##### Table of Contents

##### Index to Financial Statements





UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549





Form 10-K







|x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|- | ------------------------------------------------------------------------------------

For the fiscal year ended: December 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: 000-49688





Speedemissions, Inc.

(Exact name of registrant as specified in its charter)







|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|Florida                                                        |  | 33-0961488                          
|(State or other jurisdiction of incorporation or organization) |  | (I.R.S. Employer Identification No.)

1015 Tyrone Road, Suite 220

Tyrone, Georgia 30290

(Address of principal executive offices)

Registrants telephone
number (770) 306-7667

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

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



|                               |  |                                          
|------------------------------ |  | -----------------------------------------
|Title of Each Class            |  | Name of Each Exchange on Which
Registered
|Common stock, par value $0.001 |  | Over the Counter: Bulletin Board         





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 or Section 15(d) of the Act.    Yes   ̈    No  x

Indicate by check mark whether the registrant: (1) has 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 Website, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§229.405 of the chapter) during the preceeding 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.    Yes   ̈    No  x

Indicate by check mark 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

Indicate by check mark 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 of the registrant as of June 30, 2009, the last business day of the registrants most recently completed second fiscal quarter, based on
the closing price of the stock on such date was $206,484.

As of March 22, 2010, 7,025,648 shares of common stock of the
registrant were outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the definitive Proxy Statement to be delivered to stockholders in connection with our 2010 Annual Meeting of Stockholders are
incorporated by reference in Part III herein.









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##### Index to Financial Statements

Speedemissions, Inc.

FORM 10-K

For the fiscal year ended December 31, 2009

TABLE OF CONTENTS



|                                                                                                                         |  |   
|------------------------------------------------------------------------------------------------------------------------ |  | --
|Special Note Regarding Forward-Looking Statements                                                                        |  | 3 
|                                                                                                                         | 
|PART I                                                                                                                   |  | 3 
|                                                                                                                         | 
|ITEM 1. BUSINESS                                                                                                         |  | 3 
|ITEM 1A. RISK FACTORS                                                                                                    |  | 8 
|ITEM 1B. UNRESOLVED STAFF
COMMENTS                                                                                       |  | 12
|ITEM 2. PROPERTIES                                                                                                       |  | 12
|ITEM 3. LEGAL PROCEEDINGS                                                                                                |  | 12
|ITEM 4. RESERVED                                                                                                         |  | 12
|                                                                                                                         | 
|PART II                                                                                                                  |  | 13
|                                                                                                                         | 
|ITEM 5. MARKET FOR THE REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY
SECURITIES |  | 13
|ITEM 6. SELECTED FINANCIAL
DATA                                                                                          |  | 14
|ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS                            |  | 15
|ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                                                      |  | 18
|ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA                                                                      |  | 19
|ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE                             |  | 20
|ITEM 9A CONTROLS AND
PROCEDURES                                                                                          |  | 20
|ITEM 9B. OTHER INFORMATION                                                                                               |  | 20
|                                                                                                                         | 
|PART III                                                                                                                 |  | 21
|                                                                                                                         | 
|ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE                                                       |  | 21
|ITEM 11. EXECUTIVE
COMPENSATION                                                                                          |  | 21
|ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS                  |  | 21
|ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE                                       |  | 21
|ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES                                                                          |  | 21
|                                                                                                                         | 
|PART IV                                                                                                                  |  | 22
|                                                                                                                         | 
|ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES                                                                      |  | 22
|SIGNATURES                                                                                                               |  | 25
|EX-23.1                                                                                                                  |  |   
|EX-31.1                                                                                                                  |  |   
|EX-31.2                                                                                                                  |  |   
|EX-32.1                                                                                                                  |  |   
|EX-32.2                                                                                                                  |  |   



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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are statements that look to future events and consist of, among other things, statements about our anticipated future income including the
amount and mix of revenue among type of product, category of customer, geographic region and distribution method and our anticipated future expenses and tax rates. Forward-looking statements include our business strategies and objectives and include
statements about the expected benefits of our strategic alliances and acquisitions, our plans for the integration of acquired businesses, our continued investment in complementary businesses, products and technologies, our expectations regarding
product acceptance, product and pricing competition, continuation of our stock repurchase program, cash requirements and the amounts and uses of cash and working capital that we expect to generate, as well as statements involving trends in the
security risk management market and statements including such words as may, believe, plan, expect, anticipate, could, estimate, predict,
goals, continue, project, and similar expressions or the negative of these terms or other comparable terminology. These forward-looking statements speak only as of the date of this Annual Report on Form 10-K
and are subject to business and economic risks, uncertainties and assumptions that are difficult to predict, including those identified below in Item 1A, Risk Factorsas well as in Item 1, Business and
Item 7, Managements Discussion and Analysis of Financial Condition and Results of Operationsin this Annual Report on Form 10-K. Therefore, our actual results may differ materially and adversely from those
expressed in any forward-looking statements. We cannot assume responsibility for the accuracy and completeness of forward-looking statements, and we undertake no obligation to revise or update publicly any forward-looking statements for any reason.

Part I

Item 1. Business

Overview

Speedemissions, Inc. is one of the largest test-only emissions testing and safety inspection companies in the United States. We perform
vehicle emissions testing and safety inspections in certain cities in which vehicle emissions testing is mandated by the Environmental Protection Agency (EPA). As of March 22, 2010, we operated 41 vehicle emissions testing and safety inspection
stations under the trade names of Speedemissions(Atlanta, Georgia and St. Louis, Missouri); Mr. Sticker(Houston, Texas); and Just Emissions(Salt Lake City, Utah). We also operate four mobile testing units in the Atlanta,
Georgia area which service automotive dealerships and local government agencies. We manage our operations based on these four regions and we have one reportable segment. References in this document to Speedemissions, Company,
we, us and our mean Speedemissions, Inc and our consolidated subsidiaries.

We use
computerized emissions testing and safety inspections equipment that test vehicles for compliance with vehicle emissions and safety standards. Our revenues are generated from the test or inspection fee charged to the registered owner of the vehicle.
We do not provide automotive repair services.

Corporate Information

We were incorporated as SKTF Enterprises, Inc. in Florida in March 2001. In June 2003, we acquired Speedemissions, Inc., a Georgia
corporation in the business of vehicle emissions testing since May 2000. In connection with the acquisition, we changed our name to Speedemissions, Inc. in September 2003. Our principal offices are located at 1015 Tyrone Rd Suite 220, Tyrone,
Georgia 30290. Our telephone number is (770) 306-7667 and our website is www.speedemissions.com. Information on our website is not intended to be incorporated into this annual report.

Our Typical Testing Center

Our testing centers generally are located in freestanding buildings in areas with high vehicle traffic counts, good visibility and easy access to major roadways. The typical testing center is located inside of a structure similar to a
typical lube or tire change garage with doors at both ends so vehicles can drive-through the facility. We also have structures that resemble a bank drive-through facility. We are creating brand awareness in our current testing stations
through standard building style and façade, consistent color schemes, signs, and employee uniforms, and we advertise in select local markets. Computerized testing systems are located in each building to test vehicle emissions and safety, if
applicable in that state. We purchase or lease these computerized testing systems from state approved equipment vendors.

Most
of our emissions testing stations are open for business during weekdays between the hours of 8:00 am and 6:00 pm, and from 8:30 am to 5:00 pm on Saturdays. We operate some stations on Sundays in Texas. The average emissions test in Georgia takes
approximately 8 to 12 minutes to complete. In Texas, Missouri and Utah, because of the safety inspection, the completion time is slightly longer. In addition, we do a limited amount of oil changes in four of our fifteen Texas locations.



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There are two types of primary emissions tests that are performed, the Accelerated Simulated
Model (ASM) and the On-Board Diagnostic (OBD). In selected markets a vehicle safety inspection is required to be performed. These tests apply to vehicles generally manufactured from 1983 through 2005, depending on the state. The ASM test is done on
vehicles 1995 and older, while the OBD test is conducted on vehicles 1996 and newer. We generally operate two or three testing lanes at each testing center depending upon the size of the building. We typically lease the land and the building from
the property owners, however we have constructed several buildings on land leases in the past.

In our Atlanta, Georgia
locations, under the guidelines of the Georgia Clean Air Force program the mobile vehicle emission testing units are only permitted to conduct the OBD test on 1996 and newer vehicles. In the Atlanta, Georgia area, we currently have four mobile units
and they serve the automobile fleets of the federal, state, and local governments. All used cars in Georgia, prior to being re-sold, must have a vehicle emission test, and thus we serve selected new and used car dealers throughout the greater
Atlanta market with these mobile units.

Expansion of Business

Since our incorporation, we have grown as a result of comparable store sales growth, new store openings and strategic acquisitions. We have
acquired some of our well-known, well-established competitors in the Atlanta, Georgia, Houston, Texas and Salt Lake City, Utah trade areas. We last acquired a competitor in 2005. Our acquisitions in 2005 included Mr. Sticker, Inc. in Houston
which began testing in 1985 and Just Inc. (Just Emissions) in Salt Lake City which began testing in 1993. We expect to open between one and three new testing locations during 2010. Our expansion during 2010 will be funded by existing working capital
and 2010 cash flows from operations.

We continually reassess our store rollout plans based on numerous factors including the
overall environment of the emissions testing industry, our access to working capital and external financing, general economic conditions and the availability of suitable locations. This growth may be curtailed if we do not have adequate working
capital, access to financing, as a cost containment initiative, or if we are unable to obtain the standard emission and safety station licensing approval from the respective state regulatory agencies for each location.

Industry Background  Government and Regulatory Overview

The United States Environmental Protection Agency (EPA) reported in 2007 that approximately 158.5 million people lived in counties across the United States whose air pollution exceeded
national air quality standards. Motor vehicles are responsible for nearly one half of the smog-forming volatile organic compounds, more than half of the nitrogen oxide emissions and about half of the toxic air pollutant emissions in the United
States. Motor vehicles, including off road vehicles, now account for 75 percent of carbon monoxide emissions nationwide.

The
total vehicle miles people travel in the United States increased 178 percent between 1970 and 2005 and continues to increase at a rate of two to three percent each year. In the United States, there are more than 210 million cars and light-duty
trucks on the road.

The 2007 Motor Vehicle I/M Report published by Sierra Research, states that 32 states and the District of
Columbia currently have vehicle emissions testing programs. Each state, as well as the District of Columbia, has its own regulatory structure for emissions testing with which we must comply if we conduct business in that state.

Public awareness of air pollution and its hazardous effects on human health and the environment has increased in recent years. Increased
awareness of air pollution and its hazardous effects on human health and the environment has led governmental authorities to pass more stringent pollution control measures. One especially effective measure that many governmental authorities have
adopted is vehicle emissions testing. The EPA estimates that enhanced emissions testing on motor vehicles is approximately 10 times more cost-effective in reducing air pollution than increasing controls on stationary pollution sources such as
factories and utilities. Consequently, the EPA has made emissions testing an integral part of its overall effort to reduce air pollution by ensuring that vehicles meet emissions standards.

Vehicle emissions control requirements have become progressively more stringent since the passage of the Clean Air Act in 1970. In 1990,
Congress amended the Clean Air Act. The revisions required areas that did not meet national ambient air quality standards (NAAQS) to implement either basic or enhanced vehicle I/M emissions testing programs, depending upon the severity
of the areas air quality problem. The act also required that metro areas with populations of more than 100,000 implement enhanced I/M emissions testing regardless of their air quality designation.

On November 5, 1992, the EPA issued its original rule establishing minimum performance and administrative requirements for states
developing air quality implementation plans. The EPA said areas that needed enhanced emissions testing would have to use their new I/M 240 test procedure. However, the EPA decided to grant state governmental authorities the discretion to
determine how best to establish and operate a network of emissions testing facilities, including the flexibility to choose either a centralized or a decentralized program.



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In general, these vehicle emissions tests are performed either in a centralized program or
in a decentralized program. In a centralized program, a select number of emissions testing operators are licensed by the state or are operated by certain states to perform vehicle emissions testing. These operators are authorized to perform
emissions tests, but generally they are prohibited from repairing vehicles that fail to pass an emissions test.

On the other
hand, in a decentralized program, a wider range of persons may perform emissions tests, including those engaged primarily in other businesses, such as automotive repair shops, oil change stores and others. For many of these operators, performing
emissions tests is not their primary business.

Nineteen states have implemented decentralized programs, ten states and the
District of Columbia have implemented centralized programs. There are three states that have implemented a hybrid program, whereby the state operates its own testing stations and also allows independently operated stations.

On July 31, 1998, the EPA issued a final study that concluded that more stringent air quality standards for motor vehicle emissions are
needed, and that such standards should be implemented as it becomes technologically feasible and cost-effective to do so. We believe that the setting of such standards will be the most important EPA regulatory initiative affecting motor vehicles
since the passage of the 1990 Amendments. We believe that the EPA study is likely to result in more stringent standards that will have the effect of increasing the number of areas that must implement emissions testing programs and thereby
potentially increasing the market for our service. On February 28, 2006, the EPA proposed new standards that would establish stringent new controls on gasoline passenger vehicles to further reduce emissions of mobile source air toxins.

Since 1977, when federal legislation first required states to comply with emissions standards through the use of testing
programs, California has been a leader in testing procedures and technical standards. California has approximately 23 million vehicles subject to emissions testing, more than two times that of any other state. Californias testing program
is overseen by the California Bureau of Automotive Repair (CARB). CARB has revised its emissions testing standards three times: in 1984, 1990 and, most recently, in 1997. With each of these revisions, the Bureau has required the use of new, more
sophisticated and more accurate emissions testing and analysis equipment, which must be certified by CARB. Californias testing standards have become the benchmark for emissions testing in the United States.

All states with decentralized programs and many states with centralized programs require emissions testing and analysis equipment used in
their programs to be either BAR-84, BAR-90, or BAR-97 certified, with all newly implemented enhanced programs requiring BAR-97 certification.

As emissions testing equipment has become more technologically advanced, government regulators have required that testing facilities use this more advanced equipment. The most significant technological
advance that has occurred in the emissions testing industry over the past decade is the development of enhanced testing systems. Prior to 1990, the EPA required government agencies to test vehicles only for emissions of carbon monoxide and
hydrocarbons, which form smog. During this basic test, a technician inserts a probe in the vehicles tailpipe while the vehicle is idling and emissions analyzers then measure pollution levels in the exhaust. These basic tests worked
well for pre-1981, non-computerized vehicles containing carburetors because typical emission control problems involved incorrect air/fuel mixtures and such problems increase pollution levels in the exhaust even when the vehicle is idling.

However, todays vehicles have different emissions problems. For tests on modern vehicles to be effective, the equipment
must measure nitrogen oxide emissions that also cause smog and must test the vehicle under simulated driving conditions. The EPA now requires these enhanced tests in the major metropolitan areas of 32 states and the District of Columbia. A
technician conducts these Accelerated Simulated Mode (ASM) tests on a dynamometer, a treadmill-type device that simulates actual driving conditions, including periods of acceleration, deceleration and cruising, or the On Board Diagnostic (OBD) by
plugging into the vehicles computerized operation system.

Emissions Testing in the State of Georgia

In 1996, the Environmental Protection Division of the State of Georgia initiated Georgias Clean Air Force (GCAF) program
that required emissions testing of certain vehicles in a 13 county area surrounding metro Atlanta, Georgia. These rules are set forth in Sections 391-3-20-.01 through .22 of the Rules of the Georgia Department of Natural Resources, Environmental
Protection Division.

Georgias program is a decentralized program. All operators performing emissions testing in Georgia
must have their technicians attend and complete certain state certified training, and report to the state on their emissions testing activities every month. Testing stations may be licensed to test all vehicles, which are known as ALL VEHICLES
WELCOME stations, or only vehicles not more than ten years old, known as 1996 OR NEWER VEHICLES ONLY stations. All the stations we currently operate in Georgia, are ALL VEHICLES WELCOME stations. The program requires vehicles in the 13
covered counties to undergo an emissions test on an annual basis, with an annual exemption for the three most recent model years.



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The market for emissions testing in Georgia is highly fragmented and generally consists of
services provided by independent auto repair service providers, service stations, oil and tire repair stores, and independent test-only facilities. According to the State of Georgias GCAF, there are approximately 800 licensed test sites, and
approximately 2,500,000 tests are performed annually in Georgia.

Georgia law mandates compliance with its vehicle emissions
testing program. For vehicles subject to the states emissions law, a successful test, or a waiver from the state, is required to obtain a vehicle registration in Georgia. Nearly 2 million heavy polluting vehicles have been identified and
repaired since the start of the program.

Emissions Testing and Safety Inspections in the State of Texas

The Texas Vehicle Emissions Testing Program, also known as AirCheck Texas, was implemented in May 2002 in affected areas of Texas to improve
air quality. As of January 2010, 17 counties are subject to enhanced vehicle emissions testing in Texas including the greater metropolitan areas of Dallas  Ft. Worth, Houston, Galveston, Austin and El Paso. The rules are set forth in §
114.50 of the Texas Administrative Code.

The testing program is integrated with the annual safety inspection program, both of
which are operated by the Texas Department of Public Safety in conjunction with the Texas Commission on Environmental Quality. Vehicles two to twenty-four years old are subject to vehicle emissions testing in Texas. The emissions tests conducted are
the same as in Georgia, and Utah with 1996 and newer models subject to the OBD test and 1995 and older models subject to the ASM test. Vehicles are required to be tested on an annual basis, with an annual exemption for the two most recent model
years. According to the American Automobile Motor Vehicle Association, there are approximately 4.6 million eligible vehicles in the state.

Texas law mandates compliance with its vehicle emissions and safety inspection program. For a vehicle to obtain a sticker for yearly registration the owner must have a successful emissions and safety
inspection, or a waiver.

Emissions Testing and Safety Inspections in the State of Utah

The state of Utah allows a hybrid of the centralized and decentralized programs where the state operates a select number of emissions testing
and safety inspection centers while authorizing those businesses such as an automotive repair shop, automobile dealers and others to conduct emissions testing and safety inspections. The Department of Health for each county manages emission testing
and the Utah Highway Patrol manages safety inspection program. The emissions tests conducted are the same as in Georgia and Texas.

All vehicles registered in Davis, Salt Lake, Utah and Weber counties with model years less than six years old are required to have an emission test once every two years. Vehicles with model years six years old and older (to 1967) must have
an emission test every year. Emission testing is not required for vehicles with model years 1967 or older. Vehicles with model years less than eight years old are required to have a safety inspection once every two years. Vehicles with model years
eight years old and older must pass safety inspections every year.

Utah law mandates compliance with its vehicle emissions
and safety inspection program. For a vehicle to obtain a sticker for yearly registration the owner must have a successful emissions and/or safety inspection.

Emissions Testing and Safety Inspections in the State of Missouri

The
state of Missouris Gateway Vehicle Inspection Program switched from a centralized program to a decentralized program on October 1, 2007. The program is administered by the Department of Natural Resources and the Missouri State Highway
Patrol.

Missouri law requires all motor vehicles pass a vehicle safety inspection at an authorized inspection station every
other year unless specifically exempted from a safety inspection. New motor vehicles are exempt from the safety inspection during the first five years following the model year of manufacture.

In addition to the safety inspection, vehicles registered in St. Louis City, St. Louis County, St. Charles County, Franklin County and
Jefferson County are required to have an emissions inspection every other year prior to registering the vehicle. New motor vehicles and the first retail sale of titled motor vehicles, with less than 6,000 miles during the model year of the vehicle
and the following year are exempt from the emissions inspection. Vehicles with a model year of 1995 and older are exempt from the ASM emissions inspections in Missouri. An emissions inspection is required regardless of the model year if the vehicle
is sold.



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Operating Strategy

Our operating strategy focuses on (a) providing our customers with fast, honest and courteous vehicle testing and inspection services, (b) increasing the number of sites we operate in a given
market, (c) increasing the volume of business at each site, (d) creating brand awareness for our services, and (e) creating repeat customer sales, all of which are designed to enhance our revenue and cash flow. To achieve these goals,
we:



| |  |  | Seek to secure and maintain multiple stations at well-traveled intersections and other locations that are easily accessible by our customers;
| | - |  | ---------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Coordinate operations, training and local outreach programs in each market to enhance revenue and maximize cost efficiencies within each market;
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Implement regional management and marketing initiatives in each of our markets;
| | - |  | -------------------------------------------------------------------------------



| |  |  | Tailor each facility, utilize limited local advertising and the services we offer to appeal to the broadest range of consumers; and
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------



| |  |  | Seek to expand the use of our mobile vehicle testing units by bidding on federal, state, and local governments for their fleet vehicles, as well as
corporate accounts and automotive dealerships.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

We currently purchase our raw materials, such as filters,
hoses, etc., from several suppliers, and because these raw materials are readily available from a variety of suppliers, we do not rely upon any one supplier for a material portion of our materials. Certificates of emission and safety inspection are
purchased from each states department or agency responsible for overseeing the emissions testing and safety inspections programs in that state.

Intellectual Property

We have registered the trade names Speedemissions, Mr. Sticker
and Just Emissions in the United States. We have filed a Federal Service Mark Registration for the name and logo of Speedemissions, Inc., and for the tag line The Fastest Way to Keep Your Air Clean.

Competition

The emissions
testing and safety inspection industry is full of small owner-operators. Auto repair shops, tire stores, oil change stores, muffler shops, service stations, and other emissions testing stations may offer this service. There are no national
competitors at this time. We expect competition from local operators at all of our locations. We expect such competition whenever and wherever we open or acquire a station. Our market share is too small to measure. Our revenue from emissions testing
is affected primarily by the number of emissions and safety tests our stations perform, and the price charged per test. Other emissions testing operators may have greater financial resources than us, which may allow them to obtain more expensive and
advantageous locations for testing stations, to provide services in addition to emissions testing, to charge lower prices than we do, and to advertise and promote their businesses more effectively than we do. For example, some of our competitors in
Atlanta charge only $20.00 to test a vehicle rather than the $25.00 maximum allowed under Georgia law. As a result, we have had to reduce our fees to $20.00 in some of our Atlanta stations. We intend to compete by creating brand awareness through
advertising, a standard building style and facade, a consistent color scheme and uniform and improving the customer experience. Although we believe our stations are well positioned to compete, we cannot assure you that our stations will maintain, or
will increase, their current testing volumes and revenues.

Research and Development

We have not spent any material amount of time or money on research and development, and do not anticipate doing so in the future.

Compliance with Environmental Laws

There are no environmental laws applicable to the vehicle emissions and safety inspection business.

Employees

At December 31, 2009, we employed 121 full-time and part-time employees. None of our employees
are represented by a union.

SEC Filings

We file annual, quarterly and current reports, proxy and information statements and other information with the Securities and Exchange Commission (the SEC). All material we file with the SEC
is publicly available at the SECs Public Reference Room at 100 F Street NE, Room 1580, Washington, DC 20549. You may obtain information on the operation of the Public Reference Room



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by calling the SEC at 1-800-SEC-0330. In addition, the SEC maintains a website at www.sec.gov that contains reports, proxy and information statements and other information regarding issuers that
is filed electronically with the SEC.

Website Access

Our website address is www.speedemissions.com. Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished with
the SEC pursuant to the Securities Exchange Act of 1934, as amended, will be available free of charge on our website www.speedemissions.com (under Investor Relations) as soon as reasonably practicable after the reports are filed
with the SEC.

Item 1A. Risk Factors

Current economic conditions may continue to adversely affect our industry, business and results of operations, our ability to obtain
financing on reasonable and acceptable terms to expand our operations and the market price of our common stock.

The
United States economy may continue to experience a significant recession. This recession has and could further lead to reduced consumer and commercial spending in the foreseeable future. The emissions testing and safety inspection industry may
experience significant downturns in connection with, or in anticipation of, declines in general economic conditions and its impact on the automotive industry as a whole. Declines in consumer and commercial spending may drive us and our competitors
to reduce pricing, which would have a negative impact on our gross profit. A continued softening in the economy may adversely and materially affect our industry, business and results of operations and we can not accurately predict how severe and
prolonged the current downturn might be. Moreover, reduced revenues as a result of a softening of the economy may also reduce our working capital and interfere with our long term business strategy. These macroeconomic developments could negatively
affect our business, operating results, or financial condition in a number of ways. For example, current or potential customers, such as automotive dealerships may delay or decrease spending with us or may not pay us or may delay paying us for
previously provided services. In addition, if consumer spending continues to decrease, this may result in fewer sales of used automobiles that are subject to emissions testing and safety inspections.

The United States stock and credit markets have experienced significant price volatility, dislocations and liquidity disruptions, which have
caused market prices of many stocks to fluctuate substantially and the spreads on prospective and outstanding debt financings to widen considerably. These circumstances have materially impacted liquidity in the financial markets, making terms for
certain financings materially less attractive, and in certain cases have resulted in the unavailability of certain types of financing. Continued uncertainty in the stock and credit markets may negatively impact our ability to access additional
short-term and long-term financing on reasonable terms or at all, which would negatively impact our liquidity, financial condition and ability to expand our operations. A prolonged downturn in the stock or credit markets may cause us to seek
alternative sources of potentially less attractive financing, and may require us to adjust our business operations accordingly. These disruptions in the financial markets also may adversely affect our credit rating and the market value of our common
stock.

While we believe we have adequate sources of liquidity to meet our anticipated requirements for working capital, debt
servicing and capital expenditures for the foreseeable future, if our operating results worsen significantly and our cash flow or capital resources prove inadequate, or if interest rates increase significantly, we could face liquidity problems that
could materially and adversely affect our results of operations and financial condition.

We have a limited operating
history and limited historical financial information upon which you may evaluate our performance.

Our limited
operating history and losses to date make it difficult to evaluate our business. We incurred net losses of $2,787,072 and $495,776 for the years ended December 31, 2009 and 2008, respectively. As of December 31, 2009, we had cash on hand
of $449,203, working capital surplus of $115,136, an accumulated deficit of $15,312,740 and total shareholders equity of $491,589. You should consider, among other factors, our prospects for success in light of the risks and uncertainties
encountered by companies that, like us, have not generated net earnings on an annual basis. Various factors, such as economic conditions, regulatory and legislative considerations, and competition, may also impede our ability to expand our market
presence. We may not successfully address these risks and uncertainties or successfully implement our operating and acquisition strategies. If we fail to do so, it could materially harm our business and impair the value of our common stock. Even if
we accomplish these objectives, we may not generate positive cash flows or profits we anticipate in the future.

We have
a large amount of outstanding common stock held by a single shareholder, and a large amount of common stock that could be acquired by a second shareholder upon conversion of preferred stock and exercise of warrants, which if sold could have a
negative impact on our stock price.

Our largest shareholder, GCA Strategic Investment Fund Limited, and its
affiliates, own 3,379,361 shares of our common stock as of December 31, 2009. Upon exercise of all outstanding warrants at exercise prices between $0.30 and $0.90 per share and conversion of their Series A Convertible Preferred Stock, GCA
Strategic Investment Fund Limited and its affiliates could own up to 10,056,859 shares of our common stock. As of December 31, 2009, Barron Partners LP (Barron) could acquire up to 29,824,092 shares of our common stock



8



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##### Table of Contents

##### Index to Financial Statements

upon the exercise of outstanding warrants at exercise prices between $0.30 and $0.90 per share and the conversion of their Series B Convertible Preferred Stock. If either of these shareholders
sold a large number of shares of our common stock into the public market it could have a negative impact on our stock price.

There is an extremely limited market for our stock.

There is an extremely limited trading market for
our common stock. Although our common stock is quoted on the OTC Bulletin Board, there are very few trades of our shares. Currently, there are no consistent market makers in our common stock. Making a market in securities involves maintaining bid
and ask quotations and being able to effect transactions in reasonable quantities at those quoted prices, subject to various securities laws and other regulatory requirements. The development and maintenance of a public trading market depends,
however, upon the existence of willing buyers and sellers, the presence of which is not within our control or that of any market maker. Market makers on the OTC Bulletin Board are not required to maintain a continuous two-sided market, are required
to honor firm quotations for only a limited number of shares, and are free to withdraw firm quotations at any time. Even with a market maker, factors such as our losses from operations for each of the past three years, the large number of shares
reserved for issuance upon exercise of existing warrants or options or the conversion of outstanding shares of preferred stock, and the small size of our company mean that there can be no assurance of an active and liquid market for our common stock
developing in the foreseeable future. Even if a market develops, we cannot assure you that a market will continue, or that shareholders will be able to resell their shares at any price. You should carefully consider the limited liquidity of your
investment in our common stock.

Our near term growth is expected to be financed through limited cash flows from
operations.

Our growth in 2010 is expected to be limited to one to three new stores and it will be financed through
existing working capital and limited cash flows from operations. We cannot be certain that we will be successful in generating sufficient cash flows from operations to significantly expand our operations. Our growth and expansion may be curtailed if
we are unable to generate sufficient cash flows to fund the growth and expansion.

We may have to pay a substantial
amount of liquidated damages to a single shareholder if we fail to maintain certain requirements.

If we fail to
maintain a majority of independent directors on our board and a majority of independent directors on both our Audit Committee and Compensation Committee, then we must pay to Barron an amount equal to 24% of the purchase price of $6,615,000 for the
Series B Convertible Preferred Stock and common stock warrants per annum, payable monthly. For every month the majority of our board or any of our committees is not independent, we must pay Barron liquidated damages in the amount of $132,300.
Currently we have a majority of independent directors on our board.

If we fail to maintain the effectiveness of a resale
registration statement for the shares held by Barron, without Barrons consent, then we must pay to Barron in the form of shares of Series B Convertible Preferred Stock an amount equal to 24% of the purchase price of $6,615,000 paid by Barron
for the Series B Convertible Preferred Stock and common stock warrants per annum for each day the resale registration is not effective. For example, if we fail to maintain the effectiveness of the resale registration statement for a period of 30
days, we must issue to Barron approximately 49,315 shares of Series B Convertible Preferred Stock which would convert to approximately 372,822 shares of our common stock.

We are obligated to redeem a series of our preferred stock upon a change of control.

If a person or group of persons other than GCA Strategic Investment Fund Ltd. acquires beneficial ownership of 33 1/3% or more of the outstanding shares of common stock without the prior written consent
of GCA Strategic Investment Fund Ltd., we could be required to redeem the Series A Convertible Preferred Stock at the greater of (i) the original issue price of $1,000 per share or (ii) the number of shares of common stock into which the
redeemed shares may be converted multiplied by the market price of the common stock at the time of the change in control. Based on the 5,133 shares of Series A Convertible Preferred Stock currently outstanding, if this redemption were triggered we
would be required to pay the holders of these shares an aggregate of at least $5,133,000. This restriction will likely deter any proposed acquisition of our stock and may make it more difficult for us to attract new investors, as any mandatory
redemption of the preferred shares will materially adversely affect our ability to remain in business and significantly impair the value of your common stock.

A change of control could occur if one shareholder exercises all of its common stock purchase warrants.

At December 31, 2009, Barron could acquire 17,236,660 shares of common stock upon conversion of 2,279,982 shares of Series B Convertible Preferred Stock. However, Barron is restricted from converting
any portion of the Series B Convertible Preferred Stock which would cause Barron to beneficially own in excess of 4.99% of the number of shares of common stock outstanding immediately after giving effect to such conversion unless such restriction is
waived or amended by Barron and the holders of a majority of the outstanding common stock who are not affiliates. In addition, Barron may acquire 12,587,432 shares of common stock upon the exercise of warrants at exercise prices between $0.30 and
$0.90 per share. However, Barron is restricted from exercising any portion of the common stock warrants (except as described below) which would cause Barron to beneficially own in excess of 4.99% of the outstanding shares of common stock unless such
restriction is waived or amended by Barron and the holders of a majority of the



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##### Table of Contents

##### Index to Financial Statements

outstanding common stock who are not affiliates. Barrons Common Stock Purchase Warrant AA-5 gives Barron the ability to revoke this ownership restriction upon 61 days prior
notice from Barron to Speedemissions. If the restrictions relating to the warrants are waived, amended or revoked, as the case may be, Barron could control approximately 71% of outstanding shares of common stock based on number of outstanding shares
as of March 22, 2010.

We depend upon government laws and regulations that may be changed in ways that may impede
our business.

Our business depends upon government legislation and regulations mandating air pollution controls. At
this point, Georgia, Missouri, Texas and Utah laws are especially important to us because all of our existing emissions testing services are conducted in those states. Changes in federal or state laws that govern or apply to our operations could
have a materially adverse effect on our business. Federal vehicle emissions testing law may evolve due to technological advances in the automobile industry creating cleaner, more efficient automobiles which could affect current testing policy and
procedures in our markets. For example, Georgia law could be changed so as to require that vehicles in the state be tested every other year, as opposed to every year. Such a change would reduce the number of vehicles that need to be tested in any
given year and such a reduction would have a material adverse effect on our revenues in Georgia. Other changes that would adversely affect us would be a reduction in the price we can charge customers for our testing service, an increase in the fees
we must pay to the state in order to operate emissions testing stations in its jurisdiction, and the adoption of a system whereby the state, as opposed to private operators, performs vehicle emissions testing. We cannot be assured that changes in
federal or state law would not have a materially adverse effect on the vehicle emissions testing industry generally or, specifically, on our business.

We may be unable to effectively manage our growth and operations.

The management of our expansion will require, among other things, continued development of our financial and management controls and management information systems, stringent control of costs, increased marketing activities, the ability to
attract and retain qualified management personnel, and the training of new personnel. We intend to hire additional personnel as needed in order to effectively manage our expected growth and expansion. Failure to successfully manage our expected
growth and development and difficulties in managing additional emissions testing and safety inspection stations could have a material adverse effect on our business and the value of our common stock.

Because the emissions testing and safety inspection industry is highly competitive, we may lose customers and revenues to our
competitors.

Our testing stations face competition from other emissions testing and safety inspection operators that
are located near our sites. The markets we operate in are highly fragmented and our competitors generally consist of independent auto repair service providers, service stations, oil and tire repair stores and independent test-only facilities that
may only operate a single station. We estimate our total number of competitors to be several thousand across all the markets in which we operate. We expect such competition whenever and wherever we open or acquire a station. Our revenue from
emissions testing and safety inspections is affected primarily by the number of vehicles our stations service, and the price charged per test. Other emissions testing operators may have greater financial resources than us, which may allow them to
obtain more expensive and advantageous locations for testing stations, to provide services in addition to emissions testing, to charge lower prices than we do, and to advertise and promote their businesses more effectively than we do. For example,
some of our competitors in Atlanta charge only $20.00 to test a vehicle rather than the $25.00 maximum allowed under Georgia law. As a result, we reduced our fees to $20.00 in some of our Atlanta stations several years ago. Although we believe our
stations are well positioned to compete, we cannot assure you that our stations will maintain, or will increase, their current testing volumes and revenues. A decrease in testing volume as the result of competition or other factors could materially
impair our profitability and our cash flows, thereby adversely affecting our business and the value of our common stock.

The loss of Richard A. Parlontieri, our President and Chief Executive Officer, and the inability to hire or retain other key personnel, would adversely affect our ability to manage and control our business.

Our business now depends primarily upon the efforts of Mr. Richard A. Parlontieri, who currently serves as our President and Chief
Executive Officer. We believe that the loss of Mr. Parlontieris services would have a materially adverse effect on us. In this regard, we note that we have entered into a rolling three-year employment agreement with Mr. Parlontieri.
We maintain key-man life insurance on Mr. Parlontieri.

As our business grows and expands, we will need the services of
other persons to fill key positions in our company. We may not be able to attract, or retain, competent, qualified and experienced individuals to direct and manage our business due to our limited resources. The absence of skilled persons within our
company will have a materially adverse effect on us and the value of our common stock.

Our largest shareholder controls
our company, allowing it to direct the company in ways that may be contrary to the wishes of other shareholders.



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##### Table of Contents

##### Index to Financial Statements

Our largest shareholder, GCA Strategic Investment Fund Limited, and its affiliate, owned
approximately 47% of our outstanding common shares and control approximately 69% of our outstanding voting securities as of March 22, 2010. They have the ability to control the direction of our company, which may be contrary to the wishes of
other shareholders or new investors.

There are a large number of outstanding warrants, options and preferred stock
which if exercised or converted will result in substantial dilution of the common stock.

As of March 22, 2010,
there were 7,025,648 shares of common stock outstanding. If all warrants and options outstanding as of March 22, 2010 are exercised and all preferred stock are converted to common stock, there will be 49,270,848 shares of common stock
outstanding. As a result, a shareholders proportionate interest in us will be substantially diluted.

Our
operating results may fluctuate, which makes our results difficult to predict and could cause our results to fall short of expectation, which could result in substantial losses for investors.

Our operating results may fluctuate as a result of a number of factors, many outside of our control. As a result, comparing our operating
results on a period-to-period basis may not be meaningful, and you should not rely on our past results as an indication of our future performance. Our quarterly, year-to-date, and annual expenses as a percentage of our revenues may differ
significantly from our historical or projected rates. Our operating results in future quarters may fall below expectations. Any of these events could cause our stock price to fall. Each of the risk factors listed in Item 1A and the following
factors may affect our operating results:



| |  |  | Quarterly variations in operating results;
| | - |  | ------------------------------------------



| |  |  | Any significant sale of stock or exercise of warrants by any of our existing shareholders;
| | - |  | ------------------------------------------------------------------------------------------



| |  |  | Announcements by us or our competitors of new products, significant contracts, acquisitions or strategic relationships;
| | - |  | -----------------------------------------------------------------------------------------------------------------------



| |  |  | Publicity about our company, management, products or our competitors;
| | - |  | ---------------------------------------------------------------------



| |  |  | Additions or departures of key personnel;
| | - |  | -----------------------------------------



| |  |  | Regulatory changes affecting the price we are allowed to charge or the fee required to be remitted to the state;
| | - |  | ----------------------------------------------------------------------------------------------------------------



| |  |  | Reduced commercial or consumer spending due to the current economic slowdown in the United States;
| | - |  | --------------------------------------------------------------------------------------------------



| |  |  | Any future sales of our common stock or other securities; and
| | - |  | -------------------------------------------------------------



| |  |  | Stock market price and volume fluctuations of publicly traded companies.
| | - |  | ------------------------------------------------------------------------

These and other external factors have caused and may continue to cause the market price and demand for our common stock to fluctuate
substantially, which may limit or prevent investors from readily selling their shares of common stock and may otherwise negatively affect the liquidity of our common stock.

Because we are subject to the penny stock rules, the level of trading activity in our stock may be reduced.

Our common stock is quoted on the OTC Bulletin Board. Broker-dealer practices in connection with transactions in
penny stocks are regulated by certain penny stock rules adopted by the Securities and Exchange Commission. Penny stocks, like shares of our common stock, generally are equity securities with a price of less than $5.00, other than
securities registered on certain national securities exchanges or quoted on Nasdaq. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure
document that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the
broker-dealer and its salesperson in the transaction, and, if the broker-dealer is the sole market maker, the broker-dealer must disclose this fact and the broker-dealers presumed control over the market, and monthly account statements showing
the market value of each penny stock held in the customers account. In addition, broker-dealers who sell these securities to persons other than established customers and accredited investors must make a special written
determination that the penny stock is a suitable investment for the purchaser and receive the purchasers written agreement to the transaction. Consequently, these requirements may have the effect of reducing the level of trading activity, if
any, in the secondary market for a security subject to the penny stock rules, and investors in our common stock may find it difficult to sell their shares.

We do not intend to pay dividends on our common stock.

We have
never declared or paid any cash dividend on our capital stock. We currently intend to retain any future earnings and do not expect to pay any dividends in the foreseeable future.

Seasonality

Our business is affected by the seasonal nature of vehicle registrations in Missouri, Texas and Utah. Vehicle registrations and related emissions testing and safety inspections in these states are generally required annually based on the
month in which the vehicle is purchased. Historically, this has resulted in lower registrations and emissions and safety test volumes during the winter months, our first and fourth quarters. Prior quarterly results are not indicative of first or
fourth quarter results.



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##### Table of Contents

##### Index to Financial Statements

Failure to achieve and maintain effective internal controls in accordance with
Section 404 of the Sarbanes-Oxley Act could have a material adverse effect on our business and stock price

We are
required to document and test our internal control procedures in order to satisfy the requirements of Section 404 of the Sarbanes-Oxley Act, which requires annual management assessments of the effectiveness of our internal control over
financial reporting for our fiscal year ended December 31, 2009. Testing and maintaining internal control can divert our managements attention from other matters that are important to our business. We expect to incur increased expense and
to devote additional management resources to Section 404 compliance. We may not be able to conclude on an ongoing basis that we have effective internal control over financial reporting in accordance with Section 404 or our independent
registered public accounting firm may not be able or willing to issue an unqualified report on the effectiveness of our internal control over financial reporting. If we conclude that our internal control over financial reporting is not effective, we
cannot be certain as to the timing of completion of our evaluation, testing and remediation actions or their effect on our operations since there is presently no precedent available by which to measure compliance adequacy. If either we are unable to
conclude that we have effective internal control over financial reporting or our independent registered public accounting firm is unable to provide us with an unqualified report, then investors could lose confidence in our reported financial
information, which could have a negative effect on the trading price of our stock.

Item 1B. Unresolved
Staff Comments

None.

Item 2. Properties

Corporate Office

We rent our general corporate offices located at 1015 Tyrone Road, Suite 220, Tyrone, Georgia, which consists of 4,166 square feet of
office space and a training classroom with a term that expires on April 30, 2011. The lease automatically renews for additional 2-year renewal period unless either party gives ninety-day notice of non-renewal.

Testing Facilities

We
lease the land and buildings we use in our emissions testing and safety inspection stations in Atlanta, St. Louis, Houston, and Salt Lake City. All of our facilities are believed to be in adequate condition for their intended purposes and adequately
covered by insurance. The following table shows the store locations for our 40 stores as of December 31, 2009:



|         |  |                 
|-------- |  | ----------------
|Location |  | Number of Stores
|Georgia  |  | 13              
|Missouri |  | 4               
|Texas    |  | 15              
|Utah     |  | 8               
|         |  |                 
|Total    |  | 40              
|         |  |                 

Item 3. Legal Proceedings

We are not currently a party to or otherwise involved in any legal proceedings that would have a material adverse affect on
our business.

In the ordinary course of business, we may be from time to time involved in various pending or threatened legal
actions. The litigation process is inherently uncertain and it is possible that the resolution of such matters might have a material adverse effect upon our financial condition and/or results of operations.

Item 4. Reserved



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##### Table of Contents

##### Index to Financial Statements

Part II

Item 5. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

Our
common stock is currently quoted on the OTC Bulletin Board under the symbol SPMI. Prior to January 20, 2006, our common stock was traded on the OTC Bulletin Board under the symbol SPEM. Although our common stock is quoted on the OTC
Bulletin Board, there has been limited trading, at widely varying prices, and trading to date has not created an active market for our common stock. Thus, the prices at which trades occurred may not be representative of the actual value of our
common stock. On a number of days during this period, there were no trades at all in our common stock.

The following tables
set forth, for the periods indicated, the high and low bids of our common stock. The following quotations reflect inter-dealer prices, without retail markup, mark-down or commission, and may not represent actual transactions.



|                                     |  |      |      |     |   |     
|------------------------------------ |  | ---- | ---- | --- | - | ----
|                                     |  | High |      | Low
|Fiscal year ended December 31, 2008: |  |      |      |     |   |     
|First Quarter                        |  | $    | 0.25 |     | $ | 0.07
|Second Quarter                       |  | $    | 0.13 |     | $ | 0.07
|Third Quarter                        |  | $    | 0.12 |     | $ | 0.05
|Fourth Quarter                       |  | $    | 0.07 |     | $ | 0.05
|                                     |  |     
|Fiscal year ended December 31, 2009: |  |      |      |     |   |     
|First Quarter                        |  | $    | 0.07 |     | $ | 0.05
|Second Quarter                       |  | $    | 0.05 |     | $ | 0.02
|Third Quarter                        |  | $    | 0.10 |     | $ | 0.04
|Fourth Quarter                       |  | $    | 0.30 |     | $ | 0.08
|                                     |  |     
|Fiscal year ended December 31, 2010: |  |      |      |     |   |     
|First Quarter (Through March 22)     |  | $    | 0.10 |     | $ | 0.05

The Securities
Enforcement and Penny Stock Reform Act of 1990 requires additional disclosure relating to the market for penny stocks in connection with trades in any stock defined as a penny stock. The Commission has adopted regulations that generally define a
penny stock to be any equity security that has a market price of less than $5.00 per share, subject to a few exceptions which we do not meet. Unless an exception is available, the regulations require the delivery, prior to any transaction involving
a penny stock, of a disclosure schedule explaining the penny stock market and the risks associated therewith.

Holders

As of December 31, 2009 and March 22, 2010, there were 6,685,448 and 7,025,648 shares of our common stock issued and outstanding,
held by approximately 100 shareholders of record. As of December 31, 2009 and March 22, 2010, there were 5,133 shares of Series A Convertible Preferred Stock issued and outstanding and held of record by two shareholders. As of
December 31, 2009 and March 22, 2010, there were 2,294,482 and 2,279,982 shares of our Series B Convertible Preferred Stock issued and outstanding held of record by one shareholder.

Dividends

We have never
declared or paid a cash dividend on our common stock and we do not expect to pay cash dividends on our common stock in the foreseeable future. We currently intend to retain our earnings, if any, for use in our business. Any dividends declared on our
common stock in the future will be at the discretion of our Board of Directors.

We previously were obligated to pay
cumulative dividends at an annual rate of 7% on the outstanding Series A Convertible Preferred Stock. At our option, we could have paid these dividends in cash or in additional shares of our common stock. On October 14, 2005, the holders
of Series A Convertible Preferred Stock consented to the termination of dividend accruals on the Series A Convertible Preferred Stock. Pursuant to the GCA Exchange Agreement, GCA exchanged the $302,847 in cumulative dividends due and owing under
2,500 shares of Series A Convertible Preferred Stock through October 14, 2005 for additional shares of Series A Convertible Preferred Stock and common stock purchase warrants.

We do not pay dividends on our Series B Convertible Preferred Stock.



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##### Table of Contents

##### Index to Financial Statements

Securities Authorized for Issuance Under Equity Compensation Plans

We have adopted four stock option plans. On May 15, 2001, our directors and shareholders approved the SKTF, Inc. 2001 Stock Option Plan,
effective June 1, 2001. At our annual shareholders meeting on August 27, 2003, our shareholders approved an amendment to the plan, changing its name to the Speedemissions, Inc. 2001 Stock Option Plan, and increasing the number of shares of
our common stock available for issuance under the plan from 60,000 shares to 100,000 shares. As of March 22, 2010, we have issued and outstanding options to acquire 79,525 shares of our common stock under the plan at prices ranging from $2.00
to $5.15 per share, and we have issued 5,000 shares of common stock under the plan.

At our 2005 annual meeting, the
shareholders approved the 2005 Omnibus Stock Grant and Option Plan (the 2005 Plan), effective September 1, 2005. The 2005 Plan authorized us to issue options for up to 250,000 shares of our common stock. For purposes of the 2005
Plan, each year of the plan commences on September 1. On September 1 of each new plan year, the number of shares available for issuance in the 2005 Plan was automatically adjusted to an amount equal to 10% of outstanding shares of common
stock on August 31 of the immediately preceding plan year. On August 26, 2008, we amended and restated the 2005 Plan (2005 Restated Plan) to terminate this annual automatic adjustment provision. As a result of the previous
automatic adjustments, there are 303,498 options available for issuance under the 2005 Restated Plan. As of March 22, 2010, under the 2005 Restated Plan we have issued 271,000 options at an exercise prices ranging from $0.50 to $1.00 per share.

At our 2006 annual meeting, the shareholders approved and adopted the 2006 Stock Grant and Option Plan (the 2006
Plan), effective September 18, 2006. We may issue options for up to 2,000,000 shares of our common stock under the 2006 Plan. As of March 22, 2010, under the 2006 Plan we have 1,899,533 options issued and outstanding at exercise
prices ranging from $0.50 to $0.58 per share.

At our 2008 annual meeting, the shareholders approved and adopted the 2008
Stock Grant and Option Plan (the 2008 Plan), effective May 19, 2008. We may issue options for up to 5,000,000 shares of our common stock under the 2008 Plan. As of March 22, 2010, under the 2008 Plan, we have 3,528,750 issued
and outstanding options at exercise prices ranging from $0.07 to $0.125 per share.

As of December 31, 2009, the
aggregate information with respect to our equity compensation plans is as follows:



|                                                           |  |                                                                        |  |                                                         |  |                                                                                                                                         
|---------------------------------------------------------- |  | ---------------------------------------------------------------------- |  | ------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------
|Plan Category                                              |  | Number of Securitiesto be issued uponexercise of outstandingoptions(a) |  | Weighted-averageexercise price ofoutstanding options(b) |  | Number of securitiesremaining available forfuture issuance underequity
compensationplans (excludingsecurities reflected incolumn (a))(c)
|Equity compensation plans approved by security holders     |  | 5,778,808                                                              |  | $0.35                                                   |  | 1,619,688                                                                                                                               
|                                                           |  |                                                                        | 
|Equity compensation plans not approved by security holders |  | N/A                                                                    |  | N/A                                                     |  | N/A                                                                                                                                     
|                                                           |  |                                                                        | 
|Total                                                      |  | 5,778,808                                                              |  | $0.35                                                   |  | 1,619,688                                                                                                                               

Recent Sales of Unregistered
Securities; Use of Proceeds from Registered Securities

All sales of unregistered securities for the past two years have
been previously reported on either Form 10-Q, Form 10-K or Form 8-K filed with the Securities and Exchange Commission.

Item 6. Selected Financial Data

As a smaller reporting company, we are not required to provide the
information required by this Item pursuant to 301(c) of Regulation S-K.



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##### Table of Contents

##### Index to Financial Statements

Item 7. Managements Discussion and Analysis of Financial Condition
and Results of Operations

Disclaimer Regarding Forward Looking Statements

Our Managements Discussion and Analysis contains not only statements that are historical facts, but also statements that are
forward-looking (within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934). Forward-looking statements are, by their very nature, uncertain and risky. These risks and
uncertainties include international, national and local general economic and market conditions; demographic changes; our ability to sustain, manage, or forecast growth; our ability to successfully make and integrate acquisitions; raw material costs
and availability; new product development and introduction; existing government regulations and changes in, or the failure to comply with, government regulations; adverse publicity; competition; the loss of significant customers or suppliers;
fluctuations and difficulty in forecasting operating results; changes in business strategy or development plans; business disruptions; the ability to attract and retain qualified personnel; the ability to protect technology; and other risks that
might be detailed from time to time in our filings with the Securities and Exchange Commission.

Although the forward-looking
statements in this Annual Report reflect the good faith judgment of our management, such statements can only be based on facts and factors currently known by them. Consequently, and because forward-looking statements are inherently subject to risks
and uncertainties, the actual results and outcomes may differ materially from the results and outcomes discussed in the forward-looking statements. You are urged to carefully review and consider the various disclosures made by us in this report and
in our other reports as we attempt to advise interested parties of the risks and factors that may affect our business, financial condition, and results of operations and prospects.

Overview

As of December 31, 2009 we operated 40 vehicle emissions
testing and safety inspection stations and four mobile units in four separate markets, Atlanta, Georgia; St. Louis, Missouri; Houston, Texas and Salt Lake City, Utah.

We perform vehicle emissions testing and safety inspections in certain cities in which vehicle emissions testing is mandated by the Environmental Protection Agency (EPA). We use computerized emissions
testing and safety inspections equipment that test vehicles for compliance with vehicle emissions and safety standards as determined by each state. Our revenues are generated from the test or inspection fee charged to the registered owner of the
vehicle. We do not provide automotive repair services.

We charge a fee for each test, whether the vehicle passes or not, and
a portion of that fee is remitted to the state governing agency.

Results of Operations

Year ended December 31, 2009 compared to the year ended December 31, 2008

Our revenue, cost of emission certificates (our cost of goods sold), store operating expenses, general and administrative expenses, gain
from disposal of non-strategic assets and operating loss for the year ended December 31, 2009 as compared to the comparable period ended December 31, 2008 were as follows:



|                                           |  |                         |            |   |                  |   |           |   |  |          |   
|------------------------------------------ |  | ----------------------- | ---------- | - | ---------------- | - | --------- | - |  | -------- | --
|                                           |  | Year Ended December 31, |            |   | PercentageChange |  
|                                           |  | 2009                    |            |   | 2008             |   |          
|Revenue                                    |  | $                       | 9,916,678  |   |                  | $ | 9,779,942 |   |  | 1.4      | % 
|Cost of emission certificates              |  |                         | 2,156,673  |   |                  |   | 2,097,940 |   |  | 2.8      | % 
|Store operating expenses                   |  |                         | 6,266,578  |   |                  |   | 6,061,774 |   |  | 3.4      | % 
|General and administrative expenses        |  |                         | 1,411,296  |   |                  |   | 1,768,519 |   |  | (20.2    | )%
|Gain from disposal of non-strategic assets |  |                         | (39,820    | ) |                  |   | (48,668   | ) |  | (18.2    | )%
|Goodwill impairment expense                |  |                         | 2,873,766  |   |                  |   |          |   |  | N/A      |   
|                                           |  |                         |            |   |                  |   |           |   |  |          |   
|Operating loss                             |  | $                       | (2,751,815 | ) |                  | $ | (99,623   | ) |  | (2,662.2 | )%
|                                           |  |                         |            |   |                  |   |           |   |  |          |   

Revenue.For the year ended December 31, 2009, revenue increased $136,736 or 1.4% to
$9,916,678 compared to $9,779,942 in the prior year. The increase in revenue was primarily due to an increase in revenue from same store sales of 2.6% or $246,317 and additional revenue of $95,934 generated from new stores. The increase in revenue
was offset by a decrease of $205,515 resulting from the closure of a store in 2008.



15



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##### Table of Contents

##### Index to Financial Statements

Cost of emission certificates.Cost of emission certificates increased $58,733 or
2.8% to $2,156,673 in the year ended December 31, 2009 and was 21.7% of revenues, compared to $2,097,940 and 21.5% of revenues, during 2008. The increase in the cost of emission certificates was primarily due to a $79,686 increase in same
store certificates and additional cost of certificates sold for our new stores in the amount of $19,448. The increase in the cost of emission certificates was offset by a $40,400 decrease in certificate costs from the closure of a store in 2008.

Store operating expenses.Our store operating expenses increased $204,804 or 3.4% to $6,266,578 in the year ended
December 31, 2009 and was 63.2% of revenues, compared to $6,061,774 or 62.0% of revenues during 2008. The increase in store operating expenses was primarily due to an increase in same store operating expenses of $172,686 and new store operating
expenses of $114,935. The increase in store operating expenses was partially offset by a decrease of $82,817 from the closure of a store in 2008.

General and administrative expenses. For the year ended December 31, 2009, our general and administrative expenses decreased $357,223 or (20.2%) to $1,411,296 from $1,768,519 in 2008. The
decrease in general and administrative expenses was primarily due to an decrease in professional fees and consulting expenditures of $314,536 and a decrease in stock option compensation expense of $107,119.

Gain from disposal of non-strategic assets. For the year ended December 31, 2009, we recognized a gain of $39,820 from the
disposal of non-strategic assets. We recognized a gain of $48,668 from the disposal of non-strategic assets in the year ended December 31, 2008.

Goodwill impairment expenseWe determined that goodwill recorded from the 2005 acquisition of securities of Mr. Sticker, Inc. was impaired as of December 31, 2009. The fair value of
goodwill was determined using discounted cash flow models. Due to an overall decline in the financial performance and anticipated future performance at the stores in Texas, it is estimated that Texas stores future undiscounted cash flows would
not be sufficient to cover the carrying value of Mr. Stickers goodwill. The amount of goodwill impaired in 2009 was $2,873,766 and is recorded in the accompanying consolidated statements of operations for the year ended December 31,
2009.

Interest income, interest expense and loss from continuing operations and basic and diluted loss per share from
continuing operations. Our interest income, interest expense, loss from continuing operations and basic and diluted loss per share from continuing operations for the year ended December 31, 2009 as compared to the year ended
December 31, 2008 were as follows:



|                                                            |  |                         |            |   |                  |   |          |   |  |          |   
|----------------------------------------------------------- |  | ----------------------- | ---------- | - | ---------------- | - | -------- | - |  | -------- | --
|                                                            |  | Year Ended December 31, |            |   | PercentageChange |  
|                                                            |  | 2009                    |            |   | 2008             |   |         
|Interest income                                             |  | $                       | 111        |   |                  | $ | 1,495    |   |  | (92.6    | )%
|Interest expense                                            |  |                         | (35,368    | ) |                  |   | (36,673  | ) |  | (3.6     | )%
|Loss from continuing operations                             |  |                         | (2,787,072 | ) |                  |   | (134,801 | ) |  | (1,967.5 | )%
|                                                            |  |                         |            |   |                  |   |          |   |  |          |   
|Basic and diluted loss per share from continuing operations |  | $                       | (0.53      | ) |                  | $ | (0.03    | ) |  | (1,666.7 | )%

Loss from
discontinued operations and loss per share from discontinued operations.On December 31, 2008, we decided to close our last 4 vehicle emissions testing and safety inspection stations located within Sears Auto Centers in the Dallas-Ft.
Worth, Texas trade area. These stores were closed on January 5, 2009. We had previously announced the closing of 8 similar stores in the Dallas-Ft. Worth, Texas trade area on July 18, 2008. Discontinued operations for the years ended
December 31, 2009 and 2008 consists of the operating results for these 12 stores. Revenue in the year ended December 31, 2009 and 2008 from these stores was $0 and $242,025, respectively. Loss from discontinued operations was $0 and
$360,975 in the years ended December 31, 2009 and 2008, respectively. Basic and diluted loss per share from discontinued operations was $0.00 and $0.07 in the years ended December 31, 2009 and 2008, respectively.

Net loss and basic and diluted net loss per share. Our net loss increased from $495,776 in 2008 to $2,787,072 in 2009. Our basic and
diluted net loss per share was $0.53 and $0.10 in the year ended December 31, 2009 and 2008, respectively. The increase in the net loss and net loss per share was mainly attributable to the Goodwill impairment expense in 2009 in the amount of
$2,873,766 in the year ended December 31, 2009.



16



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##### Table of Contents

##### Index to Financial Statements

Liquidity and Capital Resources

Introduction

We believe that our existing cash and cash flows from
operations will be sufficient to support our operating and investing needs for at least the next twelve months. However, this depends on our ability to manage our working capital requirements and the ability of our stores to achieve or maintain
positive operating cash flow. Net cash provided by operating activities in 2009 was $36,980 as compared to net cash used in operating activities of $289,293 in 2008. During 2009, we used our positive operating cash flows to decrease our current
liabilities by 42.0% and our total liabilities by 34.3%. As we continue to implement our growth strategy, we anticipate an increase in our operating cash flow, but with the increased costs of expanding our operations, we may not achieve positive
operating cash flows on a consistent basis.

Our cash, current assets, total assets, current liabilities, total liabilities,
Series A convertible preferred stock and total stockholders equity as of December 31, 2009 as compared to December 31, 2008 were as follows:



|                                     |  |                        |           |                        |   |           |  |   |            |  
|------------------------------------ |  | ---------------------- | --------- | ---------------------- | - | --------- |  | - | ---------- | -
|                                     |  | As of December 31,2009 |           | As of December 31,2008 |   | Change    | 
|Cash                                 |  | $                      | 449,203   |                        | $ | 512,492   |  | $ | (63,289    | )
|Total current assets                 |  |                        | 585,993   |                        |   | 650,183   |  |   | (64,190    | )
|Total assets                         |  |                        | 5,894,836 |                        |   | 9,066,429 |  |   | (3,171,593 | )
|Total current liabilities            |  |                        | 470,857   |                        |   | 811,954   |  |   | (341,097   | )
|Total liabilities                    |  |                        | 823,901   |                        |   | 1,255,153 |  |   | (431,252   | )
|Series A convertible preferred stock |  |                        | 4,579,346 |                        |   | 4,579,346 |  |   |           |  
|Total stockholders equity           |  |                        | 491,589   |                        |   | 3,231,930 |  |   | (2,740,341 | )

For the year ended
December 31, 2009 our net cash provided by operating activities was $36,980, as compared to net cash used in operating activities of $289,293 for the year ended December 31, 2008. Positive operating cash flows during 2009 were primarily
created by $2,873,766 in goodwill and related asset impairment expense, depreciation and amortization of $319,288, share based compensation expense of $46,731 and a decrease in other current assets of $901, offset by net loss of $2,787,072, a
decrease in accounts payable and accrued expenses of $361,492, a decrease in other liabilities of $12,256 and an increase in other assets of $3,066.

Negative operating cash flows during 2008 were primarily created by a net loss of $495,776. The net loss was mainly due to the loss from discontinued operations of $360,975 and new store operating losses
of $356,653 incurred in the year ended December 31, 2008. Decreases in accounts payable and accrued liabilities of $282,206, other liabilities of $9,106 and a gain from disposal of non-strategic assets of $48,668 also contributed to the
negative operating cash flows during 2008, offset by an decrease in other current assets of $52,888, an increase in other assets of $2,850, share based compensation expenses of $153,850 and depreciation and amortization of $336,875.

Inflation has not had an abnormal or unanticipated effect on our operations. Our cost of emissions certificates does not fluctuate from year
to year as the fee we pay to the state or local government agency remains constant over the states contract period with the administrator, which is usually five to seven years.

Sources and Uses of Cash

Net cash (used in) provided by investing
activities was ($42,763) and $48,181, respectively, for the years ended December 31, 2009 and 2008.

Investing activities
during 2009 involved primarily capital expenditures of $89,093 related to leasehold improvements and the purchase of equipment for our stores and proceeds from the disposal of non-strategic assets in the amount of $46,330.

Investing activities during 2008 involved primarily $102,407 received from Gwinnett County for the condemnation of our Lawrenceville,
Georgia store for a road widening project in 2007, proceeds of $149,372 received from the disposal of equipment and capital expenditures related to the building of new stores and purchase of equipment for the stores in the amount of $203,598.

Net cash used in financing activities was $57,506 and $51,058, respectively, for the years ended December 31, 2009 and
2008. Net cash used in financing activities during 2009 was for payments on debt in the amount of $15,539 and payments on capitalized leases of $41,967. Net cash used in financing activities during 2008 was for payments on debt in the amount of
$14,206 and payments on capitalized leases of $36,852.



17



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##### Table of Contents

##### Index to Financial Statements

Critical Accounting Policies

The discussion and analysis of the Companys financial condition and results of operations are based upon its consolidated financial
statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires the Company to make estimates and judgments that affect the reported
amounts of assets, liabilities, revenues and expenses. In consultation with its Board of Directors, the Company has identified accounting policies related to valuation of its common stock and for assessing whether any value should be assigned to a
warrant that it believes are key to an understanding of its financial statements. Additionally, the Company has identified accounting policies related to the valuation of goodwill, created as the result of business acquisitions, as a key to an
understanding of its financial statements. These are important accounting policies that require managements most difficult, subjective judgments.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

As a smaller reporting company, we are not required to provide the information required by this Item, pursuant to 305(e) of Regulation S-K.



18



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##### Table of Contents

##### Index to Financial Statements

Item 8. Financial Statements and Supplementary Data



|                                                        |  |    
|------------------------------------------------------- |  | ---
|Index to Financial Statements                           |  |    
|                                                        | 
|Report of Independent Registered Public Accounting Firm |  | F-1
|                                                        | 
|Consolidated Balance Sheets                             |  | F-2
|                                                        | 
|Consolidated Statements of Operations                   |  | F-3
|                                                        | 
|Consolidated Statements of Shareholders Equity         |  | F-4
|                                                        | 
|Consolidated Statements of Cash Flows                   |  | F-5
|                                                        | 
|Notes to Consolidated Financial Statements              |  | F-6



19



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##### Table of Contents

##### Index to Financial Statements

Speedemissions, Inc. and Subsidiaries

Consolidated Financial Statements

December 31, 2009 and 2008



---

##### Table of Contents

##### Index to Financial Statements

Report of Independent Registered Public Accounting Firm

To the Board of Directors

Speedemissions, Inc.

We have audited the accompanying consolidated balance sheets of Speedemissions, Inc. and subsidiaries (the Company) as of
December 31, 2009 and 2008, and the related consolidated statements of operations, shareholders equity, and cash flows for the years then ended. These consolidated financial statements are the responsibility of the Companys
management. Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

We conducted our
audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements
are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of their 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 consolidated 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 audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Speedemissions, Inc. and subsidiaries as of December 31, 2009 and 2008, and the results of
their operations and their cash flows for the years then ended in conformity with accounting principles generally accepted in the United States of America.



|                               
|-------------------------------
|/s/ Habif, Arogeti & Wynne, LLP
|Atlanta, Georgia               
|March 30, 2010                 



F-1



---

##### Table of Contents

##### Index to Financial Statements

Speedemissions, Inc. and Subsidiaries

Consolidated Balance Sheets

as of
December 31,



|                                                                                                                                                                                             |  |      |             |   |      |   |             |  
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---- | ----------- | - | ---- | - | ----------- | -
|                                                                                                                                                                                             |  | 2009 |             |   | 2008 |  
|Assets                                                                                                                                                                                       |  |      |             |   |      |   |             |  
|                                                                                                                                                                                             |  |     
|Current assets:                                                                                                                                                                              |  |      |             |   |      |   |             |  
|Cash                                                                                                                                                                                         |  | $    | 449,203     |   |      | $ | 512,492     |  
|Other current assets                                                                                                                                                                         |  |      | 136,790     |   |      |   | 137,691     |  
|                                                                                                                                                                                             |  |      |             |   |      |   |             |  
|Total current assets                                                                                                                                                                         |  |      | 585,993     |   |      |   | 650,183     |  
|Property and equipment, net                                                                                                                                                                  |  |      | 953,183     |   |      |   | 1,214,737   |  
|Goodwill                                                                                                                                                                                     |  |      | 4,251,657   |   |      |   | 7,100,572   |  
|Other assets                                                                                                                                                                                 |  |      | 104,003     |   |      |   | 100,937     |  
|                                                                                                                                                                                             |  |      |             |   |      |   |             |  
|Total assets                                                                                                                                                                                 |  | $    | 5,894,836   |   |      | $ | 9,066,429   |  
|                                                                                                                                                                                             |  |      |             |   |      |   |             |  
|Liabilities and Shareholders Equity                                                                                                                                                         |  |      |             |   |      |   |             |  
|                                                                                                                                                                                             |  |     
|Current liabilities:                                                                                                                                                                         |  |      |             |   |      |   |             |  
|Accounts payable                                                                                                                                                                             |  | $    | 177,647     |   |      | $ | 498,554     |  
|Accrued liabilities                                                                                                                                                                          |  |      | 196,544     |   |      |   | 237,127     |  
|Current portion - capitalized lease obligations                                                                                                                                              |  |      | 47,288      |   |      |   | 41,962      |  
|Current portion - equipment financing obligations                                                                                                                                            |  |      | 18,865      |   |      |   | 16,362      |  
|Current portion - deferred rent                                                                                                                                                              |  |      | 30,513      |   |      |   | 17,949      |  
|                                                                                                                                                                                             |  |      |             |   |      |   |             |  
|Total current liabilities                                                                                                                                                                    |  |      | 470,857     |   |      |   | 811,954     |  
|                                                                                                                                                                                             |  |      |             |   |      |   |             |  
|Capitalized lease obligations, net of current portion                                                                                                                                        |  |      | 93,604      |   |      |   | 140,897     |  
|Equipment financing obligations, net of current portion                                                                                                                                      |  |      | 46,389      |   |      |   | 64,431      |  
|Deferred rent                                                                                                                                                                                |  |      | 205,701     |   |      |   | 230,521     |  
|Other long term liabilities                                                                                                                                                                  |  |      | 7,350       |   |      |   | 7,350       |  
|                                                                                                                                                                                             |  |      |             |   |      |   |             |  
|Total liabilities                                                                                                                                                                            |  |      | 823,901     |   |      |   | 1,255,153   |  
|                                                                                                                                                                                             |  |      |             |   |      |   |             |  
|Commitments and contingencies                                                                                                                                                                |  |      |             |   |      |   |             |  
|Series A convertible redeemable preferred stock, $.001 par value, 5,000,000 shares authorized, 5,133 shares issued and
outstanding; liquidation preference: $5,133,000                       |  |      | 4,579,346   |   |      |   | 4,579,346   |  
|                                                                                                                                                                                             |  |      |             |   |      |   |             |  
|                                                                                                                                                                                             |  |     
|Shareholders equity:                                                                                                                                                                        |  |      |             |   |      |   |             |  
|Series B convertible preferred stock, $.001 par value, 3,000,000 shares authorized, 2,279,982 and 2,481,482 shares issued and
outstanding; liquidation preference: $5,854,994 and $6,372,446 |  |      | 2,280       |   |      |   | 2,481       |  
|Common stock, $.001 par value, 250,000,000 shares authorized, 6,685,448 and 5,162,108 shares issued and
outstanding                                                                          |  |      | 6,685       |   |      |   | 5,162       |  
|Additional paid-in capital                                                                                                                                                                   |  |      | 15,795,364  |   |      |   | 15,749,955  |  
|Accumulated deficit                                                                                                                                                                          |  |      | (15,312,740 | ) |      |   | (12,525,668 | )
|                                                                                                                                                                                             |  |      |             |   |      |   |             |  
|Total shareholders equity                                                                                                                                                                   |  |      | 491,589     |   |      |   | 3,231,930   |  
|                                                                                                                                                                                             |  |      |             |   |      |   |             |  
|Total liabilities and shareholders equity                                                                                                                                                   |  | $    | 5,894,836   |   |      | $ | 9,066,429   |  
|                                                                                                                                                                                             |  |      |             |   |      |   |             |  

See accompanying notes to consolidated financial statements.



F-2



---

##### Table of Contents

##### Index to Financial Statements

Speedemissions, Inc. and Subsidiaries

Consolidated Statements of Operations for the Years Ended December 31,



|                                                                     |  |      |            |   |      |   |           |  
|-------------------------------------------------------------------- |  | ---- | ---------- | - | ---- | - | --------- | -
|                                                                     |  | 2009 |            |   | 2008 |  
|Revenue                                                              |  | $    | 9,916,678  |   |      | $ | 9,779,942 |  
|Costs of revenues:                                                   |  |      |            |   |      |   |           |  
|Cost of emission certificates                                        |  |      | 2,156,673  |   |      |   | 2,097,940 |  
|Store operating expenses                                             |  |      | 6,266,578  |   |      |   | 6,061,774 |  
|General and administrative expenses                                  |  |      | 1,411,296  |   |      |   | 1,768,519 |  
|Gain from disposal of non-strategic assets                           |  |      | (39,820    | ) |      |   | (48,668   | )
|Goodwill impairment expense                                          |  |      | 2,873,766  |   |      |   |          |  
|                                                                     |  |      |            |   |      |   |           |  
|Operating loss                                                       |  |      | (2,751,815 | ) |      |   | (99,623   | )
|                                                                     |  |      |            |   |      |   |           |  
|Interest income (expense)                                            |  |      |            |   |      |   |           |  
|Interest income                                                      |  |      | 111        |   |      |   | 1,495     |  
|Interest expense                                                     |  |      | (35,368    | ) |      |   | (36,673   | )
|                                                                     |  |      |            |   |      |   |           |  
|Interest, net                                                        |  |      | (35,257    | ) |      |   | (35,178   | )
|                                                                     |  |      |            |   |      |   |           |  
|Loss from continuing operations                                      |  |      | (2,787,072 | ) |      |   | (134,801  | )
|Loss from discontinued operations, no tax effect                     |  |      |           |   |      |   | (360,975  | )
|                                                                     |  |      |            |   |      |   |           |  
|Net loss                                                             |  | $    | (2,787,072 | ) |      | $ | (495,776  | )
|                                                                     |  |      |            |   |      |   |           |  
|Basic and diluted loss per common share from continuing operations   |  | $    | (0.53      | ) |      | $ | (0.03     | )
|Basic and diluted loss per common share from discontinued operations |  | $    | (0.00      | ) |      | $ | (0.07     | )
|                                                                     |  |      |            |   |      |   |           |  
|Basic and diluted net loss per common share                          |  | $    | (0.53      | ) |      | $ | (0.10     | )
|                                                                     |  |      |            |   |      |   |           |  
|Weighted average common shares outstanding, basic and diluted        |  |      | 5,217,990  |   |      |   | 5,162,108 |  
|                                                                     |  |      |            |   |      |   |           |  

See accompanying notes to consolidated financial statements.



F-3



---

##### Table of Contents

##### Index to Financial Statements

Speedemissions, Inc. and Subsidiaries

Consolidated Statements of Shareholders Equity

For the Years Ended December 31, 2009 and 2008



|                                        |  |                            |   |  |              |       |                           |        |           |                    |   |       |       |   |            |   |  |   |             |   |  |   |            |  
|--------------------------------------- |  | -------------------------- | - |  | ------------ | ----- | ------------------------- | ------ | --------- | ------------------ | - | ----- | ----- | - | ---------- | - |  | - | ----------- | - |  | - | ---------- | -
|                                        |  | Preferred Stock - Series B |   |  | Common Stock |       | AdditionalPaid-In-Capital |        |           | AccumulatedDeficit |   |       | Total |  
|                                        |  | Shares                     |   |  | Amount       |       |                           | Shares |           | Amount             |   |       |      
|Balance at December 31, 2007            |  | 2,481,482                  |   |  | $            | 2,481 |                           |        | 5,162,108 |                    | $ | 5,162 |       | $ | 15,596,105 |   |  | $ | (12,029,892 | ) |  | $ | 3,573,856  |  
|                                        |  |                            |   |  |              |       |                          
|Share based compensation                |  |                           |   |  |              |      |                           |        |          |                    |   |      |       |   | 153,850    |   |  |   |            |   |  |   | 153,850    |  
|                                        |  |                            |   |  |              |       |                          
|Net loss                                |  |                           |   |  |              |      |                           |        |          |                    |   |      |       |   |           |   |  |   | (495,776    | ) |  |   | (495,776   | )
|                                        |  |                            |   |  |              |       |                           |        |           |                    |   |       |       |   |            |   |  |   |             |   |  |   |            |  
|Balance at December 31, 2008            |  | 2,481,482                  |   |  |              | 2,481 |                           |        | 5,162,108 |                    |   | 5,162 |       |   | 15,749,955 |   |  |   | (12,525,668 | ) |  |   | 3,231,930  |  
|                                        |  |                            |   |  |              |       |                          
|Share based compensation                |  |                           |   |  |              |      |                           |        |          |                    |   |      |       |   | 46,731     |   |  |   |            |   |  |   | 46,731     |  
|                                        |  |                            |   |  |              |       |                          
|Conversion - Preferred Stock - Series B |  | (201,500                   | ) |  |              | (201  | )                         |        | 1,523,340 |                    |   | 1,523 |       |   | (1,322     | ) |  |   |            |   |  |   |           |  
|                                        |  |                            |   |  |              |       |                          
|Net loss                                |  |                           |   |  |              |      |                           |        |          |                    |   |      |       |   |           |   |  |   | (2,787,072  | ) |  |   | (2,787,072 | )
|                                        |  |                            |   |  |              |       |                           |        |           |                    |   |       |       |   |            |   |  |   |             |   |  |   |            |  
|Balance at December 31, 2009            |  | 2,279,982                  |   |  | $            | 2,280 |                           |        | 6,685,448 |                    | $ | 6,685 |       | $ | 15,795,364 |   |  | $ | (15,312,740 | ) |  | $ | 491,589    |  
|                                        |  |                            |   |  |              |       |                           |        |           |                    |   |       |       |   |            |   |  |   |             |   |  |   |            |  

See accompanying notes to consolidated financial statements.



F-4



---

##### Table of Contents

##### Index to Financial Statements

Speedemissions, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

For the Years Ended December 31,



|                                                                                          |  |      |            |   |      |   |          |  
|----------------------------------------------------------------------------------------- |  | ---- | ---------- | - | ---- | - | -------- | -
|                                                                                          |  | 2009 |            |   | 2008 |  
|Operating activities:                                                                     |  |      |            |   |      |   |          |  
|Net loss                                                                                  |  | $    | (2,787,072 | ) |      | $ | (495,776 | )
|Adjustments to reconcile net loss to net cash provided by (used in) operating activities: |  |      |            |   |      |   |          |  
|Depreciation and amortization                                                             |  |      | 319,288    |   |      |   | 336,875  |  
|Goodwill impairment expense                                                               |  |      | 2,873,766  |   |      |   |          |  
|Gain from disposal of non-strategic assets                                                |  |      | (39,820    | ) |      |   | (48,668  | )
|Share based compensation                                                                  |  |      | 46,731     |   |      |   | 153,850  |  
|Changes in operating assets and liabilities:                                              |  |      |            |   |      |   |          |  
|Other current assets                                                                      |  |      | 901        |   |      |   | 52,888   |  
|Other assets                                                                              |  |      | (3,066     | ) |      |   | 2,850    |  
|Accounts payable and accrued liabilities                                                  |  |      | (361,492   | ) |      |   | (282,206 | )
|Other liabilities                                                                         |  |      | (12,256    | ) |      |   | (9,106   | )
|                                                                                          |  |      |            |   |      |   |          |  
|Net cash provided by (used in) operating activities                                       |  |      | 36,980     |   |      |   | (289,293 | )
|                                                                                          |  |      |            |   |      |   |          |  
|Cash flows from investing activities:                                                     |  |      |            |   |      |   |          |  
|Proceeds from asset sales                                                                 |  |      | 46,330     |   |      |   | 251,779  |  
|Purchases of property and equipment                                                       |  |      | (89,093    | ) |      |   | (203,598 | )
|                                                                                          |  |      |            |   |      |   |          |  
|Net cash (used in) provided by investing activities                                       |  |      | (42,763    | ) |      |   | 48,181   |  
|                                                                                          |  |      |            |   |      |   |          |  
|Cash flows from financing activities:                                                     |  |      |            |   |      |   |          |  
|Payments on equipment financing obligations                                               |  |      | (15,539    | ) |      |   | (14,206  | )
|Payments on capitalized leases                                                            |  |      | (41,967    | ) |      |   | (36,852  | )
|                                                                                          |  |      |            |   |      |   |          |  
|Net cash used in financing activities                                                     |  |      | (57,506    | ) |      |   | (51,058  | )
|                                                                                          |  |      |            |   |      |   |          |  
|Net decrease in cash                                                                      |  |      | (63,289    | ) |      |   | (292,170 | )
|                                                                                          |  |     
|Cash at beginning of year                                                                 |  |      | 512,492    |   |      |   | 804,662  |  
|                                                                                          |  |      |            |   |      |   |          |  
|Cash at end of year                                                                       |  | $    | 449,203    |   |      | $ | 512,492  |  
|                                                                                          |  |      |            |   |      |   |          |  
|Supplemental Information:                                                                 |  |      |            |   |      |   |          |  
|                                                                                          |  |     
|Cash paid during the period for interest                                                  |  | $    | 35,368     |   |      | $ | 36,702   |  
|                                                                                          |  |      |            |   |      |   |          |  
|Non-cash Investing and Financing activities:                                              |  |      |            |   |      |   |          |  
|Non-cash asset additions for financed and capital leases                                  |  | $    |           |   |      | $ | 31,425   |  
|                                                                                          |  |      |            |   |      |   |          |  

See accompanying notes to consolidated financial statements.



F-5



---

##### Table of Contents

##### Index to Financial Statements

Speedemissions, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

December 31, 2009 and 2008

Note 1: Nature of Operations

Description of Business

Speedemissions,
Inc. (Speedemissions or the Company) performs vehicle emissions testing and safety inspections in certain cities in which vehicle emissions testing is mandated by the Environmental Protection Agency (EPA). The federal
government and a number of state and local governments in the United States (and in certain foreign countries) mandate vehicle emissions testing as a method of improving air quality. As of December 31, 2009, the Company operated 40 vehicle
emissions testing and safety inspection stations under the trade names of Speedemissions(Atlanta, Georgia and St. Louis, Missouri); Mr. Sticker(Houston, Texas); and Just Emissions(Salt Lake City, Utah). The Company also
operates four mobile testing units in the Atlanta, Georgia area. The Company manages its operations based on these four regions and has one reportable segment.

At its vehicle emissions testing and safety inspection stations, the Company uses computerized emissions testing equipment and safety inspection equipment that tests vehicles for compliance with emissions
and safety standards.

Basis of Presentation

The Consolidated Financial Statements are presented in accordance with accounting principles generally accepted in the United States of America (GAAP) as codified in the Financial Accounting
Standards Board (FASB) Accounting Standards Codification .

The Company has evaluated subsequent events through the date of the
filing its Form 10-K with the Securities and Exchange Commission. The Company is not aware of any significant events that occurred subsequent to the balance sheet date but prior to the filing of this report that would have a material impact on the
Companys Consolidated Financial Statements.

Certain reclassifications of previously reported amounts have been made to conform to the
current year presentation (see Note 3: Discontinued Operations). Such reclassifications did not impact net income or shareholders equity as previously reported.

Consolidation

The accompanying consolidated financial statements include the accounts of
Speedemissions and non-operating subsidiaries, which are 100% owned by the Company. All significant intercompany accounts and transactions have been eliminated in consolidation.

Note 2: Significant Accounting Policies

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to
make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the
reporting periods. Significant estimates included in these financial statements relate to useful lives of property and equipment, the valuation allowance provided against deferred tax assets and the valuation of long-lived assets such as goodwill.
Actual results could differ from those estimates.

Revenue Recognition

Revenue is recognized as the testing services are performed. The cost of emissions certificates is shown separately in the accompanying consolidated statements of operations.

The Company normally requires that the customers payment be made at the time of service. The Company does not have significant levels of accounts
receivable.

Under current Georgia, Texas, Missouri, and Utah laws, if a vehicle fails an emissions test, it may be retested at no additional
charge during a specified period after the initial test, as long as the subsequent test is performed at the same facility. The costs of such retests are not material. Accordingly, no accrual for retest is recorded by the Company.



F-6



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##### Table of Contents

##### Index to Financial Statements

Property and Equipment

Property and equipment are recorded at original cost and depreciated on a straight-line basis over the estimated useful lives, as follows: buildings, fifteen years; emission testing equipment, five to
seven years; furniture, fixtures and office equipment, three to five years, and vehicles three years.

The cost of repairs and maintenance is
charged to maintenance expense as incurred.

Leasehold improvements are amortized using the straight-line method over the lesser of the
remaining lease terms, including renewal periods expected to be exercised, or the estimated useful lives of the improvements.

Impairment
of Long-Lived Assets

Property and Equipment

The Company reviews its assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When indicators of impairment are present,
the Company evaluates the carrying amount of such assets in relation to the operating performance and future estimated undiscounted net cash flows expected to be generated by the assets or underlying businesses. If such assets are considered to be
impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.

Goodwill

Goodwill represents the excess of the purchase price paid over the estimated fair value of the assets acquired and
liabilities assumed in the acquisition of a business. Goodwill is not amortized, but is tested for impairment at least annually as well as on an interim basis if an event occurs or circumstances change that could reduce the fair value of a reporting
unit below its carrying value.

Income Taxes

Income tax expense (benefit) is computed utilizing the liability method. Deferred income tax assets and liabilities are determined based on the differences between the financial reporting and income tax
basis of assets and liabilities and for income tax carryforwards given the provisions of the enacted tax laws. A valuation allowance is provided against deferred tax assets for which it is more likely than not that the asset will not be realized.

General and Administrative

General and administrative expenses consist of payroll and related expenses for employees involved in general corporate functions, including accounting and human relations, among others; costs associated with use by these functions of
facilities and equipment, such as depreciation expense and rent; professional fees; and other general corporate costs.

Fair Value
Measurements

The Company uses a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. This hierarchy
requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:



| |  |  | Level 1  Quoted prices in active markets for identical assets or liabilities. The Company has no Level 1 assets or liabilities.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------



| |  |  | Level 2  Observable inputs, other than quoted prices included in Level 1, such a quoted prices for markets that are not active; or other inputs
that are observable or can be corroborated by observable market data. The Company has no Level 2 assets or liabilities.
| | - |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | Level 3  Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or
liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. The Company has no Level 3 assets or liabilities at December 31, 2009, but as discussed in
Note 5, goodwill is evaluated at least annually for impairment based on Level 3 inputs.
| | - |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Fair Value of Financial
Instruments

The carrying amounts of cash, accounts receivable, accounts payable and accrued liabilities approximate their fair value
because of the short-term nature of these accounts. Fair value of the equipment financing agreements and capital lease obligations approximate carrying value based upon current borrowing rates.



F-7



---

##### Table of Contents

##### Index to Financial Statements

Net Loss Per Common Share

Basic net loss per share is computed by dividing the net loss attributable to common shareholders for the period by the weighted-average number of common shares outstanding for the period. Diluted net
loss per share is computed by dividing the net loss for the period by the weighted-average number of common and potential common shares outstanding during the period, if the effect of the potential common shares is dilutive.

Stock-Based Compensation

We have several
stock-based compensation plans under which employees and non-employee directors receive stock options. Share-based compensation cost is measured at the grant date, based on the calculated fair value of the award, and is recognized as an expense over
the employees requisite service period (generally the vesting period of the equity grant).

Recently Issued Accounting Pronouncements

In June 2009, the FASB issued authoritative guidance which replaced the previous hierarchy of GAAP and establishes the FASB Codification
as the single source of authoritative GAAP recognized by the FASB to be applied by nongovernmental entities. SEC rules and interpretive releases are also sources of authoritative GAAP for SEC registrants. This guidance modifies the GAAP hierarchy to
include only two levels of GAAP: authoritative and nonauthoritative. This guidance was adopted by the Company on July 1, 2009. The adoption of this guidance did not impact the Companys results of operations, cash flows or financial
position.

The FASB Statement on Business Combinations was effective for the Company for business combinations with the acquisition date on or
after January 1, 2009. This Statement requires the acquiring entity in a business combination to recognize all (and only) the assets acquired and liabilities assumed in the transaction and establishes the acquisition-date fair value as the
measurement objective for all assets acquired and liabilities assumed in a business combination. Certain provisions of this Statement will, among other things, impact the determination of acquisition-date fair value of consideration paid in a
business combination (including contingent consideration); exclude transaction costs from acquisition accounting; and change accounting practices for acquired contingencies, acquisition-related restructuring costs, in-process research and
development, indemnification assets, and tax benefits. The adoption did not have an impact on the Companys financial position, results of operations or cash flows.

Note 3: Discontinued Operations

On January 5, 2009, the Company closed 4 vehicle
emissions testing and safety inspection stations located within Sears Auto Centers in the Dallas-Ft. Worth, Texas trade area. The Company had previously announced the closing of 8 similar stores in the Dallas-Ft. Worth, Texas trade area on
July 18, 2008. Each of the twelve stores had been operating less than 13 months. Based on the Companys analysis of 2008 test volumes at each of the 4 stores closed, the Company believed they could not generate enough test volume over time
to produce a reasonable expectation of positive cash flow. The Company no longer has stores in the Dallas-Ft. Worth, Texas trade area.

The
Company repositioned the equipment used at the 12 stores to existing Company stores in other markets. The Company reclassified the results of these twelve stores as discontinued operations in its Consolidated Statements of Operations for all periods
presented.

The following table presents Revenue, Cost of emission certificates, Store operating expenses and Loss from discontinued
operations for the 12 stores which have been reclassified to discontinued operations in the Consolidated Statements of Operations:



|                                  |  |              |   |      |   |          |  
|--------------------------------- |  | ------------ | - | ---- | - | -------- | -
|                                  |  | December 31, |  
|                                  |  | 2009         |   | 2008 |  
|Revenue                           |  | $            |  |      | $ | 242,025  |  
|Cost of emission certificates     |  |              |  |      |   | 85,411   |  
|Store operating expenses          |  |              |  |      |   | 517,589  |  
|                                  |  |              |   |      |   |          |  
|Loss from discontinued operations |  | $            |  |      | $ | (360,975 | )
|                                  |  |              |   |      |   |          |  



F-8



---

##### Table of Contents

##### Index to Financial Statements

Note 4: Property and Equipment

Property and equipment at December 31, 2009 and 2008 were as follows:



|                                               |  |      |           |      |   |          
|---------------------------------------------- |  | ---- | --------- | ---- | - | ---------
|                                               |  | 2009 |           | 2008
|Buildings                                      |  | $    | 485,667   |      | $ | 485,667  
|Emission testing equipment                     |  |      | 1,568,622 |      |   | 1,816,579
|Furniture, fixtures and office equipment       |  |      | 145,882   |      |   | 128,519  
|Vehicles                                       |  |      | 23,272    |      |   | 13,165   
|Leasehold improvements                         |  |      | 292,325   |      |   | 254,820  
|                                               |  |      |           |      |   |          
|                                               |  |      | 2,515,768 |      |   | 2,698,750
|Less accumulated amortization and depreciation |  |      | 1,562,585 |      |   | 1,484,013
|                                               |  |      |           |      |   |          
|                                               |  | $    | 953,183   |      | $ | 1,214,737
|                                               |  |      |           |      |   |          

No interest costs were capitalized during the years ended
December 31, 2009 or 2008.

Note 5: Goodwill

We measure the fair value of reporting units using discounted future cash flows based on our forward-looking projections. Because the business is assumed to continue in perpetuity, the discounted future
cash flow includes a terminal value. The long-term growth assumptions incorporated into the discounted cash flow calculation reflect our long-term view of the market and the discount rate is based on our weighted average cost of capital. Each year,
we re-evaluate the assumptions used to reflect changes in the business environment.

At December 31, 2009 and 2008, we compared the fair
value of the individual reporting units for which the goodwill relates to their respective carrying amounts, including goodwill. In the opinion of management, goodwill was impaired as of December 31, 2009. The impaired goodwill related to the
goodwill recorded from the acquisition of Mr. Sticker, Inc. The fair value of goodwill was determined using discounted cash flow techniques. The Company wrote off the remaining recorded value of the goodwill of Mr. Sticker, Inc. and
recorded an impairment charge of $2,873,766 in the twelve months ended December 31, 2009. The goodwill recorded for the Companys other acquisitions remaining on the Companys balance sheet was not impaired as of December 31,
2009. In the opinion of management, goodwill was not impaired as of December 31, 2008.

Note 6: Accrued Liabilities

Accrued liabilities at December 31, 2009 and 2008 were as follows:



|                               |  |      |         |      |   |        
|------------------------------ |  | ---- | ------- | ---- | - | -------
|                               |  | 2009 |         | 2008
|Professional fees              |  | $    | 99,690  |      | $ | 83,724 
|Accrued payroll                |  |      | 44,529  |      |   | 60,669 
|Other                          |  |      | 42,906  |      |   | 44,074 
|Accrued property taxes         |  |      | 9,419   |      |   | 2,187  
|Accrued store closing expenses |  |      |        |      |   | 46,473 
|                               |  |      |         |      |   |        
|                               |  | $    | 196,544 |      | $ | 237,127
|                               |  |      |         |      |   |        

Note 7: Equipment Financing Agreements

On December 7, 2007 and December 19, 2007, the Company entered into sixty-month equipment financing agreements with two financing companies in the
amounts of $55,124 and $40,458, respectively. The financing agreements are secured by the equipment and are personally guaranteed by the President of the Company. The financing agreements bear interest at 17.35% and 10.37% per annum,
respectively.

Equipment financing agreements at December 31, consisted of the following:



|                               |  |      |        |      |   |       
|------------------------------ |  | ---- | ------ | ---- | - | ------
|                               |  | 2009 |        | 2008
|Equipment financing agreements |  | $    | 65,254 |      | $ | 80,793
|Less current portion           |  |      | 18,865 |      |   | 16,362
|                               |  |      |        |      |   |       
|Long-term portion              |  | $    | 46,389 |      | $ | 64,431
|                               |  |      |        |      |   |       

Future minimum debt payments required under the non-cancelable
equipment financing agreements were as follows at December 31, 2009:



F-9



---

##### Table of Contents

##### Index to Financial Statements

|                         |  |   |       
|------------------------ |  | - | ------
|Year Ending December 31, |  |  
|2010                     |  | $ | 18,865
|2011                     |  |   | 22,601
|2012                     |  |   | 23,788
|2013                     |  |   |      
|2014                     |  |   |      
|                         |  |   |       
|                         |  | $ | 65,254
|                         |  |   |       

Note 8: Income Taxes

The Company follows the provisions of FASB accounting guidance on accounting for uncertain income tax positions. Accordingly, assets and liabilities are
recognized for a tax position, based solely on its technical merits that is believed to be more likely than not to be fully sustainable upon examination. As of December 31, 2009 and 2008, there is no accrual for interest or penalties related to
uncertain tax positions since the tax benefits have not been included in prior income tax return filings. Accrued interest relating to uncertain tax positions would be recorded as a component of interest expense and penalties related to uncertain
tax positions would be recorded as a component of general and administrative expenses.

The tax years 2006 to 2009 remain open to examination
by the taxing jurisdictions to which we are subject. Additionally, upon inclusion of the NOL carry forward tax benefits in future tax returns, the related tax benefit for the period in which the benefit arose may be subject to examination.

As of December 31, 2009, the Company had net operating loss (NOL) carry forwards of approximately $10,174,000 that may be used to offset
future taxable income. If not utilized, the NOL carry forwards will expire at various dates through 2028.

Differences between the income
taxes incurred for 2009 and 2008 and the amount determined by applying the statutory federal income tax rate (34%) to the loss before income taxes were as follows:



|                                             |  |       |    |  |       |   
|-------------------------------------------- |  | ----- | -- |  | ----- | --
|                                             |  | 2009  |    |  | 2008  |   
|Statutory rate                               |  | (34.0 | )% |  | (34.0 | )%
|State income taxes, net of federal deduction |  | (4.0  | )  |  | (4.0  | ) 
|Valuation allowance                          |  | 38.0  |    |  | 38.0  |   
|                                             |  |       |    |  |       |   
|                                             |  |      | %  |  |      | % 
|                                             |  |       |    |  |       |   

Deferred income taxes result from the net tax effects of temporary differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts used for income tax purposes and for net operating loss carry forwards. A valuation allowance is provided against deferred tax assets for which it is more likely than not that the asset
will not be realized. Significant components of the Companys deferred tax assets as of December 31, 2009 and 2008 are as follows:



|                                                  |  |      |            |   |      |   |            |  
|------------------------------------------------- |  | ---- | ---------- | - | ---- | - | ---------- | -
|                                                  |  | 2009 |            |   | 2008 |  
|Deferred tax assets:                              |  |      |            |   |      |   |            |  
|Property and equipment                            |  | $    |           |   |      | $ | 97,000     |  
|Other                                             |  |      | 237,000    |   |      |   | 201,000    |  
|Goodwill                                          |  |      | 608,000    |   |      |   |           |  
|Net operating losses                              |  |      | 3,836,000  |   |      |   | 3,627,000  |  
|                                                  |  |      |            |   |      |   |            |  
|                                                  |  |      | 4,681,000  |   |      |   | 3,925,000  |  
|Deferred tax liability:                           |  |      |            |   |      |   |            |  
|Goodwill                                          |  |      |           |   |      |   | (260,000   | )
|                                                  |  |      |            |   |      |   |            |  
|Net deferred tax asset before valuation allowance |  |      | 4,681,000  |   |      |   | 3,665,000  |  
|Valuation allowance                               |  |      | (4,681,000 | ) |      |   | (3,665,000 | )
|                                                  |  |      |            |   |      |   |            |  
|Net deferred tax asset                            |  | $    |           |   |      | $ |           |  
|                                                  |  |      |            |   |      |   |            |  

Note 9: Net Loss Per Common Share

Basic earnings per share (EPS) represents net (loss) divided by the weighted average number of common shares outstanding during a reported period. Diluted EPS reflects the potential
dilution that could occur if securities or other contracts to issue common stock, including stock options, warrants, and contingently issuable shares such as the Companys Series A and Series B preferred stock (commonly and hereinafter referred
to as Common Stock Equivalents), were exercised or converted into common stock.



F-10



---

##### Table of Contents

##### Index to Financial Statements

The following table sets forth the computation for basic and diluted net loss per share for the twelve month
period ended December 31, 2009 and 2008, respectively:



|                                                             |  |      |            |   |      |   |           |  
|------------------------------------------------------------ |  | ---- | ---------- | - | ---- | - | --------- | -
|                                                             |  | 2009 |            |   | 2008 |  
|Loss from continuing operations (A)                          |  | $    | (2,787,072 | ) |      | $ | (134,801  | )
|Loss from discontinued operations (B)                        |  |      |           |   |      |   | (360,975  | )
|                                                             |  |      |            |   |      |   |           |  
|Net loss (C)                                                 |  | $    | (2,787,072 | ) |      | $ | (495,776  | )
|                                                             |  |      |            |   |      |   |           |  
|                                                             |  |     
|Weighted average common shares - basic (D)                   |  |      | 5,217,990  |   |      |   | 5,162,108 |  
|Effect of dilutive securities (3):                           |  |      |            |   |      |   |           |  
|Diluted effect of stock options (1)                          |  |      |           |   |      |   |          |  
|Diluted effect of stock warrants (1)                         |  |      |           |   |      |   |          |  
|Diluted effect of unrestricted Preferred Series A Shares (2) |  |      |           |   |      |   |          |  
|                                                             |  |      |            |   |      |   |           |  
|Weighted average common shares - diluted (E)                 |  |      | 5,217,990  |   |      |   | 5,162,108 |  
|                                                             |  |      |            |   |      |   |           |  
|Loss per share from continuing operations - basic (A/D)      |  | $    | (0.53      | ) |      | $ | (0.03     | )
|                                                             |  |      |            |   |      |   |           |  
|Loss per share from continuing operations - diluted (A/E)    |  | $    | (0.53      | ) |      | $ | (0.03     | )
|                                                             |  |      |            |   |      |   |           |  
|Loss per share from discontinued operations - basic (B/D)    |  | $    |           |   |      | $ | (0.07     | )
|                                                             |  |      |            |   |      |   |           |  
|Loss per share from discontinued operations - diluted (B/E)  |  | $    |           |   |      | $ | (0.07     | )
|                                                             |  |      |            |   |      |   |           |  
|Net loss per share - basic (C/D)                             |  | $    | (0.53      | ) |      | $ | (0.10     | )
|                                                             |  |      |            |   |      |   |           |  
|Net loss per share - diluted (C/E)                           |  | $    | (0.53      | ) |      | $ | (0.10     | )
|                                                             |  |      |            |   |      |   |           |  



|(1) | As a result of the Companys net loss in the twelve months ended December 31, 2009 and 2008, aggregate Common Stock Equivalents of 21,071,239 and 21,226,845
issuable under stock option plans and stock warrants that were potentially dilutive securities are anti-dilutive and have been excluded from the computation of weighted average common shares (diluted) for the twelve months ended December 31,
2009 and 2008. These Common Stock Equivalents could be dilutive in future periods.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(2) | As a result of the Companys net loss in the twelve months ended December 31, 2009 and 2008, aggregate Common Stock Equivalents of 4,277,498 issuable under
Series A convertible, redeemable preferred stock that were potentially dilutive securities are anti-dilutive and have been excluded from the computation of weighted average common shares diluted for the twelve months ended December 31, 2009 and
2008. These Common Stock Equivalents could be dilutive in future periods.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(3) | Series B convertible preferred stock held by Barron Partners, LP (Barron) do not have voting rights and are subject to a maximum ownership percentage by
Barron at any time of 4.9% of the Companys outstanding common stock. As a result, Common Share Equivalents of the Series B convertible preferred stock of 17,236,660 and 18,760,000 are anti-dilutive and have been excluded from the weighted
average common shares diluted calculation for the twelve months ended December 31, 2009 and 2008.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Note 10: Commitments
and Contingencies

Operating Leases

The Company leases office space, land and buildings for certain of its emission testing stations. The leases generally require that the Company pay taxes, maintenance, and insurance. The leases for the
emission testing stations are renewable, at the option of the Company, for specified periods. Management expects that, in the normal course of business, leases that expire will be renewed or replaced by other leases. Certain leases have been
personally guaranteed by the President of the Company.

Certain leases contain scheduled base rent increases over the terms of the leases. The
total amount of base rent payments is charged to expense on a straight-line basis over the lease terms. At December 31, 2009 and 2008, the excess of rent expense over cash payments was $236,214 and $248,470, respectively. Such amounts are
included in the accompanying consolidated balance sheets as deferred rents.

Future minimum rental payments required under the non-cancelable
operating leases were as follows at December 31, 2009:



|                        |  |   |          
|----------------------- |  | - | ---------
|Year Ending December 31 |  |  
|2009                    |  | $ | 1,566,319
|2010                    |  |   | 1,262,479
|2011                    |  |   | 965,471  
|2012                    |  |   | 719,278  



F-11



---

##### Table of Contents

##### Index to Financial Statements

|                        |  |   |          
|----------------------- |  | - | ---------
|Year Ending December 31 |  |  
|2013                    |  |   | 511,808  
|2014 and later          |  |   | 974,351  
|                        |  |   |          
|                        |  | $ | 5,999,706
|                        |  |   |          

Total rent expense under all operating leases totaled $1,655,762 in
2009 and $1,639,132 in 2008.

Capital Leases

The Companys capital lease commitments relate to emission testing and other related equipment. The Company records a capital lease asset and obligation equal to the present value of the lease
payments. The cost and accumulated depreciation of assets held under capital leases was $244,821 and $77,769, respectively as of December 31, 2009 and $244,821 and $42,794, respectively, as of December 31, 2008.

Future minimum rental payments required under the non-cancelable capital leases were as follows at December 31, 2009:



|                                            |  |   |        
|------------------------------------------- |  | - | -------
|Year Ending December 31                     |  |  
|2010                                        |  | $ | 61,479 
|2011                                        |  |   | 59,947 
|2012                                        |  |   | 42,920 
|2013                                        |  |   | 682    
|2014                                        |  |   |       
|                                            |  |   |        
|                                            |  |   | 165,028
|Less amounts representing interest          |  |   | 24,136 
|                                            |  |   |        
|Present value of net minimum lease payments |  |   | 140,892
|Less current portion                        |  |   | 47,288 
|                                            |  |   |        
|Long-term capitalized lease obligations     |  | $ | 93,604 
|                                            |  |   |        

Litigation

From time to time, the Company may be involved in claims that arise out of the normal course of its business. In the opinion of management, we are not
currently involved in any legal proceedings which would have a material adverse effect on the Companys financial position, results of operations or cash flows.

Note 11: Preferred and Common Stock Transactions

Preferred Stock

The Company had 5,133 shares of Series A Convertible Preferred Stock (Preferred A Stock) outstanding at December 31, 2009 and 2008. Each
share of Preferred A Stock is convertible into 833.33 shares of the Companys common stock, or 4,277,498 shares of common stock in aggregate. GCA Strategic Investment Fund, LLC held 3,724 shares of Preferred A Stock convertible into 3,103,333
shares of common stock as of December 31, 2009 and 2008. Global Capital Funding Group, LP held 1,409 shares of Preferred A Stock convertible into 1,174,166 shares of common stock as of December 31, 2009 and 2008. As of October 14,
2005, pursuant to an article of amendment, the Preferred A Stock ceased to accrue dividends. The Preferred A Stock has a liquidation preference equal to the purchase price of the remaining units of Preferred A Stock, or $5,133,000 at
December 31, 2009.

The Preferred A Stock contains certain contingent redemption features which could trigger its redemption. Since the
contingent redemption features are outside the control of the Company the fair value assigned to the Preferred A Stock has been classified outside of Shareholders Equity in the Companys balance sheet. The contingent redemption will occur
only due to events such as a change of control, which is defined as a person or group of persons other than GCA Strategic Investment Fund Ltd. that acquires a beneficial ownership of 33 1/3% or more of the outstanding shares of the Companys
common stock without the prior written consent of GCA Strategic Investment Fund Ltd., a transfer of substantially all of the assets of the Company, a merger, or certain other events. Should one of the contingent redemption instances occur, the
Company would be required to redeem the Preferred A Stock at the greater of (i) the original issue price of $1,000 per share or (ii) the number of shares of common stock into which the redeemed shares may be converted multiplied by the
market price of the common stock at the time of the change in control. Based on the 5,133 shares of Preferred A Stock currently outstanding, if this redemption were triggered, the Company would be required to pay the holders of these shares
$5,133,000.



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##### Table of Contents

##### Index to Financial Statements

The carrying value of the Preferred A Stock at December 31, 2009 and 2008 was $4,579,346. An accretion
from the original value assigned to the Preferred A Stock has not been made since the contingent redemption features have no mandatory time for redemption and the probability of one of the contingent redemption features occurring cannot be
determined.

The Company had 2,279,982 and 2,481,482 shares of Series B Convertible Preferred Stock (Preferred B Stock)
outstanding at December 31, 2009 and 2008. Barron Partners LP (Barron) held 2,279,982 and 2,481,482 shares of the Preferred B Stock at December 31, 2009 and 2008. Each share of the Preferred B Stock is convertible into 7.56
shares of the Companys common stock, subject to adjustment if certain conditions are met, for a total of 17,236,660 and 18,760,000 shares of common stock at December 31, 2009 and 2008. Barron converted 201,500 shares of Preferred B Stock
into 1,523,340 common shares during the twelve months ended December 31, 2009. Barron did not convert any of its Preferred B Stock into common shares during the twelve months ended December 31, 2008. Barron is restricted from converting
any portion of the Preferred B Stock which would cause Barron to beneficially own in excess of 4.99% of the number of shares of common stock outstanding immediately after giving effect to such conversion. The Preferred B Stock has a liquidation
preference equal to the purchase price of the remaining units of Preferred B Stock, or $5,854,994 and $6,372,446 at December 31, 2009 and 2008. The Preferred B Stock does not pay a dividend and has no voting rights.

In the event of liquidation, dissolution or winding up of the Company, preferred stockholders are entitled to be paid prior to any preference of any other
payment or distribution.

Common Stock

The Company issued a total of 1,523,340 shares of common stock to Barron during December 2009. The issuances to Barron resulted from Barrons conversion of a total of 201,500 shares of Preferred B
Stock on multiple occasions during December 2009.

The Company is authorized to issue 250,000,000 shares of $0.001 par value common stock, of
which 6,685,448 and 5,162,108 shares were issued and outstanding as of December 31, 2009 and 2008, respectively. The total number of shares reserved for options and warrant conversions was 21,071,239 and 21,226,845 on December 31, 2009 and
2008, respectively.

Stock Incentive Plans

The Company has four stock incentive plans that authorize the Compensation Committee of the Board of Directors (Compensation Committee) to grant to eligible employees and non-employee
directors stock options, restricted stock awards, unrestricted stock awards and performance stock rewards. As of December 31, 2009, only stock options have been granted to employees and non-employee directors.

Under the Companys Stock Option Plan 2001 (2001 Plan), the Compensation Committee is authorized to grant eligible employees and
non-employee directors options to purchase up to 100,000 shares of the Companys common stock. Options granted to date under this plan vested immediately, with the exception of 40,000 options that vested annually in three equal installments.
The Company does not anticipate granting any options under this plan in the future.

Under the Companys 2005 Omnibus Stock Grant and
Option Plan (2005 Plan) the Compensation Committee is authorized to grant eligible employees and non-employee directors up to 303,496 shares of the Companys authorized common stock. Options granted under this plan generally vest
annually in three equal installments.

Under the Companys Speedemissions Inc. 2006 Stock Grant and Option Plan (2006
Plan), the Compensation Committee is authorized to grant eligible employees and non-employee directors up to 2,000,000 shares of the Companys common stock. Options granted under the 2006 Plan vest annually in three equal installments.

During the Companys annual meeting on May 19, 2008, the shareholders approved and adopted the 2008 Stock Grant and Option Plan
(2008 Plan). The Compensation Committee may issue options for up to 5,000,000 shares of our common stock under the 2008 Plan.

On
May 19, 2008, the Compensation Committee approved the grant of 3,800,000 stock options to employees and directors under the 2008 Plan at an exercise price of $0.125 per share.

On November 10, 2008, the Compensation Committee approved the grant of 64,250 options to employees under the 2008 Plan at an exercise price of $0.12 per share.

On January 30, 2009, the Compensation Committee approved the grant of 13,000 options to employees under the 2008 Plan at an exercise price of $0.07 per
share.

These plans do not allow for the exercise of options after ten years from the date of grant. There were 1,619,688 and 1,616,938 stock
options available to be granted under these plans at December 31, 2009 and 2008, respectively. As of December 31, 2009 and 2008,



F-13



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##### Table of Contents

##### Index to Financial Statements

options to purchase a total of 5,778,808 and 5,781,558, respectively, shares had been granted and were outstanding under these four plans. Options to purchase 4,648,225 and 3,505,892 common
shares were exercisable as of December 31, 2009 and 2008, respectively.

The Company recorded $46,731 and $153,850 in share-based
compensation expense during the years ended December 31, 2009 and 2008. These expenses are included in the Companys general and administrative expenses in its Statements of Operations.

For grants issued during 2009 and 2008, the fair value for stock options was estimated at the date of grant using the Black-Scholes option pricing model,
which requires management to make certain assumptions. Expected volatility was based on the Companys historical stock price volatility. The Company based the risk-free interest rate on U.S. Treasury note rates. The expected term is based on
the vesting period and an expected exercise term. The Company does not anticipate paying cash dividends in the foreseeable future and therefore used an expected dividend yield of 0%.



|                                   |  |         |   |  |         |  
|---------------------------------- |  | ------- | - |  | ------- | -
|                                   |  | 2009    |   |  | 2008    |  
|Risk free interest rate            |  | 1.27    | % |  | (a      | )
|Expected term of stock awards      |  | 2 years |   |  | 2 years |  
|Expected volatility in stock price |  | 45.0    | % |  | 45.0    | %
|Expected dividend yield            |  | None    |   |  | None    |  



|(a) | The risk-free interest rate used was 2.42% and 1.27% for the Companys May 19, 2008 and November 10, 2008 grants, respectively.
|--- | -------------------------------------------------------------------------------------------------------------------------------

The following table sets forth the options granted under Speedemissions stock option plans as of December 31, 2009 and 2008:



|                                         |  |                 |   |      |                              |      |                                     |   |                 |  |           |                              |  |                                     |      |  |   |     
|---------------------------------------- |  | --------------- | - | ---- | ---------------------------- | ---- | ----------------------------------- | - | --------------- |  | --------- | ---------------------------- |  | ----------------------------------- | ---- |  | - | ----
|                                         |  | 2009            |   | 2008
|                                         |  | Number ofShares |   |      | WeightedAverageExercisePrice |      | WeightedAverageGrant-dateFair Value |   | Number ofShares |  |           | WeightedAverageExercisePrice |  | WeightedAverageGrant-dateFair Value
|Options outstanding at December 31, 2008 |  | 5,781,558       |   |      | $                            | 0.35 |                                     |   |                 |  | 2,347,725 |                              |  | $                                   | 0.69 |  |   |     
|Granted                                  |  | 13,000          |   |      | $                            | 0.07 |                                     | $ | 0.02            |  | 3,864,250 |                              |  |                                     | 0.12 |  | $ | 0.03
|Expired                                  |  | (15,750         | ) |      | $                            | 0.30 |                                     |   |                 |  | (430,417  | )                            |  |                                     | 0.21 |  |   |     
|                                         |  |                 |   |      |                              |      |                                     |   |                 |  |           |                              |  |                                     |      |  |   |     
|                                         |  |                 |   |      |                              |     
|Options outstanding at December 31, 2009 |  | 5,778,808       |   |      | $                            | 0.35 |                                     |   |                 |  | 5,781,558 |                              |  | $                                   | 0.35 |  |   |     
|                                         |  |                 |   |      |                              |      |                                     |   |                 |  |           |                              |  |                                     |      |  |   |     
|                                         |  |                 |   |      |                              |     
|Options exercisable at December 31, 2009 |  | 4,648,225       |   |      | $                            | 0.40 |                                     |   |                 |  | 3,505,892 |                              |  | $                                   | 0.49 |  |   |     
|                                         |  |                 |   |      |                              |      |                                     |   |                 |  |           |                              |  |                                     |      |  |   |     

The following table summarizes information about stock options outstanding at December 31, 2009:



|                         |  |                                                     |  |                                           |  |                               |       |                                                     |           |                               |   |      
|------------------------ |  | --------------------------------------------------- |  | ----------------------------------------- |  | ----------------------------- | ----- | --------------------------------------------------- | --------- | ----------------------------- | - | -----
|                         |  | Options Outstanding                                 |  | Options Exercisable                      
|Range of Exercise Prices |  | Number of OptionsOutstanding As ofDecember 31, 2009 |  | WeightedAverage RemainingContractual Life |  | WeightedAverageExercise Price |       | Number of OptionsExercisable As ofDecember 31, 2009 |           | WeightedAverageExercise Price
|$0.00 - $0.49            |  | 3,528,750                                           |  | 9.01 years                                |  | $                             | 0.125 |                                                     | 2,398,167 |                               | $ | 0.125
|$0.50 - $0.99            |  | 1,941,533                                           |  | 6.80 years                                |  | $                             | 0.58  |                                                     | 1,941,533 |                               | $ | 0.58 
|$1.00 - $1.99            |  | 229,000                                             |  | 5.97 years                                |  | $                             | 1.00  |                                                     | 229,000   |                               | $ | 1.00 
|$2.00 - $2.99            |  | 69,900                                              |  | 3.85 years                                |  | $                             | 2.48  |                                                     | 69,900    |                               | $ | 2.48 
|$3.00 - $3.99            |  | 2,625                                               |  | 4.88 years                                |  | $                             | 3.00  |                                                     | 2,625     |                               | $ | 3.00 
|$4.00 - $4.99            |  | 4,500                                               |  | 4.02 years                                |  | $                             | 4.00  |                                                     | 4,500     |                               | $ | 4.00 
|$5.00 - $5.99            |  | 2,500                                               |  | 4.31 years                                |  | $                             | 5.15  |                                                     | 2,500     |                               | $ | 5.20 
|                         |  |                                                     |  |                                           |  |                               |       |                                                     |           |                               |   |      
|$0.00 - $5.99            |  | 5,778,808                                           |  | 7.72 years                                |  | $                             | 0.35  |                                                     | 4,648,225 |                               | $ | 0.40 
|                         |  |                                                     |  |                                           |  |                               |       |                                                     |           |                               |   |      

As of December 31, 2009, there was $14,776 of unrecognized stock-based compensation expense related to
non-vested stock options that is expected to be recognized over a weighted average period of six months.



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##### Table of Contents

##### Index to Financial Statements

The following table represents our non-vested stock options and activity for the years ended
December 31, 2009 and 2008:



|                                       |  |                  |   |  |                                      |     
|-------------------------------------- |  | ---------------- | - |  | ------------------------------------ | ----
|                                       |  | Number ofOptions |   |  | Weighted AverageGrant DateFair Value
|Non-vested options  December 31, 2007 |  | 710,401          |   |  | $                                    | 0.16
|Granted                                |  | 3,864,250        |   |  |                                      | 0.03
|Vested                                 |  | (1,892,818       | ) |  |                                      | 0.03
|Forfeited                              |  | (406,167         | ) |  |                                      | 0.06
|                                       |  |                  |   |  |                                      |     
|Non-vested options  December 31, 2008 |  | 2,275,666        |   |  |                                      | 0.03
|Granted                                |  | 13,000           |   |  |                                      | 0.02
|Vested                                 |  | (1,151,583       | ) |  |                                      | 0.03
|Forfeited                              |  | (6,500           | ) |  |                                      | 0.03
|                                       |  |                  |   |  |                                      |     
|Non-vested options  December 31, 2009 |  | 1,130,583        |   |  | $                                    | 0.03
|                                       |  |                  |   |  |                                      |     

The aggregate intrinsic value of options outstanding and exercisable was $43 at December 31, 2009 and 2008,
based on the Companys closing stock price of $0.08 and $0.07, respectively. The aggregate intrinsic value of options vesting during 2009 and 2008 was $0. Intrinsic value is the amount by which the fair value of the underlying stock exceeds the
exercise price of the options.

Warrants

The fair value of each common stock warrant issued is estimated on the date of grant using the Black-Scholes option-pricing model. There were no warrants granted during the years ended December 31,
2009 and 2008. The following table represents our warrant activity for the years ended December 31, 2009 and 2008:



|                                         |  |                   |  
|---------------------------------------- |  | ----------------- | -
|                                         |  | Number ofWarrants |  
|Outstanding Warrants  December 31, 2007 |  | 15,497,787        |  
|Forfeited                                |  | (52,500           | )
|                                         |  |                   |  
|Outstanding Warrants  December 31, 2008 |  | 15,445,287        |  
|Forfeited                                |  | (152,856          | )
|                                         |  |                   |  
|Outstanding Warrants  December 31, 2009 |  | 15,292,431        |  
|                                         |  |                   |  

All warrants issued were fully vested within the calendar year in which they were granted. Prior to January 1, 2008,
the Company issued warrants to purchase shares of the Companys common stock to certain members of its Board of Directors, investors, consultants, creditors and others.

As of December 31, 2009, warrants to purchase a total of 15,292,431 shares of common stock were outstanding at exercise prices ranging from $0.30 to $3.57. All outstanding warrants are vested,
currently exercisable and expire at various dates through January 2011.

Note 12: Risks and Uncertainties

Regulatory Impact

The current and future
demand for the Companys services is substantially dependent upon federal, state and local legislation and regulations mandating air pollution controls and emissions testing. If any or all of these governmental agencies should change their
positions or eliminate or revise their requirements related to air pollution controls and emissions testing (including a shift to centralized facilities versus decentralized facilities), the Company could experience a significant adverse impact on
its financial position, results of operations and cash flows.

Arrangement with Shareholders

The Company is required to maintain a majority of independent directors on its Board of Directors and a majority of independent directors on both the Audit
Committee and Compensation Committee. In addition, the Company must maintain the effectiveness of a resale registration statement for shares held by a shareholder. Failure to do so could result in liquidated damages equal to 24% of the purchase
price of the Preferred B Stock and Stock Warrants.



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##### Table of Contents

##### Index to Financial Statements

If we fail to maintain the effectiveness of a resale registration statement for the shares held by Barron,
then we may have to pay Barron in the form of shares of Preferred B Stock an amount equal to 24% of the purchase price of $6,615,000 paid by Barron for the Preferred B Stock and common stock warrants per annum for each day the resale registration is
not effective.

If a person or group of persons other than GCA Strategic Investment Fund Ltd. acquires beneficial ownership of 33 1/3% or more
of the outstanding shares of common stock without the prior written consent of GCA Strategic Investment Fund Ltd., we could be required to redeem the Preferred A Stock at the greater of (i) the original issue price of $1,000 per share or
(ii) the number of shares of common stock into which the redeemed shares may be converted multiplied by the market price of the common stock at the time of the change in control. Based on the 5,133 shares of Preferred A Stock currently
outstanding, if this redemption were triggered we would be required to pay the holders of these shares an aggregate of at least $5,133,000. This restriction will likely deter any proposed acquisition of our stock and may make it more difficult for
us to attract new investors, as any mandatory redemption of the preferred shares will materially adversely affect our ability to remain in business and significantly impair the value of your common stock.

Potential Control Relationship by Existing Shareholders

We have a large amount of outstanding common stock held by a single shareholder and a large amount of common stock that could be acquired by a second shareholder upon conversion of preferred stock and
exercise of warrants, which if sold could have a negative impact on our stock price. The Company had 6,685,448 shares of common stock issued and outstanding as of December 31, 2009. As of December 31, 2009, our largest shareholder, GCA
Strategic Investment Fund Ltd, and its affiliates, owned 3,379,360 shares of our common stock. GCA Strategic Investment Fund Ltd, and its affiliates currently have the effective power to control the vote on substantially all significant matters
without the approval of other shareholders. Upon exercise of all outstanding warrants at the exercise prices ranging from $0.30 to $0.90 per share and conversion of their Preferred A Stock, GCA Strategic Investment Fund Ltd could own up to
10,056,859 shares of our common stock.

As of December 31, 2009, Barron could acquire up to 29,824,092 shares of our common stock upon
the exercise of outstanding warrants at the exercise prices ranging from $0.30 to $0.90 per share and the conversion of their Preferred B Stock. In the event Barron obtains ownership of these shares, they will have the effective power to control the
vote on substantially all significant matters without the approval of other shareholders.

If either of these shareholders sold a large number
of shares of our common stock into the public market it would have a negative impact on our stock price.

Note 13: Significant Fourth
Quarter Adjustments

During the fourth quarter of 2009, the Company reviewed the carrying amount of goodwill in relation to the operating
performance and future estimated discounted net cash flows expected to be generated by the assets and underlying stores previously acquired. The Company determined that goodwill recorded from the acquisition of the assets of Mr. Sticker, Inc.
was impaired due to a decline in operating performance and anticipated future performance at the stores located in Texas. The impairment recognized was measured by the amount by which the carrying amount of the assets exceeds the fair value of the
net assets. The fair value of goodwill was determined using discounted cash flow techniques. The amount of the goodwill impairment expensed during the fourth quarter was $2,873,766. The goodwill recorded for the Companys other acquisitions
remaining on the Companys balance sheet was not impaired as of December 31, 2009.

*****



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##### Table of Contents

##### Index to Financial Statements

Item 9. Changes in and Disagreements With Accountants on Accounting and
Financial Disclosure.

None

Item 9A. Controls and Procedures

Evaluation of Disclosure Controls and
Procedures

We conducted an evaluation under the supervision and with the participation of our management, including our Chief
Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. The term disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the
Securities and Exchange Act of 1934, as amended (Exchange Act), means controls and other procedures of a company that are designed to ensure that information required to be disclosed by the company in the reports it files or submits
under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commissions rules and forms. Disclosure controls and procedures also include, without limitation, controls
and procedures designed to ensure that information required to be disclosed by a company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the companys management, including its principal
executive and principal financial officers, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded
as of December 31, 2009 that our disclosure controls and procedures were effective at the reasonable assurance level.

Managements 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) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is designed to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and
procedures that:

(1) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and
dispositions of our assets;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial
statements in accordance with U.S. GAAP, and that our receipts and expenditures are being made only in accordance with the authorization of our management and directors; and

(3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of
any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Management assessed the effectiveness of our internal control over financial reporting as of December 31, 2009. In making this assessment, management
used the framework set forth in the report entitled Internal ControlIntegrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission, or COSO. The COSO framework summarizes each of the components of a
companys internal control system, including (i) the control environment, (ii) risk assessment, (iii) control activities, (iv) information and communication, and (v) monitoring. This annual report does not include an
attestation report of our registered public accounting firm regarding internal control over financial reporting. Managements report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the
Securities and Exchange Commission that permits us to provide only managements report in this annual report. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded as of December 31, 2009 that our
internal controls over financial reporting were effective.

Item 9B. Other Information

None



20



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##### Table of Contents

##### Index to Financial Statements

Part III

Item 10. Directors and Executive Officers and Corporate Governance

The information required by this Item relating to our directors is incorporated herein by reference to the definitive Proxy Statement to be filed pursuant to Regulation 14A of the Exchange Act for
our 2010 Annual Meeting of Shareholders. The information required by this Item relating to our executive officers is included in Part I, Item 1 Business  Executive Officers.

Item 11. Executive Compensation

The information required by this Item is incorporated herein by reference to the information contained in the definitive Proxy Statement to be filed pursuant to Regulation 14A of the Exchange Act for
our 2010 Annual Meeting of Shareholders.

Item 12. Security Ownership of Certain Beneficial Owners and
Management and Related Stockholder Matters

The information required by this Item is incorporated herein by reference to the
information contained in the definitive Proxy Statement to be filed pursuant to Regulation 14A of the Exchange Act for our 2010 Annual Meeting of Shareholders.

Item 13. Certain Relationships, Related Transactions, and Director Independence

The information required by this Item is incorporated herein by reference to the information contained in the definitive Proxy Statement to be filed pursuant to Regulation 14A of the Exchange Act for
our 2010 Annual Meeting of Shareholders.

Item 14. Principal Accountant Fees and Services

The information required by this Item is incorporated herein by reference to the information contained in the definitive Proxy
Statement to be filed pursuant to Regulation 14A of the Exchange Act for our 2010 Annual Meeting of Shareholders.



21



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##### Table of Contents

##### Index to Financial Statements

Part IV

Item 15. Exhibits and Financial Statement Schedules



|     |  |                                                                                                                                                                                                                                                                                           
|---- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1  |  | Articles of Incorporation of Speedemissions, Inc., as amended (incorporated by reference to Exhibit 3.1 to Form 10-KSB dated March 31, 2006)                                                                                                                                              
|     | 
|3.2  |  | Bylaws of Speedemissions, Inc. (incorporated by reference to Exhibit 3.2 of the Pre-Effective Registration Statement on Form SB-2, File No. 333-68730)                                                                                                                                    
|     | 
|3.3  |  | Articles of Merger and Agreement and Plan of Merger of Mr. Sticker, Inc. with and into Speedemissions, Inc. (incorporated by reference to Exhibit 3.3 of the Pre-Effective Amendment
No. 1 to the Registration Statement on Form SB-2, File No. 333-146733)                               
|     | 
|3.4  |  | Articles of Merger and Agreement and Plan of Merger of Just, Inc. with and into Speedemissions, Inc. (incorporated by reference to Exhibit 3.4 of the Pre-Effective Amendment No. 2
to the Registration Statement on Form S-1, File No. 333-146733)                                       
|     | 
|4.1  |  | Certificate of Designation of Series A Convertible Preferred Stock, as amended (incorporated by reference to Exhibit 4.1 to Form 10-KSB dated March 31, 2006)                                                                                                                             
|     | 
|4.2  |  | Certificate of Designation of Series B Convertible Preferred Stock, as amended (incorporated by reference to Exhibit 4.2 to Form 10-KSB dated March 31, 2006)                                                                                                                             
|     | 
|4.3  |  | Common Stock Purchase Warrant AA-1 dated October 12, 2007 issued to Barron Partners LP (incorporated by reference to Exhibit 4.3 of the Registration Statement on Form
SB-2, File No. 333-146733)                                                                                       
|     | 
|4.4  |  | Common Stock Purchase Warrant AA-2 dated October 12, 2007 issued to Barron Partners LP (incorporated by reference to Exhibit 4.4 of the Registration Statement on Form
SB-2, File No. 333-146733)                                                                                       
|     | 
|4.5  |  | Common Stock Purchase Warrant AA-3 dated October 12, 2007 issued to Barron Partners LP (incorporated by reference to Exhibit 4.5 of the Registration Statement on Form
SB-2, File No. 333-146733)                                                                                       
|     | 
|4.6  |  | Common Stock Purchase Warrant AA-4 dated October 12, 2007 issued to Barron Partners LP (incorporated by reference to Exhibit 4.6 of the Registration Statement on Form
SB-2, File No. 333-146733)                                                                                       
|     | 
|4.7  |  | Common Stock Purchase Warrant AA-5 dated October 12, 2007 issued to Barron Partners LP (incorporated by reference to Exhibit 4.7 of the Registration Statement on Form
SB-2, File No. 333-146733)                                                                                       
|     | 
|4.8  |  | Common Stock Purchase Warrant AA-6 dated October 12, 2007 issued to Barron Partners LP (incorporated by reference to Exhibit 4.8 of the Registration Statement on Form
SB-2, File No. 333-146733)                                                                                       
|     | 
|4.9  |  | Common Stock Purchase Warrant AA-7 dated October 12, 2007 issued to Global Capital Funding Group, L.P. (incorporated by reference to Exhibit 4.9 of the Registration
Statement on Form SB-2, File No. 333-146733)                                                                       
|     | 
|4.10 |  | Common Stock Purchase Warrant AA-8 dated October 12, 2007 issued to Global Capital Funding Group, L.P. (incorporated by reference to Exhibit 4.10 of the Registration
Statement on Form SB-2, File No. 333-146733)                                                                      
|     | 
|4.11 |  | Common Stock Purchase Warrant AA-9 dated October 12, 2007 issued to Global Capital Funding Group, L.P. (incorporated by reference to Exhibit 4.11 of the Registration
Statement on Form SB-2, File No. 333-146733)                                                                      
|     | 
|4.12 |  | Amended and Restated Plan of Recapitalization dated October 12, 2007, with respect to Common Stock Purchase Warrants AA-1 through AA-9 (incorporated by
reference to Exhibit 4.12 of the Pre-Effective Amendment No. 2 to the Registration Statement on Form S-1, File No. 333-146733)
|     | 
|4.13 |  | Amendment No. 1 dated October 14, 2005 to Common Stock Purchase Warrant issued to GCA Strategic Investment Fund Limited dated January 21, 2004 (incorporated by reference to Exhibit
10.5 to Form 8-K dated November 21, 2005 and filed with the Commission on November 23, 2005)         
|     | 
|4.14 |  | Amendment No. 1 dated October 14, 2005 to Common Stock Purchase Warrant issued to GCA Strategic Investment Fund Limited dated January 26, 2005 (incorporated by reference
to Exhibit 10.6 to Form 8-K dated November 21, 2005 and filed with the Commission on November 23, 2005)         
|     | 
|4.15 |  | Common Stock Purchase Warrant issued to GCA Strategic Investment Fund Limited dated October 14, 2005 (incorporated by reference to Exhibit 10.8 to Form 8-K dated November 21, 2005
and filed with the Commission on November 23, 2005)                                                   
|     | 
|4.16 |  | Registration Rights Agreement between Speedemissions, Inc. and Global Capital Funding Group LP dated October 14, 2005 (incorporated by reference to Exhibit 10.10 to Form 8-K
dated November 21, 2005 and filed with the Commission on                                                    



22



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##### Table of Contents

##### Index to Financial Statements

|      |  |                                                                                                                                                                                                                                                                         
|----- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  | November 23, 2005)                                                                                                                                                                                                                                                      
|      | 
|4.17  |  | Registration Rights Agreement between Speedemissions, Inc. and GCA Strategic Fund Investment dated October 14, 2005 (incorporated by reference to Exhibit 10.12 to Form 8-K dated
November 21, 2005 and filed with the Commission on November 23, 2005)                 
|      | 
|4.18  |  | Common Stock Purchase Warrant issued to GCA Strategic Investment Fund Limited dated January 26, 2005 (incorporated by reference to Exhibit 10.2 to Form 8-K dated February 2, 2005
and filed with the Commission on February 3, 2005)                                   
|      | 
|4.19  |  | Common Stock Purchase Warrant issued to Global Capital Advisors, LLC dated January 26, 2005 (incorporated by reference to Exhibit 10.3 to Form 8-K dated February 2, 2005, and filed
with the Commission on February 3, 2005)                                           
|      | 
|4.20  |  | Registration Rights Agreement to Global Capital Advisors, LLC and GCA Strategic Investment Fund Limited dated January 26, 2005 (incorporated by reference to Exhibit 10.4 to Form 8-K
dated February 2, 2005 and filed with the Commission on February 3, 2005)         
|      | 
|4.21  |  | Registration Rights Agreement between Speedemissions, Inc. and Barron Partners LP dated June 30, 2005 (incorporated by reference to Exhibit 10.3 to Form 8-K dated July 6, 2005 and
filed with the Commission on July 7, 2005)                                          
|      | 
|10.1  |  | Speedemissions, Inc. 2001 Stock Option Plan (incorporated by reference to Exhibit 4.1 of the Pre-Effective Registration Statement on Form SB-2, File No. 333-68730)                                                                                                     
|      | 
|10.2  |  | First Amendment to Speedemissions, Inc. 2001 Stock Option Plan (incorporated by reference to Exhibit 4.1 of Form 8-K dated August 29, 2003 and filed with the Commission on
September 2, 2003)                                                                          
|      | 
|10.3  |  | Form of Indemnification Agreement (incorporated by reference to Exhibit 10.1 of Pre-Effective Registration Statement on Form SB-2, File No. 333-109416)                                                                                                                 
|      | 
|10.4  |  | Employment Agreement with Richard A. Parlontieri dated September 15, 2003 (incorporated by reference to Exhibit 10.2 of Pre-Effective Registration Statement on Form SB-2, File No.
333-109416)                                                                         
|      | 
|10.5  |  | First Amendment to Employment Agreement with Richard A. Parlontieri dated December 19, 2003 (incorporated by reference to Exhibit 10.16 to the Companys Form 10-KSB for the
period ended December 31, 2003 and filed with the Commission on March 30, 2004)            
|      | 
|10.6  |  | Second Amendment to Employment Agreement with Richard A. Parlontieri dated October 23, 2006 (incorporated by reference to Exhibit 10.1 to Form 8-K dated October 23, 2006 and filed
with the Commission on October 23, 2006)                                            
|      | 
|10.7  |  | Conversion Notice and Agreement between Speedemissions, Inc. and Calabria Advisors, LLC dated June 16, 2004 (incorporated by reference to Exhibit 10.2 to the Companys Form
10-QSB for the period ended June 30, 2004 and filed with the Commission on August 16, 2004)
|      | 
|10.8  |  | Equity Research Agreement with The Research Works, Inc. dated as of October 29, 2004 (incorporated by reference to Exhibit 10.1 to Form 8-K dated November 8, 2004 and filed with the
Commission on November 12, 2004)                                                  
|      | 
|10.9  |  | Asset Purchase Agreement between Speedemissions, Inc. and SITs EMI Mobile Testing Unit dated as of December 2, 2004 (incorporated by reference to Exhibit 2.1 to Form 8-K
dated December 7, 2004 and filed with the Commission on December 8, 2004)                    
|      | 
|10.10 |  | Asset Purchase Agreement between Speedemissions, Inc. and State Inspection of Texas, Inc. dated as of December 30, 2004 (incorporated by reference to Exhibit 2.1 to Form 8-K dated
January 3, 2005 and filed with the Commission on January 7, 2005)                   
|      | 
|10.11 |  | $1,285,000 Promissory Note to State Inspections of Texas, Inc. dated December 30, 2004 (incorporated by reference to Exhibit 2.2 to Form 8-K dated January 3, 2005 and filed with the
Commission on January 7, 2005)                                                    
|      | 
|10.12 |  | $350,000 Promissory Note to GCA Strategic Investment Fund Limited dated January 26, 2005 (incorporated by reference to Exhibit 10.1 to Form 8-K dated February 2, 2005 and filed with
the Commission on February 3, 2005)                                               
|      | 
|10.13 |  | Common Stock Purchase Warrant issued to Richard A. Parlontieri dated February 22, 2005 (incorporated by reference to Exhibit 10.1 to Form 8-K dated March 10, 2005 and filed with the
Commission on March 17, 2005)                                                     
|      | 
|10.14 |  | Stock Purchase Agreement between Speedemissions, Inc. and Mr. Sticker, Inc. dated June 30, 2005 (incorporated by reference to Exhibit 10.1 to Form 8-K dated July 6, 2005 and filed
with the Commission on July 7, 2005)                                                
|      | 
|10.15 |  | Preferred Stock Purchase Agreement between Speedemissions, Inc. and Barron Partners LP dated June 30, 2005                                                                                                                                                              



23



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##### Index to Financial Statements

|      |  |                                                                                                                                                                                                                                                                                                                                  
|----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |  | (incorporated by reference to Exhibit 10.2 to form 8-K dated July 6, 2005 and filed with the Commission on July 7, 2005)                                                                                                                                                                                                         
|      | 
|10.16 |  | Amendment to Preferred Stock Purchase Agreement between Speedemissions, Inc. and Barron Partners, LP dated August 4, 2005 (incorporated by reference to Exhibit 10.1 to Form 8-K
dated August 8, 2005 and filed with the Commission on August 9, 2005)                                                                           
|      | 
|10.17 |  | Stock Purchase Agreement between Speedemissions, Inc., Just, Inc. and Michael Duncan and Steve Malmgren dated September 7, 2005 (incorporated by reference to Exhibit 10.1 to Form
8-K dated September 12, 2005 and filed with the Commission on September 13, 2005)                                                             
|      | 
|10.18 |  | Settlement Agreement and General Release between Global Capital Funding Group, LP, GCA Strategic Investment Fund Limited, Barron Partners, LP, and Speedemissions, Inc. dated October
14, 2005 (incorporated by reference to Exhibit 10.1 to Form 8-K dated November 21, 2005 and filed with the Commission on November 23, 2005)
|      | 
|10.19 |  | Exchange Agreement between Speedemissions, Inc. and Global Capital Funding Group LP dated October 14, 2005 (incorporated by reference to Exhibit 10.9 to Form 8-K dated November 21,
2005 and filed with the Commission on November 23, 2005)                                                                                    
|      | 
|10.20 |  | Exchange Agreement between Speedemissions, Inc. and GCA Strategic Fund Investment dated October 14, 2005 (incorporated by reference to Exhibit 10.11 to Form 8-K dated November 21,
2005 and filed with the Commission on November 23, 2005)                                                                                     
|      | 
|10.21 |  | Speedemissions, Inc. Amended and Restated 2005 Omnibus Stock Grant and Option Plan effective September 11, 2008 (incorporated by reference to Exhibit 4.1 to Form S-8, filed with the
Commission on September 11, 2008)                                                                                                          
|      | 
|10.22 |  | Speedemissions, Inc. 2006 Stock Grant and Option Plan effective September 18, 2006 (incorporated by reference to Exhibit 4.2 to Form 10-QSB filed with the Commission on March 30,
2007)                                                                                                                                         
|      | 
|10.23 |  | Subscription and Securities Purchase Agreement between Speedemissions, Inc., and GCA Strategic Investment Fund dated January 21, 2004 (incorporated by reference to Exhibit 10.1 to
Form 8-K dated January 21, 2004 and filed with the Commission on January 29, 2004)                                                           
|      | 
|10.24 |  | Speedemissions, Inc. 2008 Stock Grant and Option Plan effective May 19, 2008 (incorporated by reference to Exhibit 10.25 to Form S-1/A filed with the Commission on June 19, 2008)                                                                                                                                               
|      | 
|16.1  |  | Letter from Bennett Thrasher PC dated February 1, 2005 (incorporated by reference to Exhibit 16.1 to Form 8-K dated February 2, 2005 and filed with the Commission on February 3,
2005)                                                                                                                                          
|      | 
|16.2  |  | Letter from Tauber & Balser, P.C. dated October 31, 2008 (incorporated by reference to Exhibit 16.1 to Form 8-K dated November 1, 2008 and filed with the Commission on November
1, 2008)                                                                                                                                        
|      | 
|23.1  |  | Consent of Habif, Arogeti & Wynne, LLP                                                                                                                                                                                                                                                                                           
|      | 
|24    |  | Power of Attorney (contained on signature pages herewith)                                                                                                                                                                                                                                                                        
|      | 
|31.1  |  | Rule 13a-14(a) Certification of the Chief Executive Officer                                                                                                                                                                                                                                                                      
|      | 
|31.2  |  | Rule 13a-14(a) Certification of the Chief Financial Officer                                                                                                                                                                                                                                                                      
|      | 
|32.1  |  | Section 906 Certification of Chief Executive Officer                                                                                                                                                                                                                                                                             
|      | 
|32.2  |  | Section 906 Certification of Chief Financial Officer                                                                                                                                                                                                                                                                             



24



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##### Index to Financial Statements

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.



|                      |  |                      |  |                                                              
|--------------------- |  | -------------------- |  | -------------------------------------------------------------
|                      |  | Speedemissions, Inc.
|                      |  |                     
|Dated: March 30, 2010 |  |                      |  | /s/ Richard A. Parlontieri                                   
|                      |  | By:                  |  | Richard A. Parlontieri, President and Chief Executive Officer
|                      |  |                     
|Dated: March 30, 2010 |  |                      |  | /s/ Michael S. Shanahan                                      
|                      |  | By:                  |  | Chief Financial Officer and Chief Accounting Officer         

KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below
constitutes and appoints Richard A. Parlontieri, his true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities, to sign any and all amendments
to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto attorney-in-fact and agent full power and authority to do
and perform each and every act and thing requisite or necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that attorney-in-fact and agent, or his
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

In accordance with the Exchange Act, this
report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.



|    |  |                                                                                      |  |  |  |                      
|--- |  | ------------------------------------------------------------------------------------ |  |  |  | ---------------------
|    |  | /s/ Richard A. Parlontieri                                                           |  |  |  | Dated: March 30, 2010
|By: |  | Richard A. Parlontieri, Director, President and Chief Executive Officer              |  |  |  |                      
|    |  |                                                                                      | 
|    |  | /s/ Bradley A. Thompson                                                              |  |  |  | Dated: March 30, 2010
|By: |  | Bradley A. Thompson, Director                                                        |  |  |  |                      
|    |  |                                                                                      | 
|    |  | /s/ Dr. Ernest A. Childs                                                             |  |  |  | Dated: March 30, 2010
|By: |  | Dr. Ernest A. Childs, Director                                                       |  |  |  |                      
|    |  |                                                                                      | 
|    |  | /s/ Gerald Amato                                                                     |  |  |  | Dated: March 30, 2010
|By: |  | Gerald Amato, Director                                                               |  |  |  |                      
|    |  |                                                                                      | 
|    |  | /s/ Michael E. Guirlinger                                                            |  |  |  | Dated: March 30, 2010
|By: |  | Michael E. Guirlinger, Director                                                      |  |  |  |                      
|    |  |                                                                                      | 
|    |  | /s/ Michael S. Shanahan                                                              |  |  |  |                      
|By: |  | Michael S. Shanahan, Chief Financial Officer, Chief Accounting Officer and Secretary |  |  |  | Dated: March 30, 2010



25



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##### Index to Financial Statements

EXHIBIT INDEX



|     |  |                                                                                                                                                                                                                                                                                           
|---- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1  |  | Articles of Incorporation of Speedemissions, Inc., as amended (incorporated by reference to Exhibit 3.1 to Form 10-KSB dated March 31, 2006)                                                                                                                                              
|     | 
|3.2  |  | Bylaws of Speedemissions, Inc. (incorporated by reference to Exhibit 3.2 of the Pre-Effective Registration Statement on Form SB-2, File No. 333-68730)                                                                                                                                    
|     | 
|3.3  |  | Articles of Merger and Agreement and Plan of Merger of Mr. Sticker, Inc. with and into Speedemissions, Inc. (incorporated by reference to Exhibit 3.3 of the Pre-Effective Amendment
No. 1 to the Registration Statement on Form SB-2, File No. 333-146733)                               
|     | 
|3.4  |  | Articles of Merger and Agreement and Plan of Merger of Just, Inc. with and into Speedemissions, Inc. (incorporated by reference to Exhibit 3.4 of the Pre-Effective Amendment No. 2
to the Registration Statement on Form S-1, File No. 333-146733)                                       
|     | 
|4.1  |  | Certificate of Designation of Series A Convertible Preferred Stock, as amended (incorporated by reference to Exhibit 4.1 to Form 10-KSB dated March 31, 2006)                                                                                                                             
|     | 
|4.2  |  | Certificate of Designation of Series B Convertible Preferred Stock, as amended (incorporated by reference to Exhibit 4.2 to Form 10-KSB dated March 31, 2006)                                                                                                                             
|     | 
|4.3  |  | Common Stock Purchase Warrant AA-1 dated October 12, 2007 issued to Barron Partners LP (incorporated by reference to Exhibit 4.3 of the Registration Statement on Form
SB-2, File No. 333-146733)                                                                                       
|     | 
|4.4  |  | Common Stock Purchase Warrant AA-2 dated October 12, 2007 issued to Barron Partners LP (incorporated by reference to Exhibit 4.4 of the Registration Statement on Form
SB-2, File No. 333-146733)                                                                                       
|     | 
|4.5  |  | Common Stock Purchase Warrant AA-3 dated October 12, 2007 issued to Barron Partners LP (incorporated by reference to Exhibit 4.5 of the Registration Statement on Form
SB-2, File No. 333-146733)                                                                                       
|     | 
|4.6  |  | Common Stock Purchase Warrant AA-4 dated October 12, 2007 issued to Barron Partners LP (incorporated by reference to Exhibit 4.6 of the Registration Statement on Form
SB-2, File No. 333-146733)                                                                                       
|     | 
|4.7  |  | Common Stock Purchase Warrant AA-5 dated October 12, 2007 issued to Barron Partners LP (incorporated by reference to Exhibit 4.7 of the Registration Statement on Form
SB-2, File No. 333-146733)                                                                                       
|     | 
|4.8  |  | Common Stock Purchase Warrant AA-6 dated October 12, 2007 issued to Barron Partners LP (incorporated by reference to Exhibit 4.8 of the Registration Statement on Form
SB-2, File No. 333-146733)                                                                                       
|     | 
|4.9  |  | Common Stock Purchase Warrant AA-7 dated October 12, 2007 issued to Global Capital Funding Group, L.P. (incorporated by reference to Exhibit 4.9 of the Registration
Statement on Form SB-2, File No. 333-146733)                                                                       
|     | 
|4.10 |  | Common Stock Purchase Warrant AA-8 dated October 12, 2007 issued to Global Capital Funding Group, L.P. (incorporated by reference to Exhibit 4.10 of the Registration
Statement on Form SB-2, File No. 333-146733)                                                                      
|     | 
|4.11 |  | Common Stock Purchase Warrant AA-9 dated October 12, 2007 issued to Global Capital Funding Group, L.P. (incorporated by reference to Exhibit 4.11 of the Registration
Statement on Form SB-2, File No. 333-146733)                                                                      
|     | 
|4.12 |  | Amended and Restated Plan of Recapitalization dated October 12, 2007, with respect to Common Stock Purchase Warrants AA-1 through AA-9 (incorporated by
reference to Exhibit 4.12 of the Pre-Effective Amendment No. 2 to the Registration Statement on Form S-1, File No. 333-146733)
|     | 
|4.13 |  | Amendment No. 1 dated October 14, 2005 to Common Stock Purchase Warrant issued to GCA Strategic Investment Fund Limited dated January 21, 2004 (incorporated by reference to Exhibit
10.5 to Form 8-K dated November 21, 2005 and filed with the Commission on November 23, 2005)         
|     | 
|4.14 |  | Amendment No. 1 dated October 14, 2005 to Common Stock Purchase Warrant issued to GCA Strategic Investment Fund Limited dated January 26, 2005 (incorporated by reference
to Exhibit 10.6 to Form 8-K dated November 21, 2005 and filed with the Commission on November 23, 2005)         
|     | 
|4.15 |  | Common Stock Purchase Warrant issued to GCA Strategic Investment Fund Limited dated October 14, 2005 (incorporated by reference to Exhibit 10.8 to Form 8-K dated November 21, 2005
and filed with the Commission on November 23, 2005)                                                   
|     | 
|4.16 |  | Registration Rights Agreement between Speedemissions, Inc. and Global Capital Funding Group LP dated October 14, 2005 (incorporated by reference to Exhibit 10.10 to Form 8-K dated
November 21, 2005 and filed with the Commission on November 23, 2005)                                 



---

##### Table of Contents

##### Index to Financial Statements

|      |  |                                                                                                                                                                                                                                                                         
|----- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.17  |  | Registration Rights Agreement between Speedemissions, Inc. and GCA Strategic Fund Investment dated October 14, 2005 (incorporated by reference to Exhibit 10.12 to Form 8-K
dated November 21, 2005 and filed with the Commission on November 23, 2005)                 
|      | 
|4.18  |  | Common Stock Purchase Warrant issued to GCA Strategic Investment Fund Limited dated January 26, 2005 (incorporated by reference to Exhibit 10.2 to Form 8-K dated February 2, 2005
and filed with the Commission on February 3, 2005)                                   
|      | 
|4.19  |  | Common Stock Purchase Warrant issued to Global Capital Advisors, LLC dated January 26, 2005 (incorporated by reference to Exhibit 10.3 to Form 8-K dated February 2, 2005, and filed
with the Commission on February 3, 2005)                                           
|      | 
|4.20  |  | Registration Rights Agreement to Global Capital Advisors, LLC and GCA Strategic Investment Fund Limited dated January 26, 2005 (incorporated by reference to Exhibit 10.4 to Form 8-K
dated February 2, 2005 and filed with the Commission on February 3, 2005)         
|      | 
|4.21  |  | Registration Rights Agreement between Speedemissions, Inc. and Barron Partners LP dated June 30, 2005 (incorporated by reference to Exhibit 10.3 to Form 8-K dated July 6, 2005 and
filed with the Commission on July 7, 2005)                                          
|      | 
|10.1  |  | Speedemissions, Inc. 2001 Stock Option Plan (incorporated by reference to Exhibit 4.1 of the Pre-Effective Registration Statement on Form SB-2, File No. 333-68730)                                                                                                     
|      | 
|10.2  |  | First Amendment to Speedemissions, Inc. 2001 Stock Option Plan (incorporated by reference to Exhibit 4.1 of Form 8-K dated August 29, 2003 and filed with the Commission on September
2, 2003)                                                                          
|      | 
|10.3  |  | Form of Indemnification Agreement (incorporated by reference to Exhibit 10.1 of Pre-Effective Registration Statement on Form SB-2, File No. 333-109416)                                                                                                                 
|      | 
|10.4  |  | Employment Agreement with Richard A. Parlontieri dated September 15, 2003 (incorporated by reference to Exhibit 10.2 of Pre-Effective Registration Statement on Form SB-2, File No.
333-109416)                                                                         
|      | 
|10.5  |  | First Amendment to Employment Agreement with Richard A. Parlontieri dated December 19, 2003 (incorporated by reference to Exhibit 10.16 to the Companys Form 10-KSB for the
period ended December 31, 2003 and filed with the Commission on March 30, 2004)            
|      | 
|10.6  |  | Second Amendment to Employment Agreement with Richard A. Parlontieri dated October 23, 2006 (incorporated by reference to Exhibit 10.1 to Form 8-K dated October 23, 2006 and filed
with the Commission on October 23, 2006)                                            
|      | 
|10.7  |  | Conversion Notice and Agreement between Speedemissions, Inc. and Calabria Advisors, LLC dated June 16, 2004 (incorporated by reference to Exhibit 10.2 to the Companys Form
10-QSB for the period ended June 30, 2004 and filed with the Commission on August 16, 2004)
|      | 
|10.8  |  | Equity Research Agreement with The Research Works, Inc. dated as of October 29, 2004 (incorporated by reference to Exhibit 10.1 to Form 8-K dated November 8, 2004 and filed with the
Commission on November 12, 2004)                                                  
|      | 
|10.9  |  | Asset Purchase Agreement between Speedemissions, Inc. and SITs EMI Mobile Testing Unit dated as of December 2, 2004 (incorporated by reference to Exhibit 2.1 to Form 8-K
dated December 7, 2004 and filed with the Commission on December 8, 2004)                    
|      | 
|10.10 |  | Asset Purchase Agreement between Speedemissions, Inc. and State Inspection of Texas, Inc. dated as of December 30, 2004 (incorporated by reference to Exhibit 2.1 to Form 8-K dated
January 3, 2005 and filed with the Commission on January 7, 2005)                   
|      | 
|10.11 |  | $1,285,000 Promissory Note to State Inspections of Texas, Inc. dated December 30, 2004 (incorporated by reference to Exhibit 2.2 to Form 8-K dated January 3, 2005 and filed with the
Commission on January 7, 2005)                                                    
|      | 
|10.12 |  | $350,000 Promissory Note to GCA Strategic Investment Fund Limited dated January 26, 2005 (incorporated by reference to Exhibit 10.1 to Form 8-K dated February 2, 2005 and filed with
the Commission on February 3, 2005)                                               
|      | 
|10.13 |  | Common Stock Purchase Warrant issued to Richard A. Parlontieri dated February 22, 2005 (incorporated by reference to Exhibit 10.1 to Form 8-K dated March 10, 2005 and
filed with the Commission on March 17, 2005)                                                     
|      | 
|10.14 |  | Stock Purchase Agreement between Speedemissions, Inc. and Mr. Sticker, Inc. dated June 30, 2005 (incorporated by reference to Exhibit 10.1 to Form 8-K dated July 6, 2005 and filed
with the Commission on July 7, 2005)                                                
|      | 
|10.15 |  | Preferred Stock Purchase Agreement between Speedemissions, Inc. and Barron Partners LP dated June 30, 2005 (incorporated by reference to Exhibit 10.2 to form 8-K dated July 6, 2005
and filed with the Commission on July 7, 2005)                                     



---

##### Table of Contents

##### Index to Financial Statements

|      |  |                                                                                                                                                                                                                                                                                                                                  
|----- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.16 |  | Amendment to Preferred Stock Purchase Agreement between Speedemissions, Inc. and Barron Partners, LP dated August 4, 2005 (incorporated by reference to Exhibit 10.1 to Form 8-K
dated August 8, 2005 and filed with the Commission on August 9, 2005)                                                                           
|      | 
|10.17 |  | Stock Purchase Agreement between Speedemissions, Inc., Just, Inc. and Michael Duncan and Steve Malmgren dated September 7, 2005 (incorporated by reference to Exhibit 10.1 to Form
8-K dated September 12, 2005 and filed with the Commission on September 13, 2005)                                                             
|      | 
|10.18 |  | Settlement Agreement and General Release between Global Capital Funding Group, LP, GCA Strategic Investment Fund Limited, Barron Partners, LP, and Speedemissions, Inc. dated October
14, 2005 (incorporated by reference to Exhibit 10.1 to Form 8-K dated November 21, 2005 and filed with the Commission on November 23, 2005)
|      | 
|10.19 |  | Exchange Agreement between Speedemissions, Inc. and Global Capital Funding Group LP dated October 14, 2005 (incorporated by reference to Exhibit 10.9 to Form 8-K dated November 21,
2005 and filed with the Commission on November 23, 2005)                                                                                    
|      | 
|10.20 |  | Exchange Agreement between Speedemissions, Inc. and GCA Strategic Fund Investment dated October 14, 2005 (incorporated by reference to Exhibit 10.11 to Form 8-K dated November 21,
2005 and filed with the Commission on November 23, 2005)                                                                                     
|      | 
|10.21 |  | Speedemissions, Inc. Amended and Restated 2005 Omnibus Stock Grant and Option Plan effective September 11, 2008 (incorporated by reference to Exhibit 4.1 to Form S-8, filed with the
Commission on September 11, 2008)                                                                                                          
|      | 
|10.22 |  | Speedemissions, Inc. 2006 Stock Grant and Option Plan effective September 18, 2006 (incorporated by reference to Exhibit 4.2 to Form 10-QSB filed with the Commission on March 30,
2007)                                                                                                                                         
|      | 
|10.23 |  | Subscription and Securities Purchase Agreement between Speedemissions, Inc., and GCA Strategic Investment Fund dated January 21, 2004 (incorporated by reference to Exhibit 10.1 to
Form 8-K dated January 21, 2004 and filed with the Commission on January 29, 2004)                                                           
|      | 
|10.24 |  | Speedemissions, Inc. 2008 Stock Grant and Option Plan effective May 19, 2008 (incorporated by reference to Exhibit 10.25 to Form S-1/A filed with the Commission on June 19, 2008)                                                                                                                                               
|      | 
|16.1  |  | Letter from Bennett Thrasher PC dated February 1, 2005 (incorporated by reference to Exhibit 16.1 to Form 8-K dated February 2, 2005 and filed with the Commission on February 3,
2005)                                                                                                                                          
|      | 
|16.2  |  | Letter from Tauber & Balser, P.C. dated October 31, 2008 (incorporated by reference to Exhibit 16.1 to Form 8-K dated November 1, 2008 and filed with the Commission on November
1, 2008)                                                                                                                                        
|      | 
|23.1  |  | Consent of Habif, Arogeti & Wynne, LLP                                                                                                                                                                                                                                                                                           
|      | 
|24    |  | Power of Attorney (contained on signature pages herewith)                                                                                                                                                                                                                                                                        
|      | 
|31.1  |  | Rule 13a-14(a) Certification of the Chief Executive Officer                                                                                                                                                                                                                                                                      
|      | 
|31.2  |  | Rule 13a-14(a) Certification of the Chief Financial Officer                                                                                                                                                                                                                                                                      
|      | 
|32.1  |  | Section 906 Certification of Chief Executive Officer                                                                                                                                                                                                                                                                             
|      | 
|32.2  |  | Section 906 Certification of Chief Financial Officer