property and equipment                                                    (82,475)       (188,405)
                                                                                      ------------     -----------
NET CASH USED IN INVESTING ACTIVITIES                                                     (99,117)       (139,936)
                                                                                      ------------     -----------

CASH FLOWS FROM FINANCING ACTIVITIES
    Principal payments of long-term debt and factor advances                             (788,691)     (2,230,286)
    Payments of revolving bank line, net                                               (1,200,596)      1,984,420
    Proceeds from equipment term loan                                                        -            595,000
    Proceeds from private placements                                                    2,642,350            -
    Proceeds from issuance of  short term notes                                           238,779            -
    Payments on short term notes                                                           (9,054)           -
    Proceeds from notes due affiliate                                                   2,100,000            -
    Dividends paid on redeemable preferred stock                                          (39,000)        (19,500)
    Proceeds from exercise of stock options                                                 2,625            -
    Proceeds from issuance of Common Stock                                                   -            130,000
                                                                                      ------------     -----------
NET CASH PROVIDED BY FINANCING ACTIVITIES                                               2,946,413         459,634
                                                                                      ------------     -----------

NET INCREASE IN CASH                                                                    2,104,513         269,526

CASH - BEGINNING                                                                           46,336          33,915
                                                                                      ------------     -----------

CASH - ENDING                                                                         $ 2,150,849      $  303,441
                                                                                      ===========      ===========

Cash paid during the period for:
Interest                                                                              $   566,797      $  385,152
                                                                                      ===========      ==========
Taxes                                                                                 $      -         $    2,750
                                                                                      ===========      ==========

<FN>
          See accompanying notes to consolidated financial statements.
</FN>
</TABLE>
                                      -6-
<PAGE>



              WINDSWEPT ENVIRONMENTAL GROUP, INC.
           NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
           FOR THE SIX MONTHS ENDED OCTOBER  31, 1999
                          (Unaudited)

1.   BASIS OF PRESENTATION

     The    accompanying     unaudited    condensed    consolidated    financial
     statements   of   the   Company   have   been  prepared  by  management  in
     accordance  with  generally   accepted   accounting  principles for interim
     financial  information  and  with  the instructions to Form 10-QSB and Item
     310  of   Regulation   S-B.   Accordingly,  they do not  include all of the
     information   and  footnotes  required  by  generally  accepted  accounting
     principles   for  financial  statement  presentation.  In  the  opinion  of
     management,  all  adjustments  (consisting  of  normal  recurring accruals)
     considered  necessary  for  a  fair  presentation  have been included.  The
     results   of   operations  for  interim    periods   are  not   necessarily
     indicative  of  the  results  to  be  expected  for  the full  year.  These
     consolidated  interim  financial  statements  should be read in conjunction
     with   the  financial   statements  and   notes  thereto   included  in the
     Company's Form 10-KSB for the fiscal year ended April 30, 1999.

2.   LIQUIDITY AND BUSINESS RISKS

     The   Company's   financial   statements   have   been  prepared   assuming
     that  the  Company  will   continue as a going  concern.  As of October 31,
     1999  the  Company  has  a   stockholders'   deficit of  $2,144,695  and an
     accumulated   deficit  of  $33,987,708.   The   Company  has  financed  its
     operations  to  date   primarily  through  issuances   of  debt and  equity
     securities.   At  October  31, 1999 the Company had $2,150,849 in cash, and
     a  working  capital  deficit  of $166,136.  In addition,  as of October 31,
     1999,  the  Company  was  in  arrears with  respect to certain  payroll and
     sales   tax   obligations    of   approximately   $90,000   and   $550,000,
     respectively.   In  addition,   the  Company is in arrears with many of its
     vendors.  These   factors   raise   substantial   doubt about the Company's
     ability  to  continue  as  a going concern.  These financial  statements do
     not  include  any  adjustments  that  might result from the outcome of this
     uncertainty.

     On  October  29, 1999 the Company consummated an  equity and debt financing
     transaction  with   Spotless Plastics  (USA),  Inc.  (see  Note  6  )  that
     significantly   improved  the  Company's   liquidity  and  cash   position.
     Management  believes  the  Company  will  require  positive  cash flow from
     operations to meet its working  capital needs over the next twelve  months.
     In the event that positive cash flow from operations is not generated,  the
     Company may be required to seek  additional  financing  to meet its working
     capital needs. The Company currently has no credit facility. Revenue growth
     is  expected  in new  and  existing  service  areas.  As is  common  in the
     environmental  services  industry,   payments  for  services  rendered  are
     generally  received  pursuant to specific draw schedules after services are
     rendered.  Thus, pending the receipt of payments for services rendered, the
     Company must  typically  fund project  costs,  including  labor and bonding
     costs,  from  financing  sources  within and outside the  Company.  Certain
     contracts,  in particular those with state or federal agencies, may provide
     for  payment  terms of up to 90 days or more and may require the posting of
     performance  bonds which are generally not released until completion of the
     project.  The Company is  striving to improve its gross  margin and control
     its  selling,  general,  and  administrative  expenses.  There  can  be  no
     assurance,  however,  that changes in the  Company's  plans or other events
     affecting  the  Company's  operations  will not  result in  accelerated  or
     unexpected  cash  requirements,  or that it will be successful in achieving
     positive cash flow from operations or obtaining additional  financing.  The
     Company's  future  cash  requirements  are  expected  to depend on numerous
     factors, including, but not limited to: (i) the ability to successfully bid
     on environmental  or related  construction  contracts,  (ii) the ability to
     generate positive cash flow from operations,  and the extent thereof, (iii)
     the ability to raise additional capital or obtain additional financing, and
     (iv) economic conditions.

                                      -7-
<PAGE>

3.   INCOME TAXES

     No  provision  (benefit)  for income tax was recorded for the three and six
     month periods ended October 31, 1999 due to a net loss being incurred.  Any
     deferred  tax assets  which may have arisen  during the period would have a
     full valuation allowance provided such asset.

4.   EQUITY TRANSACTIONS

     Stock Options

     On June 28,  1999 the  Company's  Board of  Directors  granted  options  to
     purchase  750,000  shares of Common Stock to the  directors of the Company,
     which included 250,000 options to the Chief Executive Officer. All of these
     options are  exercisable  immediately at an exercise  price of $.1875,  and
     expire June 27, 2004.

     On July 20, 1999 the Company granted options to purchase  171,407 shares of
     Common Stock to employees.  All of these options are  exercisable two years
     after date of grant at an  exercise  price of $.3438,  and expire  July 19,
     2004.

     On August 18,  1999 and  August 27,  1999 the  Company  granted  options to
     purchase  10,000 and 50,000  shares of Common  Stock at exercise  prices of
     $.3906  and  $.3125,   respectively,   to  employees.   These  options  are
     exercisable two years and one year after date of grant,  respectively,  and
     expire five years after date of grant.

     On October  29,1999 options to purchase  2,000,000  shares of Common Stock,
     previously granted,  vested. The Company recorded  compensation  expense in
     the amount of $138,080.  Additionally,  options to purchase  2,674,714  and
     2,811,595 shares of Common Stock were granted to Michael O'Reilly (see Note
     6).

     Issuances of Common and Preferred Stock and Warrants

     During the six months  ended  October 31, 1999 the Company  issued  882,334
     shares of Common Stock and warrants to purchase 200,000  additional  shares
     of the  Company's  Common  Stock  exercisable  at $.20 per share in private
     placement  transactions  for proceeds of $142,350.  The warrants  expire on
     July 22, 2004.

     On July 29, 1999 a former  employee  exercised  options to  purchase  7,000
     common shares at an exercise price of $.375 per share.

     On September 10, 1999 the Company  issued 223,988 shares of common stock in
     payment of dividends and accumulated  interest  aggregating  $69,996 on its
     Series A redeemable convertible preferred stock.

     On October 29, 1999 the Company  issued  9,346 shares of Series B preferred
     stock and 22,284,683  shares of Common Stock in a transaction with Spotless
     Plastics  (USA),  Inc. and its subsidiary for  consideration  of $2,500,000
     (see Note 6).

     On November 16, 1999 a former employee exercised options to purchase 13,000
     common shares at an exercise price of $.375 per share.


     Issuance of Convertible Debt

     On October 29,1999 the Company borrowed  $2,000,000 from Spotless  Plastics
     (USA),  Inc.  and  issued  a  secured   promissory  note  convertible  into
     25,304,352  shares of Common  Stock or 25,305  shares of Series B Preferred
     (see Note 6).

                                      -8-
<PAGE>

5.   COMMITMENTS AND CONTINGENCIES

     Litigation

     In October 1996, the United States Attorney for the Eastern District of New
     York obtained a federal grand jury indictment  against,  among others,  the
     Company's former Chief Operating  Officer,  Leo Mangan,  and former Special
     Securities  Counsel,  James Nearen,  on charges that include  violations of
     federal securities law, including fraudulent issuances of 700,000 shares of
     the  Company's  Common Stock.  Mr. Mangan and Mr. Nearen both  subsequently
     pleaded guilty to the charges in the Federal indictment.  In addition,  the
     Securities and Exchange  Commission also instituted an investigation of the
     Company.  To date,  no charges  have been filed  against the Company or any
     other  current  member of  management  as a result of the Eastern  District
     investigation.  On June 9, 1999, the Company's Board of Directors  approved
     making a  settlement  offer with the  Securities  and  Exchange  Commission
     pursuant to which the Company neither admits nor denies any allegations. On
     November  22, 1999 the  Securities  and  Exchange  Commission  accepted the
     settlement   offer  in  its  "Order   Instituting   Public   Administrative
     Proceedings,  Making  Findings,  Imposing  Remedial  Sanctions  and Issuing
     Cease-and-Desist  Order." Under the terms of the order the Company will not
     incur any  monetary  fines.  The order  requires the Company to develop and
     institute  certain  policies,  procedures and manuals that will improve its
     corporate  governance,  including the  adaptation  of a formal  conflict of
     interest policy and a formal employee handbook. The order also requires the
     Company to obtain a secure off site  storage  facility  to store its backup
     data files and system software and to make certain  reporting  disclosures.
     The Company is  currently  in the process of  implementing  such  policies,
     procedures and manuals. Additionally, the Company's special defense counsel
     has advised the Company that an Assistant United States Attorney  confirmed
     that the Government,  at this time, does not intend to proceed further with
     its investigation of the Company.

     The  Company is a  defendant  in a  litigation  matter  whereby one or more
     plaintiffs  claim to be entitled to  additional  wages while  working for a
     subcontractor  of the  Company.  The  amount  of the  claim  has  not  been
     specified.  Management believes that the case is without merit, and intends
     to defend the action vigorously.

     The  Company is party to other  litigation  matters  and  claims  which are
     normal in the  course of its  operations,  and  while the  results  of such
     litigation  and  claims  cannot be  predicted  with  certainty,  management
     believes  that the final outcome of such matters will not have a materially
     adverse  effect  on  the  consolidated   financial  position,   results  of
     operations and cash flows of the Company.

     Other Proceedings

     In January 1996 Laboratory  Testing Services,  Inc. ("LTS"), a wholly-owned
     subsidiary  of the  Company,  filed a Chapter 11 petition in United  States
     Bankruptcy  Court in the Eastern District of New York.  Subsequently,  this
     case was converted to a Chapter 7 Bankruptcy proceeding.  LTS is in process
     of liquidation  through these bankruptcy  proceedings.  Management believes
     that the Company's  financial  condition and results of operations will not
     be materially affected by this proceeding.

6.   SALE OF CONTROLLING INTEREST AND REFINANCING

     On October  26,  1999 the Board of  Directors  of  Windswept  Environmental
     Group, Inc. ("the "Company")  created a class of 50,000 shares of preferred
     stock,  par value $.01 per share,  designated  as the Series B  Convertible
     Preferred  Stock  (the  "Series  B  Preferred").  Each  share  of  Series B
     Preferred has a liquidation  preference of $79.04, is initially convertible
     into 1,000  shares of Common  Stock,  par value  $.0001  per share,  of the
     Company (the "Common  Stock")  (subject to  adjustment)  and is entitled to
     cast 1,000 votes, together with the Common Stock and the Series A Preferred
     Stock,  par value $.01 per share,  on any matters  subject to a vote of the
     holders of the Common Stock.

     On October 29, 1999 the Company entered into a subscription  agreement with
     Spotless  Plastics  (USA),  Inc.,  a Delaware  corporation  ("Spotless"  or
     "Affiliate"),  pursuant to which the Company sold to Windswept

                                      -9-
<PAGE>

     Acquisition  Corporation,  a  Delaware  corporation  and  a  wholly   owned
     subsidiary of Spotless ("Acquisition Corp."),  22,284,683  shares of Common
     Stock,   and  9,346  shares  of  Series  B  Preferred,  for  an   aggregate
     subscription  price  of  $2,500,000  (the "Purchase  Price") or $.07904 per
     share  of  Common  Stock  and  $79.04 per share of Series B  Preferred.  At
     October 31,  1999  Acquisition Corp's  Common Stock  holdings equate to 58%
     of the Company's issued and outstanding common shares. If Acquisition Corp.
     were to convert the shares  of Series B  Preferred  stock to Common  Stock,
     it would hold 66.2% of the Company's issued and outstanding common shares.

     In addition, the Company and Trade-Winds Environmental  Restoration,  Inc.,
     North Atlantic Laboratories, Inc. and New York Testing Laboratories,  Inc.,
     each of which is a  wholly-owned  subsidiary  of the Company,  as joint and
     several obligors (collectively,  the "Obligors"),  borrowed $2,000,000 from
     Spotless (the "Loan")  pursuant to a secured  convertible  promissory  note
     dated October 29, 1999 (the "Note") which bears interest at a rate equal to
     LIBOR plus one percent (1%).  The Note matures on October 29, 2004,  and is
     convertible into either  25,304,352 shares of Common Stock or 25,305 shares
     of Series B Preferred shares at Spotless' option. Additionally Spotless has
     the right to defer the maturity  date of the note for one year.  At October
     31,  1999 the common  shares  issuable  upon  conversion  of the Note would
     represent 39.7% of the Company's issued and outstanding  common shares.  In
     connection with the note, each of the Obligors  granted Spotless a security
     interest in  substantially  all of their  respective  assets  pursuant to a
     Security Agreement dated October 29, 1999.

     Upon the  occurrence  of the  change in control  of the  Company  described
     above,  options to purchase 2,000,000 shares of Common Stock exercisable at
     $.01 per share  granted to Michael  O'Reilly  on  September  12,  1996 have
     vested and become exercisable over a five-year period. The Company recorded
     compensation  expense  in the  amount  of  $138,080  due to this  change in
     control.

     The  Board  of  Directors  has  approved  an  amendment  to  the  Company's
     certificate of incorporation  increasing the number of authorized shares of
     Common  Stock  from  50,000,000  to  100,000,000  (the  "Amendment").   The
     Amendment  is expected to become  effective  promptly  after the  Company's
     compliance  with  Section  14(c)  of the  Exchange  Act and the  rules  and
     regulations  thereunder,  approval by the  stockholders  of the Company and
     filing with the Secretary of State of the State of Delaware.

     In addition,  on October 29, 1999,  the Company  entered into an Employment
     Agreement  with  Michael  O'Reilly.  This  agreement  is for a term of five
     years,  calls for a base salary of  $260,000  per year and a bonus equal to
     2.5% of the  Company's  pre-tax  income  (as that  term is  defined  in the
     Employment Agreement). Upon the termination of Mr. O'Reilly's employment by
     the Company (other than  termination for cause,  death or disability or his
     resignation  without good reason, as defined in the Employment  Agreement).
     Mr. O'Reilly will be entitled to sell, in a single transaction,  any or all
     of shares of Common Stock held by him as of October 29, 1999 and all shares
     of Common Stock  underlying  options to purchase  shares of Common Stock of
     the Company held by him as of October 29, 1999 (collectively, the "O'Reilly
     Shares"),  to the extent  vested and  exercisable,  back to the Company (or
     pursuant to the Letter  Agreement  [as defined  below],  to Spotless to the
     extent that the  Company's  capital would be impaired by such a repurchase)
     at a mutually  agreeable price. If the parties are not able to agree upon a
     purchase  price,  then the purchase  price will be determined  based upon a
     procedure  using  the  appraised  value of the  Company  at the  time  such
     obligation to purchase arises.  Similarly,  pursuant to a letter agreement,
     dated as of October 29, 1999, by and between Michael  O'Reilly and Spotless
     (the "Letter  Agreement"),  Michael O'Reilly has the right, upon receipt of
     notice that  Spotless and any of its  affiliates  has acquired a beneficial
     ownership of more than seventy-five percent (75%) of the outstanding shares
     of  Common  Stock  (on a fully  diluted  basis),  to  require  Spotless  to
     purchase, in a single transaction,  the O'Reilly Shares. The purchase price
     applicable to any such purchase shall be at a price  mutually  agreed upon.
     If the  parties  are not  able to agree  upon a  purchase  price,  then the
     purchase  price  will  be  determined  based  upon a  procedure  using  the
     appraised  value of the  Company at the time such  obligation  to  purchase
     arises. As a condition  precedent to requiring the Company or Spotless,  as
     the case may be, to repurchase the O'Reilly  Shares,  Michael O'Reilly must
     forfeit the Conversion Date Option (as defined below), except to the extent
     that  the  Conversion  Date  Option is at that time vested and exercisable.
     Based  upon  the  terms  of  the Employment Agreement, the Company recorded
     compensation  expense  in  the amount of $14,016 based upon the fair market
     value of the Common Stock held by Michael O'Reilly.

                                      -10-
<PAGE>

     The  Company has  granted to Mr.  O'Reilly an option to purchase  2,674,714
     shares of Common Stock, which vests and becomes exercisable,  to the extent
     of one third of the option  grant,  on each of the first,  second and third
     anniversaries  of October 29,  1999.  The  Company has also  granted to Mr.
     O'Reilly  an option to  purchase  2,811,595  shares  of Common  Stock  (the
     "Conversion  Date Option")  which are  exercisable  on or after October 29,
     2006; provided,  that the exercisability of such option will be accelerated
     if and to the extent that Spotless  converts or exchanges  the Note.  These
     options are exerciseable at $.07904 per share of Common Stock, representing
     the fair market value of the stock on the date of grant.

     On October 29, 1999 the Company used some of the  proceeds  from the equity
     and debt  financing  with Spotless to repay the  revolving  credit note and
     term loan with Business Alliance Capital Corporation ("BACC").  The related
     security agreement with BACC was simultaneously  terminated. The prepayment
     penalty of $100,000 paid to BACC is presented as an  extraordinary  item in
     the Consolidated Statements of Operations.

     In September  1999, the Company  borrowed  $100,000 from Spotless  Plastics
     (USA),  Inc. The  borrowings  bore  interest at a rate of 6% and was repaid
     with accrued interest in November 1999.

                                      -11-
<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition  and Results
        of Operations.

The  following  discussion  of the three and six month periods ended October 31,
1999 and 1998,  should be read in conjunction  with the  Consolidated  Financial
Statements contained herein, including the notes thereto.

This  Item 2 and  other  items  in  this  Form  10-QSB  contain  forward-looking
statements  within the meaning of Section 27A of the  Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. The Company's actual results
could differ materially from those set forth in the forward-looking  statements.
Forward-looking  statements  included  in this  Form  10-QSB  involve  known and
unknown risks, uncertainties and other factors which could cause actual results,
performance  (financial and operating) or  achievements  expressed or implied by
such  forward  looking  statements  not to occur or be  realized.  Such  forward
looking statements generally are based upon the best estimates by the Company of
future results,  performance or achievement,  based upon current  conditions and
the most  recent  results  of  operations.  Forward  looking  statements  may be
identified  by the use of forward  looking  terminology  such as "may",  "will",
"expect",  "believe",  "estimate",  "anticipate",  "continue", or similar terms,
variations  of those terms or the negative of those terms.  Potential  risks and
uncertainties  include,  among other  things,  such factors as the amount of the
Company's  revenues,  the success of the  Company in  limiting  or reducing  its
expenses, the frequency and magnitude of environmental disasters or disruptions,
the effects of new laws or regulations  relating to  environmental  remediation,
the Company's ability to raise capital,  the competitive  environment within the
Company's industry,  dependence on key personnel,  economic conditions,  and the
other factors and information  disclosed and discussed in other sections in this
Form  10-QSB,  and in the  Company's  annual  report on Form 10-KSB for the year
ended April 30, 1999. Readers of this Form 10-QSB should carefully consider such
risks,  uncertainties and other  information,  disclosures and discussions which
contain  cautionary  statements  identifying  important factors that could cause
actual results to differ  materially  from those provided in the forward looking
statements.

RESULTS OF OPERATIONS

Net loss and net loss per share before  extraordinary item for the three and six
month periods ended October 31,1999 was ($1,551,039) and ($.09) and ($1,590,836)
and ($.10),  respectively,  compared to a net income and income per share before
extraordinary item for the three and six-month periods ended October 31, 1998 of
$575,469 and $.04 and $598,206 and $.04,  respectively.  Extraordinary  item and
extraordinary  item per share for both the  three  and six month  periods  ended
October 31, 1999 was a loss of  $100,000 or ($.01).  There was no  extraordinary
item in the  comparable  three and six month periods ended October 31, 1998. Net
loss and net loss per share for the three and six month  periods  ended  October
31,1999 was ($1,651,039)  and ($.10) and ($1,690,836) and ($.11),  respectively,
compared  to a net  income  and  income  per share  for the three and  six-month
periods  ended  October  31, 1998 of $575,469  and $.04 and  $598,206  and $.04,
respectively.

Three Months Ended October 31, 1999 and 1998

Revenues for the quarter ended October 31, 1999 decreased by $1,330,455, or 29%,
to  $3,186,392  from  $4,516,847  for the quarter  ended  October 31. 1998.  The
decrease  in  revenues  for the quarter  ended  October  31, 1999 was  primarily
attributable  to  the  Company's  Trade-Winds   Environmental  Restoration  Inc.
subsidiary,   where  revenues   decreased  in  construction  and  renovation  by
approximately  $1,107,000.  During this period,  revenue from  asbestos and lead
abatement  declined by  $788,000  which was  partially  offset by  increases  in
emergency response and other services.  The Company's cash flow difficulties and
interest cost considerations limited its ability to fund additional construction
and  abatement  projects.  Additionally,  the revenues for the  Company's  North
Atlantic Laboratory subsidiary decreased by approximately $351,000 due to a loss
of key personnel and the non-renewal of a major contract.

Gross margins for the three months ended October 31, 1999  decreased to 16% from
29% for the  three  months  ended  October  31,  1998.  Approximately  6% of the
decrease in gross margins is  attributable  to  disproportionately  higher labor
costs during the three months ended October 31, 1999  resulting  from the change
in the composition of the contract performed during the period. Labor costs vary
with  the mix of  services  provided.  The  decline  in  gross  margins  is also
attributable  to  certain  indirect  costs  remaining   constant  despite  lower
revenues.

                                      -12-
<PAGE>

Selling,  general and administrative  expenses for the quarter ended October 31,
1999 increased by $837,831,  or 97%, to $1,702,586  from $864,755 in the quarter
ended October 31, 1998. The increase was primarily attributable to the following
items:  bad debt expense of $110,000,  a provision  for  litigated  and disputed
items of $160,000,  accounting fees of $52,000, state and local taxes, penalties
and interest of approximately $230,000, legal and consulting fees related to the
equity and debt  financing with Spotless  Plastics  (USA) Inc. of $182,381,  the
compensatory  effect of  redeemable  common  stock  and  the  vesting of options
previously  granted  to  Mr.  Michael  O'Reilly  of  $152,096  and  compensation
authorized  by the Board of Directors to Mr.  O'Reilly  for his role as Chairman
of the Board of  Directors  of $100,000.  This  increase  was  partially  offset
by a  reduction  in  the  sales force which  decreased costs  in  the quarter by
approximately $142,000.

Interest  expense for the three  months  ended  October 31,  1999  increased  by
$207,015,  to $364,760,  from  $157,745  for the three months ended  October 31,
1998. The increase in interest  expense is  attributable  to higher average loan
balances,  higher  average  interest  rates during the period from the Company's
principal  lender and the incurrence of interest on both payroll and sales taxes
in arrears. The Company anticipates significantly lower interest costs in future
periods as a result of the equity and debt  transaction  with Spotless  Plastics
(USA) Inc.

The extraordinary  item - loss on the  extinguishment of debt of $100,000 in the
three  months  ended  October 31, 1999 is due to a  prepayment  penalty  paid to
Business Alliance Capital Corporation, the Company's former principal lender.

Six Months Ended October 31, 1999 and 1998

Revenues for the first six months of fiscal year 2000  decreased by  $1,792,387,
or 23%, to $5,967,923  from  $7,960,310  for the first six months of fiscal year
1999.  The decrease in revenues  for the six months  ended  October 31, 1999 was
primarily  attributable to the Company's Trade-Winds  Environmental  Restoration
Inc.  subsidiary,  where revenues  decreased in  construction  and renovation by
approximately  $1,234,000.  During this period  revenue  from  asbestos and lead
abatement  declined by approximately  $2,106,000,  which was partially offset by
increases in emergency  response and other  services.  The  Company's  cash flow
difficulties  and  interest  cost  considerations  limited  its  ability to fund
additional construction and abatement projects.  Additionally,  the revenues for
the Company's North Atlantic  Laboratory  subsidiary  decreased by approximately
$567,000 due to a loss of key personnel and the non-renewal of a major contract.

Gross  margins for the six months ended  October 31, 1999  decreased to 22% from
31% for the six months ended October 31, 1998.  Approximately 2% of the decrease
in gross margins is attributable to disproportionately higher labor costs during
the six  months  ended  October  31,  1999  resulting  from  the  change  in the
composition of the contract  performed during the period.  Labor costs vary with
the mix of services provided.  The decline in gross margins is also attributable
to certain indirect costs remaining constant despite lower revenues.

Selling,  general and  administrative  expenses for the six months ended October
31, 1999 increased by $650,578, or 38%, to $2,353,928 from $1,703,350 in the six
months ended October 31, 1998.  The increase was primarily  attributable  to the
following  items:  bad debt expense of $110,000,  a provision  for litigated and
disputed  items of  $160,000,  accounting  fees of $52,000,  and state and local
taxes,  penalties and interest of approximately  $230,000,  legal and consulting
fees related to the equity and debt financing with Spotless  Plastics (USA) Inc.
of $182,381, the compensatory effect of redeemable common stock and the  vesting
of  options  previously  granted  to  Mr .  Michael  O'Reilly  of  $152,096  and
compensation  authorized by the  Board  of  Directors  to Mr.  O'Reilly  for his
role as  Chairman of the Board of  Directors  of  $100,000.  This  increase  was
offset by a reduction in the sales force and advertising costs  which  decreased
costs  in the  six  months  by approximately $267,000 and $61,000, respectively.

Interest  expense for the three  months  ended  October 31,  1999  increased  by
$113,162, to $547,213,  from $434,051 for the six months ended October 31, 1998.
The  increase  in  interest  expense  is  attributable  to higher  average  loan
balances,  higher  average  interest  rates during the period from the Company's
principal  lender and the incurrence of interest on both payroll and sales taxes
in arrears. The Company anticipates significantly lower interest costs in future
periods as a result of the equity and debt  transaction  with Spotless  Plastics
(USA) Inc.

The extraordinary  item - loss on the  extinguishment of debt of $100,000 in the
six  months  ended  October  31,  1999 is due to a  prepayment  penalty  paid to
Business Alliance Capital Corporation, the Company's former principal lender.

                                      -13-
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

The Company's financial  statements have been prepared assuming that the Company
will  continue  as a going  concern.  As of October  31,  1999 the Company has a
stockholders'  deficit of $2,144,695 and an accumulated  deficit of $33,987,708.
The Company has financed its operations to date primarily  through  issuances of
debt and equity  securities.  At October 31, 1999 the Company had  $2,150,849 in
cash, and a working capital deficit of $166,136.  In addition, as of October 31,
1999,  the Company was in arrears with respect to certain  payroll and sales tax
obligations of approximately  $90,000 and $550,000,  respectively.  In addition,
the  Company  is in  arrears  with  many of its  vendors.  These  factors  raise
substantial  doubt about the Company's  ability to continue as a going  concern.
These financial statements do not include any adjustments that might result from
the outcome of this uncertainty.

On  October  29,  1999 the  Company  consummated  an equity  and debt  financing
transaction with Spotless Plastics (USA), Inc. that  significantly  improved the
Company's  liquidity  and cash  position.  The Company  received  $2,500,000  in
exchange for equity and $2,000,000 of debt  financing.  Management  believes the
Company  will require  positive  cash flow from  operations  to meet its working
capital needs over the next twelve months.  In the event that positive cash flow
from operations is not generated, the Company may be required to seek additional
financing to meet its working capital needs. The Company currently has no credit
facility.  Revenue growth is expected in new and existing  service areas.  As is
common in the environmental  services  industry,  payments for services rendered
are generally  received  pursuant to specific draw schedules  after services are
rendered.  Thus,  pending the receipt of payments  for  services  rendered,  the
Company must typically fund project  costs,  including  labor and bonding costs,
from financing  sources within and outside the Company.  Certain  contracts,  in
particular those with state or federal  agencies,  may provide for payment terms
of up to 90 days or more and may require the posting of performance  bonds which
are  generally  not released  until  completion  of the project.  The Company is
striving to improve  its gross  margin and control  its  selling,  general,  and
administrative expenses. There can be no assurance, however, that changes in the
Company's  plans or other events  affecting  the Company's  operations  will not
result  in  accelerated  or  unexpected  cash  requirements,  or that it will be
successful  in  achieving  positive  cash  flow  from  operations  or  obtaining
additional  financing . The Company's  future cash  requirements are expected to
depend on numerous  factors,  including,  but not limited to: (i) the ability to
successfully bid on environmental or related  construction  contracts,  (ii) the
ability to generate positive cash flow from operations,  and the extent thereof,
(iii) the ability to raise additional  capital or obtain  additional  financing,
and (iv) economic conditions.

In September 1999, the Company borrowed  $100,000 from Spotless  Plastics (USA),
Inc. The  borrowings  bore  interest at a rate of 6% and was repaid with accrued
interest in November 1999.

CASH FLOW

Net cash used by  operating  activities  was  $742,783  in the six months  ended
October  31,  1999.  The  amount  used  by  operating  activities  is  primarily
attributable  to the net loss after  adjusting for noncash items;  increases and
decreases in the assets and liabilities used approximately $65,000 of cash. Cash
used in  investing  activities  for the six months  ended  October  31, 1999 was
primarily due to capital expenditures and other assets of approximately  $82,000
and $43,000 respectively.  The net cash provided by financing activities for the
six months ended October 31, 1999 was $2,946,413.  Of this amount $1,968,000 was
provided from the  transaction  with  Spotless  Plastics  (USA) Inc.,  described
above;  after paying off the  indebtedness  to the Company's  previous lender of
approximately $2,622,000 and a short-term $100,000 loan .

THE YEAR 2000

The Company has taken actions to make its systems,  services and  infrastructure
Year 2000  compliant.  Specifically,  the Company  believes that its  accounting
system, estimating system, and all corporate office computers are Y2K compliant.
The Company also believes that the  mechanical and  navigational  systems on its
fleet of floating  vessels,  are Y2K compliant.  The Company has inquired of its
vendors in the  laboratory  and  consulting  division  regarding  the  Company's
equipment being Y2K compliant. The Company now estimates the total costs related
to Y2K  compliance to be  approximately  $25,000 and the Company  expects to pay
these costs out of working capital.

                                      -14-
<PAGE>

The  Company  has made  inquires  and been  advised  that its banks' and primary
lender's  systems are Y2K  compliant.  As an emergency  response  provider,  the
Company keeps a full inventory of supplies and other materials  available at all
times.  The Company's  inquiries of its largest  vendors have led to indications
that they are or expect to be, Y2K compliant by December 31, 1999.

The Company has numerous customer relationships. The Company's current customers
will not  necessarily be the same as those in the Year 2000 due to the nature of
its business.  However,  the Company's  inquiries of its largest and most likely
continuing  clients  indicate  that  they are in the  process  of  becoming  Y2K
compliant and many believe that they are already Y2K compliant. If this were not
the case,  the  Company's  services  may be more  difficult  to provide to these
customers. Increased difficulties would also arise if electric power or wireless
communications systems failed.

The Company has a computer  consultant  devoted to assessing  and  analyzing Y2K
issues and  arranging  for their final  resolution.  Although at this time,  the
Company believes that it has resolved the most significant  issues,  the Company
may  encounter  some Y2K impact,  which at this time is  unforeseen.  Due to the
nature of the Company's  business,  which is primarily  labor based,  management
believes  that it is taking the  necessary  steps to resolve  Year 2000  issues;
however,  there can be no  assurance  that a failure to  resolve  any such issue
would  not have a  material  adverse  effect on the  Company.  The  Company  has
developed a Y2K contingency plan to the extent deemed  appropriate.  In December
1999 all data in the Company's systems will be backed up onto media that will be
stored  offsite.  All  programs  have been  checked for Y2K  compliance  and all
deficient software has been upgraded to Y2K compliant versions. All hardware has
been tested and was found to be Y2K compliant.

SEASONALITY

Since the  Company  and its  subsidiaries  are able to  perform  their  services
throughout the year, the business is not considered seasonal in nature. However,
it is affected by the timing of large contracts in certain of its service areas,
i.e.,   asbestos   abatement  and  construction,   as  well  as  the  timing  of
catastrophes.


PART II - OTHER INFORMATION

Item 1. Legal Proceedings

        See Note 5 to the Condensed Consolidated Financial Statements.

Item 2. Changes in Securities

     On October 29, 1999, the Company entered into a subscription agreement with
     Spotless  Plastics  (USA),  Inc.,  a  Delaware  corporation   ("Spotless"),
     pursuant to which the Company sold to Windswept Acquisition Corporation,  a
     Delaware   corporation   and  a  wholly   owned   subsidiary   of  Spotless
     ("Acquisition Corp."),  22,284,683 shares of Common Stock, and 9,346 shares
     of Series B Preferred,  for an aggregate  subscription  price of $2,500,000
     (the "Purchase  Price") or $.07904 per share of Common Stock and $79.04 per
     share of Series B  Preferred.  The issuance of these shares of Common Stock
     and Series B Preferred were private  transactions  exempt from registration
     under Section 4(2) of the Securities Act.

     On October 29,1999 the Company borrowed  $2,000,000 from Spotless  Plastics
     (USA),  Inc.  and  issued  a  secured   promissory  note  convertible  into
     25,304,352  shares of Common Stock or 25,305  shares of Series B Preferred.
     The  issuance  of the  secured  convertible  promissory  note was a private
     transaction  exempt from registration  under Section 4(2) of the Securities
     Act.

     On October 29, 1999 the Company  granted to Mr. Michael  O'Reilly an option
     to  purchase  2,674,714  shares of Common  Stock,  which  vests and becomes
     exercisable, to the extent of one third of the option grant, on each of the
     first,  second and third  anniversaries  of the  grant.  The  Company  also
     granted to Mr.  O'Reilly an option to purchase  2,811,595  shares of Common
     Stock (the  "Conversion  Date Option")  which are  exercisable  on or after
     October 29, 2006; provided,  that the exercisability of such option will be
     accelerated  if  and to the  extent

                                      -15-

<PAGE>

     that  Spotless  Plastics  (USA),  Inc. converts  or  exchanges  the secured
     convertible  promissory  note.  These  options are  exercisable  at $.07904
     per share of Common Stock.  The issuance  of  these  options  were  private
     transactions  exempt from registration under Section 4(2) of the Securities
     Act.

     See Note 6 to Condensed Consolidated Financial Statements.

Item 3. Defaults Upon Senior Securities

        None


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

     1. The Board of  Directors  has  approved  an  amendment  to the  Company's
     certificate of incorporation  increasing the number of authorized shares of
     Common  Stock  from  50,000,000  to  100,000,000  (the  "Amendment").   The
     Amendment  is expected to become  effective  promptly  after the  Company's
     compliance  with  Section  14(c)  of the  Exchange  Act and the  rules  and
     regulations  thereunder,  approval by the  stockholders  of the Company and
     filing with the Secretary of State of the State of Delaware.

     2. On October 26, 1999, the Board of Directors of the Company,  pursuant to
     the By-laws of the  Company,  increased  the size of the Board of Directors
     from five directors to nine directors. In connection with this transaction,
     JoAnn O'Reilly  resigned as a director of the Company effective October 26,
     1999 and four nominees of Spotless, Brian S. Blythe, Ronald B. Evans, Peter
     A. Wilson and Charles L. Kelly, have been elected to the Board of Directors
     of the Company. A fifth nominee of Spotless, John J. Bongiorno, is expected
     to be elected to the Board of Directors of the Company upon  compliance  by
     the Company with Section 14(f) of the  Securities  Exchange Act of 1934, as
     amended (the "Exchange Act") and the rules and regulations thereunder.

                                      -16-

<PAGE>

Item 5. Other Information

    Pursuant to the  requirements  of the Securities  and Exchange  Commission's
  Order Instituting Public Administrative Proceedings, Making Findings, Imposing
  Remedial Sanctions and Issuing  Cease-and-Desist Order dated November 22, 1999
  (the "Consent Order"), the following table presents salaries,  bonuses,  stock
  and stock  options  received from the Company over the past three fiscal years
  by each member of Mr. Michael O'Reilly's  immediate family (as defined in Item
  404 of Regulation S-K).


<TABLE>
<CAPTION>
Name/                 Year-Ended                     Common       Stock     Exercise  Exercise  Expiration
Relationship            April 30,         Salaries    Stock      Options      Date      Price      Date

<S>                      <C>              <C>                     <C>       <C>   <C>    <C>     <C>   <C>
Arzuaga, Gustavo         1997             $82,815      -          18,027    12/03/98     $.22    12/02/01
Brother-in-law           1998              73,983      -          14,196    12/29/99     $.22    12/28/02
                         1999              79,715      -            -

McConnell, Shane         1997              $3,000                  2,311    12/03/98     $.22    12/02/01
Step son                 1998               9,825      -          (2,311)   LAPSED
                         1999              14,250      -            -

Mullady, Jenny           1997             $22,905      -           8,533    12/03/98     $.22    12/02/01
Sister-in-law            1998              36,181      -           7,758    12/29/99     $.22    12/28/02
                         1999              41,403      -                       -

O'Reilly, Christine      1997             $33,742      -           7,627    12/03/98     $.22    12/02/01
Daughter                 1998              10,457      -           1,500    12/29/99     $.22    12/28/02
                                                                  (9,127)   LAPSED
                         1999              $2,977      -            -

O'Reilly, Eric           1997              $9,520      -            -
Son                      1998              39,206      -           8,200    12/29/99     $.22    12/28/02
                         1999              49,521      -            -

O'Reilly, Tiffany        1997             $24,938      -           6,240    12/3/98      $.22    12/02/01
Daughter                 1998              24,889      -           5,500    12/29/99     $.22    12/28/02
                         1999              26,984      -            -

O'Reilly, Joann          1997             $  -        1,000       50,000    9/26/96      $.22    09/25/01
Wife                     1998                -        5,000       50,000   12/29/97      $.22    12/28/02
                         1999                - -       -         100,000   8/18/98       $.34    08/17/03
</TABLE>

     No bonuses were paid to any of the above persons. The Company believes that
all compensation paid to the above persons was no more favorable to such persons
than would be awarded to persons  performing similar functions who had no family
relationship with Mr. O'Reilly.

     The Consent Order requires the Company within 120 days of November 22, 1999
to comply with the following undertakings to:
               1. Arrange for a secure off site storage facility to store backup
                  data files and system  software.
               2. Adopt a formal  conflict  of interest  policy
               3. Develop  an Audit  Committee charter that describes roles and
                  responsibilities,  and  have  it  approved  by  the  Board  of
                  Directors.
               4. Develop  a  formal  employee  handbook   that clearly  defines
                  lines of  employee authority, areas of  responsibility, duties
                  and benefits.

     On December 1, 1999, the Company's Board of Directors  appointed Deloitte &
Touche LLP as the Company's independent certified public accounts, replacing BDO
Seidman, LLP.

                                      -17-

<PAGE>

Item 6. Exhibits and Reports on Form 8-K
(a)  Exhibits:

3.1.      Certificate   of   Designations   for   Series   B    Preferred  Stock
          (incorporated  by reference  to Exhibit 3.1 to Current  Report on Form
          8-K (Date of Report:  October 29, 1999) filed with the SEC on November
          12,  1999).
4.1.      Specimen  Series  B  Preferred  Stock  certificate  (incorporated   by
          reference  to  Exhibit  4.1  to  Current  Report  on Form 8-K (Date of
          Report:  October 29, 1999) filed with the SEC on November 12, 1999).
10.1      Subscription  Agreement dated October 29, 1999 between  the Registrant
          and Spotless  Plastics  (USA),  Inc.  (incorporated  by  reference  to
          Exhibit 10.1 to Current Report  on  Form 8-K (Date of Report:  October
          29, 1999) filed with the SEC on November  12,  1999).
10.2      Convertible  Promissory  Note  dated  October  29, 1999  issued by the
          Registrant to Spotless Plastics (USA), Inc. (incorporated by reference
          to Exhibit 10.2 to Current Report on Form 8-K (Date of Report: October
          29,  1999) filed with the SEC on November  12,  1999).
10.3.     Form of  Security  Agreement  dated  October  29,  1999  between  each
          of  the Registrant,  Trade-Winds  Environmental   Remediation,   Inc.,
          North  Atlantic  Laboratories,  Inc.  and  New York Testing,  Inc. and
          Spotless Plastics (USA),  Inc.  (incorporated  by reference to Exhibit
          10.3 to Current Report on Form 8-K (Date of Report:  October 29, 1999)
          filed with the SEC on November 12, 1999).
10.4.     Employment Agreement dated October 29, 1999   between  the  Registrant
          and  Michael   O'Reilly (incorporated  by reference to Exhibit 10.4 to
          Current  Report on Form  8-K (Date of Report:  October 29, 1999) filed
          with the SEC on November 12, 1999).
10.5.     Stock Option Agreement dated October 29, 1999 between  the  Registrant
          and Michael  O'Reilly  (incorporated  by reference to Exhibit  10.5 to
          Current  Report on Form 8-K (Date of Report:  October  29, 1999) filed
          with the SEC on November 12, 1999).
10.6.     Stock Option Agreement  dated October 29, 1999 between the  Registrant
          and Michael O'Reilly  relating to options vesting upon exercise of the
          convertible note (incorporated by reference to Exhibit 10.6 to Current
          Report on  Form 8-K (Date of  Report:  October  29,  1999)  filed with
          the SEC on November 12,  1999).
10.7.     Letter  Agreement  dated October 29, 1999 between   Michael   O'Reilly
          and  Spotless   Plastics   (USA),   Inc.  (incorporated  by  reference
          to Exhibit 10.7 to Current Report on Form 8-K (Date of Report: October
          29, 1999) filed with the SEC on November 12,  1999).
16.1      Letter  December  7, 1999 from  BDO  Seidman  to  the  Securities  and
          Exchange  Commission  (incorporated  by  reference to  Exhibit  16  to
          Current Report on Form 8-K (date of Report:  December 1, 1999)   filed
          with the SEC on December 8,  1999).
27.       Restated Financial  Data Schedule.

(b)  Reports on Form 8-K:
i)   Current  report  on  Form 8-K (Date of Report: October 29, 1999) filed with
     the SEC on November 12, 1999
ii)  Current report on  Form  8-K  (Date of Report: December 1, 1999) filed with
     the SEC on December 8, 1999

                                      -18-
<PAGE>


                                   SIGNATURES


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

Dated:  April 21, 2000

                                   WINDSWEPT ENVIRONMENTAL GROUP, INC.



                                   By: /s/ Michael O'Reilly
                                   MICHAEL O'REILLY,
                                   Chairman and Chief Executive Officer



                                   By: /s/ Charles L. Kelly
                                   CHARLES L. KELLY,
                                   Chief Financial Officer

                                      -19-