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

                                   FORM 10-K/A
                                (AMENDMENT NO. 2)

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

    For the Fiscal Year Ended July 31, 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 000-52827

                                 OMNICITY CORP.
             (Exact name of registrant as specified in its charter)

              Nevada                                             98-0512569
   (State or other jurisdiction                               (I.R.S. Employer
of incorporation of organization)                            Identification No.)

807 S State Rd 3, Rushville, Indiana, U.S.A.                       46173
 (Address of Principal Executive Offices)                        (Zip Code)

                                 (317) 903-8178
              (Registrant's telephone number, including area code)

        Securities registered pursuant to Section 12(b) of the Act: None

          Securities registered pursuant to Section 12(g) of the Act:

                         Common Stock, $0.001 Par Value
                                (Title of class)

Indicate by check mark if the  registrant is a well-known  seasoned  issuer,  as
defined in Rule 405 of the Securities Act. Yes [ ] No [X]

Indicate  by  check  mark if the  registrant  is not  required  to file  reports
pursuant to Section 13 of Section 15(d) of the Act. Yes [ ] No [X]

Indicate by check mark whether the registrant (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 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 (ss.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 if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]

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

Large accelerated filer [ ]                        Accelerated filer [ ]
Non-accelerated filer [ ]                          Smaller reporting company [X]
(do not check if a smaller reporting company)

Indicate by checkmark  whether the  registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). Yes [ ] No [X]

The aggregate  market value of the voting and  non-voting  common equity held by
non-affiliates computed by reference to the price at which the common equity was
last sold, as of October 22, 2009 was approximately $10,683,000.

The registrant had 38,517,055  shares of common stock  outstanding as of October
23, 2009.
<PAGE>
                                EXPLANATORY NOTE

This Form 10-K/A  (Amendment No. 2) is being filed by the Company in response to
certain comments from the U.S. Securities and Exchange Commission (the "SEC") to
the Company  regarding the  Company's  Annual Report on Form 10-K for its fiscal
year ended July 31, 2009, as  originally  filed with the SEC on October 23, 2009
and amended  (Amendment  No. 1) filed with the SEC on September  29, 2010.  This
Form 10-K/A  (Amendment  No. 2) is sometimes  referred to herein as "Form 10-K",
and any  references  herein to "Form 10-K" or "10-K"  should be read to refer to
this Form 10-K/A unless otherwise  specified or as required based on the context
in which the term "Form 10-K" or "10-K" is used.

                           FORWARD LOOKING STATEMENTS

This annual report  contains  forward-looking  statements that involve risks and
uncertainties.  Any  statements  contained  herein  that are not  statements  of
historical fact may be deemed to be forward-looking  statements.  In some cases,
you can  identify  forward-looking  statements  by  terminology  such as  "may",
"will",  "should",   "expect",   "plan",  "intend",   "anticipate",   "believe",
"estimate",  "predict", "potential" or "continue", the negative of such terms or
other  comparable  terminology.  In  evaluating  these  statements,  you  should
consider various factors,  including the  assumptions,  risks and  uncertainties
outlined in this annual  report under "Risk  Factors".  These  factors or any of
them may cause our actual results to differ materially from any  forward-looking
statement made in this annual report.  Forward-looking statements in this annual
report include, among others, statements regarding:

     *    our capital needs;
     *    business plans; and
     *    expectations.

While these forward-looking  statements, and any assumptions upon which they are
based, are made in good faith and reflect our current judgment  regarding future
events,  our actual  results will likely vary,  sometimes  materially,  from any
estimates,  predictions,  projections,  assumptions or other future  performance
suggested  herein.  Some of the risks and  assumptions  include:

     *    our need for additional financing;
     *    our limited operating history;
     *    our history of operating losses;
     *    the competitive environment in which we operate;
     *    changes in governmental regulation and administrative practices;
     *    our dependence on key personnel;
     *    conflicts of interest of our directors and officers;
     *    our ability to fully implement our business plan;
     *    our ability to effectively manage our growth; and
     *    other regulatory, legislative and judicial developments.

We advise the reader that these cautionary  remarks  expressly  qualify in their
entirety all forward-looking  statements attributable to us or persons acting on
our behalf.  Important factors that you should also consider,  include,  but are
not  limited  to, the  factors  discussed  under  "Risk  Factors" in this annual
report.

The forward-looking  statements in this annual report are made as of the date of
this  annual  report  and we do not  intend or  undertake  to update  any of the
forward-looking statements to conform these statements to actual results, except
as required by  applicable  law,  including  the  securities  laws of the United
States.

                              AVAILABLE INFORMATION

Omnicity Corp. files annual,  quarterly and current reports,  proxy  statements,
and other  information with the Securities and Exchange  Commission (the "SEC").
You may read and copy  documents  referred to in this Annual Report on Form 10-K
that have been filed with the SEC at the SEC's Public  Reference Room, 450 Fifth
Street,  N.W.,  Washington,  D.C. You may obtain information on the operation of
the Public  Reference  Room by calling the SEC at  1-800-SEC-0330.  You can also
obtain   copies  of  our  SEC   filings  by  going  to  the  SEC's   website  at
http://www.sec.gov.

                                       2
<PAGE>
                                   REFERENCES

As used in this annual report:  (i) the terms "we", "us", "our",  "Omnicity" and
the  "Company"  mean Omnicity  Corp.;  (ii) "SEC" refers to the  Securities  and
Exchange  Commission;  (iii)  "Securities  Act"  refers  to  the  United  States
SECURITIES  ACT OF 1933, as amended;  (iv)  "Exchange  Act" refers to the United
States SECURITIES  EXCHANGE ACT OF 1934, as amended;  and (v) all dollar amounts
refer to United States dollars unless otherwise indicated.


                                       3
<PAGE>
                                TABLE OF CONTENTS

ITEM 1.     BUSINESS.........................................................  5

ITEM 1A.    RISK FACTORS..................................................... 12

ITEM 1B.    UNRESOLVED STAFF COMMENTS........................................ 15

ITEM 2.     PROPERTIES....................................................... 15

ITEM 3.     LEGAL PROCEEDINGS................................................ 15

ITEM 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.............. 15

ITEM 5.     MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER
            MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES................ 16

ITEM 6.     SELECTED FINANCIAL DATA.......................................... 17

ITEM 7.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
            AND RESULTS OF OPERATIONS........................................ 17

ITEM 7A.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK....... 27

ITEM 8.     FINANCIAL STATEMENTS............................................. 28

ITEM 9.     CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
            AND FINANCIAL DISCLOSURE......................................... 50

ITEM 9A(T). CONTROLS AND PROCEDURES.......................................... 50

ITEM 9B.    OTHER INFORMATION................................................ 50

ITEM 10.    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE........... 51

ITEM 11.    EXECUTIVE COMPENSATION........................................... 54

ITEM 12.    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
            AND RELATED STOCKHOLDER MATTERS.................................. 55

ITEM 13.    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR
            INDEPENDENCE..................................................... 56

ITEM 14.    PRINCIPAL ACCOUNTING FEES AND SERVICES........................... 57

ITEM 15.    EXHIBITS......................................................... 58


                                       4
<PAGE>
                                     PART I

ITEM 1. BUSINESS

NAME, INCORPORATION AND PRINCIPAL OFFICES

We were  incorporated  under the laws of the State of Nevada on October 12, 2006
under the name "Bear River  Resources  Inc.". On October 21, 2008, we effected a
forward  split of our  shares of common  stock on the basis of 7.7 new shares of
our common stock for each one share of common stock outstanding on that date and
increased our authorized share capital from  200,000,000  shares of common stock
to  1,540,000,000  shares  of  common  stock.  Also  on  October  21,  2008,  in
contemplation of the acquisition of Omnicity,  Incorporated,  we merged with our
wholly-owned  subsidiary incorporated under the laws of the State of Nevada, and
changed our name to "Omnicity Corp."

Our principal and operations office and registered and records office is located
at 807 S State Rd 3, Rushville,  Indiana, U.S.A. Tel: (317) 903-8178; Fax: (866)
567-3897.

OUR PRIOR BUSINESS

Up to July 29, 2008, Omnicity Corp. (formerly Bear River Resources, Inc.) was an
exploration  stage company engaged in the acquisition and exploration of mineral
properties.  Omnicity Corp. received a geologist report on February 6, 2008, the
results  of  which  were  not  as  expected.  Given  the  prospects,  management
determined  to allow the claims to lapse on July 29, 2008.  See Omnicity  Corp's
(formerly Bear River Resources, Inc.) annual report filed on Form 10-KSB for the
year ended June 30, 2008 for more information  relating to our business prior to
the acquisition of Omnicity, Incorporated.

THE ACQUISITION OF OMNICITY, INCORPORATED

On February 16, 2009,  Omnicty Corp. closed the acquisition (the  "Acquisition")
of Omnicity,  Incorporated,  effected by way of merger  pursuant to an Agreement
and Plan of Merger (the  "Agreement"),  dated December 29, 2008,  among Omnicity
Corp.,  Omnicity,  Incorporated,  and  MergerSub,  our  wholly-owned  subsidiary
incorporated  under  the laws of the State of  Indiana  in  connection  with the
Acquisition ("MergerSub").

Omnicity,  Incorporated was a private company incorporated under the laws of the
State of Indiana pursuant to the Indiana Business  Corporation Law on August 14,
2003. In August 2003,  Omnicity,  Incorporated began acquiring the rights to and
constructing  wireless internet service  infrastructure in the State of Indiana,
USA. In September 2003, Omnicity, Incorporated acquired the assets of the Circle
City Wireless Division of Hi-Tech Business Machines,  LLC in exchange for common
stock of Omnicity, Incorporated.

Omnicity, Incorporated convened a special meeting of its shareholders on January
17, 2009 to obtain  approval of the adoption of the Agreement,  the  Acquisition
and all other transactions  contemplated thereby (the "Special Meeting"). At the
Special Meeting,  Omnicity,  Incorporated obtained the required approvals of the
holders of a majority of its common shares.

The merger  was  effective  on  February  17,  2009 and time at which the merger
became effective is referred to herein as the "Effective Time". At the Effective
Time, MergerSub merged with and into Omnicity,  Incorporated,  pursuant to which
the identity and separate corporate  existence of MergerSub ceased and Omnicity,
Incorporated  became the  surviving  corporation  in the merger (the  "Surviving
Corporation") and a wholly-owned subsidiary of the Company.

Under  the  terms  of the  Agreement,  at  closing,  (i) all of the  issued  and
outstanding Omnicity,  Incorporated shares,  totaling 8,256,240,  were converted
and exchanged for 23,000,000  shares of the Company,  or 2.7858 common shares of
the Company for each Omnicity, Incorporated share held; each common share issued
had a deemed fair value of $0.35 per share,  in accordance  with the  procedures
set out in the Agreement,  (ii) each share of Omnicity,  Incorporated issued and
outstanding  immediately prior to the Effective Time and owned by Omnicity Corp.
or MergerSub was cancelled and extinguished  without any conversion  thereof and
no payment was made with respect  thereto,  and (iii) all issued and outstanding
shares of common stock of MergerSub held by Omnicity Corp.  immediately prior to
the Effective Time were converted into and became one validly issued, fully paid
and non-assessable share of common stock of Omnicity, Incorporated.

                                       5
<PAGE>
Pursuant to the terms of the  Agreement  on and after the  Effective  Time,  (i)
until surrendered for exchange, each outstanding share certificate  representing
shares of Omnicity,  Incorporated's  common stock  (except for shares  cancelled
pursuant to the provisions of the Agreement)  were deemed to evidence  ownership
of and represent  the number of shares of the Company into which such  Omnicity,
Incorporated  common shares shall convert  pursuant to the  Agreement,  and (ii)
each holder of such outstanding  certificates  representing  shares of Omnicity,
Incorporated's  common  stock were  entitled to vote on any matters on which the
holders  of record of the  Company's  common  shares  having  voting  rights are
entitled to vote.

At closing, (i) all the property, rights,  privileges,  powers and franchises of
Omnicity Incorporated and MergerSub vested in the Surviving Corporation, and all
debts,  liabilities and duties of Omnicity Incorporated and MergerSub became the
debts, liabilities and duties of the Surviving Corporation, (ii) the articles of
incorporation of MergerSub became the articles of incorporation of the Surviving
Corporation,  (iii) the bylaws of MergerSub  became the bylaws of the  Surviving
Corporation,  and (v) the name of the Surviving  Corporation  became  "Omnicity,
Incorporated".

The closing of the  Acquisition  represented a change in control of our Company.
For accounting purposes,  this change in control constituted a re-capitalization
of Omnicity,  Incorporated,  and the  acquisition  has been  accounted  for as a
reverse merger whereby Omnicity Corp., as the legal acquirer, are treated as the
acquired entity, and Omnicity Incorporated,  as the legal subsidiary, is treated
as the acquiring company with the continuing operations.

Omncity  Corp.  had a  fiscal  year  end of June  30.  Pursuant  to a  Directors
Resolution  and 8K filed on March 20, 2009 and amended 8K filed on May 21, 2009,
the Company  changed its fiscal year end to July 31 to coincide  with the fiscal
year end of Omnicity, Incorporated, being the accounting acquirer. All reporting
periods,  starting with April 30, 2009, is filed on a basis  consistent with the
Company's new fiscal year end of July 31. As a transitional  matter, the Company
supplied  quarterly  information  for the quarter  ended January 31, 2009 in its
April 30, 2009 10Q filed on June 15, 2009.

OUR CURRENT BUSINESS

OVERVIEW

Omnicity Corp.,  through its  wholly-owned  subsidiary  Omnicity,  Incorporated,
collectively the "Company" or "Omnicity", provides broadband access via wireless
and fiber  infrastructure to business,  government and residential  customers in
rural  markets  in the  Midwest.  Omnicity's  strategy  is to  become a  premier
broadband  and  communications  services  provider  in rural and  urban  cluster
markets,  beginning  in the Midwest and  extending  nationally.  These  markets,
consisting  of  over  40  million  homes  and  500,000  businesses,   have  been
underserved or un-served by existing providers, creating an opening for Omnicity
to offer  high-speed  and  broadband-enabled  services to customers with pent-up
demand, and taking advantage of key industry developments, including:

     *    The forecasted increase of demand for broadband and  broadband-enabled
          services, including: web use and social networking; video (TV, movies,
          and  personal   video);   software-as-a-service   (SaaS);   and  cloud
          computing;
     *    The  availability  of  high-speed  4G Worldwide  Interoperability  for
          Microwave Access (WIMAX) equipment;
     *    Weakness of existing service  providers in Omnicity's  target markets,
          primarily  small  telephone  companies and Wireless  Internet  Service
          Providers ("WISPs");
     *    A push by the federal government,  Congress,  and state governments to
          increase  the   availability  of  broadband   services  in  rural  and
          underserved   markets,   including  $7.2  billion  in  stimulus  funds
          earmarked for rural broadband services.

THE COMPANY'S OPERATING PLAN IS TO GROW BY:

     *    Consolidating  WISPs in rural  and  urban  cluster  markets  initially
          within the Midwestern United States;
     *    Developing and expanding,  through organic growth, the subscriber base
          through disciplined sales and marketing programs;
     *    Partnering  with Rural  Electric  Membership  Cooperatives  ("REMCs"),
          local and state governments,  rural telephone companies ("Telcos") and
          Original  Equipment  Manufacturers  ("OEMs") to  efficiently  and cost
          effectively expand its network across rural America;

                                       6
<PAGE>
     *    Developing  and  expanding  its  service  offerings  to become a total
          broadband  solution  provider,  including  VOIP,  IPTV  and  Satellite
          Internet,  to increase value and average  revenue per subscriber  unit
          (ARPU);
     *    Completing  further debt and equity  offerings,  in stages, of $15m by
          July 31, 2010.

DESCRIPTION OF BUSINESS AND BUSINESS STRATEGY

Omnicity's  business  strategy,  as  mentioned  above,  is to  become a  premier
broadband and communications  services provider in rural and small urban cluster
markets,  beginning in the Midwest by:  acquiring and  consolidating  WISPs into
regional market  clusters;  driving  organic growth in acquired  markets through
uniform  sales and  marketing  and product  offerings;  layering on new services
(voice/VoIP,  video distribution) that attract additional customers and drive up
ARPU;  building  marketing and sales partnerships with REMCs, local governments,
and  telcos  that  can  accelerate  penetration;  and  creating  and  leveraging
economies of scale that cannot be easily matched by competitors.

By acquiring  existing  WISPs,  Omnicity  believes it can enter new  geographies
quickly with an established revenue base and build meaningful revenue and market
share ahead of  competitors,  while  taking  advantage  of economies of scale in
operations,  sales,  marketing,  and network  build-outs.  Further,  the Company
believes that delivering  services using wireless  technology (both licensed and
unlicensed) provides it several competitive advantages, including:

     *    Wireless  costs  about  $300 per  acquired  subscriber  making it cost
          effective in  low-density  markets  where new wired  services  (fiber,
          high-speed CATV) cannot be easily justified;
     *    Wireless  infrastructure  can be deployed in about 3 months vs.  years
          for new wired services;
     *    Wireless can cover an entire  geographic area with high-speed  service
          vs. only structures passed by wired infrastructure.

Generally, the Company plans to target WISPs for acquisition in contiguous areas
to create regional market clusters.  Due to capital and other constraints,  many
WISPs have penetrated  only a small  percentage of homes and businesses that can
be serviced by their existing  antennas,  creating the  opportunity  for organic
growth post acquisition.  Using  disciplined sales and marketing  programs and a
uniform product set,  Omnicity believes it can increase demand in these markets,
while  taking  advantage  of  economies  of scale,  to drive cash flow  positive
operations.

Currently,   Omnicity   uses   standards-based   wireless   equipment   in   the
license-exempt  700Mhz,  900MHz,  2.4GHz and 5.8GHz  spectrum  bands,  providing
multiple  paths to cover  subscribers  in its markets.  The Company  deploys its
wireless  networks  by  installing  antennas on  cellular  and other  commercial
towers,  and  municipally or privately  owned  structures such as tall silos and
rooftops.  Customers  receive the wireless signal via customer premise equipment
(CPE) that currently costs $180 per unit. The Company is evolving its technology
and spectrum strategy as it becomes more opportune and cost effective to utilize
licensed spectrum and related equipment.

The Company plans to target multiple customer segments,  including: business and
healthcare  providers  (both local and  regional/national  entities that require
bandwidth  at multiple  locations);  local and state  government  entities;  and
residential  customers.  To reach  these  customers,  Omnicity  expects  to sell
through  a  variety  of  channels  including:   direct  sales  to  business  and
local/state government customers; direct mail and web-based sales to residential
customers  with  affiliate  sales  through  local school  systems;  agency sales
through  local  retailers;  and through  marketing  partnerships  with REMCs and
telcos.  The  Company  also  plans  to  undertake  marketing  programs,  such as
providing  web pages for the  communities  it serves that feature  local content
such as news,  sports - video broadcasts of high-school  football and businesses
information.  The Company has been providing "hands-on",  experiential marketing
at community events through its Experiential Marketing Unit ("EMU").

Marketing  partnerships  with  REMCs  form a core  part of  Omnicity's  business
strategy.  REMCs are cooperatives  that provide  electricity to about 40 million
homes and operate in 80% of counties in the U.S. The Company has  partnered  and
expects  to  partner  with many  REMCs to  provide  broadband  services  to REMC
customers,  and to provide the REMCs value-added services,  such as remote meter
reading  and fiber  construction.  To date,  Omnicity  has  formed an  exclusive
partnership  with  Service  Concepts,  a marketing  organization  that  packages
products and services for sale by REMCs,  to offer Omnicity  wireless  broadband
services to its REMC customers.  Service  Concepts is owned by 29  Indiana-based
REMCs and serves more than 300 of the 800 REMCs located in the United States.

Omnicity  also  expects  to work  with  municipalities  and  other  governmental
entities to provide broadband services in their often under-served  communities,
and to provide  these  entities with mobile  broadband  for emergency  vehicles,

                                       7
<PAGE>
high-speed  networks  for  government  offices,  and remote  meter  reading  for
municipal-owned   utilities.   On  March  24,  2009,   Omnicity   announced  the
installation  of  a  "First  Responder"  emergency  mobile  and  fixed  wireless
broadband network in Parker City, Indiana. This network will provide mobile data
connections  for police  vehicles and broadband  connectivity to water and sewer
systems,  and to  town-owned  buildings.  Using this  model,  Omnicity  plans to
provide communications infrastructure to small towns and municipalities that can
become anchor tenants on its networks.

Finally,  Omnicity is currently  reviewing the  opportunities  for accessing and
utilizing funds under various Federal, and State broadband stimulus programs and
governmental grants.

TARGET MARKET: RURAL AREAS AND URBAN CLUSTERS

The Company expects to target "rural" and small "urban cluster" markets, defined
by the U.S.  Census  Bureau  ("Census  Bureau")  as areas with less than  10,000
people.   These  markets   historically  have  had  fewer  service  options  and
competitors than urban and metropolitan areas. Nationally, these markets account
for 115.8 million people,  about 41% of the total  population,  according to the
U.S.  Department of Agriculture,  and about 40 million  occupied  housing units.
Within the Midwest,  these areas account for about 28 million people,  about 44%
of the population,  and 11 million occupied  housing units.  Consumer demand for
broadband-enabled  services  (Internet  access,  telephone  services  and  video
services) is estimated to be $17.6 billion per year in Midwest  states and $64.1
billion per year in rural and small markets nationally.

While many choices are available to urban and large-cluster market consumers for
broadband  and  advanced  services  (such  as  Internet  TV,  business  and SaaS
solutions),  consumers and  businesses  in the Company's  target market have had
limited  options for broadband  services due to the high cost of building  wired
networks (copper,  fiber,  CATV) in sparsely populated areas, and the fragmented
service areas of small market telcos and WISPs, which limit the ability of these
firms to build scale and access capital. About 30% of consumers are estimated to
have no access to broadband  services,  according to the "Rural Broadband Policy
Brief"  published  by The Rural  Policy  Research  Institute  in December  2008.
Concerns about the availability of broadband in rural and  under-served  markets
led Congress to direct the Federal Communications  Commission (FCC) to create "a
comprehensive rural broadband strategy",  which the FCC released on May 22, 2009
in a report  entitled  "Bringing  Broadband to Rural America:  Report On A Rural
Broadband Strategy".  In that report, the FCC noted that only about 38% of rural
residents have broadband  connections at home compared with 57%-60% of urban and
suburban residents.  Additionally, $7.2 billion was allocated under The American
Recovery  and  Reinvestment  Act of 2009 to fund various  broadband  programs in
small and rural markets.

ACQUISITIONS COMPLETED DURING THE YEAR ENDED JULY 31, 2009

The Company  initialized  its business  strategy  with the  completion  of asset
purchase  agreements  with four  WISPs  through  the year  ended  July 31,  2009
including NDWave,  Inc,  Forepoints  Networks Inc., Cue Connex and North Central
Communications,  Inc. in consideration  for cash,  short-term  notes, and common
shares  of  Omnicity  Corp.  as  disclosed  in  the  Table  below.   These  four
acquisitions  added  approximately  3,200  subscribers to Omnicity's  subscriber
base,  which,   combined  with  organic  growth,   totaled  approximately  5,200
subscribers as of July 31, 2009. This represents approximately 3% penetration of
homes passed by our signal.  Including these  acquisitions,  the Company now has
its network  infrastructure  across over 200 towers and is  positioned  to offer
services to approximately  173,000 homes,  over 1/3 of the geography of Indiana.
The  Company  is  targeting  in  excess  of a 15%  penetration  in all its rural
markets.

Net consideration for these completed asset acquisitions  during the years ended
July 31:

                                                                         $
                                                                    ----------
     Cash                                                              482,200
     Cash received in sale leaseback of acquired equipment            (689,368)
     Extinguishment of debt                                             10,000
     Vendor notes payable                                            1,063,800
     Assumption of debt                                                 62,000
     Capital stock to be issued                                        164,000
     Capital stock issued                                              892,700
                                                                    ----------
     Total Consideration Paid                                        1,985,332
                                                                    ==========

                                       8
<PAGE>
The purchase price was allocated as follows:

                                                                         $
                                                                    ----------
     Equipment, net of sale leaseback                                   45,632
     Customers' Relationships                                        1,939,700
                                                                    ----------
     Assets Acquired                                                 1,985,332
                                                                    ==========

The Company also,  subsequent to July 31, 2009,  completed  the  acquisition  of
Rushville  Internet  Services,  LLC ("RIS").  The  shareholders of RIS agreed to
wind-up RIS and sell RIS's  assets to Omnicity  for  $125,000.  The Company will
receive their assets, being wireless equipment and tower infrastructures, having
a fair value of $68,706 and to settle the  inter-company  debt of  $56,294.  All
shareholders of RIS accepted to receive restricted common shares of the Company.
Subsequent to July 31, 2009 the Company issued 268,818  restricted common shares
to the shareholders of RIS at a fair value of $0.465 per common share.

COMPETITION

Traditionally,  customers in Omnicity's  target markets had four primary options
for broadband  service,  though not all options are available to all  customers,
and about 30% of homes are  estimated to have no option for  broadband.  Each of
these options has limitations and cannot be quickly  upgraded to high-speed (>10
Mbps),  leaving a gap for  Omnicity to offer  high-speed  and  broadband-enabled
services to underserved customers. See Table below.

     *    Telcos - telcos offer digital  subscriber line (DSL), where available,
          that supports  download  speeds of up to 6Mbps.  DSL (including  ADSL,
          IDSL) has an  effective  serving  range of less than 2 miles  from the
          telco  central  office  (CO)  for  high-speed  service,  and  is  very
          dependent on the quality of the existing copper plant. Small and rural
          market  telcos  may  lack  capital  to  overbuild/improve  the  plant,
          especially as these companies lose traditional phone service customers
          to mobile phone providers.
     *    Cable - cable TV companies provide  broadband over cable lines,  where
          available,  that supports download speeds of up to about 10Mbps. While
          cable  generally is faster than DSL,  cable  broadband  speed degrades
          based on user load since the  service  is shared  among all users on a
          particular cable run. In some cases,  cable plant must be overbuilt to
          support broadband services, requiring significant capital outlay.
     *    Satellite - Satellite  broadband has the advantage of being  available
          to any  customer  with a line of sight to the  satellite,  making  the
          service  attractive  for very remote users.  However,  broadband  over
          satellite  is  relatively  slow (up to  1.5Mbps),  and can suffer from
          latency  associated  with a long cycle time of bouncing  signal to the
          satellite.  The Company now offers Omnicity Satellite Internet through
          a re-branding agreement.
     *    WISPs - offer broadband using wireless technology. Wireless technology
          can support speeds of up to 100Mbps and has omni-directional  antennas
          so that  users  in all  directions  can  "see"  the  signal.  Wireless
          services  are  available to any  subscriber  within range of the tower
          (about 5 miles)  versus wired  solutions  that are  available  only to
          structures passed by the wire.

                 RURAL AND SMALL URBAN CLUSTER BROADBAND OPTIONS

Broadband Service            Speed                   Comments
-----------------            -----                   --------
DSL (Telcos)              Up to 6 Mbps     Speed depends on quality of copper
                                           plant; limited speeds if customer
                                           located >1 mile from telco central
                                           office (CO); very limited/no
                                           service if customer located >2
                                           miles from CO

Cable (Cable companies)   Up to 10 Mbps    Depends on age of CATV plant - may
                                           require overbuild; capital expense
                                           may not justified in small markets;
                                           speed depends on number of users

Satellite (Satellite &
Satellite TV companies)   Up to 1.5 Mbps   Suffers `latency' in data transfer;
                                           poor quality for video applications;
                                           relatively expensive

Wireless (WISPs)          Up to 3 Mbps     Can be deployed quickly; covers large
                          residential;     geographic areas; high-speed
                          up to 100 Mbps

Source:  "Rural  Broadband Policy Brief",  The Rural Policy Research  Institute,
December 2008; Company estimates.

Although  Omnicity  will compete with telcos in some  instances,  many telcos in
Omnicity's target markets are small (a few hundred to a few thousand customers),
and  are  frequently   undercapitalized,   limiting  their  ability  to  provide

                                       9
<PAGE>
higher-speed  broadband  and new  services and build  scale.  Moreover,  smaller
telcos are losing  revenues  as users shift to mobile  phones and  disconnecting
landlines. As a result, Omnicity expects to partner with telcos, providing these
companies with high-speed broadband and new broadband-enabled  services that can
be  marketed  to  the  telco  customer  base,   accelerating  Omnicity's  market
penetration and helping telcos stem revenue loss.

In addition to telcos and cable  companies,  Omnicity will compete with WISPs in
its target footprints that Omnicity cannot, or chooses not, to acquire, and with
WISPs  pursuing  similar  strategies.  Like  telcos,  many  WISPs  operating  in
Omnicity's  markets  are small  and are often  under  capitalized  limiting  the
ability to grow, provide high-speed services, and gain scale.  Nonetheless,  the
presence of a  competitive  WISP may impact  Omnicity's  ability to  penetrate a
given  market and reach  profitability  in the area.  In addition to  individual
WISPs,  three  other  companies  are known by Omnicity to be pursuing a wireless
strategy   in   smaller   markets,   including   ERF   Wireless,   DigitalBridge
Communications Corp., and Open Range Communications.  See Table below. Clearwire
Corporation  also is  pursuing a national  wireless  services  strategy,  but is
focusing on metropolitan markets to date.

               COMPANIES PURSUING WIRELESS/4G SERVICES BUSINESSES

<TABLE>
<CAPTION>
Company                   Status                       Market Focus                       Direct Competitor
-------                   ------                       ------------                       -----------------
<S>                  <C>                <C>                                              <C>
ERF Wireless          Public (OTC BB:    Similar to Omnicity, but focused in Texas,        Not at this time
                      ERFW)              Louisiana, New Mexico

DigitalBridge         Private            Focused in on metro-edge and small metro          Not at this time
Communications Corp.                     markets with up to 150,000 people.
                                         Serving 4 cities in Indiana

Open Range            Private            Similar to Omnicity, focused on 17 states         Possible competitor
Communications                           including 4 in Midwest                            in some markets
</TABLE>

ERF Wireless is a publicly  traded  company (OTC BB: ERFW)  focused on providing
wireless services to customers in Texas, Louisiana, and New Mexico. According to
ERF Wireless' press releases,  the company has completed 15 WISP acquisitions in
Texas, Louisiana, and New Mexico and reported having 9,000 residential customers
as of December 31, 2008. ERF Wireless also specializes in providing  services to
banks in Texas and has  signed an  agreement  with  Schlumberger  to market  its
wireless services and products to the oil and gas industry in the United States,
Canada and the Gulf of Mexico. While ERF Wireless is pursuing a similar strategy
to Omnicity the company has thus far limited its  business to Texas,  Louisiana,
and New Mexico, and to oil installations serviced by Schlumberger, and therefore
is not a direct competitor to the Company at this time.

DigitalBridge  Communications  is a private company that is pursuing  metro-edge
markets and smaller  metropolitan  areas with  populations up to 150,000 people,
according to the company's web site. On April 29, 2009,  DigitalBridge announced
that the National Rural  Telecommunications  Cooperative had made an undisclosed
investment in the company.  DigitalBridge currently serves 14 markets, including
4 markets in  Indiana.  Because  DigitalBridge  is  focused  on metro  areas the
Company does believe it is a direct competitor at this time.

Open Range  Communications  is a private  company that is focused on  delivering
wireless  broadband  services to up to 500 small markets in 17 states (including
Illinois, Indiana, Nebraska, Ohio, and Wisconsin in the Midwest) with an average
of 10,000 people,  according to the company's web site and press  releases.  The
services  are to be provided  on  licensed  spectrum  held by  Globalstar,  Inc.
(NASDAQ:GSAT)   under  Globalstar's   Ancillary   Terrestrial   Component  (ATC)
authority,  according to a company press release issued March 27, 2008. On March
25,  2008,  the  company  announced  that  it was  approved  for a $267  million
Broadband  Access Loan by the United States  Department of  Agriculture's  Rural
Development  Utilities  Program  (RDUP)  and on  January  9,  2009,  Open  Range
announced an  investment  of $100 million  from One Equity  Partners  (terms not
disclosed),   which  the  company's  web  site  indicates   satisfies  the  RDUP
requirements for making the loan available. Based on available information,  the
Company  believes  that Open Range may  compete  with it in some  markets in the
Midwest.

Clearwire  Corporation  also is  pursuing a  nationwide  network  rollout  using
wireless/4G technology.  Clearwire is a publically traded company (NASDAQ: CLWR)
developing  networks for large  metropolitan  areas.  While it is  significantly
larger than Omnicity,  because  Clearwire is focused on metro areas, the Company
does not believe it is a direct competitor at this time.

Omnicity  believes it will be competitively  differentiated  from telcos,  cable
companies, and small WISPs in several ways, including:

                                       10
<PAGE>
     *    Telcos - able to  deliver  higher  speeds  than  telco DSL and able to
          serve  customers that cannot be served by DSL.  Omnicity is positioned
          to partner with telcos to service  telco phone  customers  that cannot
          receive DSL due to plant constraints;
     *    Cable  companies  - able to  deliver  higher  speeds  than  cable data
          service  and able to serve  customers  that  cannot be served by cable
          data service;
     *    WISPs - leveraging  scale,  able to create wide market  footprint that
          attracts customers; able to develop and offer a larger set of services
          to better meet customer needs.

The Company also believes it is  positioned to compete with other  national WISP
companies should they enter Omnicity's target markets by:

     *    Entering  markets  quickly  through  acquisitions,  gaining an ongoing
          revenue stream vs. starting with new operations, sales and branding;
     *    Leveraging  its status as a public  company to make  acquisitions  vs.
          making cash outlays to build systems and operations from scratch;
     *    Partnering  with REMCs,  local  governments,  and telcos to accelerate
          Omnicity's market penetration and help these entities expand services,
          products and revenues;
     *    Utilizing  available  unlicensed radio technology to build revenue and
          market  share.  Several  potential  competitors  are  focused on using
          licensed spectrum to operate.

NETWORKS AND TECHNOLOGY

Service is  delivered  by antennas  deployed on  cellular  and other  commercial
towers,  municipally or privately owned  structures  such as water towers,  tall
silos and rooftops.  Customers  receive the wireless signal via customer premise
equipment  (CPE)  that  currently  costs  $180 per unit and that is  mounted  on
rooftops.  Any customer with line of sight to the antenna that is within 5 miles
can receive the signal.  Each tower can support 100-150  customers  depending on
the mix of bandwidth subscriptions and antenna equipment. Antennas are connected
to Internet access points via point-to-point radio and fiber connections through
agreements  with fiber  carriers and telcos where  traffic is  backhauled to the
Internet  backbone.  Networks  generally  are  designed  in a ring  topology  to
mitigate  service  failures in the event that a tower or network  connection  is
lost. The Company's  operations are managed through a Network  Operations Center
(NOC) in Rushville,  Indiana, which also handles customer support.  Omnicity can
currently offer services to homes in about 1/3 of the geography of Indiana.

Currently,   Omnicity   uses   standards-based   wireless   equipment   in   the
license-exempt  700Mhz,  900MHz,  2.4GHz and 5.8GHz  spectrum  bands,  providing
multiple paths to cover subscribers in its markets.  The Company is evolving its
technology and spectrum strategy as it becomes more opportune and cost effective
to utilize licensed spectrum and related equipment and is evaluating options for
using  the  2.5GHz  band  for  WIMAX-based  services.   Backhaul  from  wireless
distribution points is provided via point-to-point  radio, and fiber connections
through agreements with backhaul carriers.

MILESTONES

Upon completion of Omnicity's reverse merger transaction on February 17, 2009, a
number of milestones have been achieved in the execution of Omnicity's  business
strategy:

     *    Completed five WISP asset purchases. Including acquisitions,  Omnicity
          currently  has a  portfolio  of  transmission  rights  in six small to
          mid-size WISP markets  located  principally in Indiana.  These markets
          represent  approximately 225,000 households,  approximately 173,000 of
          which are believed to be  serviceable by  line-of-sight  transmissions
          from Omnicity antenna locations;
     *    The  Company's  revenues for 2009  increased by $655,000 to $1,689,000
          (2008 - $1,034,000), an increase of 63%. More importantly, revenue for
          Q4 2009  increased  by  $288,000  to $611,000  (2008 -  $322,000),  an
          increase of 89%. Additionally,  Q4 2009 revenues increased by $186,000
          to $611,000 (Q3 2009 - $425,000),  an increase of 44%. This is after a
          46% increase Q3 2009 compared to Q2 2009. These significant  increases
          reflect  an  increase  in  recurring  service  revenue  from  our four
          acquisitions.  Revenues from our first  acquisition began in February,
          2009.  The  numbers of  subscribers  increased  from 1,800 to 5,200 by
          virtue of these acquisitions;

                                       11
<PAGE>
     *    Completed its first local  government  project,  providing mobile data
          connections for the police vehicles and broadband  connectivity to the
          water, sewer and town hall buildings in Parker City, Indiana;
     *    Entered into a $1 million master lease facility with Agility Ventures,
          LLC for  operating  leases of radio and other  equipment to expand its
          business.

COST FACTORS

Traditional  hard-wire systems typically cost  significantly  more to build than
wireless  systems.  Hardwire  systems  must  install  a  network  of  cable  and
amplifiers in order to deliver signals to their  subscribers.  This considerable
cost is not incurred by wireless  operators and is only partially  offset by the
cost a wireless  operator incurs to purchase and install the wireless radios and
related equipment necessary for each subscriber's  location.  These lower system
development  costs  typically  result in lower debt burdens per  subscriber  for
wireless  operators  as  compared  to  comparably  sized  traditional  hard wire
systems.

The system  operating  costs for wireless  systems also are generally lower than
those for comparable  hard-wire  systems.  This is  attributable to lower system
network maintenance and depreciation expense.

We  anticipate  that  each  additional   wireless  subscriber  will  require  an
incremental  capital  expenditure  by us. This amount  consists of material  and
installation labor and overhead charges. These per subscriber capital costs will
not be  incurred  until a  subscriber  has been  added and is about to  generate
revenue  for us and will be  offset  in part by  installation  fees  paid by the
subscriber at the time of installation.

EMPLOYEES

As of July 31, 2009, we had a total of 36 full time  employees and as of October
23,  2009 we had a total of 38 full time  employees.  None of our  employees  is
subject  to a  collective  bargaining  agreement.  We have  experienced  no work
stoppages and believe that we have good relations  with our  employees.  We also
utilize  the  services  of  independent  contractors  to build and  install  our
wireless systems and market our services.

SUBSIDIARIES

We own 100% of Omnicity, Incorporated, a company organized under the laws of the
State of Indiana.

PATENTS AND TRADEMARKS

We have no  patents or  patents  pending.  We have  trademarked  the  following:
"Bringing Broadband to the Heartland".

ITEM 1A. RISK FACTORS

AN INVESTMENT IN OUR COMMON STOCK INVOLVES A NUMBER OF VERY  SIGNIFICANT  RISKS.
YOU SHOULD CAREFULLY  CONSIDER THE FOLLOWING RISKS AND UNCERTAINTIES IN ADDITION
TO OTHER  INFORMATION  IN THIS ANNUAL REPORT IN  EVALUATING  OUR COMPANY AND ITS
BUSINESS BEFORE PURCHASING  SHARES OF OUR COMMON STOCK. OUR BUSINESS,  OPERATING
RESULTS AND  FINANCIAL  CONDITION  COULD BE  SERIOUSLY  HARMED DUE TO ANY OF THE
FOLLOWING  RISKS.  THE RISKS  DESCRIBED BELOW MAY NOT BE ALL OF THE RISKS FACING
OUR COMPANY.  ADDITIONAL  RISKS NOT  PRESENTLY  KNOWN TO US OR THAT WE CURRENTLY
CONSIDER IMMATERIAL MAY ALSO IMPAIR OUR BUSINESS OPERATIONS.  YOU COULD LOSE ALL
OR PART OF YOUR INVESTMENT DUE TO ANY OF THESE RISKS.

RISKS RELATING TO OUR BUSINESS

WE HAVE LIMITED OPERATING HISTORY AND LACK PROFITABLE OPERATIONS.

Omnicity's business commenced in 2003 and substantially all of its revenues have
been generated by the six Indiana  systems,  which began serving  subscribers in
March 2004. Prospective investors,  therefore, have limited historical financial
information  about us upon which to base an evaluation of our performance and an
investment in our common stock. Omnicity has also recorded net losses in each of
the last two fiscal years and April 30, 2009 fiscal year to date,  due primarily
to  administrative  costs,  interest  expense and charges for  depreciation  and

                                       12
<PAGE>
amortization  of capital  expenditures to develop its wireless  systems.  We may
continue  to  experience  net losses  while we develop  and expand our  wireless
systems  even if  mature  individual  systems  of our  company  are  profitable.
Prospective  investors  should  be  aware  of the  difficulties  encountered  by
enterprises  in the  early  stages  of  development,  particularly  in  light of
potential competition.  There can be no assurance that an increase in the number
of  subscribers  or the launch of  additional  wireless  systems  will result in
profitability for our company in future years.

OUR BUSINESS DEPENDS ON LEASES AND MATERIAL  AGREEMENTS WITH UNAFFILIATED  THIRD
PARTIES FOR A  SIGNIFICANT  PORTION OF OUR CUSTOMER  PREMISES  EQUIPMENT AND OUR
WIRELESS TOWER TRANSMISSION RIGHTS.

We are  dependent  on leases  with  unaffiliated  third  parties for most of our
wireless  transmission  rights.  The remaining  terms of most of Omnicity's site
leases are approximately three years. Most of these leases provide for automatic
renewal of the lease term,  grant a right of first  refusal to the sites  and/or
require the parties to negotiate  lease renewals in good faith.  The termination
of or failure to renew our  operating  leases  would  result in  Omnicity  being
unable to deliver  services from such site to the  households in its  footprint.
For  customer  premises  equipment,  after  three  years,  we have the option of
acquiring  the equipment at the then fair market  value.  Such a termination  or
failure in a market that we actively serve could have a material  adverse effect
on Omnicity.

In  connection  with our  distribution  of  wireless  Internet  service,  we are
dependent  on  third  party   agreements  for  high-speed   return  path  access
("Backhaul"). Although we have no reason to believe that any such agreement will
be cancelled  or will not be renewed  upon  expiration,  if such  contracts  are
cancelled  or not renewed,  we will have to seek  Backhaul  from other  sources.
There is no assurance  that other Backhaul will be available to us on acceptable
terms  or at all or,  if so  available,  that it  will be of a grade  and  speed
acceptable to our subscribers.

WE WILL NEED ADDITIONAL FINANCING IN ORDER FOR OUR COMPANY TO GROW.

The growth of our business will require  substantial  investment on a continuing
basis to finance capital expenditures and related expenses for subscriber growth
and system development.  We may require additional  financing to continue to add
significant numbers of subscribers to our systems, develop our markets, and make
critical   acquisitions  of  additional  wireless   transmission  assets.  These
activities  may  be  financed  in  whole  or in  part  through  debt  or  equity
financings, joint ventures or other arrangements. There is no assurance that any
additional  funds  necessary  to finance the  development  and  expansion of our
wireless systems will be available on satisfactory  terms and conditions,  if at
all. To the extent that any future financing  requirements are satisfied through
the issuance of equity securities, investors may experience significant dilution
in the net tangible book value per share of the common stock offered hereby. The
amount and timing of our future capital  requirements  will depend upon a number
of factors,  many of which are not within our control,  including service costs,
capital  costs,  marketing  expenses,  staffing  levels,  subscriber  growth and
competitive  conditions.  Failure to obtain any  required  additional  financing
could adversely affect the growth of the Company.

OUR  COMPANY IS  DEPENDENT  ON THE  KNOWLEDGE  AND  EXPERIENCE  OF OUR  EXISTING
MANAGEMENT AND KEY EMPLOYEES.

We are  dependent  in large part on the  experience  and  knowledge  of existing
management. The loss of the services of any one or more of our current executive
officers could have a material adverse effect upon Omnicity. Our success is also
dependent upon its ability to attract and retain qualified  employees to develop
and operate its wireless systems.

RISKS RELATING TO OUR INDUSTRY

THE WIRELESS BROADBAND SERVICE PROVIDER INDUSTRY IS HIGHLY COMPETITIVE.

The  wireless  broadband  service  provider  industry is  competitive.  Wireless
systems face or may face competition  from several sources,  such as traditional
hard-wire  companies,   telephone  companies,  satellite  providers,  and  other
alternative   methods  of   distributing   and  receiving   Internet  and  voice
transmissions.  In addition,  within each market,  we may compete with others to
acquire rights to transmission sites. Legislative,  regulatory and technological
developments  may result in additional and  significant  competition,  including
competition from local telephone  companies.  In our existing  systems,  we have
targeted  our  marketing to  households  that are not served or  underserved  by
traditional  hard-wire  providers  and that have  limited  access to high  speed
internet  service from other  sources  (primarily  having access only to dial-up
internet  access,  if any).  Accordingly,  we have not  encountered  significant
direct  competition from traditional  hard-wire  companies.  No assurance can be
given,  however,  that we will  not face  direct  competition  from  traditional
hard-wire companies in the future. The standard service offering package offered
in each of the Existing  Systems is  comparable  to that offered by  traditional

                                       13
<PAGE>
hard-wire  operators.   Many  actual  and  potential  competitors  have  greater
financial,  marketing and other resources than our company.  No assurance can be
given that we will compete successfully.

THERE ARE PHYSICAL LIMITATIONS OF WIRELESS TRANSMISSION.

Wireless  broadband  service  is  transmitted  through  the  air  via  microwave
frequencies from radios at a transmission facility to a small receiving radio at
each subscriber's  location,  which generally requires a direct  `line-of-sight"
from the transmission facility to the subscriber's  receiving radio.  Therefore,
in  communities  with  tall  trees,  hilly  terrain,  tall  buildings  or  other
obstructions in the transmission path, wireless transmission can be difficult or
impossible to receive at certain  locations without the use of signal repeaters.
Based on our installation and operating  experience,  we believe that our signal
can be  received  directly by  approximately  85% of the  households  within our
expected signal patterns for such markets. The terrain in most of our markets is
generally conducive to wireless  transmission and we do not presently anticipate
any material use of beam benders or repeater stations.  In addition,  in limited
circumstances,  extremely adverse weather can damage transmission facilities and
receiving radios. However, we do not believe such potential damage is a material
risk.

WE ARE SUBJECT TO GOVERNMENT REGULATION.

Although much of the microwave  spectrum used by our company for transmission of
our services is not required to be licensed by the FCC, many of the  frequencies
that we use in the future are highly regulated. We cannot predict precisely what
effect any potential regulations may have on our company.

Wireless  operators  are also  subject to  regulation  by the  Federal  Aviation
Administration  with respect to the use and construction of transmission  towers
and to certain local zoning  regulations  affecting  construction  of towers and
other facilities.  There may also be restrictions  imposed by local authorities.
There can be no assurance that we will not be required to incur additional costs
in complying with such regulations and restrictions.

RISKS RELATING TO OUR COMMON STOCK

OUR  STOCKHOLDERS  MAY  EXPERIENCE  DILUTION  AS A  RESULT  OF OUR  ISSUANCE  OF
ADDITIONAL COMMON STOCK OR THE EXERCISE OF OUTSTANDING OPTIONS.

We may enter into commitments in the future, which would require the issuance of
additional  common  stock,  and we may grant share  purchase  warrants and stock
options.  The  exercise  of such share  purchase  warrants  or  options  and the
subsequent  resale of such common  stock in the public  market  could  adversely
affect the  prevailing  market price and our ability to raise equity  capital in
the future at a time and price which we deem  appropriate.  Any share  issuances
from  our  treasury   will  result  in   immediate   dilution  to  our  existing
stockholders.

WE HAVE NEVER DECLARED OR PAID CASH DIVIDENDS ON OUR COMMON STOCK.

We do  not  anticipate  paying  cash  dividends  on  our  common  stock  in  the
foreseeable  future.  Payment of future cash  dividends,  if any, will be at the
discretion of our board of directors and will depend on our financial condition,
results of operations, contractual restrictions, capital requirements,  business
prospects  and other  factors  that our board of directors  considers  relevant.
Accordingly, investors may only see a return on their investment if the value of
our securities appreciates.

THERE IS A LIMITED TRADING MARKET FOR OUR COMMON STOCK, AND OUR INVESTORS MAY BE
UNABLE TO SELL THEIR SHARES.

We  have a  limited  trading  market  for  our  common  stock  on  the  National
Association  of  Securities  Dealers  Inc.'s OTC  Bulletin  Board.  As a result,
investors  may not be able to sell the shares of our common stock that they have
purchased and may lose all of their investment.

OUR COMMON STOCK IS SUBJECT TO THE "PENNY  STOCK"  RULES OF THE SEC,  WHICH WILL
MAKE  TRANSACTIONS IN OUR COMMON STOCK CUMBERSOME AND MAY REDUCE THE VALUE OF AN
INVESTMENT IN OUR COMMON STOCK.

Our common stock is quoted on the Financial Industry Regulatory  Authority's OTC
Bulletin Board, which is generally considered to be a less efficient market than
markets  such as  NASDAQ  or other  national  exchanges,  and  which  may  cause
difficulty in conducting  trades and obtaining future  financing.  Further,  our
securities  are subject to the "penny stock rules"  adopted  pursuant to Section
15(g) of the Securities Exchange Act of 1934, as amended.  The penny stock rules
apply  generally to companies whose common stock trades at less than US$5.00 per
share,  subject to certain limited exemptions.  Such rules require,  among other

                                       14
<PAGE>
things,  that brokers who trade "penny stock" to persons other than "established
customers"  complete  certain  documentation,   make  suitability  inquiries  of
investors and provide investors with certain  information  concerning trading in
the security,  including a risk disclosure  document and quote information under
certain  circumstances.  Many brokers  have  decided not to trade "penny  stock"
because of the  requirements  of the "penny stock  rules" and, as a result,  the
number of  broker-dealers  willing to act as market makers in such securities is
limited.  In the event that we remain subject to the "penny stock rules" for any
significant  period,  there may develop an adverse impact on the market, if any,
for our  securities.  Because our  securities  are  subject to the "penny  stock
rules",  investors  will find it more  difficult  to dispose of our  securities.
Further, it is more difficult: (i) to obtain accurate quotations, (ii) to obtain
coverage for  significant  news events because major wire services,  such as the
Dow Jones News  Service,  generally  do not publish  press  releases  about such
companies, and (iii) to obtain needed capital.

OUR INDEPENDENT  AUDITORS HAVE EXPRESSED  SUBSTANTIAL DOUBT ABOUT OUR ABILITY TO
CONTINUE  AS A GOING  CONCERN,  WHICH MAY  HINDER OUR  ABILITY TO OBTAIN  FUTURE
FINANCING.

Our company's  consolidated  financial  statements  include a statement that our
financial  statements are prepared on a going concern basis,  and therefore that
certain reported carrying values are subject to our company receiving the future
continued  support  of our  stockholders,  obtaining  additional  financing  and
generating  revenues to cover our operating costs. The going concern  assumption
is only  appropriate  provided  that  additional  financing  continues to become
available.

A DECLINE IN THE PRICE OF OUR COMMON  STOCK  COULD  AFFECT OUR  ABILITY TO RAISE
FURTHER WORKING CAPITAL AND ADVERSELY IMPACT OUR OPERATIONS.

A decline in the price of our common  stock could  result in a reduction  in the
liquidity of our common stock and a reduction in our ability to raise additional
capital for our operations. Because our operations to date have been principally
financed  through the sale of equity  securities,  a decline in the price of our
common stock could have an adverse  effect upon our  liquidity and our continued
operations.  A reduction  in our ability to raise  equity  capital in the future
would have a material  adverse  effect upon our  business  plan and  operations,
including  our ability to continue  our current  operations.  If our stock price
declines,  we may not be able to raise additional capital or generate funds from
operations sufficient to meet our obligations.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 2. PROPERTIES

Our  executive  and  operations  offices  are  located at 807 South  State Rd 3,
Rushville, Indiana, U.S.A.

ITEM 3. LEGAL PROCEEDINGS

We are not a party to any  material  legal  proceedings  nor are we aware of any
legal proceedings pending or threatened against us or our properties.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters were submitted during the fourth quarter of our fiscal year to a vote
of security holders, through the solicitation of proxies or otherwise.

                                       15
<PAGE>
                                     PART II

ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND
        ISSUER PURCHASES OF EQUITY SECURITIES

MARKET INFORMATION

Our shares of common  stock were  quoted for trading on the OTC  Bulletin  Board
under the symbol "BRVR.OB" on September 8, 2008.  Effective October 21, 2008 our
symbol was  changed to  "OMCY.OB".  The market for our common  stock is limited,
volatile  and  sporadic.  The  following  table  sets forth the high and low bid
prices  relating to our common stock for the periods  indicated,  as provided by
the OTC Bulletin Board.  These quotations  reflect  inter-dealer  prices without
retail  mark-up,   mark-down,  or  commissions,   and  may  not  reflect  actual
transactions.

     Quarter Ended                High Bid           Low Bid
     -------------                --------           -------
     July 31, 2009                 $0.95              $0.50
     April 30, 2009                $0.73              $0.51
     January 31, 2009              $0.61              $0.46
     October 31, 2008              $0.50              $0.50

HOLDERS

As of October 23, 2009, we had approximately 650 shareholders of record.

DIVIDEND POLICY

No dividends  have been declared or paid on our common  stock.  We have incurred
recurring  losses and do not currently  intend to pay any cash  dividends in the
foreseeable future.

RECENT SALES OF UNREGISTERED SECURITIES

In connection with the closing of the Acquisition,  we issued  23,000,000 shares
of common  stock in the  capital of our  Company to  shareholders  of  Omnicity,
Incorporated.  These securities were issued pursuant to Rule 506 of Regulation D
under the United States  Securities  Act of 1933, as amended (the "US Securities
Act") to non-accredited  and accredited  investors (as defined in Rule 501 under
Regulation D under the US Securities Act) based upon representations made by the
acquirers.

Effective on April 29, 2009,  we issued a total of 1,428,571  common shares from
treasury to 2  individuals  to complete the common share  portion to complete an
Asset Purchase  Agreement dated October 7, 2008 and amended February 26, 2009 at
an agreed  price of $0.35  per  common  share.  We  relied  on  exemptions  from
registration  under the Securities Act provided by Rule 506 for U.S.  accredited
investors based on representations and warranties provided by the individuals.

Effective  on June 9, 2009,  we issued a total of  545,417  common  shares  from
treasury to 11  individuals  to complete the common share portion to complete an
Asset Purchase  Agreement dated October 7, 2008 and amended March 25, 2009 at an
agreed  price  of  $0.72  per  common  share.   We  relied  on  exemptions  from
registration  under the Securities Act provided by Rule 506 for U.S.  accredited
investors based on representations and warranties provided by the individuals.

Effective on May 8, 2009 and June 24, 2009, we completed a non-brokered  private
placement pursuant to which we issued from treasury to 33 subscribers  1,928,029
units at a  subscription  price of $0.35  per  unit for  proceeds  of  $674,810.
Effective  on May 8,  2009  and June  24,  2009,  we  completed  a  non-brokered
units-for-debt  private placement pursuant to which we issued from treasury to 8
subscribers  679,358  units at a  deemed  issuance  price  of $0.35  per unit in
retirement of an aggregate of $237,775 of Company debt.  Stock issuance costs of
$52,595 was charged as a reduction  of  proceeds.  The  proceeds of the combined
Unit and Unit for debt  non-brokered  private  placement,  net of stock issuance
costs,  were  $859,990.  Each unit  consisted  of one share of common  stock and
one-half of one share purchase  warrant.  Each whole warrant entitles the holder
to acquire an additional share of common stock at an exercise price of $0.50 per
share until May 8, 2011 as to  1,199,408  shares and June 24, 2009 as to 100,000
shares and September 17, 2009 as to 4,287 shares.  We relied on exemptions  from
registration under the Securities Act provided by (i) Regulation S (with respect
to two of the  subscribers),  and (ii)  Rule 506 for U.S.  accredited  investors
(with respect to 24 of the subscribers),  and (iii) Rule 506 for  non-accredited

                                       16
<PAGE>
investors  (with  respect  to 15 of the  subscribers)  in  each  case  based  on
representations  and warranties  provided by the subscribers in their respective
subscription agreements entered into between each subscriber and the Company.

Effective  on May 26,  2009,  we issued a total of 350,000  common  shares  from
treasury to a company  pursuant to an Investor  Relations  Consulting  Agreement
dated  May 25,  2009.  We  relied  on  exemptions  from  registration  under the
Securities  Act  provided  by Rule 506 for U.S.  accredited  investors  based on
representations and warranties provided by the Company.

NO REPURCHASES

Neither  we nor any of our  affiliates  have made any  purchases  of our  equity
securities during the fourth quarter of our fiscal year ended July 31, 2009.

ITEM 6. SELECTED FINANCIAL DATA

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

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

The  following  discussion  of our  financial  condition,  changes in  financial
condition,  plan of  operations  and  results  of  operations  should be read in
conjunction with (i) our audited  consolidated  financial  statements as at July
31, 2009 and 2008 and (ii) the section entitled  "Business",  included in Item 1
in this  Form  10-K  Annual  Report.  The  discussion  contains  forward-looking
statements that involve risks, uncertainties and assumptions. Our actual results
may differ materially from those anticipated in these forward-looking statements
as a result of many  factors,  including,  but not limited  to,  those set forth
under "Risk Factors" and elsewhere in this Annual Report.

PLAN OF OPERATIONS

Our business plan is to be a rural  wireless  internet  service  provider in the
United  States  through  a  consolidation  strategy  and  organic  growth of all
acquired business units and to partner with REMCs,  Telcos and local governments
for  nationwide  marketing.  We also plan to partner with  regional and national
telecommunication  companies  for the  delivery of voice  services  and complete
negotiations  and  logistics of DirecTV  resell  agreements.  We further plan to
partner with local governments to provide essential  services,  including mobile
internet for emergency mobile  communications,  fire and police and to establish
new utility  applications such as automated meter reading. We plan to bring WISP
based services to rural America through three distinct market channels: (1) REMC
partnerships,  (2)  strategic  acquisitions,  (3) local  government  and private
enterprise partnerships.

Utilizing  our  relationship  with the REMCs  and  "value  added"  institutional
services and facilities we provide for municipalities and local governments,  we
plan to organize and consolidate  within the rural broadband market initially in
Indiana and then in the  Midwestern  United  States and  ultimately  nationwide.
Collaborations  with  both the  REMCs and  municipalities  may act as  effective
barriers for competition and provide  additional sources of revenue and customer
service  for both the REMCs and  municipalities  as well as income and cash flow
for our company. The bundling of broadband services,  including internet, voice,
and video, in partnership with rural electric and/or municipal services provides
an opportunity to imbed,  cross promote,  and extend  services in  collaboration
with these institutional providers.

FUTURE FINANCING REQUIREMENTS

We estimate  that  approximately  $6,000,000  will be required in fiscal 2010 to
finance the expansion of, and the addition of  subscribers  through  acquisition
to,  our  existing  and to be  acquired  network  infrastructures.  A  total  of
$1,130,000  has been raised as at October 22, 2009. A minor portion will be used
to finance our negative  operational  cash flow to the end of December 31, 2009.
Once  targeted  acquisitions  are  complete,  by the  end of  2009,  we  will be
operationally cash flow positive and will require no additional funds to finance
these  deficits.  A portion  of these  funds  will also be used to  finance  the
acquisition of additional  transmission rights, the purchase and installation of
transmission and tower equipment and the cost of customer premises equipment.  A
portion of the funds will be earmarked to pay down existing debt that has a high
cost of capital  associated with it and to make principal and interest  payments
of our long-term and short term debt as required.

                                       17
<PAGE>
CURRENT FINANCING ARRANGEMENTS

     *    8%  Senior  Subordinated   Redeemable  Debenture  -  to  raise  up  to
          $2,000,000  by  issuing   long-term   debentures  with  interest  paid
          quarterly;
     *    Equity Unit Private Placement - to raise up to $2,000,000  pursuant to
          a unit private  placement being sold to accredited  investors of which
          $1,130,000 has been raised as at October 22, 2009;
     *    Equipment  Leasing  Arrangement - Master Lease  Agreement with Agility
          Leasing for a $1,000,000  equipment  leasing  facility.  This facility
          will be used to help finance customer premise equipment needs for 2009
          and 2010. The Company has used $727,368 of this leasing facility.  The
          Company is in discussions to increase this Master Lease Agreement;
     *    Private  Investment  Public  Entity  ("PIPE")  -  we  have  signed  an
          engagement letter with Bowen Advisors, Inc. out of Boston to assist us
          in raising up to $10m in stages over the next fifteen  months with the
          first stage being $2,500,000. Marketing of this offering has begun and
          the Company is discussing with various  financial  institutions  under
          Non-disclosure Agreements.

We will  continue to seek  traditional  cash flow and asset backed  financing to
supplement  our  efforts  discussed  above and to  reduce  our  overall  cost of
capital.  Additionally,  in order to  accelerate  our growth rate and to finance
general  corporate  activities,  we may supplement our existing sources of funds
with financing  arrangements at the operating system level or through additional
borrowings, joint ventures or other off balance sheet arrangements. As a further
capital  resource,  we may sell or lease certain  wireless rights or assets from
our portfolio as appropriate opportunities become available.  However, there can
be no  assurance  that we will be able to obtain any  additional  financing,  on
acceptable terms or at all.

PLAN OF OPERATIONS FOR THE NEXT TWELVE MONTHS

Our plan of operations for the next twelve months through our fiscal year ending
July 31, 2010 is to:

     1.   complete  further  debt and equity  offerings  of $5m by December  31,
          2009;
     2.   develop  and expand,  through  organic  growth,  the  subscriber  base
          through our sales and marketing program;
     3.   acquire and transition  into our  operations  assets of competing WISP
          operators and expand our network into all of Midwest USA;
     4.   reach  operationally  cash flow  positive and build a liquidity  floor
          under operations of $100,000 minimum by December 31, 2009;
     5.   build a current ratio of 2:1 by December 31, 2009;
     6.   continue  to  partner  with  Rural  Electric  Membership  Cooperatives
          "REMCs",  local and  State  governments,  Rural  Telcos  and  Original
          Equipment  Manufacturers  "OEMs" to efficiently  and cost  effectively
          expand our network across rural America;
     7.   develop and expand our service  offerings to become a total  broadband
          solution including VOIP and IPTV; and
     8.   complete a further  equity  offering,  in stages,  of $10m by July 31,
          2010.

RESULTS OF OPERATIONS

The following  table sets forth certain  financial  information  relating to the
Company for the years ended July 31, 2009  ("2009") and July 31, 2008  ("2008").
The  financial  information  presented is derived from the audited  consolidated
financial statements included under Item 8 in this 10-K.

                                       18
<PAGE>
YEARS ENDED JULY 31, 2009 AND 2008

                                                     $                    $
                                                ----------           ----------

Sales, net                                       1,688,944            1,034,310
                                                ----------           ----------
Expenses:
  Service costs                                     30,712               26,465
  Plant and signal delivery                        967,406              566,613
  Marketing and sales                               45,375               26,487
  General and administration                       744,616              535,604
  Salaries and benefits                          1,276,016              482,579
  Stock based compensation                         289,629                   --
  Depreciation and amortization                    536,113              352,425
                                                ----------           ----------
Total expenses                                   3,889,867            1,989,627
                                                ----------           ----------

Loss from operations                            (2,200,923)            (955,317)
                                                ----------           ----------
Other income (expense):
  Other income                                          --               57,883
  Forgiveness of interest                               --              121,889
  Interest expense                                (241,096)            (204,316)
  Financing expense                               (190,039)                  --
                                                ----------           ----------
Total other income (expense)                      (431,135)             (24,544)
                                                ----------           ----------

Net loss                                        (2,632,058)            (979,861)
                                                ==========           ==========
Net loss per share - basic and diluted                (.08)                (.03)
                                                ==========           ==========

The  following  discussion  should  be  read in  conjunction  with  the  audited
consolidated  financial statements  (including the notes thereto) included under
Item 8 in this 10-K.

REVENUES

The  Company's  revenues for 2009  increased by $655,000 to  $1,689,000  (2008 -
$1,034,000), an increase of 63%. More importantly, revenue for Q4 2009 increased
by $288,000 to $611,000 (2008 - $322,000), an increase of 89%. Additionally,  Q4
2009  revenues  increased  by  $186,000  to $611,000  (Q3 2009 -  $425,000),  an
increase of 44%. This is after a 46% increase Q3 2009 compared to Q2 2009. These
significant  increases reflect an increase in recurring service revenue from our
four  acquisitions.  Revenues  from  our  first  acquisition  in 2009  began  in
February,  2009.  The numbers of  subscribers  increased  from 1,800 to 5,200 by
virtue of these acquisitions.  For the first six months of 2009 and all of 2008,
subscriber counts were not significantly different. The Company receives revenue
mainly  from  monthly   service  and  modem  rental  fees   collected  from  its
subscribers.  The Company also  receives web hosting  fees,  installation  fees,
fiber  construction  projects fees and late fees,  this is less than 8% of total
revenue. The Company expects revenues to increase over the next fiscal year as a
result of organic growth, planned acquisitions and increase in ARPU.

OPERATIONAL EXPENSES

Operational expenses include service costs, plant and signal delivery, marketing
and sales, general and administration and salaries and benefits.

Service costs include the cost of billing and collection. Service costs for 2009
increased by $4,000 to $31,000 (2008 - $26,000). This increase was due mainly to
the  increase in the number of  customers  accounts  offset by a decrease in the
cost of collection.  Service costs are not expected to increase significantly in
2010.

Plant and signal delivery expenses include the rental of tower  infrastructures,
the purchase of internet  transmission  (backhaul) the cost of  installations at
customers'  premises and the customer premises equipment  operating lease costs.
Plant and signal  delivery  expenses for 2009  increased by $401,000 to $967,000
(2008 -  $566,000),  an  increase  of 71% which is in line with the  increase in
revenues.  This  increase was due mainly to the increase in the number of towers
under rental arrangements, the amount of backhaul needed to service the increase
in customers,  the increase in customer premises equipment being leased pursuant
to operating  lease  arrangements  and the  increase in customer  installations.
Plant and signal  delivery costs per customer will  significantly  decrease once
the Company populates its towers with customers.  The Company, on average, has a
penetration  of  approximately  4% of homes  passed  whereas the minimum  target

                                       19
<PAGE>
penetration is greater than 20% which is the penetration rate in the Wabash REMC
coverage area.

Marketing and sales  expenses  include REMC fees,  advertising,  preparation  of
marketing  materials,  commissions  paid  to  our  VP  of  corporate  sales  and
commissions paid to Service Concepts, a company responsible for marketing to the
REMCs on the Company's behalf. Marketing and sales for 2009 increased by $19,000
to  $45,000  (2008 -  $26,000).  This  increase  was due mainly to the hiring of
salesperson and Service Concepts  beginning their marketing campaign targeted at
the REMCs.  Marketing and sales expenses are expected to significantly  increase
during  2010 as the  Company  increases  its  marketing  plan  to  significantly
increase organic growth.

General and administration  expenses include professional fees (including legal,
accounting and outside professional consulting), investor relations fees, office
expenses  (including  rent,  telephone  and  office),  software  fees  and  fees
associated  with late  payments  and bank  charges.  General and  administration
expenses  for 2009  increased by $210,000 to $745,000  (2008 -  $535,000).  This
increase is mainly due to becoming a public company on February 17, 2009 and the
additional  costs  associated  with  this  transaction  and  investor  relations
expenses,   transfer   agent   expenses  and   regulatory   fees.   General  and
administration  expenses are not expected to increase  significantly  in 2010 in
relation to increased revenue.

Salaries and benefits for 2009 have increased by $793,000 to $1,276,000  (2008 -
$483,000).  This increase is mainly due to becoming a public company on February
17, 2009 and the additional costs associated with hiring senior  management such
as a Chief  Financial  Officers,  VP of Corporate  Development,  VP of Sales and
Marketing, VP of Acquisitions,  VP of Field Services, VP of Customer Support and
a corporate sales person. The Company went from 10 employees as at July 31, 2008
to 38 employees currently. The Company does not expect to increase its number of
employees   significantly   during  2010  as  it  has  now  contracted  out  its
installations to an independent  contractor and the Company's  current number of
employees is expected to be able to maintain a customer base at least double its
current 5,200 customers.

Stock based  compensation  for 2009  increased  by $290,000 to $290,000  (2008 -
$nil).  This was a  result  of an  Omnicity,  Incorporated  Board  of  Directors
Resolution dated January 2, 2009 to issue shares to current employees, including
its then Chief Executive Officer and Chief Operating Officer, to compensate them
for all services performed up to the end of December 31, 2008.

Depreciation and amortization for 2009 increased by $184,000 to $536,000 (2008 -
$352,000).  A total of $80,000  of this  increase  was as a  function  of adding
signal  delivery  equipment  on  towers  through  acquisitions,  developing  the
Company's  Customer   Relationship   Management   software  package,   acquiring
additional  office  furniture  and equipment  and  acquiring  customer  premises
equipment.  $98,000 of the increase was attributed to the  amortization,  over a
period of seven years, the customers' relationships acquired in conjunction with
the four completed asset acquisitions.

OTHER INCOME AND EXPENSE

Interest  expense for 2009  increased by $37,000 to $241,000  (2008 - $204,000).
The increase was a result of increased  short-term  and  long-term  debt and the
additional  interest  and late fees  charged by Wabash  REMC  totaling  $44,000.
Interest  expense  is not  expected  to  increase  substantially  in 2010 as the
Company plans to pay down  short-term  and long-term  debt and to finance growth
through the issuance of equity instruments.

Financing  expense for 2009 increased by $190,000 to $190,000 (2008 - $nil). The
Company acquires, either new or as part of asset acquisitions, certain fixed and
wireless  tower and  customer  premises  equipment.  Pursuant to a Master  Lease
Agreement with Agility Venture Fund I, LLC  ("Agility")  dated November 6, 2006,
the Company sells this  equipment to Agility and then leases the equipment  back
pursuant to operating lease agreements. On December 1, 2006 the Company received
$233,333 pursuant to a sale leaseback arrangement.

Pursuant to a new Master  Lease  Agreement  with  Agility  Venture  Fund II, LLC
("Agility  II") dated  December  24,  2008,  the Company  and Agility  agreed to
provide  funding under new sale lease back  arrangements  totalling  $1,000,000.
This new facility is in addition to and in conjunction with the November 6, 2006
agreement.  On February 17, 2009, March 27, 2009, July 9, 2009 and July 14, 2009
the Company  received an aggregate of $749,749  pursuant to four sale  leaseback
schedules  completed  ($689,368 in connection  with sale leaseback  arrangements
pursuant  to  the  Master  Lease  Agreements  and an  aggregate  of  $60,381  in
connection with sale leaseback arrangements with various unrelated vendors).

                                       20
<PAGE>
Each sale leaseback  transaction  requires a 10% deposit as additional  security
for the  stream  of lease  payments  and 30%  warrant  coverage  as a  financing
expense. Each lease agreement is for a period of 36 months with a buy-out at the
end of the lease  equal to the fair value of the  equipment  at that  time.  Our
Chief  Executive  Officer and Chairman of the Board of the Company have provided
personal guarantees for all remaining lease payments.

Pursuant to Warrant  Agreements  appended to the Master  Lease  Agreements  with
Agility and Agility II, the Company was obligated to provide the Lessor with 30%
warrant coverage.  On June 24, 2009, the Company settled the commitment to issue
warrants  under the November 6, 2006 Master Lease  Agreement and issued  155,556
warrants  exercisable  at $0.45 per common share  expiring  December 1, 2011 and
recorded the value of these  warrants,  being $70,000,  as a financing  expense.
This expense was not recognized on December 1, 2006 and the Company has restated
its July 31, 2007 financial statements to charge this expense to the appropriate
period.  Also on June 24, 2009 the  Company  settled  the  commitments  to issue
warrants on the first two of four sale leaseback  schedules.  The Company issued
77,569 warrants exercisable at $0.51 per common share expiring February 17, 2019
and issued 184,914 warrants exercisable at $0.58 per common share expiring March
27,  2019.  These  warrants  were valued at $126,907  and charged as a financing
expense.  Subsequently,  on October 13, 2009 the Company settled  commitments to
issue  warrants on the final two sale  leaseback  schedules.  The Company issued
139,490  warrants  exercisable  at $0.56 per common share  expiring  October 13,
2019.  These warrants were valued at $63,132 and charged as a financing  expense
during the year ended July 31, 2009.

Other income and  forgiveness of interest for 2009 was $nil (2008 - $180,000) as
result of not incurring these items in 2009.

NET LOSS

The net loss for 2009  increased by $1,652,000 to $2,632,000  (2008 - $980,000).
This increase in loss was due to increases in operational expenses of $1,900,000
offset by an  increase in revenue of  $655,000  for a net  increase in loss from
operations of $1,246,000.  This net increase is mainly  associated with building
internal infrastructure and the costs of being a public company.  Non-cash items
such as stock based compensation and financing expense,  totaling $489,000, were
not incurred in 2008. Depreciation also increased by $184,000. Additionally, the
Company did not receive the benefit of $179,000 of other income and  forgiveness
of interest in 2009 as compared to 2008.

LIQUIDITY AND CAPITAL RESOURCES

                                             July 31, 2009         July 31, 2008
                                             -------------         -------------
                                                   $                     $

Cash                                             159,000                    nil
Working Capital (Deficiency                   (2,585,000)            (2,056,000)
Total Assets                                   3,350,000              1,243,000
Total Liabilities                              4,424,000              2,906,000
Stockholders' Deficit                         (1,074,000)            (1,663,000)

Included in working capital deficiency are short-term notes totaling $1,222,716.
These notes are all standard unsecured  promissory notes due on demand or within
one year at rates varying from 5% on $625,800, 7% on $365,000, 8% on $8,416, 10%
on $10,000 and 20% on $203,500.  Also included in working capital deficiency are
long-term obligations totaling $1,947,574. The long-term debt principal payments
due over the next five years and beyond are as follows:

                     Year               $
                     ----            -------

                     2010            511,521
                     2011            284,530
                     2012            224,432
                     2013            194,426
                     2014            182,133
               Thereafter            550,532

Long-term  debt is made up of many smaller debt  agreements.  The material  debt
agreements are as follows:

                                       21
<PAGE>
<TABLE>
<CAPTION>
                                                                                         July 31,       July 31,
                                                                                          2009           2008
                                                                                        ---------      ---------
                                                                                            $              $
<S>                                                                                    <C>            <C>
Notes  payable  to Jay County  Development  Corporation.  Non-interest  bearing,
repayable  monthly based on the number of  subscribers  in Jay County,  Indiana.
Collateralized by certain equipment located in Jay County.                                296,911        300,099

Notes payable to Wabash Rural Electric Membership  Cooperative  ("Wabash").  Six
separate notes were renewed pursuant to a Memorandum of Understanding  effective
September  24,  2009.  Accrued  interest and  penalties to this date,  totalling
$115,111,  were added to the principal amounts  outstanding.  Interest rates are
between 5.7% and 7.45% annually and are  collateralized  by certain equipment in
Wabash County,  Indiana.  Monthly  payments of $448 begin on January 31, 2010 on
one note with final payment due December 31, 2015. Quarterly payments of $23,469
begin on  December  31,  2009 on three  notes with final  payments  due  between
September,  2016 and August,  2017. Quarterly payments of $945 begin on December
31, 2009 on one note with final payment due July 31, 2014 and quarterly payments
of $835 on one note begins on January  31, 2010 with final  payment due July 31,
2017.                                                                                     629,388        490,040

Note payable to Muncie Industrial Revolving Loan Fund Board. Interest of 5% only
was paid to July 13, 2009.  Monthly  principal  and interest of $4,570  payments
start August 13, 2009 and end December 13, 2011,  at which time the loan will be
reviewed by Muncie's Board of Directors.  This note is collateralized by certain
equipment in Muncie County and Delaware County, Indiana.                                  283,741        247,361

Note payable to Star Financial Bank. Interest is paid monthly at 8.6% per annum.
This note is due  February,  2010 and is  collateralized  by certain  equipment.          193,170        193,170

Notes  payable to the son of the  Chairman  of the Board of the  Company  and to
Insul Reps Profit Sharing Plan, a company controlled by the Chairman.  Repayable
in monthly  instalments of principal and interest at 8%,  totalling  $5,199,  to
December,  2010,  $4,845 from  January,  2010 to May, 2012 and $3,492 from June,
2012 to April 2014.                                                                       217,663             --

Senior subordinated  redeemable  debenture owing to William Herdrich, a director
of the Company - 8% interest per annum payable  quarterly.  Due January 2, 2011.           20,000             --
                                                                                        ---------      ---------
In addition to the debt agreements described above, we have additional long-term
debt  payable  pursuant  to a number of smaller  debt  agreements  with  monthly
payments of principal and interest  ranging from 5% to 10%,  unsecured.                   306,701         83,797
                                                                                        ---------      ---------
Total long-term debt                                                                    1,947,574      1,314,467
                                                                                        =========      =========
</TABLE>

LIQUIDITY OVERVIEW

We completed our going public  transaction on February 17, 2009. Since then, the
Company's  acquisition  and  transition  teams have  acquired and folded in four
WISP's  increasing our  subscriber  base from 1,800 to over 5,200 as at July 31,
2009. See discussion  under  "Revenues" above for our increase in cash flow from
our customers.

At July  31,  2009 we had  cash of  $159,000.  Subsequent  to July  31,  2009 we
deposited $1,130,000 relating to issuance of equity and debentures.  Our payroll
is  currently  $120,000  per  month  and  we now  have  36  employees  including
contractors.  We manage  our cash in a strict  manner  with a daily,  weekly and
multi-weekly  cash forecast  prepared by our  controller  and  circulated to the
three senior officers for their review,  discussion and direction. From February
17, 2009 to October 22, 2009 our creditors have been  substantially paid down or
brought  more  current,  paid  off,  converted  into  equity or  converted  into
long-term debt.

CASH TO OPERATING ACTIVITIES

During  the  year  ended  July  31,  2009,  operating  activities  used  cash of
$1,127,000  (2008 -  $264,000).  Our loss for the  year was  $2,632,000  (2008 -
$980,000)  which included  non-cash  items:  Depreciation  and  amortization  of
$536,000 (2008 - $352,000),  stock based compensation of $290,000 (2008 - $nil),
financing  expense paid through  issuance of warrants of $190,000  (2008 - $nil)
and expenses  and services  paid by issuing  equity and notes  totaling  $82,000
(2008 - $nil) for a net cash  outflow of  $1,534,000  before  changes in working
capital  items.  Our  accounts  receivable  have  increased  by $23,000  (2008 -
decrease of $83,000)  due to doubling  our  customer  base.  Our  expenses  were

                                       22
<PAGE>
financed by our vendors as to $485,000 (2008 - $283,000).  Our prepaid  expenses
increased by $34,000 due to a cash advance of $27,000 to a financial consultant.

CASH TO INVESTING ACTIVITIES

The WISP business is a capital intensive business.  Since inception, the Company
has expended  funds to lease or otherwise  acquire  transmission  site rights in
various locations and markets,  to construct the existing systems and to finance
initial operating losses. The Company intends to expand the existing systems and
launch  additional  wireless  systems and will  require  additional  funds.  The
Company  estimates that a launch by it of a wireless internet provider system in
a typical new tower location will involve the expenditures for wireless internet
system transmission equipment and incremental  installation costs per subscriber
for customer premise equipment. As a result of these costs, operating losses are
likely to be incurred by a system during the roll-out period.

During the year  ended  July 31,  2009,  investing  activities  used net cash of
$146,000 (2008 - $216,000),  primarily related to our four acquisitions.  During
fiscal  2009  we  acquired   $1,119,000   of   wireless   equipment   and  tower
infrastructures  (2008 - $91,000) of which we sold,  and leased  back,  wireless
equipment totaling $689,000 from Agility Ventures Fund II in four sale operating
leaseback transactions. We also financed $247,000 of equipment purchases through
vendor notes, and $7,000 of equipment through capital lease agreements for a net
cash  investment of $166,000.  We paid operating lease deposits to Agility Lease
Fund II of $75,000 and used deposits of $115,000 paid in fiscal 2008 to complete
the four asset purchase agreements.  We also increased our equipment deposits by
$20,000.  An  additional  deposit of $10,000 paid in fiscal 2008 remains at July
31,  2009.  We  acquired  customers'  relationships  (subscribers)  at a cost of
$1,940,000.  These  customers  were acquired  without a cash outlay.  To acquire
these customers'  relationships we issued $893,000 in common stock,  $164,000 in
common  stock to be issued,  $71,000  assumption  of debt and $812,000 in vendor
notes.

From a non-financial viewpoint we have also invested in systems upgrades, hiring
and training of our 36 member workforce, and developed a strategic and operating
plan for the next five years. We have invested in going public and in developing
our  acquisition  and  transition  teams which are not  necessarily  operational
functions.

CASH FROM FINANCING ACTIVITIES

During the year ended  July 31,  2009,  financing  activities  provided  cash of
$1,432,000  (2008 -  $480,000)  not  including  cash of $689,000  received  from
Agility Ventures Fund II, $1,068,000 of vendor note financing, and $1,057,000 of
common  shares  issued  and  to be  issued  relating  to the  four  acquisitions
referenced under "Cash from Investing  Activities".  Net proceeds of $1,100,000,
after issuance costs of $53,000, was received from common stock subscriptions or
common stock issued during the year (2008 - $nil). During the year cash proceeds
of $411,000 (2008 - $645,000) were received from  short-term  loans and $145,000
(2008 - $nil) from  long-term  debt.  We repaid  $219,000  (2008 - $165,000)  of
short-term  and  long-term  debt.  The  Company  advanced  $5,000  to our  Chief
Executive  Officer as loan  against  expenses.  Subsequent  to July 31,  2009 we
received an additional  $1,130,000 through an equity placement of our securities
and our 8% senior subordinated redeemable debenture.

NON-CASH FINANCING ACTIVITIES

Non-cash investing and financing  activities during the year ended July 31, 2009
and 2008 included the following:

<TABLE>
<CAPTION>
                                                                               $                 $
                                                                           ---------         ---------
<S>                                                                        <C>               <C>
Net liabilities assumed in corporate reorganization                        (168,352)               --
Net assets acquired in exchange for common stock                                 --           124,938
Current liabilities transferred to long-term debt                           556,327                --
Equipment acquired under capital leases                                       6,800            95,800
Warrants issued pursuant to a Master Lease Agreement                        196,907                --
Conversion of debt and accrued interest into common stock                   409,421           682,918
Customer relationships acquired in exchange for assumption of debt           60,945                --
Customer relationships acquired in exchange for common stock
 issued or to be issued                                                   1,056,700                --
Net liabilities assumed in corporate reorganization                        (168,352)               --
Net assets acquired in exchange for common stock                                 --           124,938
</TABLE>

                                       23
<PAGE>
OFF-BALANCE SHEET ARRANGEMENTS

As of the  date  of  this  report,  Omnicity  Incorporated  does  not  have  any
off-balance  sheet  arrangements  that have or are  reasonably  likely to have a
current  or future  effect on its  financial  condition,  changes  of  financial
condition,  revenues or  expenses,  results of  operations,  liquidity,  capital
expenditures or capital resources that are material to investors.

APPLICATION OF CRITICAL ACCOUNTING POLICIES

Our consolidated  financial  statements and  accompanying  notes are prepared in
accordance  with generally  accepted  accounting  principles  used in the United
States. Preparing financial statements requires management to make estimates and
assumptions  that affect the reported amounts of assets,  liabilities,  revenue,
and expenses.  These  estimates  and  assumptions  are affected by  management's
application of accounting policies.  We believe that understanding the basis and
nature of the estimates and assumptions  involved with the following  aspects of
our  consolidated  financial  statements is critical to an  understanding of our
financials.

USE OF ESTIMATES

The  preparation  of  financial  statements  in  accordance  with United  States
generally accepted  accounting  principles requires management to make estimates
and  assumptions  that affect the reported  amounts of assets and liabilities at
the date of the  financial  statements  and the reported  amounts of revenue and
expenses in the reporting period. The Company regularly  evaluates estimates and
assumptions  related to the useful life and recoverability of long-lived assets,
stock-based  compensation,  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.

PROPERTY AND EQUIPMENT

Property and equipment is stated at cost, less accumulated depreciation based on
estimated  useful  lives  utilizing  the  straight-line   method.   The  Company
capitalizes   costs   associated  with  the  construction  of  new  transmission
facilities.   Capitalized  construction  costs  include  materials,  labour  and
interest.  The Company's methodology for capitalization of internal construction
labour and internal and contracted  third party  installation  costs  (including
materials) utilizes actual costs. Materials and external labour costs associated
with  construction  activities are capitalized  based on amounts invoiced to the
Company by third parties.

Computers and wireless  equipment also consists of spare  equipment and supplies
not put in use such as  radios,  antennas,  cable  and wire and is stated at the
lower of cost (first-in,  first-out basis) or market. The carrying value of such
equipment  was $234,867  (2008 - $163,743).  The spare  electronic  equipment is
maintained  to  provide  replacement  parts  when and if needed in a short  time
period to provide  minimal  service  disruption  to  customers in the event of a
parts  failure and to install new  customers  premises  equipment  quickly  when
ordered. Spare equipment and supplies are not depreciated until put into use.

Improvements  that  extend  asset  lives  are  capitalized.  Other  repairs  and
maintenance costs are charged to operations as incurred.  Estimated useful lives
for property and equipment are as follows:

               Description                               Life
               -----------                             -------

     Computer and wireless equipment                   3 years
     Towers and infrastructures                        5 years
     Furniture and fixtures                            7 years
     Vehicles                                          5 years
     Software                                          3 years

The  Company  periodically  evaluates  the  useful  lives  of its  property  and
equipment.  The  Company's  property and  equipment  is reviewed for  impairment
whenever events or changes in circumstances indicate that the carrying amount of
an asset may not be recoverable. Recoverability is measured by comparison of the
carrying  amount to the  future  net  undiscounted  cash  flows  expected  to be
generated by the related  assets.  If such assets are considered to be impaired,

                                       24
<PAGE>
the  impairment to be  recognized  is measured by the amount the carrying  value
exceeds the fair market value of the assets.  No impairment was recorded at July
31, 2009 or 2008.

CUSTOMERS' RELATIONSHIPS

Customers'   relationships   represent   the  value   attributed  to  customers'
relationships  acquired in asset  acquisitions  and are amortized  over a 7-year
period.

LONG-LIVED ASSETS

Pursuant  to SFAS  No.  144,  "ACCOUNTING  FOR THE  IMPAIRMENT  OR  DISPOSAL  OF
LONG-LIVED ASSETS", the Company evaluates property and equipment and amortizable
intangible  assets for  impairment  whenever  current  events and  circumstances
indicate  the  carrying  amounts  may  not be  recoverable.  The  evaluation  of
long-lived assets for impairment requires a high degree of judgment and involves
the use of  significant  estimates and  assumptions.  If the carrying  amount is
greater than the expected future  undiscounted  cash flows to be generated,  the
Company  recognizes  an  impairment  loss equal to the  excess,  if any,  of the
carrying value over the fair value of the asset. The Company generally  measures
fair value based upon the present value of estimated future net cash flows of an
asset group over its remaining useful life.

REVENUE RECOGNITION

The  Company  charges  a  recurring  subscription  fee  for  providing  wireless
broadband  services to its  subscribers.  Revenue from service is  recognized as
monthly   services  are  rendered  in  accordance   with   individual   customer
arrangements.  Credit risk is managed by  disconnecting  services  to  customers
whose accounts are delinquent for a specified  number of days.  Consistent  with
SFAS No. 51, installation revenue obtained from the connection of subscribers to
the system is recognized in the period installation services are provided to the
extent of related  direct selling  costs.  Any remaining  amount is deferred and
recognized  over the  estimated  average  period that  customers are expected to
remain  connected  to the system.  From time to time,  the  Company  enters into
barter  arrangements   whereby  it  provides  certain  customers  with  wireless
broadband  services  in  exchange  for use of  towers  and  equipment  owned  by
customers.  Revenue and expenses recorded under barter  arrangements was $66,851
(2008 - $42,000) for the year ended July 31, 2009.

STOCK-BASED COMPENSATION

The  Company  accounts  for  stock-based  compensation  in  accordance  with the
provisions of SFAS No. 123(R), "SHARE BASED PAYMENTS".  The Company measures the
cost of employee  services in exchange for an award of equity  instruments based
on the grant-date  fair value.  On January 2, 2009 the Company issued  1,655,009
Omnicity,  Incorporated common shares valued at $289,629 to certain employees as
a performance bonus. There is no stock option plan adopted.

RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS

Effective  this  quarter,  the Company  implemented  SFAS No.  165,  "SUBSEQUENT
EVENTS" ("SFAS 165"). This standard  establishes general standards of accounting
for and  disclosure of events that occur after the balance sheet date but before
financial  statements  are issued.  The  adoption of SFAS 165 did not impact the
Company's financial position or results of operations. The Company evaluated all
events or transactions  that occurred after July 31, 2009 up through October 23,
2009,  the date the  Company  issued  these  financial  statements.  During this
period,  the Company did not have any material  recognizable  subsequent events,
other than as disclosed in Note 16.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In June 2009,  the FASB  issued  SFAS No. 168,  "THE FASB  ACCOUNTING  STANDARDS
CODIFICATION AND THE HIERARCHY OF GENERALLY ACCEPTED  ACCOUNTING  PRINCIPLES - A
REPLACEMENT  OF  FASB  STATEMENT  NO.  162".  The  FASB   Accounting   Standards
Codification  ("Codification")  will  become  the source of  authoritative  U.S.
generally  accepted  accounting  principles  ("GAAP")  recognized  by FASB to be
applied by  nongovernmental  entities.  Rules and  interpretive  releases of the
Securities and Exchange  Commission "SEC" under authority of federal  securities
laws  are  also  sources  of  authoritative  GAAP  for SEC  registrants.  On the
effective  date  of  this  statement,   the  Codification   will  supersede  all
then-existing   non-SEC   accounting   and   reporting   standards.   All  other
non-grandfathered non-SEC accounting literature not included in the Codification
will  become  non-authoritative.  This  statement  is  effective  for  financial
statements  issued for interim and annual  periods  ending after  September  30,
2009. The adoption of this  statement is not expected to have a material  effect
on the Company's financial statements.

In June 2009, the FASB issued SFAS No. 167,  "AMENDMENTS TO FASB  INTERPRETATION
NO. 46(R)". The objective of this statement is to improve financial reporting by
enterprises  involved with variable interest entities.  This statement addresses
(1) the effects on certain  provisions  of FASB  Interpretation  No. 46 (revised
December 2003),  "CONSOLIDATION OF VARIABLE INTEREST  ENTITIES",  as a result of
the  elimination  of the qualifying  special-purpose  entity concept in SFAS No.
166,  "ACCOUNTING FOR TRANSFERS OF FINANCIAL ASSETS",  and (2) concern about the

                                       25
<PAGE>
application  of  certain  key  provisions  of  FASB  Interpretation  No.  46(R),
including those in which the accounting and disclosures under the Interpretation
do not  always  provide  timely  and useful  information  about an  enterprise's
involvement in a variable interest entity. This statement is effective as of the
beginning of each reporting  entity's first annual  reporting period that begins
after November 15, 2009, for interim periods within that first annual  reporting
period,  and for  interim  and  annual  reporting  periods  thereafter.  Earlier
application  is  prohibited.  The adoption of this  statement is not expected to
have a material effect on the Company's financial statements.

In June 2009,  the FASB  issued  SFAS No.  166,  "ACCOUNTING  FOR  TRANSFERS  OF
FINANCIAL  ASSETS - AN AMENDMENT OF SFAS NO. 140".  The object of this statement
is to improve the relevance, representational faithfulness, and comparability of
the information  that a reporting  entity  provides in its financial  statements
about a transfer of financial assets; the effects of a transfer on its financial
position,  financial performance,  and cash flows; and a transferor's continuing
involvement,  if any, in transferred  financial assets. This statement addresses
(1)  practices  that  have  developed  since  the  issuance  of  SFAS  No.  140,
"ACCOUNTING FOR TRANSFERS AND SERVICING OF FINANCIAL ASSETS AND  EXTINGUISHMENTS
OF  LIABILITIES",  that are not  consistent  with the  original  intent  and key
requirements  of that  statement and (2) concerns of financial  statement  users
that many of the  financial  assets  (and  related  obligations)  that have been
derecognized  should  continue  to be reported in the  financial  statements  of
transferors.  SFAS No. 166 must be applied as of the beginning of each reporting
entity's first annual  reporting period that begins after November 15, 2009, for
interim  periods within that first annual  reporting  period and for interim and
annual reporting periods  thereafter.  Earlier  application is prohibited.  This
statement must be applied to transfers occurring on or after the effective date.
Additionally,  on and after the  effective  date,  the  concept of a  qualifying
special-purpose  entity is no  longer  relevant  for  accounting  purposes.  The
disclosure  provisions  of this  statement  should be applied to transfers  that
occurred  both  before  and  after the  effective  date of this  statement.  The
adoption of this  statement  is not  expected  to have a material  effect on the
Company's financial statements.

In June 2008,  the FASB issued FASB Staff  Position  EITF  03-6-1,  "DETERMINING
WHETHER   INSTRUMENTS   GRANTED  IN   SHARE-BASED   PAYMENT   TRANSACTIONS   ARE
PARTICIPATING SECURITIES". FSP EITF 03-6-1 addresses whether instruments granted
in  share-based  payment  transactions  are  participating  securities  prior to
vesting,  and therefore  need to be included in the  computation of earnings per
share under the  two-class  method as described  in FASB  Statement of Financial
Accounting Standards No. 128, "Earnings per Share." FSP EITF 03-6-1 is effective
for financial  statements issued for fiscal years beginning on or after December
15, 2008 and earlier  adoption is prohibited.  The adoption of this statement is
not expected to have a material effect on the Company's financial statements.

In May 2008, the Financial  Accounting  Standards Board ("FASB") issued SFAS No.
163, "ACCOUNTING FOR FINANCIAL GUARANTEE INSURANCE CONTRACTS - AN INTERPRETATION
OF FASB  STATEMENT  NO. 60" ("SFAS  163").  SFAS 163 requires  that an insurance
enterprise  recognize a claim  liability prior to an event of default when there
is  evidence  that credit  deterioration  has  occurred in an insured  financial
obligation.  It also  clarifies how Statement 60 applies to financial  guarantee
insurance  contracts,  including the  recognition  and measurement to be used to
account  for  premium  revenue  and claim  liabilities,  and  requires  expanded
disclosures about financial guarantee insurance  contracts.  It is effective for
financial  statements issued for fiscal years beginning after December 15, 2008,
except for some  disclosures  about the insurance  enterprise's  risk-management
activities.  SFAS  163  requires  that  disclosures  about  the  risk-management
activities  of the  insurance  enterprise  be  effective  for the  first  period
beginning after issuance.  Except for those disclosures,  earlier application is
not permitted. The adoption of this statement is not expected to have a material
effect on the Company's financial statements.

In May 2008, the FASB issued SFAS No. 162, "THE HIERARCHY OF GENERALLY  ACCEPTED
ACCOUNTING   PRINCIPLES"  (SFAS  162").  SFAS  162  identifies  the  sources  of
accounting  principles and the framework for selecting the principles to be used
in the preparation of financial statements of nongovernmental  entities that are
presented in conformity  with generally  accepted  accounting  principles in the
United  States.  It is effective  60 days  following  the SEC's  approval of the
Public Company  Accounting  Oversight  Board  amendments to AU Section 411, "THE
MEANING OF PRESENT  FAIRLY IN  CONFORMITY  WITH  GENERALLY  ACCEPTED  ACCOUNTING
PRINCIPLES".  The adoption of this  statement is not expected to have a material
effect on the Company's financial statements.

In March  2008,  the FASB issued SFAS No.  161,  "DISCLOSURES  ABOUT  DERIVATIVE
INSTRUMENTS  AND HEDGING  ACTIVITIES - AN AMENDMENT TO FASB  STATEMENT  NO. 133"
(SFAS 161"). SFAS 161 is intended to improve financial  standards for derivative
instruments and hedging activities by requiring  enhanced  disclosures to enable
investors to better understand their effects on an entity's financial  position,
financial performance, and cash flows. Entities are required to provide enhanced
disclosures  about: (a) how and why an entity uses derivative  instruments;  (b)
how derivative instruments and related hedged items are accounted for under FASB
Statement  No.  133  and its  related  interpretations;  and (c) how  derivative
instruments  and related  hedged  items affect an entity's  financial  position,
financial performance,  and cash flows. It is effective for financial statements
issued for fiscal years  beginning  after November 15, 2008, with early adoption
encouraged.  The Company is currently  evaluating  the impact of SFAS No. 161 on
its financial statements,  and the adoption of this statement is not expected to
have a material effect on the Company's financial statements.

                                       26
<PAGE>
In  December  2007,  the FASB  issued  SFAS No. 141  (revised  2007),  "Business
Combinations"  (SFAS 141  revised").  This  statement  replaces SFAS No. 141 and
defines  the  acquirer  in a business  combination  as the entity  that  obtains
control of one or more businesses in a business  combination and establishes the
acquisition  date as the  date  that the  acquirer  achieves  control.  SFAS 141
revised requires an acquirer to recognize the assets  acquired,  the liabilities
assumed,  and any  non-controlling  interest in the acquired at the  acquisition
date,  measured  at their fair  values as of that date.  SFAS 141  revised  also
requires the acquirer to recognize  contingent  consideration at the acquisition
date,  measured at its fair value at that date.  This statement is effective for
fiscal years,  and interim  periods  within those fiscal years,  beginning on or
after December 15, 2008.  Earlier  adoption is prohibited.  The adoption of this
statement is not expected to have a material  effect on the Company's  financial
statements.

In December  2007, the FASB issued SFAS No. 160,  "Non-controlling  Interests in
Consolidated Financial Statements Liabilities -an Amendment of ARB No. 51". This
statement amends ARB 51 to establish  accounting and reporting standards for the
Non-controlling  interest  in a  subsidiary  and  for the  deconsolidation  of a
subsidiary.  This statement is effective for fiscal years,  and interim  periods
within those fiscal  years,  beginning  on or after  December 15, 2008.  Earlier
adoption is prohibited. The adoption of this statement is not expected to have a
material effect on the Company's financial statements.

The Company does not expect the adoption of any other recently issued accounting
pronouncements to have a material effect on the Company's financial statements.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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

                                       27
<PAGE>
ITEM 8. FINANCIAL STATEMENTS


            Report of Independent Registered Public Accounting Firm


To the Board of Directors and Stockholders
Omnicity Corp. (formerly Bear River Resources, Inc.)
Rushville, Indiana

We have audited the  accompanying  consolidated  balance sheet of Omnicity Corp,
(formerly Bear River  Resources,  Inc.) ("the  Company") as of July 31, 2009 and
the related  consolidated  statements of  operations,  changes in  shareholders'
deficit and cash flows for the year then ended.  These financial  statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements based on our audit.

We conducted  our audit in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements  are free of material  misstatement.  The company is not  required to
have,  nor were we engaged to perform,  an audit of its  internal  control  over
financial reporting.  Our audit included  consideration of internal control over
financial  reporting  as  a  basis  for  designing  audit  procedures  that  are
appropriate  in the  circumstances,  but not for the  purpose of  expressing  an
opinion on the  effectiveness  of the company's  internal control over financial
reporting.  Accordingly,  we express  no such  opinion.  An audit also  includes
examining,  on a test basis,  evidence supporting the amounts and disclosures in
the  financial   statements,   assessing  the  accounting  principles  used  and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audit  provides  a
reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the financial position of Omnicity Corp. as of July 31,
2009, and the results of their operations and their cash flows for the year then
ended in conformity with accounting  principles generally accepted in the United
States.

The  accompanying  financial  statements  have been  prepared  assuming that the
Company  will  continue  as a  going  concern.  As  discussed  in  Note 1 to the
financial statements, the Company has suffered recurring losses and had negative
cash flows from  operations  that raise  substantial  doubt about the  Company's
ability to continue as a going  concern.  Management's  plans in regard to these
matters  are  also  described  in the Note 1. The  financial  statements  do not
include any adjustments that might result from the outcome of this uncertainty.


/s/ Weaver & Martin LLC
---------------------------------
Weaver & Martin LLC
Kansas City, Missouri
October 23, 2009 except as to Note 15 which is as of March 15, 2010

                                       28
<PAGE>
Independent Auditors' Report


Board of Directors
Omnicity, Inc.
Carmel, Indiana

We have audited the accompanying balance sheets of Omnicity,  Inc. (the Company)
as of July 31, 2008 and 2007, and the related statements of operations,  changes
in  stockholders'  deficit,  and cash  flows for the  years  then  ended.  These
financial  statements are the  responsibility of the Company's  management.  Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the  United  States of  America.  Those  standards  require  that we plan and
perform our audits to obtain  reasonable  assurance  about whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our opinion the financial statements referred to above present fairly, in all
material respects, the financial position of Omnicity, Inc. at July 31, 2008 and
2007,  and the results of its  operations  and its cash flows for the years then
ended in conformity with accounting  principles generally accepted in the United
States of America.

The  accompanying  financial  statements  have been  prepared  assuming that the
Company will  continue as a going  concern.  As discussed in Note 1, the Company
has suffered recurring losses from operations, has negative working capital, and
has relied on cash  inflows  from  private  investors  to fund  working  capital
deficits.  These conditions raise  substantial doubt about the Company's ability
to continue as a going concern.  Management's  plans in regards to these matters
are also  described  in Note 1. The  financial  statements  do not  include  any
adjustments that might result from the outcome of this uncertainty.


/s/ BGBC Partners, LLP
-------------------------------------
Indianapolis, Indiana
December 4, 2008

                                       29
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Consolidated Balance Sheets

<TABLE>
<CAPTION>
                                                                                                    (Restated -
                                                                                                      Note 15)
                                                                              July 31, 2009        July 31, 2008
                                                                              -------------        -------------
                                                                                    $                    $
<S>                                                                           <C>                  <C>
Assets

Current Assets:
  Cash                                                                            159,119                    --
  Accounts receivable, net                                                         78,007                54,655
  Other receivable (Note 9 (e))                                                     5,000                10,000
  Prepaid expenses and deposits (Note 10 (e))                                     114,173                 2,353
                                                                               ----------            ----------
Total Current Assets                                                              356,299                67,008

Property and Equipment (Note 3)                                                 1,022,675             1,024,625
Deposits and Other Assets (Note 4)                                                129,886               151,088
Customers' Relationships (Note 5)                                               1,841,247                    --
                                                                               ----------            ----------

Total Assets                                                                    3,350,107             1,242,721
                                                                               ==========            ==========


Liabilities and Stockholders' Deficit

Current Liabilities:
  Amount due bank                                                                      --                   909
  Accounts payable (Note 9)                                                       838,336               386,137
  Accrued liabilities (Note 6)                                                    213,431               456,918
  Notes payable (Note 7)                                                        1,222,716               560,000
  Current portion of long-term debt (Note 8)                                      511,521               575,258
  Current portion of capital lease obligations (Note 12)                           50,147                11,874
  Reserve for customer credits                                                         --                20,000
  Deferred revenue                                                                 42,000                42,000
  Other liabilities (Note 11)                                                      63,132                70,000
                                                                               ----------            ----------
Total Current Liabilities                                                       2,941,283             2,123,096

Capital Lease Obligations (Note 12)                                                46,868                43,465
Long-term Debt (Note 8)                                                         1,436,053               739,209
                                                                               ----------            ----------

Total Liabilities                                                               4,424,204             2,905,770
                                                                               ----------            ----------
Nature of Operations and Continuance of Business (Note 1)
Commitments (Note 12)

Stockholders' Deficit:
  Common Stock, par value $.001, 1,540,000,000 shares authorized,
   38,018,382 and 5,501,355 issued and outstanding, respectively (Note 10)         38,018             3,383,487
  Common Stock Subscribed and/or Reserved (Notes 5 and 10)                        637,000                    --
  Additional Paid-in Capital                                                    5,929,479                    --
  Deficit                                                                      (7,678,594)           (5,046,536)
                                                                               ----------            ----------
Total Stockholders' Deficit                                                    (1,074,097)           (1,663,049)
                                                                               ----------            ----------

Total Liabilities and Stockholders' Deficit                                     3,350,107             1,242,721
                                                                               ==========            ==========
</TABLE>


(See accompanying notes to these consolidated financial statements)

                                       30
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Consolidated Statements of Operations

                                                                    (Restated -
                                                                      Note 15)
                                              Year Ended            Year Ended
                                             July 31, 2009         July 31, 2008
                                             -------------         -------------
                                                   $                     $

Sales, net                                     1,688,944              1,034,310
                                              ----------             ----------
Expenses:
  Service costs                                   30,712                 26,465
  Plant and signal delivery                      967,406                566,067
  Marketing and sales                             45,375                 26,487
  General and administration                     744,616                535,604
  Salaries and benefits                        1,276,016                482,579
                                              ----------             ----------
  Stock based compensation                       289,629                     --
  Depreciation and amortization                  536,113                352,425
                                              ----------             ----------
Total Expenses                                 3,889,867              1,989,627
                                              ----------             ----------

Loss from Operations                          (2,200,923)              (955,317)
                                              ----------             ----------
Other Income (Expense):
  Other income                                        --                 57,883
  Forgiveness of interest                             --                121,889
  Interest expense                              (241,096)              (204,316)
  Financing expense (Note 11)                   (190,039)                    --
                                              ----------             ----------
Total Other Income (Expense)                    (431,135)               (24,544)
                                              ----------             ----------

Net Loss                                      (2,632,058)              (979,861)
                                              ==========             ==========

Net Loss per Share - Basic and Diluted              (.08)                  (.03)

Weighted Average Shares Outstanding -
 Basic and Diluted                            34,160,000             33,087,000
                                              ==========             ==========


(See accompanying notes to these consolidated financial statements)

                                       31
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Consolidated Statement of Changes in Stockholders' Deficit

<TABLE>
<CAPTION>
                                                                              Additional     Common
                                                       Common                  Paid-in       Stock       Accumulated
                                                       Stock       Amount      Capital     Subscribed      Deficit        Total
                                                       -----       ------      -------     ----------      -------        -----
                                                         #            $           $             $             $             $
<S>                                                <C>            <C>         <C>          <C>           <C>            <C>
Balance, July 31, 2007 (Restated - Note 15)          3,353,999    2,575,631          --         --      (4,066,675)   (1,491,044)
Stock issued to settle debt                          1,797,357      682,918          --         --              --       682,918
Stock issued in acquisition of net assets              349,999      124,938          --         --              --       124,938
Net loss (Restated - Note 15)                               --           --          --         --        (979,861)     (979,861)
                                                   -----------   ----------   ---------    -------      ----------    ----------
Balance, July 31, 2008 (Restated - Note 15)          5,501,355    3,383,487          --         --      (5,046,536)   (1,663,049)
Stock issued for cash on September 19, 2008             11,112        5,000          --         --              --         5,000
Stock issued for cash on October 16, 2008                1,429          500          --         --              --           500
Stock issued to settle debt on October 31, 2008      1,087,335      383,386          --         --              --       383,386
Stock awards to employees on January 2, 2009         1,655,009      289,629          --         --              --       289,629
Recapitalization Transactions - February 17,
 2009 (Note 1)                                              --           --          --         --              --            --
Shares acquired by Omnicity Corp.                   (8,256,240)  (4,062,002)  4,062,002         --              --            --
Shares of Omnicity Corp.                            43,967,007       43,967     (43,967)        --              --            --
Cancellation of founders shares                    (33,880,000)     (33,880)     33,880         --              --            --
Shares issued to shareholders of Omnicity,
Incorporated to effect the recapitalization         23,000,000       23,000     (23,000)        --              --            --
Net liabilities assumed of Omnicity Corp.                   --           --    (168,352)        --              --      (168,352)
Stock issued for acquisition of assets               1,973,988        1,974     890,726         --              --       892,700
Stock issued for cash pursuant to a Unit and Unit
 for debt private placement at $0.35 per Unit        2,607,387        2,607     909,978         --              --       912,585
Stock issued pursuant to an investor relations
 contract                                              350,000          350     123,900         --              --       124,250
Share issuance costs                                        --           --     (52,595)        --              --       (52,595)
Warrants issued pursuant to a Master Lease
 Agreement                                                  --           --     196,907         --              --       196,907
Asset acquisition consideration to be paid in
 common shares                                              --           --          --    164,000              --       164,000
Common stock subscribed for                                 --           --          --    473,000              --       473,000
Net loss                                                    --           --          --         --      (2,632,058)   (2,632,058)
                                                   -----------   ----------   ---------    -------      ----------    ----------

Balance, July 31, 2009                              38,018,382       38,018   5,929,479    637,000      (7,678,594)   (1,074,097)
                                                   ===========   ==========   =========    =======      ==========    ==========
</TABLE>


(See accompanying notes to these consolidated financial statements)

                                       32
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Consolidated Statements of Cash Flows

<TABLE>
<CAPTION>
                                                                                                             (Restated -
                                                                                                               Note 15)
                                                                                          Year Ended         Year Ended
                                                                                         July 31, 2009      July 31, 2008
                                                                                         -------------      -------------
                                                                                               $                  $
<S>                                                                                       <C>                  <C>
Cash flows from (to) operating activities:
  Net loss                                                                                (2,632,058)          (979,861)
  Adjustments to reconcile net loss to net
   cash used in operating activities:
     Depreciation and amortization                                                           536,113            352,425
     Financing expense - warrants issued                                                     190,039                 --
     Stock based compensation                                                                289,629                 --
     Consulting services paid and expenses settled by issuing common stock                    60,157                 --
     Expenses settled through short-term borrowings                                           22,105                 --
  (Increase) decrease in:
     Accounts and other receivable                                                           (23,352)            83,270
     Prepaid expenses                                                                        (34,289)            19,641
  Increase (decrease) in:
     Accounts payable and accrued liabilities                                                484,625            260,367
     Customer deposits                                                                       (20,000)                --
                                                                                          ----------         ----------
Net cash used in operating activities                                                     (1,127,031)          (264,158)
                                                                                          ----------         ----------
Cash flows from (to) investing activities:
  (Increase) decrease in deposits                                                             19,677           (125,000)
  Proceeds from sale leaseback of property and equipment                                     689,368                 --
  Acquisition of property and equipment                                                     (854,706)           (90,810)
                                                                                          ----------         ----------
Net cash used in investing activities                                                       (145,661)          (215,810)
                                                                                          ----------         ----------
Cash flows from (to) financing activities:
  Proceeds from short-term notes                                                             411,000            645,000
  Repayment of short-term notes                                                             (128,173)                --
  Related party advance                                                                       (5,000)                --
  Repayment of bank borrowings                                                                  (909)                --
  Proceeds from long-term debt                                                               145,000                 --
  Repayment of long-term debt  and capital lease obligations                                 (80,822)          (165,032)
  Proceeds from issuance of common stock                                                     680,310                 --
  Proceeds from common stock subscriptions                                                   473,000                 --
  Common stock issuance costs                                                                (52,595)                --
                                                                                          ----------         ----------
Net cash provided by financing activities                                                  1,431,811            479,968
                                                                                          ----------         ----------

Increase in cash                                                                             159,119                 --
Cash, beginning of year                                                                           --                 --
                                                                                          ----------         ----------
Cash, end of year                                                                            159,119                 --
                                                                                          ==========         ==========
Supplemental cash flow information:
  Cash paid for interest                                                                      52,711             17,707
  Cash paid for income taxes                                                                      --                 --

Supplemental disclosure of non-cash investing and financing activities:
  Net liabilities assumed in corporate reorganization                                       (168,352)                --
  Net assets acquired in exchange for common stock                                                --            124,938
  Current liabilities transferred to long-term debt                                          556,327                 --
  Equipment acquired under capital leases                                                      6,800             95,800
  Warrants issued pursuant to a Master Lease Agreement                                       196,907                 --
  Conversion of debt and accrued interest into common stock                                  409,421            682,918
  Customer relationships acquired in exchange for assumption of debt                          60,945                 --
  Customer relationships acquired in exchange for common stock issued or to be issued      1,056,700                 --
</TABLE>

(See accompanying notes to these consolidated financial statements)

                                       33
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Notes to Consolidated Financial Statements

1. Nature of Operations and Continuance of Business

The  Company  was  incorporated  as Bear River  Resources,  Inc. in the State of
Nevada on October 12, 2006 and was  registered  as an  extra-provincial  company
under the  Business  Corporations  Act of British  Columbia on November 6, 2006.
Prior to  February  17, 2009 the Company was a  Development  Stage  Company,  as
defined by Statement of Financial  Accounting Standard ("SFAS") No.7 "ACCOUNTING
AND REPORTING  FOR  DEVELOPMENT  STAGE  ENTERPRISES".  The  Company's  principal
business was the acquisition and exploration of mineral resources.

The Company filed a Registration Statement with the United States Securities and
Exchange Commission to register 10,087,000  post-forward split common shares for
sale by existing shareholders. The Company did not receive any proceeds from the
resale of common stock by existing shareholders.  The Registration Statement was
declared effective on September 18, 2007.

On October 21, 2008 the Company changed its name to Omnicity Corp. and increased
its issued share capital on a 7.7 new for 1 old basis. The Company increased its
authorized  share  capital to  1,540,000  common  shares and changed its trading
symbol to  "OMCY.OB".  All share and per share  amounts have been  retroactively
restated.

On February 17, 2009, the Company  acquired,  by way of an Agreement and Plan of
Merger with Omnicity  Acquisition  Co. (a wholly-owned  Indiana  subsidiary) and
Omnicity,  Incorporated,  an Indiana company,  all of the issued and outstanding
shares of Omnicity, Incorporated. Omnicity, Incorporated (incorporated on August
13, 2003) provides broadband access, including advanced services of voice, video
and data, in un-served and  underserved  small and rural markets and is planning
to be a  consolidator  of  rural  market  broadband  nationwide.  The  Company's
strategy is to provide a total  broadband  solution and continue  growth through
acquisitions,  organic growth and partner with rural electric  membership co-ops
("REMCs") and rural telephone companies. The total purchase price was 23,000,000
post-forward  split  restricted  common  shares of the Company.  In addition the
Company caused  33,880,000  post-forward  split restricted  common shares of the
Company to be cancelled  leaving  33,087,007  post-forward  split common  shares
issued and outstanding, of which 10,087,000 were not restricted.

These financial  statements  have been prepared on a going concern basis,  which
implies  the Company  will  continue  to realize  its assets and  discharge  its
liabilities  in the  normal  course  of  business.  The  Company  has  generated
substantial revenues but has sustained losses since inception and has never paid
any dividends  and is unlikely to pay dividends in the immediate or  foreseeable
future. The continuation of the Company as a going concern is dependent upon the
continued  cooperation  from its  creditors  and the  ability of the  Company to
obtain necessary debt and/or equity financing to repay overdue  obligations,  to
fund its growth  strategy  and to continue  operations,  and the  attainment  of
profitability. As at July 31, 2009, the Company had a working capital deficit of
$2,584,984  and a  stockholders'  deficit of  $1,074,097.  All of these  factors
combined raises substantial doubt regarding the Company's ability to continue as
a going concern.  These  financial  statements do not include any adjustments to
the   recoverability   and   classification   of  recorded   asset  amounts  and
classification  of  liabilities  that might be  necessary  should the Company be
unable to continue as a going concern.

The Company has been  addressing  its liquidity and working  capital  issues and
continues  to raise  additional  capital  through  the  issuance  of vendor  and
short-term  notes,  a senior  subordinated  debenture  offering  and issuance of
equity securities to private and institutional  investors.  Management  believes
this additional capital and the expanded customer base through  acquisitions and
organic growth will provide the Company the opportunity to be operationally cash
flow positive and profitable over the next twelve months.

2. Summary of Significant Accounting Policies

Basis of Presentation

These  financial  statements and related notes are presented in accordance  with
accounting principles generally accepted in the United States, and are expressed
in US dollars.  The Company's fiscal year-end is July 31. Pursuant to a Board of
Directors Resolution dated March 20, 2009 Omnicity Corp. changed its fiscal year
end from June 30 to July 31 to coincide with the fiscal year end of its acquired
operating subsidiary, Omnicity, Incorporated.

                                       34
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Notes to Consolidated Financial Statements

2. Summary of Significant Accounting Policies (cont.)

Use of Estimates

The  preparation  of  financial  statements  in  accordance  with United  States
generally accepted  accounting  principles requires management to make estimates
and  assumptions  that affect the reported  amounts of assets and liabilities at
the date of the  financial  statements  and the reported  amounts of revenue and
expenses in the reporting period. The Company regularly  evaluates estimates and
assumptions  related to the useful life and recoverability of long-lived assets,
stock-based  compensation,  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

The Company  considers all highly liquid  instruments  with  maturities of three
months or less at the time of issuance to be cash  equivalents.  Amount due bank
represents  checks  written and released  but not yet  presented to the bank for
payment, effectively outstanding checks in excess of bank balances.

Concentration of Business and Credit Risk

Financial instruments which potentially subject the Company to concentrations of
credit risk consist  principally of accounts  receivable.  The Company reviews a
customer's  credit history  before  extending  credit.  There were no individual
customers with balances in excess of 10% of the accounts receivable or net sales
balances at July 31, 2009 and 2008.

Allowance for Doubtful Accounts

The Company  records an allowance for doubtful  accounts  based on  specifically
identified  amounts  that  are  believed  to  be  uncollectible.  An  additional
allowance is recorded based on certain  percentages of aged  receivables,  which
are  determined  based on historical  experience  and  assessment of the general
financial   conditions   affecting  the  Company's   customer  base.  If  actual
collections  experience  changes,  revisions to the  allowance  may be required.
After all  attempts to collect a  receivable  have  failed,  the  receivable  is
written-off  against the  allowance.  The  allowance  for doubtful  accounts was
$10,000 at July 31, 2009 and 2008.

Property and Equipment

Property and equipment is stated at cost, less accumulated depreciation based on
estimated  useful  lives  utilizing  the  straight-line   method.   The  Company
capitalizes   costs   associated  with  the  construction  of  new  transmission
facilities.   Capitalized  construction  costs  include  materials,  labour  and
interest.  The Company's methodology for capitalization of internal construction
labour and internal and contracted  third party  installation  costs  (including
materials) utilizes actual costs. Materials and external labour costs associated
with  construction  activities are capitalized  based on amounts invoiced to the
Company by third parties.

Computers and wireless  equipment also consists of spare  equipment and supplies
not put in use such as  radios,  antennas,  cable  and wire and is stated at the
lower of cost (first-in,  first-out basis) or market. The carrying value of such
equipment  was $234,867  (2008 - $163,743).  The spare  electronic  equipment is
maintained  to  provide  replacement  parts  when and if needed in a short  time
period to provide  minimal  service  disruption  to  customers in the event of a
parts  failure and to install new  customers  premises  equipment  quickly  when
ordered. Spare equipment and supplies are not depreciated until put into use.

                                       35
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Notes to Consolidated Financial Statements

2. Summary of Significant Accounting Policies (cont.)

Improvements  that  extend  asset  lives  are  capitalized.  Other  repairs  and
maintenance costs are charged to operations as incurred.  Estimated useful lives
for property and equipment are as follows:

               Description                               Life
               -----------                             -------

     Computer and wireless equipment                   3 years
     Towers and infrastructures                        5 years
     Furniture and fixtures                            7 years
     Vehicles                                          5 years
     Software                                          3 years

The  Company  periodically  evaluates  the  useful  lives  of its  property  and
equipment.  The  Company's  property and  equipment  is reviewed for  impairment
whenever events or changes in circumstances indicate that the carrying amount of
an asset may not be recoverable. Recoverability is measured by comparison of the
carrying  amount to the  future  net  undiscounted  cash  flows  expected  to be
generated by the related  assets.  If such assets are considered to be impaired,
the  impairment to be  recognized  is measured by the amount the carrying  value
exceeds the fair market value of the assets.  No impairment was recorded at July
31, 2009 or 2008.

Customers' Relationships

Customers'   relationships   represent   the  value   attributed  to  customers'
relationships  acquired in asset  acquisitions  and are amortized  over a 7-year
period.

Long-lived Assets

Pursuant  to SFAS  No.  144,  "ACCOUNTING  FOR THE  IMPAIRMENT  OR  DISPOSAL  OF
LONG-LIVED ASSETS", the Company evaluates property and equipment and amortizable
intangible  assets for  impairment  whenever  current  events and  circumstances
indicate  the  carrying  amounts  may  not be  recoverable.  The  evaluation  of
long-lived assets for impairment requires a high degree of judgment and involves
the use of  significant  estimates and  assumptions.  If the carrying  amount is
greater than the expected future  undiscounted  cash flows to be generated,  the
Company  recognizes  an  impairment  loss equal to the  excess,  if any,  of the
carrying value over the fair value of the asset. The Company generally  measures
fair value based upon the present value of estimated future net cash flows of an
asset group over its remaining useful life.

Financial Instruments

The  fair  value of  financial  instruments,  which  include  cash and  accounts
payable,  were  estimated  to  approximate  their  carrying  values  due  to the
immediate  or  short-term  maturity  of  these  financial  instruments.  Foreign
currency   transactions  are  primarily  undertaken  in  Canadian  dollars.  The
financial  risk  is the  risk  to  the  Company's  operations  that  arise  from
fluctuations  in foreign  exchange  rates and the degree of  volatility of these
rates. Currently,  the Company does not use derivative instruments to reduce its
exposure to foreign currency risk.

Foreign Currency Transactions

The Company's  functional  and reporting  currency is the United States  dollar.
Monetary assets and liabilities denominated in foreign currencies are translated
in  accordance  with  SFAS No.  52  "FOREIGN  CURRENCY  TRANSLATION",  using the
exchange rate prevailing at the balance sheet date.  Gains and losses arising on
settlement of foreign currency denominated transactions or balances are included
in the  determination of income.  Foreign currency  transactions are minimal but
primarily  undertaken in Canadian  dollars.  The Company has not, to the date of
these financials  statements,  entered into derivative instruments to offset the
impact of foreign currency fluctuations.

                                       36
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Notes to Consolidated Financial Statements

2. Summary of Significant Accounting Policies (cont.)

Deferred Revenue

Deferred revenue represents services billed but unearned.

Revenue Recognition

The  Company  charges  a  recurring  subscription  fee  for  providing  wireless
broadband  services to its  subscribers.  Revenue from service is  recognized as
monthly   services  are  rendered  in  accordance   with   individual   customer
arrangements.  Credit risk is managed by  disconnecting  services  to  customers
whose accounts are delinquent for a specified  number of days.  Consistent  with
SFAS No. 51, installation revenue obtained from the connection of subscribers to
the system is recognized in the period installation services are provided to the
extent of related  direct selling  costs.  Any remaining  amount is deferred and
recognized  over the  estimated  average  period that  customers are expected to
remain  connected  to the system.  From time to time,  the  Company  enters into
barter  arrangements   whereby  it  provides  certain  customers  with  wireless
broadband  services  in  exchange  for use of  towers  and  equipment  owned  by
customers.  Revenue and expenses recorded under barter  arrangements was $66,851
(2008 - $42,000) for the year ended July 31, 2009.

Advertising Costs

The Company incurs advertising costs in the normal course of business, which are
expensed as incurred.  Advertising costs were $3,459 for the year ended July 31,
2009.

Stock-based Compensation

The  Company  accounts  for  stock-based  compensation  in  accordance  with the
provisions of SFAS No. 123(R), "SHARE BASED Payments".  The Company measures the
cost of employee  services in exchange for an award of equity  instruments based
on the grant-date  fair value.  On January 2, 2009 the Company issued  1,655,009
Omnicity,  Incorporated common shares valued at $289,629 to certain employees as
a performance bonus. There is no stock option plan adopted.

Basic and Diluted Net Income (Loss) Per Share

Basic loss per share is computed by dividing  net loss by the  weighted  average
number of common  shares  outstanding  for the year.  Diluted  loss per share is
computed by dividing net loss by the weighted  average  number of common  shares
outstanding plus common stock equivalents (if dilutive) related to stock options
and warrants for each year. There were no common equivalent  shares  outstanding
at April 30, 2010 and 2009 that have been  included  in dilutive  loss per share
calculation  as the effects  would have been  anti-dilutive.  There are no stock
options issued and outstanding as at July 31, 2009 and 2008.  Total  potentially
dilutive  common  shares,  relating to stock purchase  warrants  issuable in the
future, as at July 31, 2009 totals 4,001,000 (See Note 11).

Recently Adopted Accounting Pronouncements

Effective  this  quarter,  the Company  implemented  SFAS No.  165,  "SUBSEQUENT
EVENTS" ("SFAS 165"). This standard  establishes general standards of accounting
for and  disclosure of events that occur after the balance sheet date but before
financial  statements  are issued.  The  adoption of SFAS 165 did not impact the
Company's financial position or results of operations. The Company evaluated all
events or transactions  that occurred after July 31, 2009 up through October 23,
2009,  the date the  Company  issued  these  financial  statements.  During this
period,  the Company did not have any material  recognizable  subsequent events,
other than as disclosed in Note 16.

Recently Issued Accounting Pronouncements

In June 2009,  the FASB  issued  SFAS No. 168,  "THE FASB  ACCOUNTING  STANDARDS
CODIFICATION AND THE HIERARCHY OF GENERALLY ACCEPTED  ACCOUNTING  PRINCIPLES - A
REPLACEMENT  OF  FASB  STATEMENT  NO.  162".  The  FASB   Accounting   Standards
Codification  ("Codification")  will  become  the source of  authoritative  U.S.
generally  accepted  accounting  principles  ("GAAP")  recognized  by FASB to be
applied by  nongovernmental  entities.  Rules and  interpretive  releases of the
Securities and Exchange  Commission "SEC" under authority of federal  securities
laws  are  also  sources  of  authoritative  GAAP  for SEC  registrants.  On the
effective  date  of  this  statement,   the  Codification   will  supersede  all
then-existing   non-SEC   accounting   and   reporting   standards.   All  other
non-grandfathered non-SEC accounting literature not included in the Codification
will  become  non-authoritative.  This  statement  is  effective  for  financial
statements  issued for interim and annual  periods  ending after  September  30,
2009. The adoption of this  statement is not expected to have a material  effect
on the Company's financial statements.

                                       37
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Notes to Consolidated Financial Statements

2. Summary of Significant Accounting Policies (cont.)

In June 2009, the FASB issued SFAS No. 167,  "AMENDMENTS TO FASB  INTERPRETATION
NO. 46(R)". The objective of this statement is to improve financial reporting by
enterprises  involved with variable interest entities.  This statement addresses
(1) the effects on certain  provisions  of FASB  Interpretation  No. 46 (revised
December 2003),  "CONSOLIDATION OF VARIABLE INTEREST  ENTITIES",  as a result of
the  elimination  of the qualifying  special-purpose  entity concept in SFAS No.
166,  "ACCOUNTING FOR TRANSFERS OF FINANCIAL ASSETS",  and (2) concern about the
application  of  certain  key  provisions  of  FASB  Interpretation  No.  46(R),
including those in which the accounting and disclosures under the Interpretation
do not  always  provide  timely  and useful  information  about an  enterprise's
involvement in a variable interest entity. This statement is effective as of the
beginning of each reporting  entity's first annual  reporting period that begins
after November 15, 2009, for interim periods within that first annual  reporting
period,  and for  interim  and  annual  reporting  periods  thereafter.  Earlier
application  is  prohibited.  The adoption of this  statement is not expected to
have a material effect on the Company's financial statements.

In June 2009,  the FASB  issued  SFAS No.  166,  "ACCOUNTING  FOR  TRANSFERS  OF
FINANCIAL  ASSETS - AN AMENDMENT OF SFAS NO. 140".  The object of this statement
is to improve the relevance, representational faithfulness, and comparability of
the information  that a reporting  entity  provides in its financial  statements
about a transfer of financial assets; the effects of a transfer on its financial
position,  financial performance,  and cash flows; and a transferor's continuing
involvement,  if any, in transferred  financial assets. This statement addresses
(1)  practices  that  have  developed  since  the  issuance  of  SFAS  No.  140,
"ACCOUNTING FOR TRANSFERS AND SERVICING OF FINANCIAL ASSETS AND  EXTINGUISHMENTS
OF  LIABILITIES",  that are not  consistent  with the  original  intent  and key
requirements  of that  statement and (2) concerns of financial  statement  users
that many of the  financial  assets  (and  related  obligations)  that have been
derecognized  should  continue  to be reported in the  financial  statements  of
transferors.  SFAS No. 166 must be applied as of the beginning of each reporting
entity's first annual  reporting period that begins after November 15, 2009, for
interim  periods within that first annual  reporting  period and for interim and
annual reporting periods  thereafter.  Earlier  application is prohibited.  This
statement must be applied to transfers occurring on or after the effective date.
Additionally,  on and after the  effective  date,  the  concept of a  qualifying
special-purpose  entity is no  longer  relevant  for  accounting  purposes.  The
disclosure  provisions  of this  statement  should be applied to transfers  that
occurred  both  before  and  after the  effective  date of this  statement.  The
adoption of this  statement  is not  expected  to have a material  effect on the
Company's financial statements.

In June 2008,  the FASB issued FASB Staff  Position  EITF  03-6-1,  "DETERMINING
WHETHER   INSTRUMENTS   GRANTED  IN   SHARE-BASED   PAYMENT   TRANSACTIONS   ARE
PARTICIPATING SECURITIES". FSP EITF 03-6-1 addresses whether instruments granted
in  share-based  payment  transactions  are  participating  securities  prior to
vesting,  and therefore  need to be included in the  computation of earnings per
share under the  two-class  method as described  in FASB  Statement of Financial
Accounting Standards No. 128, "Earnings per Share." FSP EITF 03-6-1 is effective
for financial  statements issued for fiscal years beginning on or after December
15, 2008 and earlier  adoption is prohibited.  The adoption of this statement is
not expected to have a material effect on the Company's financial statements.

In May 2008, the Financial  Accounting  Standards Board ("FASB") issued SFAS No.
163, "ACCOUNTING FOR FINANCIAL GUARANTEE INSURANCE CONTRACTS - AN INTERPRETATION
OF FASB  STATEMENT  NO. 60" ("SFAS  163").  SFAS 163 requires  that an insurance
enterprise  recognize a claim  liability prior to an event of default when there
is  evidence  that credit  deterioration  has  occurred in an insured  financial
obligation.  It also  clarifies how Statement 60 applies to financial  guarantee
insurance  contracts,  including the  recognition  and measurement to be used to
account  for  premium  revenue  and claim  liabilities,  and  requires  expanded
disclosures about financial guarantee insurance  contracts.  It is effective for
financial  statements issued for fiscal years beginning after December 15, 2008,
except for some  disclosures  about the insurance  enterprise's  risk-management
activities.  SFAS  163  requires  that  disclosures  about  the  risk-management
activities  of the  insurance  enterprise  be  effective  for the  first  period
beginning after issuance.  Except for those disclosures,  earlier application is
not permitted. The adoption of this statement is not expected to have a material
effect on the Company's financial statements.

                                       38
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Notes to Consolidated Financial Statements

2. Summary of Significant Accounting Policies (cont.)

In May 2008, the FASB issued SFAS No. 162, "THE HIERARCHY OF GENERALLY  ACCEPTED
ACCOUNTING   PRINCIPLES"  (SFAS  162").  SFAS  162  identifies  the  sources  of
accounting  principles and the framework for selecting the principles to be used
in the preparation of financial statements of nongovernmental  entities that are
presented in conformity  with generally  accepted  accounting  principles in the
United  States.  It is effective  60 days  following  the SEC's  approval of the
Public Company  Accounting  Oversight  Board  amendments to AU Section 411, "THE
MEANING OF PRESENT  FAIRLY IN  CONFORMITY  WITH  GENERALLY  ACCEPTED  ACCOUNTING
PRINCIPLES".  The adoption of this  statement is not expected to have a material
effect on the Company's financial statements.

In March  2008,  the FASB issued SFAS No.  161,  "DISCLOSURES  ABOUT  DERIVATIVE
INSTRUMENTS  AND HEDGING  ACTIVITIES - AN AMENDMENT TO FASB  STATEMENT  NO. 133"
(SFAS 161"). SFAS 161 is intended to improve financial  standards for derivative
instruments and hedging activities by requiring  enhanced  disclosures to enable
investors to better understand their effects on an entity's financial  position,
financial performance, and cash flows. Entities are required to provide enhanced
disclosures  about: (a) how and why an entity uses derivative  instruments;  (b)
how derivative instruments and related hedged items are accounted for under FASB
Statement  No.  133  and its  related  interpretations;  and (c) how  derivative
instruments  and related  hedged  items affect an entity's  financial  position,
financial performance,  and cash flows. It is effective for financial statements
issued for fiscal years  beginning  after November 15, 2008, with early adoption
encouraged.  The Company is currently  evaluating  the impact of SFAS No. 161 on
its financial statements,  and the adoption of this statement is not expected to
have a material effect on the Company's financial statements.

In  December  2007,  the FASB  issued  SFAS No. 141  (revised  2007),  "Business
Combinations"  (SFAS 141  revised").  This  statement  replaces SFAS No. 141 and
defines  the  acquirer  in a business  combination  as the entity  that  obtains
control of one or more businesses in a business  combination and establishes the
acquisition  date as the  date  that the  acquirer  achieves  control.  SFAS 141
revised requires an acquirer to recognize the assets  acquired,  the liabilities
assumed,  and any  non-controlling  interest in the acquired at the  acquisition
date,  measured  at their fair  values as of that date.  SFAS 141  revised  also
requires the acquirer to recognize  contingent  consideration at the acquisition
date,  measured at its fair value at that date.  This statement is effective for
fiscal years,  and interim  periods  within those fiscal years,  beginning on or
after December 15, 2008.  Earlier  adoption is prohibited.  The adoption of this
statement is not expected to have a material  effect on the Company's  financial
statements.

In December  2007, the FASB issued SFAS No. 160,  "Non-controlling  Interests in
Consolidated Financial Statements Liabilities -an Amendment of ARB No. 51". This
statement amends ARB 51 to establish  accounting and reporting standards for the
Non-controlling  interest  in a  subsidiary  and  for the  deconsolidation  of a
subsidiary.  This statement is effective for fiscal years,  and interim  periods
within those fiscal  years,  beginning  on or after  December 15, 2008.  Earlier
adoption is prohibited. The adoption of this statement is not expected to have a
material effect on the Company's financial statements.

3. Property and Equipment

Property and equipment consists of the following:

                                                 July 31, 2009     July 31, 2008
                                                 -------------     -------------
                                                       $                 $
Computer and wireless equipment                    1,555,645         1,464,210
Towers and infrastructures                           785,970           551,937
Furniture and fixtures                                44,959            28,754
Vehicles                                              74,529            70,529
Software                                              57,719            17,906
                                                  ----------        ----------
                                                   2,518,822         2,133,336

Less: accumulated depreciation and amortization   (1,496,147)       (1,108,711)
                                                  ----------        ----------
Property and equipment, net                        1,022,675         1,024,625
                                                  ==========        ==========

                                       39
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Notes to Consolidated Financial Statements

4. Deposits and Other Assets

Deposits and other assets consist of the following:

                                                July 31, 2009     July 31, 2008
                                                -------------     -------------
                                                      $                 $
Asset Purchase Agreement deposits                   10,000           125,000
Operating lease deposits                            86,682            11,853
Other long-term deposits                            33,204            12,710
Loan acquisition costs, net                             --             1,525
                                                   -------           -------
                                                   129,886           151,088
                                                   =======           =======

The Company,  as part of its growth strategy through  acquisitions,  enters into
Asset  Purchase  Agreements  to acquire  certain net assets of  businesses  that
provide wireless broadband  services in rural areas of Midwestern,  USA. A total
of $10,000 (July 31, 2008 - $125,000) of non-refundable deposits paid were paid.
See Note 5 for four Asset Purchase Agreements that closed between February, 2009
and July 31, 2009.  As at July 31, 2009 the Company had one  Agreement  that had
not closed.

The Company and a leasing  company  agreed to add an  additional  $1,000,000  to
their existing Master Lease Agreement facility. This new facility is in addition
to and in conjunction with earlier  agreements the companies signed in November,
2006. The Company has used $749,749 of this additional $1,000,000 facility.  The
Company acquires, either new or as part of asset acquisitions, certain fixed and
wireless tower and customer premises  equipment.  The Lessor, in turn,  acquires
these assets and leases them back to the Company pursuant to operating equipment
leases.  Each sale  leaseback  transaction  requires a 10% deposit as additional
security  for the stream of lease  payments  and each lease  agreement  is for a
period of 36 months  with a  buy-out  at the end of the lease  equal to the fair
value of the equipment at that time. Our Chief Executive Officer and Chairman of
the Board of the Company have  provided  personal  guarantees  for all remaining
lease payments. As at July 31, 2009 a total of $86,682 was held by the Lessor as
security  deposits.  The  Company  must also  provide  30%  warrant  coverage as
additional  consideration  pursuant to the Master Lease  Agreement.  See Note 11
regarding warrants issued and to be issued to the Lessor.

5. Acquisition of Assets

Pursuant to Asset Purchase Agreements completed between March, 2009 and July 31,
2009, the Company acquired tower and network infrastructures, wireless tower and
customer  premises  equipment and customers'  relationships of wireless internet
service providers.

Net consideration for completed asset  acquisitions  during the years ended July
31 was as follows:

                                                          2009           2008
                                                       ----------     ----------
                                                            $             $
Cash                                                      482,200           --
Cash received in sale leaseback of acquired equipment    (689,368)          --
Extinguishment of debt                                     10,000           --
Vendor notes payable                                    1,063,800           --
Assumption of debt                                         62,000           --
Capital stock to be issued                                164,000           --
Capital stock issued                                      892,700      124,938
                                                       ----------     --------
Total Consideration Paid                                1,985,332      124,938
                                                       ==========     ========

The consideration paid was allocated to the following assets based on their fair
values:

                                                          2009           2008
                                                       ----------     ----------
                                                            $             $
Current assets, net of current liabilities                     --       61,179
Equipment, net of sale leaseback                           45,632       63,759
Customers' Relationships                                1,939,700           --
                                                        ---------     --------
Assets Acquired                                         1,985,332      124,938
                                                        =========     ========

                                       40
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Notes to Consolidated Financial Statements

5. Acquisition of Assets (cont.)

The  carrying  value of  customers'  relationships  acquired as at July 31, 2009
consists of:

                                                                         $
                                                                     ----------
Capitalized value                                                     1,939,700
Less: accumulated amortization                                          (98,453)
                                                                     ----------
Customers' relationships, net                                         1,841,247
                                                                     ==========

6. Accrued Liabilities

                                                        July 31,        July 31,
                                                         2009            2008
                                                        -------         -------
                                                           $               $
Accrued interest                                         65,822          80,069
Professional fees accrued                                    --         140,437
Due to Rushville Internet Services, LLC (Note 9 (a))     56,294          17,496
Payroll and severance liabilities                        55,486          38,788
Other current liabilities                                35,829         139,197
Credit cards payable                                         --          40,931
                                                        -------         -------
                                                        213,431         456,918
                                                        =======         =======

7. Notes Payable

<TABLE>
<CAPTION>
                                                                               July 31,       July 31,
                                                                                 2009           2008
                                                                               --------       --------
                                                                                   $              $
<S>                                                                            <C>            <C>
Notes payable,  due on demand,  unsecured and bearing  interest at 20%
per annum (2008 -10% per annum.                                                 150,000        150,000

Note payable,  senior subordinated security position,  interest at 20%
per annum, due June, 2011.                                                       53,500             --

Note  payable  due to the  Chairman  of the Board of the  Company,  on
demand, unsecured and bearing interest at 8% per annum.                           8,416        150,000

Notes payable,  due on demand,  unsecured and bearing  interest at 10%
per annum.                                                                       10,000        260,000

Vendor Note - unsecured  and bearing  interest at 7%. Three  quarterly
payments of $121,667  starting May 26, 2009. The May 26 and August 26,
2009 payments were postponed after a $5,000 payment was made on August
17, 2009.                                                                       365,000             --

Vendor Note - unsecured  and bearing  interest at 5%. Three  quarterly
payments  of $166,600  starting  June 30,  2009.  On June 30, 2009 the
creditor  accepted  $50,000 as a partial payment and has postponed the
balance of this payment, and the payment due September 30, 2009, until
a future date to be  determined  by the  Company and the note  holder.          449,800             --

Vendor Note - unsecured and bearing  interest at 5%. A $23,000 payment
was due on August 31, 2009.  This payment has been  postponed  until a
future date to be  determined  by the Company and the note  holder.  A
final payment is due on November 30, 2009.                                       46,000             --

Vendor Note - unsecured  and bearing  interest at 5%. Three  quarterly
payments of $43,333 starting October 31, 2009.                                  130,000             --
                                                                              ---------        -------
                                                                              1,222,716        560,000
                                                                              =========        =======
</TABLE>

                                       41
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Notes to Consolidated Financial Statements

8. Long-term Debt

<TABLE>
<CAPTION>
                                                                               July 31,       July 31,
                                                                                 2009           2008
                                                                               --------       --------
                                                                                   $              $
<S>                                                                            <C>            <C>
Notes  payable to Jay  County  Development  Corporation.  Non-interest
bearing,  repayable  monthly based on the number of subscribers in Jay
County,  Indiana.  Collateralized  by certain equipment located in Jay
County.                                                                         296,911        300,099

Notes  payable  to  Wabash  Rural  Electric   Membership   Cooperative
("Wabash").  Six separate notes were renewed  pursuant to a Memorandum
of Understanding  effective  September 24, 2009.  Accrued interest and
penalties  to  this  date,  totalling  $115,111,  were  added  to  the
principal  amounts  outstanding.  Interest  rates are between 5.7% and
7.45% annually and are  collateralized  by certain equipment in Wabash
County, Indiana. Monthly payments of $448 begin on January 31, 2010 on
one note with final payment due December 31, 2015.  Quarterly payments
of  $23,469  begin on  December  31,  2009 on three  notes  with final
payments  due  between  September,  2016 and August,  2017.  Quarterly
payments  of $945 begin on  December  31,  2009 on one note with final
payment due July 31, 2014 and  quarterly  payments of $835 on one note
begins on January  31,  2010 with  final  payment  due July 31,  2017.          629,388        490,040

Note payable to Muncie Industrial Revolving Loan Fund Board.  Interest
of 5% only was paid to July 13, 2009.  Monthly  principal and interest
of $4,570 payments start August 13, 2009 and end December 13, 2011, at
which time the loan will be reviewed by Muncie's  Board of  Directors.
This note is  collateralized by certain equipment in Muncie County and
Delaware County, Indiana.                                                       283,741        247,361

Note payable to Star Financial Bank.  Interest is paid monthly at 8.6%
per annum.  This note is due February,  2010 and is  collateralized by
certain equipment.                                                              193,170        193,170

Note payable to First Farmers Trust & Bank. Monthly principal payments
of $6,092 plus variable  interest at 4.5%,  collateralized  by certain
equipment    purchased   in   the   acquisition   of   North   Central
Communications, Inc. Final payment is due December, 2009.                        24,419             --

Note  payable  to First  Farmers  Trust & Bank.  Interest  at 4.5% per
annum,   collateralized   by  certain   equipment   purchased  in  the
acquisition  of  North  Central  Communications,  Inc.  Principal  and
interest  payments of $912 are due monthly.  Final  payment due April,
2011.                                                                            18,657             --

Notes  payable to the son of the  Chairman of the Board of the Company
and to  companies  controlled  by the  Chairman.  Repayable in monthly
instalments  of principal  and interest at 8%,  totalling  $5,199,  to
December, 2010, $4,845 from January, 2010 to May, 2012 and $3,492 from
June, 2012 to April 2014.                                                       217,663             --

Senior  subordinated  redeemable debenture owing to a director of the
Company - 8% interest  per annum payable quarterly. Due January 2, 2011.         20,000             --

Notes payable with monthly  payments of principal and interest ranging
from 5% to 10%,  unsecured.  Total  payments of principal and interest
are $12,511 per month to January,  2010; $8,169 to April, 2011; $5,169
to December, 2011; $3,556 to April, 2012; $2,102 to May, 2013.                  263,625         83,797
                                                                              ---------      ---------
Total long-term debt                                                          1,947,574      1,314,467
Less: current portion                                                           511,521        575,258
                                                                              ---------      ---------
Long-term portion                                                             1,436,053        739,209
                                                                              =========      =========
</TABLE>

Long-term debt principal payments due over the next five years are as follows:

                      Year               $
                      ----            -------
                      2010            511,521
                      2011            284,530
                      2012            224,432
                      2013            194,426
                      2014            182,133
                Thereafter            550,532

                                       42
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Notes to Consolidated Financial Statements

9. Related Party Transactions and Balances

a)   Included  in  accrued  liabilities  is $56,294  (2008 -  $17,493)  owing to
     Rushville  Internet  Services,  LLC ("RIS") which represents amounts due to
     RIS under certain lease  agreements.  The Company and RIS have shareholders
     in common.  The  shareholders  of RIS agreed to wind-up  RIS and sell RIS's
     assets to Omnicity for  $125,000.  The Company will receive  their  assets,
     being wireless equipment and tower infrastructures,  having a fair value of
     $68,706,  and to settle  inter-company debt of $56,294. All shareholders of
     RIS accepted to receive restricted common shares of the Company. Subsequent
     to July 31, 2009 the Company issued 268,818 restricted common shares to the
     shareholders of RIS at a fair value of $0.465 per common share.

b)   The Company's  capital lease  obligations  entirely relate to assets leased
     from a  company  beneficially  owned by the  Chairman  of the  Board of the
     Company (See note 12).  During the year, a further $6,800 was received from
     this related party  pursuant to two capital  leases and interest of $11,212
     and principal of $43,724 was paid during the year.

c)   Current  liabilities  owing to the son of the  Chairman of the Board of the
     Company and to companies  controlled by the Chairman,  totalling  $217,663,
     were  converted  into  long-term  debt  during  the year.  These  loans are
     repayable  in  monthly  instalments  of  principal  and  interest,  at  8%,
     totalling $5,199 to December 2010, $4,845 from January, 2010 to April, 2012
     and $3,492  from May,  2012 to April 2014.  The  Chairman of the Board also
     converted a $150,000  short-term  note plus  accrued  interest  into common
     stock of Omnicity, Incorporated prior to the reverse merger.

d)   The Company  advanced $5,000 to its Chief  Executive  Officer as an advance
     for expenses.  This advance is non-interest  bearing,  unsecured and due on
     demand.  The Company advanced  $10,000 to Cue Connex,  LLC, a company owned
     the Company's VP of Sales and Marketing prior to the Company  acquiring the
     assets  of  Cue  Connex,  LLC  for  $99,000.  Consideration  paid  was  the
     settlement of the $10,000 advance and 121,417  restricted  common shares of
     the Company  having a value of $89,000.  These shares were issued on August
     18, 2009.

e)   Wabash  REMC's Chief  Executive  Officer is a director of the Company.  See
     Note 8 for six loans  owing to Wabash REMC and the  related  Memorandum  of
     Understanding  dated  September  24,  2009.  A loan of $30,000 was received
     during  the year and a total of  $60,298  of  interest  and  penalties  was
     charged to operations.

f)   A director and two companies  controlled by two  directors  subscribed  for
     499,886  Units at $0.35 per Unit and  received  499,886  common  shares and
     warrants  to  acquire a further  249,943  common  shares at $0.50 per share
     expiring May 8, 2011.

g)   A director  loaned  $20,000  pursuant to a senior  subordinated  redeemable
     debenture.  8% interest per annum is payable  quarterly and matures January
     2, 2011.  The director can request  settlement  in common shares or cash on
     the  maturity  date. A company  owned 1/3 by a director  loaned the Company
     $15,000 during the year which was repaid including a $1,500 bonus.

h)   The Company  recognized  interest  expense  attributed to all related party
     debt of $95,820  (2008 -  $61,082)  for the years  ended July 31,  2009 and
     2008.

                                       43
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Notes to Consolidated Financial Statements

10. Common Stock

a)   On October 21, 2008 the Company increased,  by way of a stock dividend, its
     issued share  capital on a 7.7 new for 1 old basis.  There were  43,967,007
     common  shares  outstanding  after the  forward  split.  As part of a stock
     dividend  the  Company  also  increased  its  authorized  share  capital to
     1,540,000,000 common shares.

b)   On February 17, 2009, the Company acquired, by way of an Agreement and Plan
     of  Merger,   all  of  the  issued  and  outstanding  shares  of  Omnicity,
     Incorporated,  an Indiana  company (See Note 1). The Company issued a total
     of 23,000,000 post-forward split restricted common shares of the Company to
     the   shareholders  of  Omnicity,   Incorporated   for  100%  of  Omnicity,
     Incorporated.   In  addition,   the  Company  caused  33,880,000  founders'
     post-forward  split common  shares of the Company to be  cancelled  leaving
     33,087,007  post-forward  split common shares issued and  outstanding as at
     February 17, 2009.

c)   On April 29, 2009 and June 9, 2009 the Company  issued a total of 1,973,988
     restricted  common  shares of the Company at an average fair value of $0.45
     per common share,  totalling  $892,700,  to acquire tower  infrastructures,
     wireless equipment and customers' relationships.

d)   In May and June,  2009 the Company issued a total of 2,607,387 Units of the
     Company  at $0.35  per  Unit  pursuant  to Unit  and Unit for Debt  Private
     Placement  Offerings.  Each Unit contained one common share and one-half of
     one share  purchase  warrant.  Each whole warrant is  exercisable  into one
     common share at $0.50 per share expiring two years after issuance.  A total
     of $912,585  was received  ($674,810 of cash and $237,775 of debt  settled)
     pursuant  to Unit and Unit for  Debt  Subscription  Agreements.  A total of
     $52,595 of legal  expenses was netted  against this  offering for total net
     proceeds of $859,990.

e)   On June 1, 2009 the Company  entered into an agreement with Onyx Consulting
     Group,  LLC  ("Onyx") to manage all aspects of the  Company's  investor and
     media  relations  program.  The Company paid a fee to Onyx in the amount of
     $40,000 for the period June 1, 2009 to November 30, 2009 and issued 350,000
     restricted  common shares of the Company  having a fair value of $0.355 per
     common share or $124,250 in total.  As at July 31, 2009 the Company charged
     $54,750 to operations and recorded $111,500 as a prepaid expense.

f)   As at July 31, 2009,  pursuant to two completed Asset Purchase  Agreements,
     the Company was committed to issuing  229,855  restricted  common shares of
     the Company at an average fair value of $0.71 per common  share,  totalling
     $164,000, to acquire tower infrastructures, wireless equipment and customer
     relationships. These shares were issued on August 18, 2009.

g)   See Note 9 (a) regarding a commitment to issue  268,818  restricted  common
     shares at $0.465 per  common  share to acquire  tower  infrastructures  and
     tower and  customer  premises  equipment  and to  settle  an  inter-company
     liability. These shares were issued on October 13, 2009.

h)   The Company received $73,000, and subsequently  received a further $20,000,
     pursuant to Unit Private  Placement  Subscription  Agreements  with certain
     private  investors.  The Company has agreed to issue 146,000 units at $0.50
     per unit.  Each  unit will  contain  one  common  share and one half of one
     common share purchase  warrant.  Each whole warrant is exercisable into one
     common share at $1.00 per share expiring two years from receipt of funds.

i)   The Company  received  $1,000,000  from a major  shareholder on October 20,
     2009. These funds plus $400,000  received on July 3, 2009 were combined and
     a subscription agreement for 4,000,000 units at $0.35 per unit was executed
     on October 20,  2009.  Each unit will contain one common share and one half
     of one common share  purchase  warrant.  Each whole warrant is  exercisable
     into one  common  share at an  exercise  price of $0.50  per  common  share
     expiring October 20, 2011 (See Note 16 (f)).

                                       44
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Notes to Consolidated Financial Statements

11. Warrants

On December 1, 2006,  pursuant to a Master Lease  Agreement and related  Warrant
Agreement (the  "Agreements"),  the Company received $233,333 pursuant to a sale
leaseback  arrangement  and was obligated to provide the Lessor with 30% warrant
coverage.  This  liability was not recorded on December 1, 2006,  in error,  and
therefore the Company has restated its comparative periods presented to increase
liabilities and deficit as at July 31, 2007 and 2008 by $70,000. This amount was
calculated  using  Black  Scholes  Option  Pricing  Model  using  the  following
assumptions:  5 year expected life, 0% expected dividends,  90% volatility and a
risk-free interest rate of 1.65%.

Pursuant to a new Master  Lease  Agreement  with  Agility  Venture  Fund II, LLC
("Agility  II") dated  December  24,  2008,  the Company  and Agility  agreed to
provide funding under new sale lease back arrangements totaling $1,000,000. This
new  facility  is in addition to and in  conjunction  with the  November 6, 2006
agreement.  On February 17, 2009, March 27, 2009, July 9, 2009 and July 14, 2009
the Company  received an aggregate of $749,749  pursuant to four sale  leaseback
schedules  completed  ($689,368 in connection  with sale leaseback  arrangements
pursuant to the Master Lease Agreements (See Note 5) and an aggregate of $60,381
in connection with sale leaseback arrangements for assets purchased from various
unrelated vendors).

Each sale leaseback  transaction  requires a 10% deposit as additional  security
for the  stream  of lease  payments  and 30%  warrant  coverage  as a  financing
expense. Each lease agreement is for a period of 36 months with a buy-out at the
end of the lease  equal to the fair value of the  equipment  at that  time.  Our
Chief  Executive  Officer and Chairman of the Board of the Company have provided
personal guarantees for all remaining lease payments.

Pursuant to Warrant  Agreements  appended to the Master  Lease  Agreements  with
Agility and Agility II, the Company was obligated to provide the Lessor with 30%
warrant coverage.  On June 24, 2009, the Company settled the commitment to issue
warrants  under the November 6, 2006 Master Lease  Agreement and issued  155,556
warrants  exercisable at $0.45 per common share expiring  December 1, 2011. Also
on June 24, 2009 the Company  settled the  commitments  to issue warrants on the
first two of four sale leaseback  schedules.  The Company issued 77,569 warrants
exercisable  at $0.51 per common  share  expiring  February  17, 2019 and issued
184,914 warrants  exercisable at $0.58 per common share expiring March 27, 2019.
These warrants were valued at $126,907 and charged as a financing expense.  This
amount was  calculated  using  Black  Scholes  Option  Pricing  Model  using the
following  assumptions:  5  year  expected  life,  0%  expected  dividends,  90%
volatility and an average risk-free interest rate of 1.75%.

As at July 31, 2009 the following warrants are exercisable:

     a)   at $0.45 per common share as to 155,556 warrants  expiring December 1,
          2011;
     b)   at $0.51 per common share as to 77,569 warrants  expiring February 17,
          2019;
     c)   at $0.58 per common share as to 184,914  warrants  expiring  March 27,
          2019.

The Company was committed to issuing 139,490 share purchase  warrants to acquire
139,490  common shares at an exercise  price of $0.56 per common share  expiring
July 14,  2019  pursuant  to the July 9, 2009 and July 14,  2009 sale  leaseback
arrangements.  These  warrants  were  issued on October  13,  2009.  The Company
recorded  $63,132 as an other liability and financing  expense.  This amount was
calculated  using  Black  Scholes  Option  Pricing  Model  using  the  following
assumptions:  5 year expected life, 0% expected dividends, 90% volatility and an
average risk-free interest rate of 2.36%.

Pursuant  to  $0.35  Unit  and Unit  for  Debt  Private  Placement  Subscription
Agreements  there are  1,303,695  common  share  purchase  warrants  outstanding
exercisable at $0.50 per common share expiring as follows:

     a)   as to 1,199,408 warrants - expiring May 8, 2011;
     b)   as to 100,000 warrants - expiring June 24, 2011;
     c)   as to 4,287 warrants - expiring - September 17, 2011.

See Note 16 (e) and (f) for 2,291,697  common share purchase  warrants issued on
October 20,  2009.  These  warrants  are  exercisable  at $0.50 per common share
expiring October 20, 2011.

In total, including warrants issued subsequent to July 31, 2009, the Company has
common  share  purchase  warrants  issued  and  outstanding  to  purchase  up to
1,861,224  common shares at an average  exercise  price of $.51 per common share
having an average remaining life of 3 years.

                                       45
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Notes to Consolidated Financial Statements

12. Lease Obligations

Pursuant to the Master Lease Agreement disclosed in Note 4, the Company received
$749,749  pursuant  to four  sale  leaseback  schedules  completed.  These  sale
leaseback  arrangements  are  treated as  operating  leases and repaid over a 36
month  period.  During  the year,  rental  expense  under  operating  leases was
$211,047 (2008 - $95,980).

Future  minimum lease  payments for  equipment  acquired  under  non-cancellable
capital  leases  from a related  party (See Note 9) and  operating  leases  with
initial terms of more than one year are as follows:

                                                        Capital       Operating
                                                        Leases          Leases
                                                        ------          ------
Twelve months ending July 31,                              $               $

2010                                                    57,497         434,173
2011                                                    32,666         386,953
2012                                                    13,768         262,585
2013                                                     6,620          19,200
2014                                                        --          19,200
                                                       -------         -------
Total minimum lease payments                           110,552

Less: amounts representing interest                     13,537
                                                       -------

Present value of net minimum lease payments             97,015
Less: current portion                                   50,147
                                                       -------
Long-term capital lease obligations                     46,868
                                                       =======

Long-term capital lease obligations are to be repaid over the next five years as
follows:

                      Year               $
                      ----             ------
                      2010             28,434
                      2011             12,873
                      2012              5,561
                      2013                 --
                      2014                 --

13. 401(K) Plan

The Company  established a 401(K) plan (the "Plan")  effective  October 1, 2008.
All employees having attained the age of 21 and having completed three months of
service are eligible to participate in the Plan. Plan  participants may elect to
have 1% to 15% of their annual compensation contributed to the Plan. The Company
plans to provide a discretionary  match of up to 4% of the  participants'  basic
compensation.

                                       46
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Notes to Consolidated Financial Statements

14. Income Taxes

The Company accounts for income taxes pursuant to SFAS No. 109,  "Accounting for
Income Taxes"  ("SFAS  109").  Deferred  income tax assets and  liabilities  are
determined based upon differences  between financial  reporting and tax bases of
assets and  liabilities  and are  measured  using the enacted tax rates and laws
that will be in effect when the differences are expected to reverse.  Income tax
expense  differs from the amount that would result from applying the Federal and
State income tax rates to earnings before income taxes. Federal and State income
tax losses of approximately  $6,700,000 are no longer  immediately  available to
the  Company  pursuant  to the  change of control  rules of  Section  382 of the
Internal  Revenue Code.  However,  an annual  deduction  equal to  approximately
$238,000 is available to reduce  taxable  income of future years for the next 28
years.  This annual  deduction is available until a total of $6,700,000 has been
deducted in total.

The Company has  consolidated  net  operating  losses  ("NOL") of  approximately
$2,040,000 to carry forward.  These NOL's are available to offset taxable income
in future  years and begin  expiring in fiscal  2027.  Pursuant to SFAS 109, the
potential benefit of these NOL's carried forward have not been recognized in the
consolidated financial statements since the Company cannot be assured that it is
more likely than not that such  benefit  will be realized in future  years.  The
following is a summary of the components of the provision for income tax benefit
and related valuation allowance for the years ended July 31:

                                                    2009                2008
                                                  --------            --------
                                                      $                   $
Deferred income tax benefit:
  Federal (34%)                                   (660,000)           (352,000)
  State (8.5%)                                     (45,000)            (58,000)
                                                  --------            --------
                                                  (705,000)           (410,000)
Valuation allowance                                705,000             410,000
                                                  --------            --------
Total income tax benefit                                --                  --
                                                  ========            ========

A reconciliation  of the provision for income taxes to the statutory federal and
state rates is as follows:

                                                    2009                2008
                                                  --------            --------
                                                      $                   $

Statutory tax rate Federal and State:                 42.5%               42.5%
Change in valuation allowance                        (42.5%)             (42.5%)
                                                  --------            --------
Effective Tax Rate                                       0%                  0%
                                                  ========            ========

                                       47
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Notes to Consolidated Financial Statements

15. Restatement of Prior Periods due to Corrections of Errors

The Company has restated  prior period  financial  statements  pursuant to error
corrections.   Pursuant  to  SFAS  No.  154,   "Accounting   Changes  and  Error
Corrections",  previously issued financial statements and comparative  financial
statements  issued  currently  are to be  restated  for  correction  of  errors.
Cumulative  effects of errors are reflected in beginning  balances of assets and
liabilities with the offsetting  adjustment  reflected in the beginning  deficit
balance.

The Company  corrected  errors in the recording of liabilities for equipment and
services not actually received and royalties not actually owing during the years
2006, 2007 and 2008. The result of recording these liabilities in error resulted
in a reduction of $170,474 in current  liabilities.  A total of $96,425 resulted
in an increase to revenue due to royalties  not incurred  that  originally  were
offset to arrive at net sales (2008 - $36,866; 2007 - $51,335; 2006 - $8,224). A
total of $48,212 was due to marketing  fees owing to an REMC which resulted in a
decrease to operating expenses (2008 - $18,433;  2007 - $25,667; 2006 - $4,112).
A total of $25,837 was for tower  rental  services  not  received  and  invoices
recorded  in error  (2008 -  $11,245;  2007 -  $11,022;  2006 -  $3,570),with  a
corresponding  net  increase  to net  income of prior  years and a  decrease  to
deficit of $127,477.  The Company also corrected an error for services  received
but no liability was recorded totaling $17,161 (2008 - $11,773; 2007 - $5,388).

On December 1, 2006,  pursuant to a Master Lease  Agreement and related  Warrant
Agreement,   the  Company  received   $233,333  pursuant  to  a  sale  leaseback
arrangement and was obligated to issue warrants. This liability was not recorded
on December 1, 2006,  in error,  and the Company has  restated  its  comparative
periods  presented to increase  liabilities  and deficit as at July 31, 2007 and
2008 by $70,000 being the value of warrants to be issued.

The combined  effect of these errors in the  financial  statements  for the year
ended July 31, 2008 is as follows:

<TABLE>
<CAPTION>
                                                           Error           Error
                                                        Corrections      Correction
                                         Previously      (Accounts        (Other
                                          Reported        Payable)       Liability)       Restated
                                         ----------      ----------      ----------      ----------
                                             $               $               $               $
<S>                                     <C>               <C>              <C>          <C>
Balance Sheet:
  Accounts payable                          539,450        (153,313)             --         386,137
  Other liability                                --              --          70,000          70,000
  Deficit                                 5,129,849        (153,313)         70,000       5,046,536
Statement of Operations:
  Revenue                                   997,444          36,866              --       1,034,310
  Plant and signal delivery                 584,246         (17,906)             --         566,340
  Net loss                                1,034,633         (54,772)             --         979,861
  Loss per share - basic and diluted           (.03)             --              --            (.03)
Stockholders' Deficit:
  Deficit - beginning of year             4,095,216         (98,541)         70,000       4,066,675
</TABLE>

                                       48
<PAGE>
Omnicity Corp. (formerly Bear River Resources, Inc.)
Notes to Consolidated Financial Statements

16. Subsequent Events

Subsequent to July 31, 2009 the Company has:

     a)   received  $10,000  pursuant  to the  Company's  8%,  18  month  senior
          subordinated  debenture  $20,000  pursuant to the Company's $0.50 unit
          private placement. See Note 10 (h).
     b)   issued 229,855  restricted common shares of the Company on August , at
          a fair value of $0.71 per common share,  totalling $164,000,  pursuant
          to the acquisition of wireless  equipment,  tower  infrastructures and
          customers'  relationships.  A total of $164,000 was recorded as common
          stock subscribed for as at July 31, 2009;
     c)   issued  139,490  common  share  purchase  warrants to acquire  139,490
          common shares at an exercise  price of $0.56 per common share expiring
          July 14, 2019;
     d)   issued 268,818  restricted common shares to the shareholders of RIS at
          a fair value of $0.465 per common shares (See Note 9 (a)).
     e)   received  $100,000  from a major  shareholder  on  September  9,  2009
          pursuant  to a  short-term  loan.  On October  20, 2009 this loan plus
          accrued  interest of $4,767 plus two  long-term  debt notes  totalling
          $99,420 were converted into equity.  Pursuant to a $0.35 unit for debt
          private  placement  subscription  agreement  the Company has agreed to
          issue  583,394  Units at $0.35 per unit.  Each unit will  contain  one
          common share and one half of one common share purchase  warrant.  Each
          whole  warrant is  exercisable  into one common  share at an  exercise
          price of $0.50 per common share expiring October 20, 2011;
     f)   received  $1,000,000  from a major  shareholder  on October 20,  2009.
          These funds plus $400,000 received on July 3, 2009 were combined and a
          subscription  agreement  for  4,000,000  units at  $0.35  per unit was
          executed on October 20, 2009.  Each unit will contain one common share
          and one half of one common share purchase warrant.  Each whole warrant
          is exercisable into one common share at an exercise price of $0.50 per
          common share expiring October 20, 2011.

                                       49
<PAGE>
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE

We have had no disagreements with our principal independent accountants.

ITEM 9A(T). CONTROLS AND PROCEDURES

DISCLOSURE CONTROLS AND PROCEDURES

Greg  Jarman  our  principal  executive  officer  and Don Prest,  our  principal
financial  officer,  have concluded that our disclosure  controls and procedures
(as defined in Rules  13a-15(e) and  15d-15(e)  under the Exchange Act) were not
effective  as of the end of the period  covered by this  report,  based on their
evaluation of these controls and  procedures  required by paragraph (b) of Rules
13a-15  and  15d-15,  due  to the  deficiencies  in our  internal  control  over
financial reporting as described below.

MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Our management is responsible for establishing and maintaining adequate internal
control  over  financial  reporting,  as  defined in Rules  13a-15(f)  under the
Exchange Act.

The  management  of the Company  assessed  the  effectiveness  of the  Company's
internal  control over financial  reporting  based on the criteria for effective
internal   control   over   financial   reporting    established   in   Internal
Control--Integrated   Framework   issued   by  the   Committee   of   Sponsoring
Organizations of the Treadway Commission ("COSO") and SEC guidance on conducting
such assessments.  Based on this assessment,  management determined that, during
the year ended July 31, 2009,  our internal  controls  and  procedures  were not
effective  to detect the  inappropriate  application  of US GAAP rules,  as more
fully described  below.  This was due to deficiencies in the design or operation
of the Company's internal control that adversely affected the Company's internal
controls and that may be considered to be material weaknesses.

Management identified the following material weaknesses in internal control over
financial reporting:

     1.   The Company has limited  segregation of duties which is not consistent
          with good internal control procedures.
     2.   The  Company  does not have a  written  internal  control  procedurals
          manual which  outlines the duties and  reporting  requirements  of the
          Directors  and any  staff to be hired in the  future.  This  lack of a
          written  internal  control   procedurals  manual  does  not  meet  the
          requirements of the SEC or good internal controls.

Management  believes  that the  material  weaknesses  set forth in items 1 and 2
above did not have an affect on the Company's financial results.

The  Company  and its  management  will  endeavor  to  correct  the above  noted
weaknesses in internal control once it has adequate funds to do so.

Management  will  continue  to monitor and  evaluate  the  effectiveness  of the
Company's  internal  controls  and  procedures  and its internal  controls  over
financial  reporting on an ongoing  basis and are  committed  to taking  further
action and implementing  additional  enhancements or improvements,  as necessary
and as funds allow.

This  annual  report  does not include an  attestation  report of the  company's
registered  public  accounting  firm regarding  internal  control over financial
reporting.  Management's  report was not subject to attestation by the company's
registered  public accounting firm pursuant to temporary rules of the Securities
and Exchange Commission that permit the company to provide only the management's
report in this annual report.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There were no changes to our internal  control  over  financial  reporting  that
occurred  during the last  quarter of our fiscal  year ended July 31,  2009 that
have materially  affected,  or are reasonably likely to materially  affect,  our
internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

Not applicable.

                                       50
<PAGE>
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Our executive officers and directors and their respective ages as of the date of
October 23, 2009 are as follows:

Name and Municipality
   of Residence               Age               Current Office
   ------------               ---               --------------

Richard Beltzhoover
Carmel, Indiana, USA          70    Chairman, Director

Greg Jarman
Rushville, Indiana, USA       46    President, Chief Executive Officer, Director

Don Prest
Vancouver, Canada             49    Chief Financial Officer, Director

David Bradford
Angola, Indiana, USA          61    Chief Operating Officer, Director

Paul Brock
Vancouver, Canada             45    Director

Robert Pearson
Wabash, Indiana, USA          52    Director

William Herdrich
Rushville, Indiana, USA       63    Director

The  following  describes  the business  experience of each of our directors and
executive officers, including other directorships held in reporting companies:

GREG JARMAN

Mr. Jarman was appointed President and Chief Executive Officer on June 23, 2009.
Mr. Jarman has been the chief architect of Omnicity's  rural broadband focus and
its long-term development  strategy.  Mr. Jarman has been with the Company since
2003,  Chief  Operating  Officer since 2006 and President since 2008. Mr. Jarman
most  recently  served as  President  of  RushDSL,  a rural  broadband  services
provider.  Mr. Jarman has also served as Chief Technology  Officer of Q-media, a
network services and managed services provider and was Chief Technology  Officer
and board member of Netisun LLC where he directed  Netisun's  technical services
group and managed network infrastructure. Mr. Jarman was a founder and executive
of Indiana  Communications  & Systems,  Inc., which was a rural business ISP and
managed service providers  acquired by Netisun LLC. He has 25 years of technical
experience  working  with many  corporate  and  governmental  agencies,  and has
consulted  with  Northrop,  The  Associated  Group,  United  Student  Aid Funds,
Cinergy,  Sperry,  Unisys,  and EDS.  Mr.  Jarman  received  his AS in  Computer
Information  Services from Indiana Central  University and has spent 10 years of
his career in information systems consulting.

DON  PREST  has been our Chief  Financial  Officer  and a member of our board of
directors  since July 18,  2007.  Mr.  Prest will lead the SEC public  financial
reporting  process for the Company and the overall financing plan. Mr. Prest has
been a US and Canadian public company  assurance partner for 17 years at a large
regional PCAOB  registered  accounting firm located in Canada,  where his career
began 26 years  ago.  Prior to  December  31,  2009 Mr.  Prest was an  assurance
partner  for over 150  public US  companies.  Mr.  Prest has  retired  from this
position as at December 31, 2008 to focus on the  business of the  Company.  Mr.
Prest is a 1/3 owner of FBP Capital Corp.  ("FBP"), a merchant bank, for 6 years
where he has leveraged his international tax and assurance practice and contacts
to assist FBP's clients in going and being public.  Mr. Prest also served as the
Chief Financial Officer for Power Air Corporation for three years.  Power Air is
a public fuel cell  company.  Mr.  Prest is currently  serving as President  and
Chief Financial  Officer for Omnicity Corp.,  the OTCBB listed company that will
be the parent company for Omnicity  Incorporated.  Mr. Prest will stay on as the
Chief Financial Officer of the Company and continue to be a director.  Mr. Prest
started his career in 1983 upon  graduating  from BCIT in Financial  Management.
Mr.  Prest  received  his  Canadian  CA  designation  in  1991  and  his  US CPA
designation in 1997.

DAVID BRADFORD Mr. Bradford became our Chief Operating  Officer on July 30, 2009
and is in charge of  managing  the  profitability  of the  Company's  day-to-day
operations  in support  of  established  policies,  goals and  objectives  while
providing  leadership,  strategic  direction and vision to the Company.  He also
assists  senior  officers  of the Company in the design and  development  of the
Company's long-term strategic planning, organization of resources to execute its
plan, and the timely and accurate  reporting and analysis of operating  results.
His  responsibilities  include  management  of  acquisitions,   operations,  and

                                       51
<PAGE>
financial  matters,   and  ensuring  their  most  effective   synthesis  to  the
maximization of the Company's  strategic and operating  plans.  Mr. Bradford has
devoted the majority of his senior management  career to the  telecommunications
industry. From 1977 through 1987 he served in executive positions at the Chicago
Tribune's  broadcast and cable  television  divisions.  Positions  included Vice
President and General Manager for Tribune Cable  Communications,  Vice President
of Operations  for WGN  Electronic  Systems  Company,  and Director of Strategic
Planning for Tribune Cable and subsidiaries. After leaving the Tribune companies
Mr.  Bradford  served  as  President  of  Empire   Communications  and  Bradford
Communications,  Inc., both rural cable television multi-system  operators.  Mr.
Bradford  subsequently  served as  President of National  Telsat,  Inc., a rural
wireless  television  and data  provider.  Mr.  Bradford  brings thirty years of
successful  subscriber  based  telecommunications  operating  experience  to the
Company as well as  participation  and  oversight  of  numerous  debt and equity
financings, acquisitions, and restructurings.

RICHARD  BELTZHOOVER Mr.  Beltzhoover  was formerly the Chief Executive  Officer
from  inception  until June 23,  2009.  He now  devotes his time to the Board of
Directors  and assisting the CEO in capital  raising  efforts.  He was the first
investor of Omnicity  Incorporated  and brings more than 35 years'  business and
corporate  venturing  experience to the Company.  Mr.  Beltzhoover was the Chief
Operations  Officer and Board  member of National  Vulcanized  Fibre and,  since
1975,  has served as founder  and  President  of Insul  Reps,  which  represents
manufacturers in the electronic and electro-mechanical  markets. Mr. Beltzhoover
grew sales to $40 million and directed Insul Reps expansion. Mr. Beltzhoover was
also  instrumental  in funding and guiding Indy  Connection  into becoming an $8
million  revenue  ground  transportation  company,  ultimately  selling to Carey
Limousine  for $12 million.  Other  companies he founded  include  Midwest Rail,
Prestige Magazine, Hunt Graphics, and Digital Arts, all of which sold to private
companies. Mr. Beltzhoover holds a Bachelor of Science in Mechanical Engineering
from Penn State University.

PAUL  BROCK  Paul  Brock is a business  management  consultant  with  experience
running  public and  private  companies  involved  primarily  in the telecom and
financial   services  sector,   developing   software  and  applied   electronic
technologies  in the UK,  the  Middle  East,  Asia,  Latin  America,  as well as
throughout the US and Canada. In 1988 Mr. Brock co-founded  VendTek Systems Inc.
(TSX:VSI),  which grew to over $100 million in revenues by 2008 when he resigned
as  Chairman.  During  his  tenure at  VendTek  he  created  and also  served as
President  of  VendTek   Industries  Inc.   (Canada),   a  Director  of  VendTek
International  Inc.  (USA),  President  (until  June  2002) of Now  Prepay  Inc.
(Canada), and President of VendTek China Systems Technologies (Beijing) Co., Ltd
(China).  Mr. Brock was a co-founder in 2003 and  President of Fortune  Partners
Inc.,  which listed on the OTCBB,  and later acquired  Power Air Corp.  where he
continues as a Director.  He was  co-founder  and  President of Rochdale  Mining
Corp.  listed on the  OTCBB  and  later  acquired  Zoro  Mining  Corp.  where he
continues as a Director.  Mr. Brock is the founder in 1999 and President of Bent
International Inc., which is a privately owned business consulting company.  Mr.
Brock now serves as a director  of the  following  public  companies;  Power Air
Corp,  i-Level Media Corp, Zoro Mining Corp,  Silica Resources Corp, and VendTek
Systems  Inc.  Mr.  Brock is a graduate of the  British  Columbia  Institute  of
Technology's  Robotics and Automation  Technology  Program,  a graduate of Simon
Fraser University's  Executive Management Development Program. He is a member in
good  standing  of  the   professional   association  of  the  Applied   Science
Technologists of BC, and an accredited  professional director with the Institute
of Charters Secretaries and Administrators (ICSA) in Canada.

ROBERT  PEARSON has been a member of our board of directors  since  February 17,
2009.  Mr.  Pearson has been employed by the Wabash  County,  Indiana REMC since
1990 and is currently the Chief Executive Officer since 1995.

WILLIAM HERDRICH is a Rushville, Indiana native and has been involved in finance
in the oil and gas  industry  for forty years.  He has a deep  understanding  of
Midwest  rural  markets  having been a retailer and  wholesaler in the petroleum
industry,  and actively  participating in numerous  leadership roles on regional
and national boards.  Mr. Herdrich has assisted in the creation of several firms
including finance, environmental and real estate development.

TERM OF OFFICE

Our  directors  are  appointed for a one-year term to hold office until the next
annual  general  meeting of our  stockholders  or until  removed  from office in
accordance with our bylaws. Our officers are appointed by our board of directors
and hold office until removed by the board.

SIGNIFICANT EMPLOYEES

We have no significant employees other than the officers and directors described
above.

                                       52
<PAGE>
FAMILY RELATIONSHIPS

There are no family relationships among our directors or officers.

INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS

Our directors,  executive officers and control persons have not been involved in
any of the following events during the past five years:

     1.   any bankruptcy petition filed by or against any business of which such
          person was a general  partner or executive  officer either at the time
          of the bankruptcy or within two years prior to that time;
     2.   any conviction in a criminal  proceeding or being subject to a pending
          criminal  proceeding  (excluding  traffic  violations  and other minor
          offences);
     3.   being  subject to any order,  judgment  or  decree,  not  subsequently
          reversed,   suspended   or   vacated,   of  any  court  of   competent
          jurisdiction,   permanently   or   temporarily   enjoining,   barring,
          suspending  or  otherwise  limiting  his  involvement  in any  type of
          business, securities or banking activities; or
     4.   being found by a court of competent  jurisdiction (in a civil action),
          the SEC or the Commodity Futures Trading Commission to have violated a
          federal or state  securities or commodities  law, and the judgment has
          not been reversed, suspended or vacated.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section  16(a) of the  SECURITIES  EXCHANGE ACT OF 1934  requires the  executive
officers and directors,  and persons who  beneficially own more than ten percent
of our equity securities,  to file reports of ownership and changes in ownership
with the Securities and Exchange  Commission.  During the fiscal year ended July
31, 2009, except as disclosed below, these filings were made on a timely basis:

                    No. of Late/Unfiled Reports      No. of Late/Unfiled Reports
                         During the Fiscal                During the Fiscal
Reporting Person      Year Ended July 31, 2009         Year Ended July 31, 2008
----------------      ------------------------         ------------------------

Don Prest             1 - late Form 4 regarding                 Nil
                          one transaction

William Herdrich      1 - failed to file Form 3                 N/A

CODE OF ETHICS

On October 22, 2009 our Board of Directors adopted a Corporate Governance Manual
which includes a Code of Ethics applicable to its principal  executive  officer,
its principal financial officer, its principal accounting officer or controller,
or persons performing similar functions.

COMMITTEES

On June 17,  2009 our  Board of  Directors  adopted  our  nominating,  audit and
compensation   committee  charters.   Pursuant  to  these  charters  independent
directors  are the only members of the audit  committee.  Paul Brock and William
Herdrich are the two independent members of each of these committees.

The Board can elect one additional non-independent member for the nominating and
compensation committees. On October 22, 2009 the Board elected Greg Jarman to be
the one non-independent member of the compensation committee.

Both of our independent  directors sitting on our audit committee are considered
"financial experts".

                                       53
<PAGE>
ITEM 11. EXECUTIVE COMPENSATION

COMPENSATION DISCUSSION AND ANALYSIS

The table below summarizes all compensation awarded to, earned by or paid to our
executive  officers by any person for all services rendered in all capacities to
us during our fiscal years ended July 31, 2009 and 2008.

                           SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
                                                                          Non-Equity      Nonqualified
 Name and                                                                 Incentive         Deferred      All Other
 Principal                                         Stock       Option        Plan         Compensation    Compen-
 Position            Year   Salary($)  Bonus($)   Awards($)   Awards($)  Compensation($)   Earnings($)    sation($)  Totals($)
 --------            ----   ---------  --------   ---------   ---------  ---------------   -----------    ---------  ---------
<S>                  <C>    <C>        <C>         <C>        <C>        <C>               <C>          <C>              <C>
Richard Beltzhoover  2008          0      nil          nil       nil           nil             nil           nil            0
(Former) Chief       2009(1)  30,000      nil      104,125       nil           nil             nil           nil      134,125
Executive Officer

Don Prest            2008     35,750      nil          nil       nil           nil             nil           nil       35,750
Chief Financial      2009        nil      nil          nil       nil           nil             nil           nil          nil
Officer

Greg Jarman          2008     68,445      nil          nil       nil           nil             nil           nil       68,445
Chief Executive      2009     73,455      nil       93,187       nil           nil             nil           nil      166,642
Officer and President
</TABLE>

----------
(1)  Mr.  Beltzhoover  resigned as our Chief Executive  Officer on June 17, 2009
     and Mr. Jarman was appointed  our Chief  Executive  Officer in his place on
     the same day.

OUTSTANDING EQUITY AWARDS

As at July 31,  2009,  there  were no  unexercised  options,  stock that had not
vested or  outstanding  equity  incentive plan awards with respect to any of our
officers or directors.

COMPENSATION OF DIRECTORS

Except  as  disclosed  below,  we did not pay our  directors  any  fees or other
compensation for acting as directors during our fiscal year ended July 31, 2009.
Certain of our current or former  directors  serve or have served as officers of
the Company,  and any  compensation  they  received  due to their  service as an
officer is disclosed in the table above and is not included in the table below:

                              DIRECTOR COMPENSATION

<TABLE>
<CAPTION>
                        Fees                              Non-Equity       Nonqualified
Name and               Earned                              Incentive         Deferred
Principal              Paid in      Stock      Option        Plan          Compensation      All Other
Position               Cash($)     Awards($)  Awards($)  Compensation($)    Earnings($)    Compensation($)   Total($)
--------               -------     ---------  ---------  ---------------    -----------    ---------------   --------
<S>                   <C>       <C>        <C>           <C>             <C>            <C>              <C>
Richard Beltzhoover      nil          nil        nil           nil              nil             nil             nil
Greg Jarman              nil          nil        nil           nil              nil             nil             nil
Don Prest                nil          nil        nil           nil              nil             nil             nil
David Bradford           nil          nil        nil           nil              nil             nil             nil
Paul Brock               nil          nil        nil           nil              nil             nil             nil
Robert Pearson           nil          nil        nil           nil              nil             nil             nil
William Herdrich         nil          nil        nil           nil              nil             nil             nil
</TABLE>

                                       54
<PAGE>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
         RELATED STOCKHOLDER MATTERS

The following  table sets forth  certain  information  concerning  the number of
shares of our common  stock  owned  beneficially  as of October 23, 2009 by: (i)
each person  (including  any group) known to us to own more than 5% of any class
of our voting securities, (ii) each of our directors, (iii) each of our officers
and  (iv)  our  officers  and  directors  as a group.  Each  stockholder  listed
possesses sole voting and investment power with respect to the shares shown.

<TABLE>
<CAPTION>
                                                                        Amount and nature          Percentage of
Title of class          Name and address of beneficial owner (2)      of beneficial owner            class (1)
--------------          ----------------------------------------      -------------------            ---------
<S>                    <C>                                            <C>                          <C>
Common Stock            Richard Beltzhoover (3)
                        Carmel, Indiana, USA                               5,852,800                  15.20

Common Stock            Greg Jarman (4)
                        Rushville, Indiana, USA                            1,633,855                   4.24

Common Stock            Don Prest
                        Vancouver, Canada                                        nil                    Nil

Common Stock            David Bradford
                        Angola, Indiana, USA                                     nil                    Nil

Common Stock            Paul Brock
                        Vancouver, Canada                                        nil                    Nil

Common Stock            Robert Pearson
                        Wabash, Indiana, USA                                     nil                    Nil

Common Stock            William Herdrich
                        Rushville, Indiana, USA                              342,743                    .89

Common Stock            All executive officers and directors
                        as a group (seven persons)                         7,829,398                  20.33

Shareholders of Greater than 5% of Issued and Outstanding Stock

Common Stock            Schwarz Partners LLC (5)                           5,515,059                  14.32

                        Harris Family Limited Partnership and
Common Stock            individual member holdings                         1,949,153                   5.06
</TABLE>

----------
(1)  Based on  38,517,055  shares of common stock issued and  outstanding  as of
     October 23, 2009.  Under Rule 13d-3 of the Exchange Act a beneficial  owner
     of a security includes any person who, directly or indirectly,  through any
     contract,  arrangement,  understanding,  relationship,  or otherwise has or
     shares:  (i) voting power,  which  includes the power to vote, or to direct
     the voting of shares;  and (ii) investment power,  which includes the power
     to dispose  or direct the  disposition  of  shares.  Certain  shares may be
     deemed to be  beneficially  owned by more than one person (if, for example,
     persons share the power to vote or the power to dispose of the shares).  In
     addition,  shares  are deemed to be  beneficially  owned by a person if the
     person has the right to acquire the shares (for  example,  upon exercise of
     an  option)  within  60 days of the date as of  which  the  information  is
     provided.  In computing the percentage  ownership of any person, the amount
     of  shares   outstanding   is  deemed  to  include  the  amount  of  shares
     beneficially owned by such person (and only such person) by reason of these
     acquisition rights.
(2)  The  address of the  executive  officers  and  directors  is c/o  Omnicity,
     Incorporated, 807 South SR 3, Rushville, Indiana, USA, 46173.
(3)  Richard  Beltzhoover  is the  beneficial  owner of 671,976  shares owned by
     Insul Reps Profit Sharing Plan and 225,912 shares owned by Insul Reps, Inc.
(4)  Greg Jarman is a beneficial owner of 11,143 shares owned by Lea Ann Jarman.
(5)  John Schwarz is beneficial owner of Schwarz Partners LLC

SECURITIES AUTHORIZED FOR ISSUANCE UNDER COMPENSATION PLANS

The  table  set  forth  below  presents   information  relating  to  our  equity
compensation plans as of the date of July 31, 2009:

                                       55
<PAGE>
<TABLE>
<CAPTION>
                                Number of Securities to be                                           Number of Securities
                                 Issued Upon Exercise of         Weighted-Average Exercise         Remaining Available for
                                   Outstanding Options,        Price of Outstanding Options,       Future Issuance Under
                                   Warrants and Rights             Warrants and Rights           Equity Compensation Plans
   Plan Category                           (a)                             (b)                      (excluding column (a))
   -------------                   -------------------             -------------------           -------------------------
<S>                               <C>                             <C>                            <C>
Equity Compensation Plans to               n/a                             n/a                               n/a
be Approved by Security
Holders

Equity Compensation Plans Not              n/a                             n/a                               n/a
Approved by Security Holders
</TABLE>

CHANGES IN CONTROL

We are  unaware  of any  contract,  or other  arrangement  or  provision  of our
Articles,  the operation of which may at any subsequent  date result in a change
in control of the Company.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR
         INDEPENDENCE

Except as described  below,  none of the following  parties has, in the last two
fiscal years, had any material interest,  direct or indirect, in any transaction
with us or in any presently  proposed  transaction  that has or will  materially
affect us:

     1.   any of our directors or officers;
     2.   any person proposed as a nominee for election as a director;
     3.   any person who  beneficially  owns,  directly  or  indirectly,  shares
          carrying  more  than  10%  of  the  voting  rights   attached  to  our
          outstanding shares of common stock; or
     4.   any  member  of  the  immediate  family  (including  spouse,  parents,
          children, siblings and in-laws) of any of the above persons.

Paul Brock, Robert Pearson and William Herdrich are independent directors of the
Company as provided in the listing standards of the American Stock Exchange.

TRANSACTIONS WITH WILLIAM HERDRICH:

Included in accrued  liabilities  is $56,294 (2008 - $17,493) owing to Rushville
Internet Services LLC ("RIS") which represents  amounts due to RIS under certain
lease  agreements.  The Company and RIS have  shareholders in common including a
company  controlled by Mr.  Herdrich.  The shareholders of RIS agreed to wind-up
RIS and sell RIS's  assets to Omnicity  for  $125,000.  The Company will receive
their assets, being wireless equipment and tower infrastructures,  having a fair
value  of  $68,706  and  to  settle  the  inter-company  debt  of  $56,294.  All
shareholders of RIS accepted to receive restricted common shares of the Company.
On October 13, 2009 the Company issued 268,818  restricted  common shares to the
shareholders of RIS at a fair value of $0.465 per common share.

On April  15,  2009 Mr.  Herdrich  and  Capital  Investors  Limited,  a  company
controlled  Mr.  Herdrich,  subscribed  for an aggregate of 342,743 Units of our
Company at $0.35 per Unit and  received  342,743  common  shares and warrants to
acquire a further 171,372 common shares as $0.50 per share expiring May 8, 2011.

On July 2, 2009, Mr. Herdrich  loaned the Company  $20,000  pursuant to a senior
subordinated  debenture.  8% interest per annum is payable quarterly and matures
January  2,  2011.  Mr.  Herdrich  can  settle in  common  shares or cash on the
maturity date of January 2, 2011.

                                       56
<PAGE>
TRANSACTIONS WITH ROBERT PEARSON:

Wabash REMC's Chief Executive Officer is Robert Pearson. Since December 21, 2004
six loans have been  provided by Wabash  REMC.  A total of $30,000 was  received
during the year ended July 31, 2009 and $60,298 of interest  and  penalties  was
charged to operations. Pursuant to a Memorandum of Understanding dated September
24, 2009 accrued interest and penalties to this date,  totalling $115,111,  were
added to the Principal  amounts  outstanding of $520,040 for a total of $635,151
of Principal  and Interest  outstanding.  These notes were then  converted  into
long-term  notes.  Interest  rates are between  5.7% and 7.45%  annually and are
collateralized by certain equipment in Wabash County, Indiana.  Monthly payments
of $448 begin on January  31, 2010 on one note with final  payment due  December
31,  2015.  Quarterly  payments of $23,469  begin on December  31, 2009 on three
notes with final  payments  due  between  September  1, 2016 and August 1, 2017.
Quarterly  payments  of $945 begin on  December  31, 2009 on one note with final
payment due July 31, 2014 and  quarterly  payments of $835 on one note begins on
January 31, 2010 with final payment due July 31, 2017.

TRANSACTIONS WITH PAUL BROCK:

None.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

Weaver & Martin LLC served as our independent  registered public accounting firm
and audited our consolidated financial statements for the fiscal year ended July
31,  2009.  BGBC  Partners  LLC  served  as our  independent  registered  public
accounting firm and audited our consolidated financial statements for the fiscal
year ended July 31, 2008.  Aggregate fees for professional  services rendered to
us by our current and predecessor auditors are set forth below:

                                       Year Ended             Year Ended
                                      July 31, 2009          July 31, 2008
                                      -------------          -------------

Audit Fees                               $28,250                $61,072
Audit-Related Fees                       $ 6,800                $ 2,700
Tax Fees                                 $   nil                $ 3,837
All Other Fees                           $   nil                $   nil
                                         -------                -------
Total                                    $26,800                $67,609
                                         =======                =======

AUDIT FEES

Audit fees are the aggregate fees billed for professional  services  rendered by
our independent auditors for the audit of our annual financial  statements,  the
review of the financial statements included in each of our quarterly reports and
services  provided  in  connection  with  statutory  and  regulatory  filings or
engagements.

AUDIT RELATED FEES

Audit related fees are the aggregate fees billed by our independent auditors for
assurance and related services that are reasonably related to the performance of
the audit or review of our  financial  statements  and are not  described in the
preceding category.

TAX FEES

Tax fees are billed by our independent  auditors for tax compliance,  tax advice
and tax planning.

ALL OTHER FEES

All other fees include fees billed by our  independent  auditors for products or
services other than as described in the immediately preceding three categories.

                                       57
<PAGE>
POLICY ON PRE-APPROVAL OF SERVICES PERFORMED BY INDEPENDENT AUDITORS

It is our Board of Directors'  policy to pre-approve  all audit and  permissible
non-audit  services  performed  by the  independent  auditors.  We approved  all
services that our independent  accountants provided to us in the past two fiscal
years.

ITEM 15. EXHIBITS

The  following  exhibits  are filed  with  this  Annual  Report  on Form  10-K/A
(Amendment No. 2)

Exhibit No.                              Description
-----------                              -----------
3.1            Articles of Incorporation.(1)
3.2            Articles of Merger.(2)
3.3            Certificate of Change..(2)
3.4            Bylaws.(1)
10.1           Agreement  and Plan of Merger  among the Company,  MergerSub  and
               Omnicity Incorporated,  dated for reference effective on December
               29, 2008.(3)
10.2           Master Lease Agreement with Agility Venture Fund I, LLC. (4)
10.3           Master Lease Agreement with Agility Venture Fund II, LLC. (4)
10.4           Agreement   Concerning   Debt   with   Jay   County   Development
               Corporation. (4)
10.5           Memorandum of Understanding between the Company and Wabash County
               REMC. (4)
10.6           Loan  Modification  Agreement  between  the  Company  and  Muncie
               Industrial Revolving Loan Board. (4)
10.7           Promissory Note Payable to Star Financial Bank. (4)
10.8           Promissory Note Payable to Insul Reps, PSP. (4)
10.9           Convertible  Redeemable Debenture Payable to William J. Herdrich.
               (4)
10.10          Form of  $0.35  Unit  Private  Placement  Subscription  Agreement
               entered into by William Herdrich. (4)
10.11          Form of  $0.35  Unit  for  Debt  Private  Placement  Subscription
               Agreement entered into by Capital Investors Limited. (4)
10.12          Promissory Note Payable to George Beltzhoover. (4)
10.13          Asset Purchase Agreement with ND Wave, LLC, as amended. (4)
10.14          Asset  Purchase  Agreement  with Fore  Point  Networks,  LLC,  as
               amended. (4)
10.15          Asset Purchase Agreement with Cue Connex, LLC. (4)
10.16          Asset Purchase Agreement with North Central Communications,  Inc.
               (4)
10.17          Form of Letter  Agreement  between  Company and  Shareholders  of
               Rushville Internet Services LLC. (4)
10.18          Form of Subscription  Agreement  between Company and Shareholders
               of Rushville Internet Services LLC. (4)
21.1           Subsidiaries of the Company - see Subsidiaries
31.1           Certifications of Chief Executive Officer Pursuant to Section 302
               of the Sarbanes-Oxley Act of 2002
31.2           Certifications of Chief Financial Officer Pursuant to Section 302
               of the Sarbanes-Oxley Act of 2002
32.1           Certifications  of Chief  Executive  Officer and Chief  Financial
               Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

----------
(1)  Incorporated by reference from our Company's registration statement on Form
     SB-2 as filed with the SEC on September 10, 2007.
(2)  Incorporated  by reference  from our Company's  Current  Report on Form 8-K
     filed with the SEC on October 23, 2008.
(3)  Incorporated  by reference  from our Company's  Current  Report on Form 8-K
     filed with the SEC on December 31, 2008.
(4)  Incorporated  by reference from our Company's Form 10K/A  (Amendment No. 1)
     for the year ended July 31, 2009 filed with the SEC on September 29, 2010

                                       58
<PAGE>
                                   SIGNATURES

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

                          OMNICITY CORP.


                          BY: /s/ Greg Jarman
                              --------------------------------------------------
                              Greg Jarman
                              Chief Executive Officer, President, and a Director
                              Date: October 29, 2010


                          BY: /s/ Don Prest
                              --------------------------------------------------
                              Don Prest
                              Chief Financial Officer and a Director
                              Date: October 29, 2010

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following  persons on behalf of the  registrant and
in the capacities and on the dates indicated.

<TABLE>
<CAPTION>
         Signature                                  Title                                        Date
         ---------                                  -----                                        ----
<S>                                  <C>                                                   <C>

/s/ Richard Beltzhoover               Chairman of the Board and Director                   October 29, 2010
--------------------------------
Richard Beltzhoover


/s/ Greg Jarman                       President, Chief Executive Officer and Director      October 29, 2010
--------------------------------
Greg Jarman


/s/ Don Prest                         Chief Financial Officer and Director                 October 29, 2010
--------------------------------
Don Prest


/s/ David Bradford                    Chief Operating Officer and Director                 October 29, 2010
--------------------------------
David Bradford


/s/ Paul Brock                        Director                                             October 29, 2010
--------------------------------
Paul Brock


/s/ Greg Dunn                         Director                                             October 29, 2010
--------------------------------
Greg Dunn


/s/ William Herdrich                  Director                                             October 29, 2010
--------------------------------
William Herdrich


/s/ Richard Reahard                   Director                                             October 29, 2010
--------------------------------
Richard Reahard
</TABLE>

                                       59