##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 10-Q
 þ
    
    Quarterly Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the quarterly period ended March 31, 2009
 o
    
    Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
 For the transition period from to
 Commission file number: 333-120908
 Converted Organics Inc.
  Delaware
    
    20-4075963(State or other jurisdiction of incorporation or organization)
    
    (I.R.S. Employer Identification No.)
 7A Commercial Wharf W, Boston, MA 02110
 (617) 624-0111
  þ o
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 o þ




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##### 



INDEX
 Page No.PART I. FINANCIAL INFORMATIONItem 1. Financial Statements
    
    
    3Consolidated Balance Sheets as of March 31, 2009 (unaudited) and December 31, 2008 (audited)
    
    
    3Consolidated Statements of Operations for the three month periods ended March 31, 2009 and 2008
    
    
    4Consolidated Statement of Changes in Owners Equity (Deficit) for the three month period ended March 31, 2009
    
    
    5Consolidated Statements of Cash Flows for the three month periods ended March 31, 2009 and 2008
    
    
    6Notes to Consolidated Interim Financial Statements (unaudited)
    
    
    7Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    19Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    26Item 4. Controls and Procedures
    
    
    26PART II. OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    26Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    27Item 3. Defaults Upon Senior Securities
    
    
    27Item 4. Submission of Matters to a Vote of Security Holders
    
    
    27Item 5. Other Information
    
    
    27Item 6. Exhibits
    
    
    28EX-31.1 Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002EX-31.2 Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002EX-32.1 Certification of Chief Executive Officer pursuant to Section 906EX-32.2 Certification of Chief Financial Officer pursuant to Section 906
  2




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##### Table of Contents



Item 1. Financial Statements
 CONVERTED ORGANICS INC.
 
 CONSOLIDATED BALANCE SHEETS
 March 31, 2009
    
    
    December 31, 2008(Unaudited)
    
    
    (Audited)ASSETSCURRENT ASSETSCash and cash equivalents
    
    $
    1,065,184
    
    
    $
    3,357,940Restricted cash
    
    
    179,870
    
    
    
    2,547,557Accounts receivable, net
    
    
    480,498
    
    
    
    313,650Inventories
    
    
    415,524
    
    
    
    289,730Prepaid rent
    
    
    439,973
    
    
    
    389,930Other prepaid expenses
    
    
    198,771
    
    
    
    73,937Deposits
    
    
    140,820
    
    
    
    141,423Other receivables
    
    
    91,250
    
    
    
    94,250Deferred financing and issuance costs, net
    
    
    
    
    
    
    22,042Total current assets
    
    
    3,011,890
    
    
    
    7,230,459Deposits
    
    
    912,055
    
    
    
    912,054Restricted cash
    
    
    720,146
    
    
    
    60,563Property and equipment, net
    
    
    22,092,095
    
    
    
    19,725,146Construction-in-progress
    
    
    209,360
    
    
    
    974,900Capitalized bond costs, net
    
    
    850,093
    
    
    
    862,010Intangible assets, net
    
    
    2,632,003
    
    
    
    2,852,876Total assets
    
    $
    30,427,642
    
    
    $
    32,618,008LIABILITIES AND OWNERS EQUITY (DEFICIT)CURRENT LIABILITIESTerm notes payable  current
    
    $
    126,214
    
    
    $
    89,170Accounts payable
    
    
    5,289,840
    
    
    
    3,583,030Accrued compensation, officers, directors and consultants
    
    
    374,656
    
    
    
    430,748Accrued legal and other expenses
    
    
    167,272
    
    
    
    164,620Accrued interest
    
    
    319,829
    
    
    
    601,166Convertible notes payable, net of unamortized discount
    
    
    2,188,433
    
    
    
    4,602,660Derivative liability
    
    
    1,103,123
    
    
    
    Capital lease obligations  current
    
    
    10,952
    
    
    
    Mortgage payable
    
    
    3,057
    
    
    
    3,006Total current liabilities
    
    
    9,583,376
    
    
    
    9,474,400Capital lease obligation, net of current portion
    
    
    37,805
    
    
    
    Term note,
net of current portion
    
    
    62,911
    
    
    
    Mortgage payable, net of current portion
    
    
    244,167
    
    
    
    245,160Convertible note payable, net of current portion
    
    
    
    
    
    
    351,516Bonds payable
    
    
    17,500,000
    
    
    
    17,500,000Total liabilities
    
    
    27,428,259
    
    
    
    27,571,076COMMITMENTS AND CONTINGENCIES
    
    
    
    
    
    
    OWNERS EQUITY (DEFICIT)Preferred stock, $.0001 par value, authorized
10,000,000 shares; no shares issued and outstanding
    
    
    
    
    
    
    Common stock, $.0001 par value, authorized
40,000,000 shares
    
    
    1,106
    
    
    
    743Additional paid-in capital
    
    
    34,319,393
    
    
    
    31,031,647Members equity
    
    
    1,367,982
    
    
    
    619,657Accumulated deficit
    
    
    (32,689,098
    )
    
    
    (26,605,115
    )Total owners equity
    
    
    2,999,383
    
    
    
    5,046,932Total liabilities and owners equity
    
    $
    30,427,642
    
    
    $
    32,618,008
 The accompanying notes are an integral part of these consolidated financial statements.
 3




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CONVERTED ORGANICS INC.
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
 (UNAUDITED)
 Three months endedMarch 31, 2009
    
    
    March 31, 2008Revenues
    
    $
    491,839
    
    
    $
    260,043Cost of good sold
    
    
    1,644,190
    
    
    
    221,996Gross (loss) profit
    
    
    (1,152,351
    )
    
    
    38,047Operating expensesGeneral and administrative expenses
    
    
    1,990,129
    
    
    
    1,587,222Research and development
    
    
    167,384
    
    
    
    127,847Depreciation expense
    
    
    3,069
    
    
    
    3,838Amortization of capitalized costs
    
    
    101,291
    
    
    
    86,249Amortization of license
    
    
    4,125
    
    
    
    4,125Loss from operations
    
    
    (3,418,349
    )
    
    
    (1,771,234
    )Other income/(expenses)Interest income
    
    
    10,295
    
    
    
    128,820Derivative gain
    
    
    1,411,985
    
    
    
    Interest expense
    
    
    (1,906,752
    )
    
    
    (753,167
    )(484,472
    )
    
    
    (624,347
    )Loss before provision for income taxes
    
    
    (3,902,821
    )
    
    
    (2,395,581
    )Provision for income taxes
    
    
    
    
    
    
    Net loss
    
    $
    (3,902,821
    )
    
    $
    (2,395,581
    )Net loss per share, basic and diluted
    
    
    (0.49
    )
    
    
    (0.44
    )Weighted average common shares outstanding
    
    
    7,990,575
    
    
    
    5,490,859
 The accompanying notes are an integral part of these consolidated financial statements.
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CONVERTED ORGANICS INC.
 
 CONSOLIDATED
STATEMENT OF CHANGES IN OWNERS EQUITY (DEFICIT)  Three months ended March 31, 2009
 (Unaudited)
 Common Stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    TotalShares Issued and
    
    
    
    
    
    
    Additional
    
    
    Members
    
    
    Accumulated
    
    
    Owners EquityOutstanding
    
    
    Amount
    
    
    Paid-in Capital
    
    
    Equity
    
    
    Deficit
    
    
    (Deficit)Balance, January 1, 2009, before cumulative effect of change in accounting principle
    
    
    7,431,436
    
    
    $
    743
    
    
    $
    31,031,647
    
    
    $
    619,657
    
    
    $
    (26,605,115
    )
    
    $
    5,046,932Cumulative effect of change in accounting principle
    
    
    
    
    
    
    
    
    
    
    (2,936,250
    )
    
    
    
    
    
    
    (2,146,858
    )
    
    
    (5,083,108
    )Balance, January 1, 2009, after cumulative effect of change in accounting principle
    
    
    7,431,436
    
    
    
    743
    
    
    
    28,095,397
    
    
    
    619,657
    
    
    
    (28,751,973
    )
    
    
    (36,176
    )Common stock issued to holders of convertible notes payable in connection with
extension
    
    
    200,000
    
    
    
    20
    
    
    
    561,980
    
    
    
    
    
    
    
    
    
    
    
    562,000Common stock issued upon conversion of convertible notes payable
    
    
    3,313,836
    
    
    
    331
    
    
    
    4,879,236
    
    
    
    
    
    
    
    
    
    
    
    4,879,567Common stock issued as compensation
    
    
    121,528
    
    
    
    12
    
    
    
    120,301
    
    
    
    
    
    
    
    
    
    
    
    120,313Warrants issued in connection with refinancing
    
    
    
    
    
    
    
    
    
    
    662,479
    
    
    
    
    
    
    
    
    
    
    
    662,479Net income (loss)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    34,304
    
    
    
    (3,937,125
    )
    
    
    (3,902,821
    )Members contributions
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    915,651
    
    
    
    
    
    
    
    915,651Members distributions
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (201,630
    )
    
    
    
    
    
    
    (201,630
    )11,066,800
    
    
    $
    1,106
    
    
    $
    34,319,393
    
    
    $
    1,367,982
    
    
    $
    (32,689,098
    )
    
    $
    2,999,383
 The accompanying notes are an integral part of these consolidated financial statements.
 5




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CONVERTED ORGANICS INC.
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS  (UNAUDITED)
 Three Months EndedMarch 31, 2009
    
    
    March 31, 2008CASH FLOWS FROM OPERATING ACTIVITIES:Net loss
    
    $
    (3,902,821
    )
    
    $
    (2,395,581
    )Adjustments to reconcile net loss to net cash
used in operating activities:Consolidation of variable interest entity
    
    
    
    
    
    
    6,164Amortization of intangible asset  license
    
    
    4,125
    
    
    
    4,125Amortization of capitalized bond costs
    
    
    11,917
    
    
    
    11,918Amortization of deferred financing fees
    
    
    22,042
    
    
    
    72,850Amortization of intangible assets
    
    
    216,748
    
    
    
    Depreciation of fixed assets
    
    
    498,566
    
    
    
    38,379Beneficial conversion feature
    
    
    
    
    
    
    2,658Amortization of discounts on convertible note payable
    
    
    230,492
    
    
    
    498,313Common stock issued for extension of convertible note payable
    
    
    562,000
    
    
    
    Common stock issued as compensation
    
    
    120,313
    
    
    
    Warrants issued for refinancing
    
    
    662,479
    
    
    
    Derivative gain
    
    
    (1,411,985
    )
    
    
    Changes in operating assets and liabilities:(Increase) decrease in:Accounts receivable
    
    
    (166,848
    )
    
    
    (75,286
    )Inventory
    
    
    (125,794
    )
    
    
    (5,348
    )Prepaid expenses and other current assets
    
    
    (174,877
    )
    
    
    (219,186
    )Other assets
    
    
    3,000
    
    
    
    5,272Deposits
    
    
    602
    
    
    
    (25,360
    )Increase (decrease) in:Accounts payable and other accrued expenses
    
    
    1,709,462
    
    
    
    1,040,160Accrued compensation  officers, directors and consultants
    
    
    (56,092
    )
    
    
    (78,767
    )Accrued interest
    
    
    (281,337
    )
    
    
    (284,204
    )Net cash used in operating activities
    
    
    (2,078,008
    )
    
    
    (1,403,893
    )CASH FLOWS FROM INVESTING ACTIVITIESRelease of restricted cash
    
    
    1,708,104
    
    
    
    2,709,488Cash paid for acquisitions
    
    
    
    
    
    
    (1,500,000
    )Purchase of fixed assets
    
    
    (1,928,746
    )
    
    
    (25,590
    )Capitalized interest
    
    
    
    
    
    
    (184,481
    )Construction costs
    
    
    
    
    
    
    (2,430,830
    )Net cash used in investing activities
    
    
    (220,642
    )
    
    
    (1,431,413
    )CASH FLOWS FROM FINANCING ACTIVITIESMembers contributions
    
    
    230,983
    
    
    
    Net proceeds from exercise of options
    
    
    
    
    
    
    525,000Net proceeds from exercise of warrants
    
    
    
    
    
    
    5,994,952Proceeds from private financing, net of original issue discount
    
    
    
    
    
    
    3,715,000Members distributions
    
    
    (201,630
    )
    
    
    Repayment of capital lease obligations
    
    
    (22,516
    )
    
    
    Repayment of mortgage payable
    
    
    (943
    )
    
    
    Repayment of term notes issued for acquisition
    
    
    
    
    
    
    (54,928
    )Net cash provided by financing activities
    
    
    5,894
    
    
    
    10,180,024NET (DECREASE) INCREASE IN CASH
    
    
    (2,292,756
    )
    
    
    7,344,718CASH, beginning of period
    
    
    3,357,940
    
    
    
    287,867CASH, end of period
    
    $
    1,065,184
    
    
    $
    7,632,585Supplemental cash flow information:Cash paid during the period in:Interest
    
    $
    963,609
    
    
    $
    714,077Non-cash financing activities:Financing costs paid from proceeds of private financing
    
    $
    
    
    
    $
    335,000Equipment acquired through assumption of capital leases
    
    
    52,979
    
    
    
    Equipment acquired through assumption of term note
    
    
    118,250
    
    
    
    Common stock issued upon conversion of convertible notes payable
    
    
    4,879,567
    
    
    
    Members contribution of convertible note
    
    
    684,668
    
    
    
    Beneficial conversion discount on convertible note
    
    
    
    
    
    
    7,136Discount on warrants issued in connection with financing
    
    
    
    
    
    
    2,227,500
 The accompanying notes are an integral part of these consolidated financial statements.
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##### Table of Contents



CONVERTED ORGANICS INC.
 
 NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS  (UNAUDITED)
 NOTE 1  BASIS OF PRESENTATION AND NATURE OF OPERATIONS
   NATURE OF OPERATIONS
     NOTE 2
 GOING CONCERN  MANAGEMENTS PLAN OF OPERATION
   7




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##### Table of Contents



CONVERTED ORGANICS INC.
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS  CONTINUED  (UNAUDITED)
 NOTE 2
 GOING CONCERN  MANAGEMENTS PLAN OF OPERATION  CONTINUED
  NOTE 3  SIGNIFICANT ACCOUNTING POLICIES
 CONSOLIDATION
  VARIABLE INTEREST ENTITY
  USE OF ESTIMATES
  CASH AND CASH EQUIVALENTS
  RESTRICTED CASH
  8




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CONVERTED ORGANICS INC.
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS  CONTINUED  (UNAUDITED)
 NOTE 3  SIGNIFICANT ACCOUNTING POLICIES  CONTINUED
 ACCOUNTS RECEIVABLE
  INVENTORIES
  PREPAID RENT
  DEFERRED FINANCING COSTS
  INTANGIBLE ASSETS  LICENSE AND OTHER INTANGIBLES
 Goodwill and
Other Intangible Assets.
 LONG-LIVED ASSETS
 Accounting for the Impairment or Disposal of Long-Lived
Assets,
 PROPERTY AND EQUIPMENT
  9




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CONVERTED ORGANICS INC.
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS  CONTINUED  (UNAUDITED)
 NOTE 3  SIGNIFICANT ACCOUNTING POLICIES  CONTINUED
 CAPITALIZED BOND COSTS
  REVENUE RECOGNITION
 Revenue Recognition in Financial Statements,
 
    
    Persuasive evidence of a sales arrangement exists;
    
    Delivery of the product has occurred;
    
    The sales price is fixed or determinable, and:
    
    Collectability is reasonably assured.
  FAIR VALUE MEASUREMENTS
 Fair Value Measurements
 NEWLY ADOPTED ACCOUNTING STANDARDS
 Disclosures about Derivative Instruments and Hedging Activities
 Determining Whether an Instrument (or Embedded Feature) is Indexed to an Entitys Own Stock
  10




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CONVERTED ORGANICS INC.
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS  CONTINUED  (UNAUDITED)
 NOTE 3  SIGNIFICANT ACCOUNTING POLICIES  CONTINUED
  EARNINGS (LOSS) PER SHARE
  SEGMENT REPORTING
 Disclosure about Segments
of an Enterprise and Related Information
 NOTE 4  INVENTORIES
  2009
    
    
    2008Finished goods
    
    $
    237,126
    
    
    $
    214,053Raw materials
    
    
    92,126
    
    
    
    18,785Packaging materials
    
    
    86,272
    
    
    
    56,892Total inventories
    
    $
    415,524
    
    
    $
    289,730
 NOTE 5  FAIR VALUE
 Fair Value of Financial
Instruments,
 Fair Value Measurements
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##### Table of Contents



CONVERTED ORGANICS INC.
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS  CONTINUED  (UNAUDITED)
 NOTE 5 FAIR VALUE  CONTINUED
  
    
    Level 1  Quoted prices in active markets that are unadjusted and accessible at the
measurement date for identical, unrestricted assets or liabilities;
    
    Level 2  Quoted prices for identical assets and liabilities in markets that are not
active, quoted prices for similar assets and liabilities in active markets or financial
instruments for which significant observable inputs are available, either directly or
indirectly such as interest rates and yield curves that are observable at commonly quoted
intervals; and
    
    Level 3  prices or valuations that require inputs that are unobservable.
   BalanceObservable Inputs
    
    March 31, 2009
    
    December 31, 2008AssetsCertificates of
Deposit
    
    Level 2
    
    $
    333,273
    
    
    $
    534,821LiabilitiesDerivatives
    
    Level 3
    
    $
    (1,103,123
    )
    
    $
    -0-
 NOTE 6  DEBT
 TERM
NOTES
   BOND FINANCING
   12




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##### Table of Contents



CONVERTED ORGANICS INC.
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS  CONTINUED  (UNAUDITED)
 NOTE 6  DEBT  CONTINUED
 CONVERTIBLE NOTE PAYABLE
  MORTGAGE NOTE PAYABLE
  PRIVATE FINANCING
    Accounting for Convertible Debt and Debt Issued with
Stock Purchase Warrants
  13




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##### Table of Contents



CONVERTED ORGANICS INC.
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS  CONTINUED  (UNAUDITED)
 NOTE 6  DEBT  CONTINUED
 Accounting for Convertible Securities with Beneficial Conversion
Features or Contingently Adjustable Conversion Ratios
  DERIVATIVE INSTRUMENTS
    NOTE 7  CAPITALIZATION OF INTEREST COSTS
 Capitalization of Interest Cost in Situations Involving Certain Tax-Exempt Borrowings
and Certain Gifts and Grants
 NOTE 8  OWNERS EQUITY (DEFICIT)
   14




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CONVERTED ORGANICS INC.
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS  CONTINUED  (UNAUDITED)
 NOTE 8  OWNERS EQUITY (DEFICIT)  CONTINUED
       WARRANTS
    WARRANT EXERCISE
  15




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##### Table of Contents



CONVERTED ORGANICS INC.
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS  CONTINUED  (UNAUDITED)
 NOTE 8  OWNERS EQUITY (DEFICIT)  CONTINUED
 WARRANT REDEMPTION
   NOTE 9  STOCK OPTION PLAN
  Weighted AverageShares
    
    
    Price per ShareOutstanding at January 1, 2009
    
    
    1,246,735
    
    
    $
    4.50Granted
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    Canceled
    
    
    
    
    
    
    Outstanding and exercisable at March 31, 2009
    
    
    1,246,735
    
    
    $
    4.50
  NOTE 10  ACQUISITIONS
   Business Combinations
  Inventories
    
    $
    11,114Accounts receivable
    
    
    28,702Technological know-how
    
    
    271,812Trade name
    
    
    228,188Existing customer relationships
    
    
    2,030,513Building
    
    
    111,584Equipment and machinery
    
    
    543,000Assumption of liabilities
    
    
    (224,913
    )Total purchase price
    
    $
    3,000,000
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##### Table of Contents



CONVERTED ORGANICS INC.
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS  CONTINUED  (UNAUDITED)
 NOTE 10  ACQUISITIONS  CONTINUED
   Three months ended March 31,2009
    
    2008Revenues (in thousands)
    
    $
    492
    
    
    $
    260Net loss (in thousands)
    
    
    (3,903
    )
    
    
    (2,449
    )Net loss per share  basic and diluted
    
    
    (.49
    )
    
    
    (.45
    )
 NOTE 11  RELATED PARTY TRANSACTIONS
 ACCRUED COMPENSATION-OFFICERS, DIRECTORS AND CONSULTANTS
  CONVERTED ORGANICS OF RHODE ISLAND, LLC
  PACKAGING VENDOR
  NOTES PAYABLE
  NOTE 12 COMMITMENTS AND CONTINGENCIES
  For years ended December 31,2009 (April 1, 2009 through December 31, 2009)
    
    $
    783,6002010
    
    
    1,044,8002011
    
    
    1,056,2002012
    
    
    1,069,1002013
    
    
    1,077,4002014 and thereafter
    
    
    9,024,000$
    14,055,100
 17




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##### Table of Contents



CONVERTED ORGANICS INC.
NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS  CONTINUED  (UNAUDITED)
 NOTE 12  COMMITMENTS AND CONTINGENCIES  CONTINUED
 LEGAL PROCEEDINGS
  NOTE 13  SUBSEQUENT EVENTS
  18




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##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
  Introduction
  Woodbridge Facility
  UOP Acquisition; Gonzales Facility
  19




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##### Table of Contents



WRI Acquisition
  Pro Forma Financial Information
  20




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##### Table of Contents



Three months ended March 31,2009
    
    
    2008Revenues (in thousands)
    
    $
    492
    
    
    $
    260Net loss (in thousands)
    
    
    (3,903
    )
    
    
    (2,449
    )Net loss per share  basic and diluted
    
    
    (.49
    )
    
    
    (.45
    )
 Rhode Island Facility
  Recent Financing Activities
 January 2008 and March 2009 Financings
    21




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Construction and Start-up Period
    22




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Full-scale Operations
   Future Development
    Trends and Uncertainties Affecting our Operations
  23




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Liquidity and Capital Resources
     24




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Results of Operations
      25




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Off-Balance Sheet Transactions
  
 Item 3. Quantitative and Qualitative Disclosures about Market Risk
  
 Item 4. Controls and Procedures
   
 PART II  OTHER INFORMATION
 
 Item 1. Legal Proceedings
  26




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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults upon Senior Securities
  
 Item 4. Submission of Matters to a Vote of Security Holders
  
 Item 5. Other Information.
  27




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Item 6. Exhibits
 Exhibit No.
    
    Description of Exhibit31.1
    
    Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes Oxley Act of 200231.2
    
    Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 200232.1
    
    Certification of Chief Executive Officer pursuant to Section 90632.2
    
    Certification of Chief Financial Officer pursuant to Section 906
 SIGNATURES
  Converted Organics Inc.Date: May 15, 2009
    /s/ Edward J. GildeaEdward J. GildeaPresident and Chief Executive OfficerDate: May 15, 2009
    /s/ David R. AllenDavid R. AllenChief Financial Officer and Executive Vice President of

AdministrationDate: May 15, 2009
    /s/ Ellen P. O'NeilEllen P. O'NeilVice President of Finance & Accounting 28