**United
      States**


**Securities
      and Exchange Commission**


**Washington,
      D.C. 20549**








**FORM
      10-QSB**







**(Mark
      One)**





**x** **Quarterly
      Report Under Section 13 or 15(d) of the Securities Exchange Act of
      1934**


**For
      the quarterly period ended September 30, 2007**




**or**





** ̈** **Transition
      Report Under Section 13 or 15(d) of the Securities Exchange Act of
      1934**


**For
      the Transition Period From** **** **to** **** ****





**Commission
      File number 0-21061**







**ORGANIC
      TO GO FOOD CORPORATION**


**(Exact
      name of small business issuer as specified in its charter)**







**Delaware**
            
            **58-2044990****(State
                or other jurisdiction of**
            
            **(IRS
                Employer****incorporation
                or organization)**
            
            **Identification
                No.)**




**3317
      Third Avenue South, Seattle, Washington**


**(Address
      of principal executive offices)**


**(206) 838-4670**


**(Issuer’s
      telephone number)**







Check
      whether the issuer (1) filed all reports required to be filed by
      Section 13 of 15(d) of the Exchange Act during the past 12 months (or for
      such shorter period that the registrant was required to file such reports),
      and
      (2) has been subject to such filing requirements for the past 90
      days.    Yes x No  ̈





Indicate
      by check mark whether the registrant is a shell company (as defined in Rule
      12b-2 of the Exchange Act.)


Yes  ̈ No x




The
      number of shares outstanding of registrant’s common stock, $0.001 par value at
      November 2, 2007 was 27,758,326.




Transitional
      Small Business Disclosure Format (Check one): Yes  ̈ No x




1





**Table
      of Contents**


PART
                  I. FINANCIAL INFORMATIONItem
                  1. Financial Statements (unaudited)Condensed
                  Consolidated Balance Sheets
              
              
              Page
                  3Condensed
                  Consolidated Statements of Operations
              
              
              Page
                  4Condensed
                  Consolidated Statement of Stockholders’ Equity (Deficit)
              
              
              Page
                  5Condensed
                  Consolidated Statements of Cash Flows
              
              
              Page
                  6Notes
                  to Condensed Consolidated Financial Statements
              
              
              Page
                  7Item
                  2. Management’s Discussion and Analysis or Plan of Operation
              
              
              Page
                  16Item
                  3. Controls and Procedures
              
              
              Page
                  20PART
                  II. OTHER INFORMATIONItem
                  6. Exhibits
              
              
              Page
                  21SIGNATURES
              
              
              Page
                  22




2




**Organic
      To Go Food Corporation and its wholly-owned subsidiary, Organic To Go,
      Inc.**


**Condensed
      Consolidated Balance Sheets**


**(in
      thousands, except share amounts)**




December
                31,
            
            September
                30,2006
            
            2007Current
                assets
            
            (audited)
            
            (unaudited)Cash
                and cash equivalents
            
            $
            865
            
            $
            892Accounts
                receivable, net
            
            
            365
            
            
            978Inventory
            
            
            236
            
            
            449Prepaid
                expenses and other current assets
            
            
            189
            
            
            701Total
                current assets
            
            
            1,655
            
            
            3,019Property
                and equipment, net
            
            
            2,148
            
            
            4,603Identifiable
                intangible assets, net
            
            
            851
            
            
            2,337Deposits
                and other assets
            
            
            623
            
            
            554Total
                assets
            
            $
            5,277
            
            $
            10,514Current
                liabilitiesAccounts
                payable
            
            $
            1,337
            
            $
            1,729Accrued
                liabilities
            
            
            881
            
            
            1,155Current
                portion of notes payable, net of discount
            
            
            6,281
            
            
            1,543Current
                portion of capital lease obligations
            
            
            50
            
            
            251Total
                current liabilities
            
            
            8,549
            
            
            4,679Deferred
                rent
            
            
            -
            
            
            54Notes
                payable, net of current portion
            
            
            592
            
            
            966Capital
                lease obligations, net of current portion
            
            
            137
            
            
            423Total
                liabilities
            
            
            9,278
            
            
            6,121Stockholders'
                equity (deficit)Preferred
                Stock; $0.001 par value; 9,670,000 and 10,000,000 shares
            
            
            8
            
            
            -authorized,
                9,670,000 and no shares issued and outstandingCommon
                stock and additional paid-in capital; $0.001 par value;15,100,000
                and 500,000,000 shares authorized; 3,454,910 and24,365,035
                Exchange Ratio adjusted shares issued and outstanding
            
            
            10,414
            
            
            27,685Accumulated
                deficit
            
            
            (14,423
            )
            
            (23,291
            )Total
                stockholders' equity (deficit)
            
            
            (4,001
            )
            
            4,394Total
                liabilities and stockholders' equity (deficit)
            
            $
            5,277
            
            $
            10,514




See
      accompanying notes to condensed consolidated financial statements.




3




**Organic
      To Go Food Corporation and its wholly-owned subsidiary, Organic To Go,
      Inc.**


**Condensed
      Consolidated Statements of Operations**


**(in
      thousands, except per share amounts)**


**(unaudited)**




Three
                  months ended September 30,
              
              Nine
                  months ended September 30,2006
              
              2007
              
              2006
              
              2007Sales
              
              $
              2,259
              
              $
              3,716
              
              $
              6,716
              
              $
              11,188Cost
                  of sales
              
              
              1,097
              
              
              1,750
              
              
              3,315
              
              
              5,391Gross
                  Profit
              
              
              1,162
              
              
              1,966
              
              
              3,401
              
              
              5,797Operating
                  expenses
              
              
              2,411
              
              
              4,797
              
              
              6,716
              
              
              12,196Depreciation
                  and amortization
              
              
              252
              
              
              871
              
              
              592
              
              
              2,009Loss
                  from operations
              
              
              (1,501
              )
              
              (3,702
              )
              
              (3,907
              )
              
              (8,408
              )Interest
                  income (expense), net
              
              
              (699
              )
              
              (45
              )
              
              (714
              )
              
              (460
              )Loss
                  before income taxes
              
              
              (2,200
              )
              
              (3,747
              )
              
              (4,621
              )
              
              (8,868
              )Income
                  taxes
              
              
              -
              
              
              -
              
              
              -
              
              
              -Net
                  loss
              
              $
              (2,200
              )
              $
              (3,747
              )
              $
              (4,621
              )
              $
              (8,868
              )Net
                  loss per share - basic and diluted
              
              $
              (0.77
              )
              $
              (0.15
              )
              $
              (1.61
              )
              $
              (0.47
              )Weighted
                  average shares outstanding
              
              
              2,852
              
              
              24,280
              
              
              2,863
              
              
              19,058




See
      accompanying notes to condensed consolidated financial statements.




4




**Organic
      To Go Food Corporation and its wholly-owned subsidiary, Organic To Go,
      Inc.**


**Condensed
      Consolidated Statement of Stockholders’ Equity (Deficit)**


**(in
      thousands, except share amounts)**


**(unaudited)**




Series
                  A, B & C Preferred Stock
              
              
              Common
                  Stock and Additional Paid-In CapitalShares
              
              
              Amount
              
              
              Shares
              
              
              Amount
              
              
              Accumulated
                  Deficit
              
              
              Total
                  Stockholders' Equity (Deficit)Balance
                  at December 31, 2006
              
              
              5,652,836
              
              $
              8
              
              
              2,898,904
              
              $
              10,414
              
              $
              (14,423
              )
              $
              (4,001
              )Conversion
                  of preferred stock into common stock
              
              
              (5,652,836
              )
              
              (8
              )
              
              5,734,769
              
              
              8
              
              
              
              
              
              -Conversion
                  of bridge notes into common stock
              
              
              
              
              
              
              
              
              4,629,340
              
              
              4,225
              
              
              
              
              
              4,225SP
                  Holding Corporation shares outstanding at merger
              
              
              
              
              
              
              
              
              1,126,659
              
              
              (15
              )
              
              
              
              
              (15
              )Issuance
                  of common shares and warrants for cash
              
              
              
              
              
              
              
              
              8,872,992
              
              
              13,428
              
              
              
              
              
              13,428Stock
                  issue costs
              
              
              
              
              
              
              
              
              
              
              
              (1,406
              )
              
              
              
              
              (1,406
              )Issuance
                  of common shares in connection with acquisition of assets
              
              
              
              
              
              
              
              
              556,359
              
              
              783
              
              
              
              
              
              783Issuance
                  of common shares upon exercise of warrants
              
              
              
              
              
              
              
              
              546,012
              
              
              -
              
              
              
              
              
              -Stock
                  based compensation
              
              
              
              
              
              
              
              
              
              
              
              248
              
              
              
              
              
              248Net
                  loss for the nine months ended September 30, 2007
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (8,868
              )
              
              (8,868
              )Balance
                  at Septemnber 30, 2007
              
              
              -
              
              $
              -
              
              
              24,365,035
              
              $
              27,685
              
              $
              (23,291
              )
              $
              4,394
  See
        accompanying notes to condensed consolidated financial
        statements.




5




**Organic
      To Go Food Corporation and its wholly-owned subsidiary, Organic To Go,
      Inc.**


**Condensed
      Consolidated Statements of Cash Flows**


**(in
      thousands)**


**(unaudited)**




Nine
                  months ended September 30,2006
              
              2007Cash
                  flows from operating activities:Net
                  loss
              
              $
              (4,621
              )
              $
              (8,868
              )Adjustments
                  to reconcile net loss to netcash
                  used by operating activities:Depreciation
                  and amortization expense
              
              
              592
              
              
              2,009Non-cash
                  interest expense
              
              
              583
              
              
              386Stock-based
                  compensation expense
              
              
              10
              
              
              248Changes
                  in operating assets and liabilities:Accounts
                  receivable
              
              
              (166
              )
              
              (613
              )Inventory
              
              
              (197
              )
              
              (213
              )Prepaid
                  expenses and other current assets
              
              
              (117
              )
              
              (512
              )Accounts
                  payable
              
              
              270
              
              
              392Accrued
                  liabilities and deferred rent
              
              
              103
              
              
              328Other
              
              
              (43
              )
              
              (466
              )Net
                  cash used by operating activities
              
              
              (3,586
              )
              
              (7,308
              )Cash
                  flows from investing activities:Purchases
                  of property, equipment and other assets
              
              
              (314
              )
              
              (2,451
              )Purchase
                  of intangible assets
              
              
              -
              
              
              (1,923
              )Net
                  cash used by investing activities
              
              
              (314
              )
              
              (4,374
              )Cash
                  flows from financing activities:Principal
                  payments of notes payable
              
              
              (245
              )
              
              (469
              )Payments
                  of capital lease obligations
              
              
              (35
              )
              
              (88
              )Proceeds
                  from issuance of notes payable
              
              
              2,328
              
              
              500Proceeds
                  from sale of preferred stock, net of issue costs
              
              
              2,305
              
              
              -Redemption
                  of common stock
              
              
              (1
              )
              
              -Proceeds
                  from sale of common stock, net of issue costs
              
              
              -
              
              
              11,766Net
                  cash provided by financing activities
              
              
              4,352
              
              
              11,709Net
                  increase in cash and cash equivalents
              
              
              452
              
              
              27Cash
                  and cash equivalents, beginning of period
              
              
              250
              
              
              865Cash
                  and cash equivalents, end of period
              
              $
              702
              
              $
              892Supplemental
                  disclosures of cash flow information:Cash
                  paid for interest
              
              $
              151
              
              $
              112Cash
                  paid for income taxes
              
              $
              -
              
              $
              -Non-cash
                  investing and financing activities:Notes
                  payable converted into preferred stock
              
              $
              2,143
              
              $
              -Preferred
                  stock converted into common stock
              
              $
              -
              
              $
              5,700Notes
                  payable converted into common stock
              
              $
              -
              
              $
              4,225Assets
                  purchased through issuance of common stock
              
              $
              -
              
              $
              782Capital
                  lease obligations incurred
              
              $
              -
              
              $
              572Notes
                  payable for assets purchased
              
              $
              -
              
              $
              225




See
      accompanying notes to condensed consolidated financial statements.




6




**Organic
      To Go Food Corporation and its wholly-owned subsidiary, Organic To Go,
      Inc.**


**Notes
      to Condensed Consolidated Financial Statements**


**September
      30, 2007**





**Note
      1. Description of Business and Summary of Significant Accounting Policies**





Organization
      and business -
      Organic
      To Go Food Corporation, formerly SP Holding Corporation (“SP”) prior to May
      2007, and its wholly-owned subsidiary Organic To Go, Inc. (“Organic” and
      together, the “Company”), which was acquired in a reverse merger on February 12,
      2007, provides convenient retail cafes and delivery and catering facilities,
      which prepare and serve “grab and go” lunch, dinner, and breakfast foods and
      beverages prepared using organic ingredients, whenever possible. The Company
      also distributes its products through select wholesale accounts. In October
      2006, Organic expanded its catering operations in the California area by
      acquiring the assets of a catering operation headquartered in Los Angeles,
      California, and in March 2007, it expanded its catering operations by acquiring
      the assets of a catering operation located in Seattle, Washington. In July
      and
      September 2007, the Company further expanded its operations by acquiring the
      assets of one or two operating locations, for a total of five locations in
      San
      Diego in three separate transactions. At September 30, 2007, the Company
      operates five stores in Washington and seventeen stores in California.





Reverse
      merger with public shell company in February 2007 -
      Pursuant to the terms of an Agreement and Plan of Merger and Reorganization
      by
      and among Organic and SP, on February 12, 2007, all of the outstanding shares
      of
      Organic common and preferred stock were exchanged for shares of SP common stock
      as determined by multiplying each such outstanding share of Organic stock by
      the
      exchange ratio of 0.69781 (the “Exchange Ratio”). In connection with the merger,
      Organic convertible promissory bridge notes approximating $5.3 million
      automatically converted into SP common stock. As a result, among other things,
      Organic became a wholly-owned subsidiary of SP. Outstanding Organic options,
      warrants and purchase rights were converted into options, warrants and purchase
      rights to purchase of shares of SP common stock in accordance with the Exchange
      Ratio. The closing of the merger was conditioned upon SP closing a private
      placement offering of a minimum of eighty units (the “Units”) at a purchase
      price of $50,000 per Unit for $4 million. Each Unit consists of (i) 40,000
      shares of SP common stock and (ii) a warrant to purchase 8,000 shares of SP
      common stock at an exercise price of $2.50 per share, exercisable for a period
      of five years from the date of issuance. Consummation of the merger occurred
      concurrently with completion of a private placement of 138 Units, for an
      aggregate of approximately $6.9 million. Prior to the merger, SP was a
      non-operating “public shell” company. The merged company operates under the name
      of Organic To Go, Inc.





From
      an
      accounting perspective, the merger transaction is considered a recapitalization
      of Organic accompanied by the issuance of stock by Organic for the assets and
      liabilities of SP, as a result of SP not having operations immediately prior
      to
      the merger, and following the merger, SP becoming an operating company. After
      the merger and private placement, former SP stockholders own approximately
      5% of
      the common stock of the merged company, former Organic stockholders and
      convertible bridge note holders own approximately 70% of the merged company,
      and
      new investors owns approximately 25% of the merged company. The board of
      directors and executive officers are comprised of Organic directors and
      executive officers. In these circumstances, the merger transaction is accounted
      for as a capital transaction rather than as a business combination, in that
      the
      transaction is equivalent to the issuance of stock by Organic for the assets
      and
      liabilities of SP, accompanied by a recapitalization. The accounting is
      identical to that resulting from a reverse acquisition, except that no goodwill
      or other intangible is recorded. All share and per share information presented
      and disclosed in these financial statements have been Exchange Ratio adjusted.





Basis
      of presentation and liquidity -
      Since
      inception, the Company has funded its operations and business development and
      growth through debt and equity financings. In this regard, during 2006 the
      Company raised approximately $8.1 million pursuant to sales of debt and equity
      securities in connection with its private placement and subordinated debt
      offerings. Further, during the three months ended March 31, 2007, proceeds
      of
      approximately $6.9 million were received from the sale of equity securities
      in
      connection with the merger and private placement, and approximately $5.3 million
      of notes payable were converted into common shares.  Additionally, during
      the three months ended June 30, 2007, proceeds of approximately $6.7 million
      were received from the sales of debt and equity securities. Subsequent to
      September 30, 2007, in October, the Company closed its private placement
      offering and issued approximately 3.2 million shares of Company common stock
      and
      warrants to purchase approximately 1.5 million shares of Company common stock.
      The aggregate gross proceeds raised by the Company were approximately $5.7
      million. Company management intends to continue to be engaged in additional
      fund-raising activities to fund future capital expenditures, potential
      acquisitions of businesses, and provide additional working capital.





Use
      of
      estimates in the preparation of financial statements -
      Preparation of financial statements in conformity with generally accepted
      accounting principles requires management to make estimates and assumptions
      that
      affect reported amounts of assets and liabilities and disclosure of contingent
      assets and liabilities at the date of the financial statements and reported
      amounts of revenue and expenses during the reporting period. Actual results
      could differ from those estimates. The more significant accounting estimates
      inherent in the preparation of the Company's financial statements include
      estimates as to the depreciable lives of property and equipment, recoverability
      of receivables, valuation and recoverability of inventories, recoverability
      of
      long-lived assets, valuation of intangible assets and allocation of purchase
      price, valuation of equity related instruments issued, and valuation allowance
      for deferred income tax assets.




7




Interim
      financial statements -
      The
      unaudited interim condensed consolidated financial statements and related notes
      are presented in accordance with the rules and regulations of the Securities
      and
      Exchange Commission with regard to interim financial information. Accordingly,
      the condensed consolidated financial statements do not include all of the
      information and notes to financial statements required by accounting principles
      generally accepted in the United States for complete financial statements.
      In
      the opinion of management, all adjustments, consisting of normal recurring
      adjustments, considered necessary for a fair presentation of the Company’s
      financial position, results of operations and cash flows for the interim periods
      presented have been included. Results of operations for the 2007 interim periods
      are not necessarily indicative of the results to be expected for the entire
      fiscal year ending December 31, 2007 or for any other future interim period.
      The
      accompanying unaudited interim condensed consolidated financial statements
      should be read in conjunction with the audited annual financial statements
      included in the Company’s December 31, 2006 Annual Report on Form 10-KSB.





Contingencies -
      Certain
      conditions may exist as of the date financial statements are issued, which
      may
      result in a loss to the Company, but which will only be resolved when one or
      more future events occur or fail to occur. Company management and its legal
      counsel assess such contingent liabilities, and such assessment inherently
      involves an exercise of judgment. In assessing loss contingencies related to
      legal proceedings that are pending against the Company or unasserted claims
      that
      may result in such proceedings, the Company's legal counsel evaluates the
      perceived merits of any legal proceedings or unasserted claims as well as the
      perceived merits of the amount of relief sought or expected to be sought
      therein. If the assessment of a contingency indicates that it is probable that
      a
      liability has been incurred and the amount of the liability can be estimated,
      then the estimated liability would be accrued in the Company's financial
      statements. If the assessment indicates that a potentially material loss
      contingency is not probable but is reasonably possible, or is probable but
      cannot be estimated, then the nature of the contingent liability, together
      with
      an estimate of the range of possible loss if determinable would be disclosed.





Concentrations **-** All
      of
      the Company’s operations are currently located in Washington and California, and
      as a result, is sensitive to negative occurrences in markets where the Company
      is located, and particularly susceptible to adverse trends and economic
      conditions including labor markets.  In addition, given geographic
      concentration, negative publicity regarding any of our operations in Washington
      or California could have a material adverse effect on the Company’s business and
      operations, as could other regional occurrences such as local strikes,
      earthquakes or other natural disasters.




Accounts
      receivable -
      The
      Company extends credit to some of its customers. Accounts receivable are
      customer obligations due under normal trade terms. The Company performs
      continuing credit evaluations of its customers’ financial condition. Management
      reviews accounts receivable on a regular basis on contracted terms and how
      recently payments have been received in order to determine estimates of amounts
      that could potentially be uncollectible. The Company includes an estimate of
      the
      amount that is more likely that not to be uncollectible in its allowance for
      doubtful accounts. Accounts uncollected are ultimately written off after all
      reasonable collection efforts have occurred.





Inventory **-** Inventory,
      which consists primarily of food, beverages and packaging products, is stated
      at
      the lower of cost or market. Cost is determined by the first-in, first-out
      method. In assessing the ultimate realization of inventories, Company management
      makes judgments as to future demand requirements compared to current inventory
      levels.





Identifiable
      intangible assets -
      In
      connection with the acquisition in October 2006 of certain assets of a catering
      business, the Company acquired certain identifiable intangible assets including
      customer-based intangibles and a covenant not to compete received from the
      sellers. This acquisition has been accounted for in accordance with Statement
      of
      Financial Accounting Standards No. 141, “Business Combinations” (“SFAS No.
      141”). Amounts allocated to intangible assets were identified by management and
      have been valued on a number of factors based upon preliminary estimates. The
      estimate of useful lives of each intangible asset was based on an analysis
      by
      management of all pertinent factors, and selected an estimated useful life
      of
      two years for each identifiable intangible asset. Customer based intangible
      assets are amortized utilizing an accelerated method and non-compete intangible
      assets are amortized on a straight-line basis. At September 30, 2007,
      identifiable intangible assets were comprised of customer based intangible
      assets of approximately $3.6 million, less accumulated amortization of $1.3
      million, and non-compete intangible assets of approximately $150,000, less
      accumulated amortization of approximately $69,000. Amortization expense for
      these intangible assets will approximate $636,000 in 2007, $1.3 million in
      2008
      and $388,000 in 2009.





Statement
      of Financial Accounting Standards No. 142, “Goodwill and Other Intangible
      Assets,” (“SFAS No. 142”) requires that long-lived assets and certain
      identifiable intangibles be reviewed for impairment whenever events or changes
      in circumstances indicate that the carrying amount of an asset may not be
      recoverable. Recoverability of assets to be held and used is measured by a
      comparison of the carrying amount of an asset to future net discounted cash
      flows expected to be generated by the asset or other valuation methods. If
      such
      assets are considered to be impaired, impairment to be recognized is measured
      by
      the amount by which the carrying amount of the assets exceeds the asset’s fair
      value.




8




Deferred
      debt issue costs -
      The
      Company capitalizes costs incurred in connection with borrowings. These costs
      are amortized as an adjustment to interest expense over the life of the
      borrowing.





Debt
      discount -
      The
      Company records the fair value of warrants issued with debt securities as a
      debt
      discount, which is amortized as an adjustment to interest expense over the
      life
      of the borrowing.





Revenue
      recognition -
      Revenues are recognized at the point of sale at retail locations or upon
      delivery of the product for delivery and wholesale transactions.





Cost
      of sales -
      Cost of
      sales includes the cost of food and paper products.





Income
      taxes -
      The
      Company accounts for income taxes in accordance with SFAS No. 109, “Accounting
      for Income Taxes,” which requires recognition of deferred tax assets and
      liabilities for expected future tax consequences of events that have been
      included in financial statements or tax returns. Under this method, deferred
      income taxes are recognized for the tax consequences in future years of
      differences between the tax bases of assets and liabilities and their financial
      reporting amounts at each period end based on enacted tax laws and statutory
      tax
      rates applicable to the periods in which the differences are expected to affect
      taxable income. Valuation allowances are established, when necessary, to reduce
      deferred tax assets to amounts expected to be realized. The Company continues
      to
      provide a full valuation allowance to reduce its net deferred tax asset to
      zero,
      inasmuch as Company management has not determined that realization of deferred
      tax assets is more likely than not. The provision for income taxes represents
      the tax payable for the period and change during the period in net deferred
      tax
      assets and liabilities.





Stock-based
      compensation -
      Prior
      to January 1, 2006, the Company accounted for employee stock option grants
      in
      accordance with APB No. 25, and adopted the disclosure-only provisions of SFAS
      No. 123, “Accounting for Stock-Based Compensation,” amended by SFAS No. 148,
“Accounting for Stock-Based Compensation - Transition and Disclosure.”  In
      December 2004, the FASB released a revision to SFAS No. 123, “Accounting for
      Stock-Based Compensation” (“FAS 123R”). FAS 123R sets forth the accounting for
      share-based payment transactions in which an enterprise receives employee
      services in exchange for (a) equity instruments of the enterprise or (b)
      liabilities that are based on the fair value of the enterprise's equity
      instruments or that may be settled by the issuance of such equity instruments.
      The statement eliminates the ability to account for share-based compensation
      transactions using APB Opinion No. 25, “Accounting for Stock Issued to
      Employees,” and generally requires instead that such transactions be accounted
      for using a fair-value-based method, which requires recording an expense over
      the requisite service period for the fair value of all options or warrants
      granted to employees and consultants. The Company adopted FAS 123R effective
      beginning January 1, 2006 using the modified prospective method.





The
      Company accounts for equity instruments issued to non-employees in accordance
      with the provisions of SFAS No. 123 and Emerging Task Force Issue No. 96-18,
      “Accounting for Equity Instruments that are Issued to Other Than Employees for
      Acquiring or in Conjunction with Selling Goods or Services.” Compensation
      expense related to equity instruments issued to non-employees is recognized
      as
      the equity instruments vest.





Basic
      and diluted net loss per share -
      Basic
      net loss per common share is computed by dividing net loss by the
      weighted-average number of common shares outstanding during the period. Diluted
      net loss per common share is determined using the weighted-average number of
      common shares outstanding during the period, adjusted for the dilutive effect
      of
      common stock equivalents, consisting of shares that might be issued upon
      exercise of common stock options, warrants or convertible promissory notes,
      or
      conversion of preferred stock shares. In periods where losses are reported,
      the
      weighted-average number of common shares outstanding excludes common stock
      equivalents, because their inclusion would be anti-dilutive. In connection
      with
      the merger with SP in February 2007, all shares of Organic preferred stock
      automatically converted into an equal number of Organic common shares and all
      Organic common shares automatically converted into SP common shares at the
      Exchange Ratio adjusted number of shares equal to .69781 SP common shares for
      every 1 Organic common share. All share and per share amounts have been Exchange
      Ratio adjusted. For purposes of determining the weighted average number of
      common shares outstanding historical Organic shares outstanding have been
      multiplied by the Exchange Ratio, which results in a fewer number of shares
      outstanding that historical amounts.  Computations
      of net loss per share for the interim 2007 periods exclude approximately
      5,819,045 shares issuable upon exercise of outstanding and issuable warrants,
      3,031,642 shares of common stock issuable upon exercise of outstanding stock
      options, and 312,500 shares of common stock issuable upon conversion of
      convertible notes payable. These common stock equivalents could have the effect
      of decreasing diluted net income per share in future periods.




9




Reclassifications -
      Certain
      reclassifications have been made to prior year’s financial statements to conform
      with current year presentations. Such reclassifications had no effect on
      stockholders’ equity, net loss or net increase in cash and cash
      equivalents.





Recent
      accounting pronouncements -
      In July
      2006, the FASB issued FASB Interpretation No. 48, “Accounting for
      Uncertainty in Income Taxes” ** (“FIN No. 48”),
      which prescribes a recognition threshold and measurement process for recording
      in the financial statements uncertain tax positions taken or expected to be
      taken in a tax return. Additionally, FIN No. 48 provides guidance on
      the recognition, classification, accounting in interim periods and disclosure
      requirements for uncertain tax positions. The accounting provisions of
      FIN No. 48 were effective for the Company beginning January 1,
      2007, the adoption of which did not have a significant effect on its results
      of
      operations or financial position.





In
      December 2006, the FASB issued FASB Staff Position No. EITF 00-19-2 “Accounting
      for Registration Payment Arrangements” (“FSP EITF 00-19-2”), which addresses an
      issuer’s accounting and disclosures relating to registration payment
      arrangements. In connection with issuance of Units in the private placement
      in
      February 2007, the Company has registered the shares underlying the Units.
      In
      accordance with FSP EITF 00-19-2, the registration payment arrangements are
      accounted for as an instrument separate and apart from the related securities
      and will be accounted for in accordance with Statement of Financial Accounting
      Standards No. 5 “Accounting for Contingencies,” accruing a liability if payment
      is probable and the amount can be reasonably estimated.




**Note
      2. Notes payable**





Notes
      payable consist of the following (in thousands):


December
                  31,
              
              September
                  30,2006
              
              2007Notes
                  payable, 6% to 8% interest collateralized by vehicles and
                  equipment
              
              $
              323
              
              $
              177Convertible
                  note payable, 8.25% interest, collateralized by substantially all
                  assets
              
              
              759
              
              
              759Notes
                  payable, 7.75% interest, collateralized by certain assets, due
                  April
                  2010
              
              
              418
              
              
              418Convertible
                  notes payable, 8% interest, due June 2008
              
              
              525
              
              
              525Note
                  payable, 18% interest, due May 2008
              
              
              -
              
              
              500Note
                  payable, prime plus 1% interest, due March 2009
              
              
              -
              
              
              115Note
                  payable, 8% interest, due October 2010
              
              
              -
              
              
              60Convertible
                  notes payable, 8% interest, due June 2007
              
              
              5,275
              
              
              -Note
                  payable, 9% interest, due December 2006
              
              
              275
              
              
              -Total
                  notes payable
              
              
              7,575
              
              
              2,554Less:
                  unamortized original discount
              
              
              (702
              )
              
              (
                  45
              )Less:
                  current portion of notes payable
              
              
              (6,281
              )
              
              (1,543
              )Notes
                  payable, net of current portion
              
              $
              592
              
              $
              966




The
      Company has a borrowing agreement with a vendor pursuant to which the Company
      has had outstanding borrowings of approximately $759,000 since March 31, 2006.
      The note payable requires monthly payments of interest at the prime rate plus
      1%
      (9.25% at December 31, 2006, and 8.75% at September 30, 2007), with the
      principal due in September 2007. The note is convertible at the note holder’s
      option into shares of the Company’s common stock at an Exchange Ratio adjusted
      conversion price of approximately $1.68 per share. If the note was not converted
      in full on or before the maturity date, the then outstanding principal balance
      and accrued interest automatically converts into a term note, which shall
      provide for thirty-six equal monthly payments and a final maturity date in
      September 2010. Since the note was not converted or repaid on or prior to the
      maturity date the original note has been replaced with a 36 month term loan
      with
      interest at prime plus 1%. The note is collateralized by a pledge of Company
      assets.





In
      connection with an asset purchase agreement in 2005, the Company issued
      promissory notes of approximately $600,000, which bear interest at 7.75% per
      annum payable quarterly, with principal due in April 2010, and are
      collateralized by a security interest in the acquired assets. In April 2006,
      pursuant to a repurchase agreement, the Company repurchased two of the notes
      having a total face value of approximately $182,000 for $130,000 cash and
      recorded the resultant gain on extinguishment of debt in other income.




During
      2006, the Company received approximately $4.3 million through the issuance
      of
      approximately $3.8 million of convertible promissory notes bearing interest
      at
      8% due June 2007 (the “Bridge Notes”) and $525,000 of convertible promissory
      notes bearing interest at 8% due June 2008 (the “2 year Bridge Notes”) and
      warrants to purchase shares of Company common stock (together with the notes,
      the “Bridge Securities”). The estimated fair value of the warrants of
      approximately $768,000 was recorded as an original issue discount to be
      amortized to interest expense on a straight-line basis over the 7-month term
      of
      the notes. Additionally, in 2006, the Company received approximately $1.6
      million through the issuance convertible promissory notes bearing interest
      at
      24%, approximately $1.5 million of which were converted at the holders’ option
      into bridge notes and the remaining notes were repaid. Warrants were issued
      in
      connection with the short-term loans, the fair value of which was expensed
      over
      the debt term prior to conversion. Bridge Notes of approximately $5.8 million
      were convertible at the note holders’ option, or in certain circumstances
      automatically, into shares of the Company’s common stock at an Exchange Ratio
      adjusted conversion price of approximately $1.68 per share. In February 2007,
      in
      connection with the closing of the merger with SP, the Bridge Notes of
      approximately $5.3 million were automatically converted into common stock.
      A
      portion of the bridge known as “Satellite Note” of $525,000 was not converted.




10




During
      2006, the Company borrowed $275,000 from one of the Company’s equity and bridge
      note investors pursuant to a promissory note payable of $275,000, bearing
      interest at 9% per annum, which was outstanding and due at December 31, 2006,
      and which was repaid in full during the three months ended March 31, 2007.





During
      2007, the Company borrowed $500,000 from three of the Company’s equity and
      bridge note investors pursuant to a promissory note payable of $500,000, bearing
      interest at 18% per annum, all of which are due on May 15, 2008.





Also
      during 2007, as part of asset purchase agreements, the Company issued to the
      sellers promissory notes of $150,000 and $75,000, bearing interests at 9.25%
      and
      8% per annum, payable monthly and due on March 11, 2009 and October 10, 2010
      respectively.





Future
      minimum principal payments on notes payable at September 30, 2007 are
      approximately $126,000 in 2007, $1.5 million in 2008, $306,000 in 2009, and
      $608,000 in 2010.




**Note
      3. Reverse Merger with Public Shell Company, Private Placement and Stockholders’
Equity**





Reverse
      merger -
      On
      February 12, 2007, pursuant to an Agreement and Plan of Merger and
      Reorganization by and among Organic and SP, Organic became a wholly owned
      operating subsidiary of SP. Those persons holding shares of Organic capital
      stock, warrants and options to purchase shares of Organic capital stock, and
      certain promissory notes convertible into shares of Organic capital stock,
      received shares of SP common stock, $.001 par value per share and warrants
      and
      options to purchase shares of SP common stock.





Under
      the
      terms of the merger, each share of Organic common stock and Organic preferred
      stock (which included certain issued and outstanding convertible promissory
      notes on an “as converted” basis) outstanding immediately prior to the closing
      of the merger was converted into the right to receive 0.69781 shares of SP
      common stock. Under the terms of the merger, each then convertible promissory
      note whose holder had not previously elected to convert to Organic common stock,
      became convertible for shares of SP common stock, provided that (i) the face
      value of each such convertible note remained unchanged, (ii) each such
      convertible note became convertible for such number of shares of SP common
      stock
      as was determined by multiplying the number of Organic shares underlying said
      convertible note by the Exchange Ratio, with the resulting product rounded
      down
      to the nearest whole number of shares, and (ii) the per share conversion price
      for each convertible note determined by dividing the conversion price per share
      for said convertible note by the Exchange Ratio, with the resulting quotient
      rounded down to the nearest whole cent.





Under
      the
      terms of the merger, each then outstanding option and warrant to purchase shares
      of Organic common stock, whether or not exercisable, was converted into an
      option or warrant to purchase shares of SP common stock upon the same terms
      and
      conditions as the corresponding Organic options and warrants, provided that
      (i)
      each such Organic option and warrant related to such number of shares of SP
      common stock as was determined by multiplying the number of shares of Organic
      common stock underlying such Organic option or warrant by the Exchange Ratio,
      with the resulting product rounded down to the nearest whole number of shares,
      and (ii) the per share exercise price for the newly-issued SP options or
      warrants was determined by dividing the exercise price per share of such Organic
      options or warrants by the Exchange Ratio, with the resulting quotient rounded
      down to the nearest whole cent.





Private
      placement -
      Consummation of the merger occurred concurrently with the completion of a
      private placement of 138 Units for an aggregate of approximately $6.9 million,
      issued by SP. Each Unit is comprised of (i) 40,000 shares of SP common stock,
      and (ii) a detachable five-year warrant to purchase 8,000 shares of SP common
      stock, at an exercise price of $2.50 per share (the “SP Warrants”). The purchase
      price per Unit was $50,000. Pursuant thereto the Company issued to the investors
      an aggregate of 5,522,992 shares of SP common stock and SP Warrants to purchase
      1,104,598 shares of Company common stock. Organic engaged Burnham Hill Partners,
      a division of Pali Capital, Inc., as the Placement Agent (the “Placement Agent”)
      in connection with the Private Placement. Pursuant to the terms of the
      engagement with the Placement Agent, the Placement Agent, or its registered
      assignees or designees, received a cash commission of 10% of the gross proceeds
      from the Units sold in the Private Placement. In addition, the Company issued
      to
      the Placement Agent or its registered assignees or designees, SP Warrants (the
      “Placement Agent Warrants”) to purchase up to 888,899 shares of SP common stock.
      The Placement Agent Warrants are exercisable at any time at a price equal to
      110% of the price paid by the investors in the private placement, on a
      net-issuance or cashless basis. The Placement Agent Warrants had registration
      rights similar to the registration rights afforded to the holders of SP
      Warrants. The Placement Agent Warrants are fully vested and have a term of
      five
      years.




11




The
      issuance of SP common stock to the Organic stockholders and the investors is
      intended to be exempt from registration under the Securities Act of 1933, as
      amended (the “Securities Act”), pursuant to Section 4(2) thereof. As such, the
      SP common stock received by the Organic stockholders pursuant to the merger
      and
      issued to the investors pursuant to the Private Placement may not be offered
      or
      sold in the United States unless they are registered under the Securities Act,
      or an exemption from the registration requirements of the Securities Act is
      available. In April 2007, the Company filed a registration statement covering
      these securities with the Securities and Exchange Commission. The registration
      statement was declared effective in May 2007.





During
      the three months ended June 30, 2007, the Company closed a private placement
      with select accredited investors related to the sale and issuance of an
      aggregate of 3,350,000 shares of common stock of the Company and warrants to
      purchase an aggregate of 1,340,000 shares of common stock. The aggregate gross
      proceeds raised by the Company were approximately $6.7 million. Each share
      was
      sold to the investors at $2.00 per share. The warrants will expire five years
      from the date of issue and may be exercised at $2.50 per share, subject to
      adjustment in certain circumstances. In connection with the private placement,
      the Company paid its placement agents an aggregate cash commission equal to
      $84,000. In addition, the Company reimbursed the placement agents $40,000 for
      costs and expenses incurred in connection with the private placement, and issued
      to the placement agents five-year warrants to purchase an aggregate of 21,000
      shares of common stock, at an exercise price of $2.50 per share, subject to
      adjustment in certain circumstances.   The private placement was conducted
      pursuant to Section 4(2) of the Securities Act and Rule 506 promulgated
      thereunder.





Authorized
      shares -
      SP is
      currently authorized under its Amended and Restated Certificate of Incorporation
      to issue 500,000,000 shares of its common stock and 10,000,000 shares of its
      preferred stock. Prior to closing of the merger and private placement, there
      were 439,403 shares of SP common stock issued and outstanding and 60 shares
      of
      SP preferred stock issued and outstanding. At the closing of the merger and
      private placement and after giving effect thereto, there were 19,595,671 shares
      of SP common stock issued and outstanding and no shares of preferred stock
      issued and outstanding (the 60 shares of SP preferred stock issued and
      outstanding prior to the merger having automatically converted into 687,271
      shares of SP common stock upon closing of the merger).





Warrants -
      As of
      March 31, 2007, in conjunction with various financing related agreements,
      including issuances of debt and equity securities, the Company issued warrants
      for a term of approximately 5 years to purchase shares of the Company’s common
      stock at exercise prices ranging from $1.17 to $1.38 per share for approximately
      4,165,000 shares and at $2.50 per share for approximately 1,105,000 shares.
      As
      of June 30, 2007, the Company issued warrants at exercise prices ranging from
      $1.17 to $2.50 per share for approximately 1,371,000 shares and 822,270 shares
      were redeemed. As of September 30, 2007, there were a total of 5,818,730
      warrants outstanding.





Stock
      options -
      During
      the three and nine months ended September 30, 2006, the Company granted to
      certain officers and directors approximately 132,000 options and 482,000
      options, respectively, to purchase Company common stock for a period of 10
      years
      from grant with an exercise price of $0.34 for 132,000 options and $0.17 per
      share for 348,000 options. During the three months ended March 31, 2007, the
      Company granted to its Chief Executive Officer and certain Company employees
      approximately 1.4 million options to purchase Company common stock for a period
      of 10 years from grant with exercise prices of $1.38 for 1,246,674 shares and
      $3.60 per share for 150,000 shares. During the three months ended June 30,
      2007,
      the Company granted to certain officers approximately 776,000 options to
      purchase Company common stock for a period of 10 years from grant with an
      exercise price of $2.23 per share. During the three months ended September
      30,
      2007, the Company granted options to certain employees approximately 269,000
      options to purchase Company common stock for a period of 10 years from grant
      with an exercise price of $2.05 for 28,000 shares and of $1.82 for 241,000
      shares. The Company determines the fair value of options granted using the
      Black-Scholes option-pricing model. The determination of the fair value of
      stock-based awards on the date of grant using an option pricing model is
      affected by the stock price as well as assumptions regarding a number of highly
      complex and subjective variables. These variables include, among others, the
      expected life of the award, expected stock price volatility over the term of
      the
      award and actual and projected exercise behaviors. Although the fair value
      of
      stock-based awards is determined in accordance with SFAS 123R and SAB 107,
      the
      Black-Scholes option pricing model requires the input of highly subjective
      assumptions, and other reasonable assumptions could provide differing results.
      The weighted average fair value of stock options granted during the three months
      ended September 30, 2006 and 2007 was approximately $0.39 and $0.90 per share,
      respectively, and the weighted average fair value of stock options granted
      during the nine months ended September 30, 2007 was approximately $0.74 per
      share determined using the Black-Scholes option pricing model with the following
      assumptions: dividend yield of 0%; expected volatility of 50% (based on the
      volatilities of common stock of comparable public companies); risk-free interest
      rates of approximately 5%, and estimated lives of 5 years.





Compensation
      expense recognized for stock options approximated $3,000 and $152,000 for the
      three months ended September 30, 2006 and 2007, respectively, and $10,000 and
      $248,000 for the nine months ended September 30, 2006 and 2007, respectively.
      As
      of September 30, 2007, there was approximately $1.5 million of unrecognized
      compensation cost related to unvested stock options granted, which is expected
      to be recognized as expense over a period of approximately 3 years. The
      intrinsic value of stock options outstanding and exercisable is based on the
      close/last price for the Company’s common stock as reported by the OTCBB of
      $1.43 per share at December 31, 2006 and $1.94 at September 30, 2007, and is
      calculated by aggregating the difference between the close price and the
      exercise price of vested and unvested stock options which have an exercise
      price
      less than the close price. The following summarizes activity for stock options
      (intrinsic value in thousands):




12


Outstanding
              
              Weighted
                  average exercise price
              
              Weighted
                  average remaining life in years
              
              Aggregate
                  intrinsic valueBalance
                  at December 31, 2006
              
              
              655,545
              
              $
              0.54
              
              
              9.4
              
              $
              585Granted
              
              
              2,441,965
              
              
              1.84
              
              
              9.8Exercised
              
              
              -Expired/cancelled/forfeited
              
              
              (65,868
              )Balance
                  at September 30, 2007
              
              
              3,031,642
              
              $
              1.57
              
              
              9.4
              
              $
              2,424Exercisable
                  at September 30, 2007
              
              
              562,725
              
              $
              1.40
              
              
              9.0
              
              $
              558




Additional
      information regarding stock options outstanding as of September 30, 2007, is
      as
      follows:




Exercise
                  price
              
              Shares
              
              Weighted
                  average remaining life$0.17
              
              
              349,254
              
              
              8.50.34
              
              
              118,628
              
              
              8.71.38
              
              
              1,246,674
              
              
              9.31.43
              
              
              145,795
              
              
              9.01.82
              
              
              217,000
              
              
              9.72.05
              
              
              28,000
              
              
              9.92.23
              
              
              776,291
              
              
              9.83.60
              
              
              150,000
              
              
              9.7




**Note
      4. Asset purchase agreements**





In
      October 2006, pursuant to terms of an asset purchase agreement, the Company
      acquired for $1.0 million cash, among other things, all inventory, furniture,
      fixtures, equipment, customer lists, leasehold improvements, and owned vehicles
      used in connection with a catering business in California. Other than the notes
      payable on the vehicles, no liabilities were assumed by the Company. The Company
      also entered in to a one year lease agreement for the building owed by the
      seller. The total purchase price of approximately $1.0 million, including
      related acquisition costs, was allocated to assets acquired based on relative
      estimated fair values, which resulted in the majority being allocated to
      customer based identifiable intangible assets, and which is summarized as
      follows (in thousands):




Inventory
              
              $
              12Furniture,
                  fixtures and equipment
              
              
              29Customer
                  based intangible assets
              
              
              860Covenant
                  not compete intangible asset
              
              
              150Note
                  payable assumed
              
              
              (9
              )Total
              
              $
              1,042




In
      March
      2007, pursuant to terms of an asset purchase agreement, the Company acquired
      for
      cash of approximately $612,000, a $150,000 promissory note and 400,000 shares
      of
      its common stock, among other things, all inventory, furniture, fixtures,
      equipment, leasehold improvements, customer lists and other intangible assets
      used in connection with a Seattle-based catering business. Other than a
      facilities lease and equipment lease, no liabilities were assumed by the
      Company. The total purchase price approximates $1.2 million, and because
      information known to exist as it pertains to estimates of fair values of
      intangible assets, has been preliminarily allocated to assets acquired based
      on
      relative estimated fair values, which resulted in the majority being allocated
      to customer based intangibles, and which is summarized as follows (in
      thousands):




Inventory
              
              $
              32Furniture,
                  fixtures, equipment and vehicles
              
              
              160Customer
                  based intangible assets
              
              
              1,084Liabilities
                  assumed
              
              
              (42
              )Total
              
              $
              1,234




13




Operating
      results for the acquired catering busi nesses
      are included in the Company’s operating results from the dates of acquisitions.
      The following supplemental pro forma information has been presented on the
      basis
      as if the asset acquisitions of the catering businesses had occurred at the
      beginning of the periods presented (in thousands):




Nine
                  months ended
                September
                  30,2006
              
              2007Sales
              
              $
              9,743
              
              $
              11,547Net
                  loss
              
              $
              (5,713
              )
              $
              (9,072
              )Net
                  loss per share
              
              $
              (1.75
              )
              $
              (0.47
              )




In
      July
      2007, pursuant to terms of an asset purchase agreement, the Company acquired
      for
      approximately $375,000 cash, shares of Company common stock having a fair value
      of approximately $163,000 based on the closing price as of the date of the
      agreement, and $50,000 due 60 days from the date of the agreement, purchased
      among other things, all inventory, furniture, fixtures, equipment, customer
      lists, leasehold improvements, and owned vehicles used in connection with a
      retail business operating two stores in San Diego, California. No liabilities
      were assumed by the Company. The Company also entered in to a five-year lease
      agreement for one of the store locations from a landlord affiliated with by
      the
      seller, and assumed the lease for the other store location. The total purchase
      price of approximately $600,000 has been preliminarily allocated to assets
      acquired based on estimated fair values, which resulted in the majority being
      allocated to customer based identifiable intangible assets, and which is
      summarized as follows (in thousands):




Inventory
                  and other assets
              
              $
              12Furniture,
                  fixtures, equipment and vehicles
              
              
              30Customer
                  based intangible assets
              
              
              558Total
              
              $
              600


In
      September 2007, pursuant to terms of an asset purchase agreement, the Company
      acquired for approximately $266,000 cash, shares of Company common stock having
      a fair value of approximately $100,000 based on the closing price as of the
      date
      of the agreement, $25,000 due in equal monthly payments within 90 days from
      the
      date of the agreement, and related acquisition costs of approximately $22,000,
      purchased among other things, all inventory, furniture, fixtures, equipment,
      customer lists, leasehold improvements, and owned vehicles used in connection
      with a retail business operating one store in San Diego, California. No
      liabilities were assumed by the Company. The Company assumed the lease for
      the
      store location. The total purchase price of approximately $415,000 has been
      preliminarily allocated to assets acquired based on estimated fair values,
      which
      resulted in the majority being allocated to customer based identifiable
      intangible assets, and which is summarized as follows (in thousands):




Inventory
                  (and other assets)
              
              $
              11Furniture,
                  fixtures, equipment and vehicles
              
              
              25Customer
                  based intangible assets
              
              
              379Total
              
              $
              415


In
      September 2007, pursuant to terms of an asset purchase agreement, the Company
      acquired for approximately $381,000 cash, shares of Company common stock having
      a fair value of approximately $48,000 based on the closing price as of the
      date
      of the agreement, purchased among other things, all inventory, furniture,
      fixtures, equipment, customer lists, leasehold improvements, and owned vehicles
      used in connection with a retail business operating two stores in San Diego,
      California. No liabilities were assumed by the Company. The Company also entered
      in to a five-year lease agreement for one of the store locations from a landlord
      affiliated with by the seller, and assumed the lease for the other store
      location. The total purchase price of approximately $430,000 has been
      preliminarily allocated to assets acquired based on estimated fair values,
      which
      resulted in the majority being allocated to customer based identifiable
      intangible assets, and which is summarized as follows (in thousands):




Inventory
                  and other assets
              
              $
              6Furniture,
                  fixtures, equipment and vehicles
              
              
              30Customer
                  based intangible assets
              
              
              394Total
              
              $
              430




14




**Note
      5. Commitments and contingencies**





The
      Company leases its cafes, central kitchens and office facilities under
      non-cancelable operating leases, some with renewal options. Rents are fixed
      base
      amounts, some with escalating rents and some with contingent rentals based
      on
      sales. Lease provisions also require additional payments for maintenance and
      other expenses. Rent is expensed on a straight-line basis over the term of
      the
      lease. The difference between amounts paid and expensed is recorded as a
      deferred credit. The Company also leases certain point-of-sale computer hardware
      and software pursuant to capital leases. Subsequent to December 31, 2006, the
      Company has entered into new leases, for two locations in Seattle, which provide
      for minimum future lease payments over five year terms of approximately
      $811,000, three store leases in Los Angeles, which provide for minimum future
      lease payments over their five to six year terms of approximately $908,000,
      and
      five store leases in San Diego, which provide for minimum future lease payments
      over their four to five year terms of approximately $1.8 million. The Company
      has also entered into three leases for delivery vehicles pursuant to capital
      leases, which provides for additional minimum future lease payments over their
      four and five year terms of approximately $572,000. Capital lease obligations
      are for terms ranging from two to five years with interest at 9% to 22%. At
      September 30, 2007, minimum future annual lease obligations for fiscal years
      ending September 30 are as follows (in thousands):




2008
              
              $
              3252009
              
              
              2312010
              
              
              1372011
              
              
              962012
              
              
              46825Less
                  amounts representing interest
              
              
              (161
              )$
              674




From
      time
      to time, the Company is subject to various legal proceedings and claims that
      may
      arise in the ordinary course of business. Further, in the past, certain vendors
      have taken legal action against the Company as a result of untimely payment
      of
      invoices. In some cases, the courts have stipulated judgment requiring the
      Company to pay interest and comply with payment schedules. Company management
      currently believes that resolution of such legal matters will not have a
      material adverse impact on the Company’s financial statements. We are not a
      party to any other material legal proceedings nor are we aware of any
      circumstance that may reasonably lead a third party to initiate material legal
      proceedings against us. In 2006, a former employee of the Company brought suit
      against us. The matter was settled for an amount immaterial to the Company’s
      financial results in June 2007.





Effective
      January 1, 2007, the Company entered into an employment agreement with a
      three-year term with its founder and Chief Executive Officer, pursuant to which
      the executive officer shall receive a base salary at an annual rate of $225,000,
      subject to annual increases as determined by the Company’s Board of Directors.
      The Company’s Chief Executive Officer is also eligible for cash bonuses and
      other typical employment benefits. In addition, effective upon the closing
      of
      the merger, the executive officer received 1,246,674 options to purchase shares
      of the Company’s common stock at an exercise price of $1.38 per share, with a
      term of 10 years from grant.  Options granted vest 25% after 12 months of
      employment, with the remainder vesting over the next 36 months, subject to
      accelerated vesting in the event of a “Change in Control,” as defined in the
      employment agreement, or in certain other circumstances. Under certain departure
      circumstances, the executive officer could be eligible to receive payments
      equal
      to one year’s salary and benefits.





**Note
      6. Subsequent Events**





In
      October 2007, the Company entered into a securities purchase agreement with
      select accredited investors related to the sale of Company common stock and
      warrants to purchase shares of Company common stock at a price of $1.75 for
      one
      share and .45 warrants. The Company closed its private placement, pursuant
      to
      which it issued an aggregate of 3,264,426 shares of Company common stock and
      warrants to purchase an aggregate of 1,468,990 shares of Company common stock
      at
      an exercise price of $2.50 per share with a five year term. The aggregate gross
      proceeds raised by the Company were approximately $5.7 million, before placement
      fees of $140,000. In connection with the private placement, the Company entered
      into a registration rights agreement with the investors, requiring the Company
      to file with the Securities and Exchange Commission an initial registration
      statement covering the resale of the common stock and the common stock issuable
      upon exercise of the warrants within 30 days following the closing of the
      private placement. In addition, the Company is required to cause the
      registration statement to be declared effective by the Securities and Exchange
      Commission 90 to 180 days following the close of the private placement,
      depending on certain conditions. If the Company does not file the registration
      statement by the required filing date or the Securities and Exchange Commission
      does not declare the registration statement effective by the required effective
      date (together, the “Event Date”), then the Company will be required to pay
      liquidated damages to each investor equal to 1% of the aggregate investment
      amount paid by each such investor on the Event Date and on each monthly
      anniversary of the Event Date until such filing or effective date has occurred,
      with the maximum liquidated damages payable by the Company capped at 10% of
      the
      aggregate investment amount paid by each such investor.




15




On
      October 18, 2007, pursuant to terms an asset purchase agreement, the Company
      acquired for $2.4
      million cash, shares of Company common stock having a fair value of $250,000
      based on the closing price as of the date of the agreement, $150,000 due 90
      days
      from the closing date and another $150,000 due 120 days after the close, and
      upon the occurrence of certain events, additional shares of Company having
      a
      fair value of $50,000 based on the closing price as of the date of the
      agreement, all inventory, furniture, fixtures, equipment, customer lists,
      leasehold improvements, and owned vehicles used in connection with a catering
      and retail business operating three stores in San Diego, California. The Company
      also entered into a consulting agreement with the three sellers providing for
      those individuals to provide consulting services to the Company for a one year
      period, pursuant to which, among other things, the Company will pay monthly
      fees
      of $35,000. Other than the Company’s assumption of the leases for the three
      locations, no other liabilities were assumed. The total purchase price of
      approximately $3.0 million will be allocated to assets acquired based on
      estimated fair values, which will result in the majority being allocated to
      customer based identifiable intangible assets.




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





*The
      following discussion and analysis of the results of operations and financial
      condition should be read in conjunction with our financial statements and the
      notes to those financial statements that are included elsewhere in this
      Quarterly Report on Form 10-QSB. This discussion includes forward-looking
      statements based upon current expectations that involve risks and uncertainties,
      such as plans, objectives, expectations and intentions. Actual results and
      the
      timing of events could differ materially from those anticipated in these
      forward-looking statements as a result of a number of factors. Words such as
      “anticipate,” “estimate,” “plan,” “continuing,” “ongoing,” “expect,” “believe,”
“intend,” “may,” “will,” “should,” “could,” and similar expressions are used to
      identify forward-looking statements.*





**Overview**





*Organization
      and Business -* Organic
      Holding Company, Inc., d/b/a Organic To Go, whose name was changed to Organic
      To
      Go, Inc. effective February 27, 2007, is a wholly-owned subsidiary of Organic
      To
      Go Food Corporation and was incorporated in the state of Delaware in February
      2004. We provide convenient cafés which prepare and serve “grab and go” lunch,
      dinner, and breakfast foods and beverages prepared using organic ingredients,
      whenever possible. We also distribute our products through delivery, catering
      and select wholesale accounts. In October 2006, we expanded our catering
      operations in the California area by acquiring the assets of a catering
      operation headquartered in Los Angeles, California. In March 2007, we expanded
      our catering operations by acquiring the assets of a catering operation located
      in Seattle, Washington, and in July and September 2007 we further expanded
      our
      operations by acquiring the assets of six retail and catering stores in San
      Diego, California. In February 2007 we completed a reverse merger with a public
      shell company named SP Holding Corporation. At September 30, 2007, we operated
      five stores in Washington and seventeen stores in California, with central
      kitchens in each market.





Management
      believes we have the opportunity to capture increasing market share in all
      three
      of our businesses: Delivery/Catering, Retail, and Wholesale “grab & go”
convenience foods, by providing customers with delicious, healthy, wholesome
      and
      organic food choices. Management is focused in the near and long term on the
      challenges and risks that we face in expanding our business. These include
      our
      ability to obtain retail, catering and wholesale locations, building a
      sufficient infrastructure to support our expansion, and obtaining a customer
      base and margin improvement sufficient to achieve and sustain profitability.





*Basis
      of Presentation and Liquidity -* Since
      our
      inception, we have funded operations and business development and growth through
      debt and equity financings. In this regard, during 2006, we raised approximately
      $8.1 million pursuant to sales of debt and equity securities in connection
      with
      our private placement and subordinated debt offerings. Further, during the
      three
      months ended March 31, 2007, proceeds of approximately $6.9 million were
      received from the sale of equity securities in connection with the merger and
      private placement, and approximately $5.3 million of notes payable were
      converted into shares of common stock.  Additionally, during the three
      months ended June 30, 2007, proceeds of approximately $6.7 million were received
      from the sale of debt and equity securities. In October 2007, the Company closed
      its private placement offering and issued approximately 3.2 million shares
      of
      Company common stock and warrants to purchase approximately 1.5 million shares
      of Company common stock. The aggregate gross proceeds raised by the Company
      were
      approximately $5.7 million. Our management intends to continue to be engaged
      in
      additional fund-raising activities to fund future capital expenditures,
      potential acquisitions of businesses, and provide additional working
      capital.





**Critical
      Accounting Policies and Estimates**





Management's
      discussion and analysis of financial condition and results of operations are
      based on our financial statements, which have been prepared in accordance with
      accounting principles generally accepted in the United States. The preparation
      of these financial statements requires our management to make estimates and
      assumptions that affect the reported amounts of assets and liabilities and
      the
      disclosure of contingent assets and liabilities at the date of the financial
      statements, as well as the reported net sales and expenses during the reporting
      periods. On an ongoing basis, estimates and assumptions are evaluated. Estimates
      are based on historical experience and on various other factors believed
      reasonable under the circumstances, the results of which form the basis for
      making judgments about the carrying value of assets and liabilities that are
      not
      readily apparent from other sources. Actual results may differ from these
      estimates under different assumptions or conditions. A summary of significant
      accounting policies is presented in Note 1 to our financial statements included
      elsewhere in this Quarterly Report on Form 10-QSB. The following accounting
      policies are considered the more critical to aid in understanding and evaluating
      our results of operations and financial condition.





16




*Use
      of Estimates -* In
      preparing the financial statements in conformity with accounting principles
      generally accepted in the United States of America, management makes estimates
      and assumptions that affect the reported amounts of assets and liabilities
      and
      disclosures of contingent assets and liabilities at the dates of the financial
      statements, as well as the reported amounts of revenues and expenses during
      the
      reporting years. Actual results could differ from those estimates. The more
      significant accounting estimates inherent in the preparation of our financial
      statements include estimates as to the depreciable lives of property and
      equipment, recoverability of long-lived assets, valuation of inventories,
      valuation of equity related instruments issued, and valuation allowance for
      deferred income tax assets.





*Inventory
      -* Inventory,
      which consists primarily of food, beverages and packaging products, is stated
      at
      the lower of cost or market. Cost is determined on a first-in, first-out basis.
      In assessing the ultimate realization of inventories, our management makes
      judgments as to future demand requirements compared to current inventory levels.





*Impairment
      of Long-lived Assets -* Long-lived
      assets are reviewed for impairment whenever events or changes in circumstances
      indicate that the carrying amount of the assets may not be recoverable.
      Impairment of long-lived assets would be recognized in the event that the net
      book values of such assets exceed the future undiscounted cash flows
      attributable to such assets. No impairment of long-lived assets was recognized
      for any of the periods presented.





*Intangible
      Assets -* In
      connection with acquisitions in 2006 and 2007, of certain assets of catering
      businesses and other retail store locations we acquired certain identifiable
      intangible assets including customer-based intangibles. These acquisitions
      have
      been accounted for in accordance with SFAS No. 141. Amounts allocated to
      intangible assets were identified by management and have been valued on a number
      of factors. The estimate of useful lives of each intangible asset was based
      on
      an analysis by management of all pertinent factors, and selected an estimated
      useful life of two years for each identifiable intangible asset.




*Revenue
      Recognition -* Revenues
      are recognized at the point of sale at retail locations or upon delivery of
      products for delivery and wholesale transactions.





*Cost
      of Sales -* Cost
      of
      sales includes the cost of food, beverages and paper products.





*Income
      Taxes -* We
      account for income taxes in accordance with SFAS No. 109, “Accounting for Income
      Taxes,” which requires recognition of deferred tax assets and liabilities for
      expected future tax consequences of events that have been included in financial
      statements or tax returns. Under this method, deferred income taxes are
      recognized for the tax consequences in future years of differences between
      the
      tax bases of assets and liabilities and their financial reporting amounts at
      each period end based on enacted tax laws and statutory tax rates applicable
      to
      the periods in which the differences are expected to affect taxable income.
      Valuation allowances are established, when necessary, to reduce deferred tax
      assets to amounts expected to be realized. We continue to provide a full
      valuation allowance in order to reduce our net deferred tax asset to zero,
      inasmuch as our management has not determined that realization of deferred
      tax
      assets is more likely than not. The provision for income taxes represents the
      tax payable for the period and change during the period in net deferred tax
      assets and liabilities.





*Stock-based
      Compensation -* In
      December 2004, the FASB released SFAS 123R. SFAS 123R sets forth the accounting
      for share-based payment transactions in which an enterprise receives employee
      services in exchange for (a) equity instruments of the enterprise, or (b)
      liabilities that are based on the fair value of the enterprise's equity
      instruments or that may be settled by the issuance of such equity instruments.
      The statement eliminates the ability to account for share-based compensation
      transactions using APB Opinion No. 25, “Accounting for Stock Issued to
      Employees,” and generally requires instead that such transactions be accounted
      for using a fair-value-based method, which requires recording an expense over
      the requisite service period for the fair value of all options or warrants
      granted to employees and consultants. We adopted SFAS 123R effective beginning
      January 1, 2006.





**Results
      of Operations**





**Three
      months ended September 30, 2006 and 2007**





*Sales
      -* Sales
      for
      the three months ended September 30, 2007 increased approximately 65%, to $3.7
      million, as compared with $ 2.3 million for the comparative prior year
      period. Retail sales were $1.8 million during the three months ended September
      30, 2007, an increase of 38% over $1.3 million during the comparative prior
      year
      period. Retail sales comprised 49% of total sales in the 2007 period as
      compared with 57% in the comparative prior year period. Delivery/Catering
      sales were $1.4 million during the three months ended September 30, 2007, an
      increase of $658,000 over $742,000 for the comparative prior year period.
      Delivery/Catering sales comprised 41% of total sales in the 2007 period as
      compared with 32% for the comparative prior year period. Wholesale sales
      were $548,000 during the three months ended September 30, 2007, an increase
      of
      $312,000 over $236,000 during the comparative prior year period. Wholesale
      sales
      comprised 13% of total sales in the 2007 period as compared with 10% in
      2006. The increases in Retail, Delivery/Catering and Wholesale were due to
      increased business volume.




17




*Cost
      of Sales -*Cost
      of
      sales includes the cost of food and paper products. Cost of sales for the three
      months ended September 30, 2007 increased approximately 60%, to $1.8 million,
      as
      compared with $1.1 million for the comparative prior year period. Cost of
      sales for the three months ended September 30, 2007 were approximately 47%
      of
      sales as compared with 49% during the comparative prior year period, and as
      compared to 48% for the immediately preceding three months ended June 30, 2007.





*Gross
      Profit -* Gross
      profit increased approximately 69%, to $2.0 million for the three months ended
      September 30, 2007, as compared with $1.2 million for the three months ended
      September 30, 2006. Gross profit for the three months ended September 30, 2007
      were approximately 53% of sales as compared with 51% during the comparative
      prior year period, and as compared to 53% for the immediately preceding three
      months ended June 30, 2007.





*Operating
      Expenses -* Operating
      expenses for the three months ended September 30, 2007 increased approximately
      99%, to $4.8 million, as compared with $2.4 million for the three months
      ended September 30, 2006. Operating expenses are comprised primarily of labor,
      and, to a lesser extent, occupancy and utilities, and selling, general and
      administrative expenses. Operating expenses increased during the three months
      ended September 30, 2007, as compared with the three months ended September
      30, 2006, primarily due to increased labor and related costs as a result of
      continued growth since the prior year, including the acquisitions of two
      catering businesses and new store locations, incremental costs of being a public
      company and preparing for future growth. During the three months ended September
      30, 2007, we recorded $498,000 in non-recurring, one-time expenses, including
      significant upfront expenses in researching and opening locations in San Diego,
      the first new geographic territory since the acquisition of Briazz in
      2005.





*Depreciation
      and Amortization -* Depreciation
      and amortization expense for the three months ended September 30, 2007 increased
      to $871,000, as compared with $252,000 for the three months ended September
      30, 2006, due primarily to amortization of identifiable intangible assets
      acquired in the catering businesses acquisitions in October 2006 and March
      2007,
      and to having more assets in service. Depreciation and amortization for the
      three months ended September 30, 2007 were approximately 23% of sales as
      compared with 11% during the comparative prior year period 2006.





*Loss
      from Operations -* Loss
      from
      operations for the three months ended September 30, 2007, increased to
      approximately $3.7 million as compared with $1.5 million for the three
      months ended September 30, 2006. The increase in loss from operations over
      the
      comparative prior year period is the result of the increase in gross profit
      of
      $804,000 being offset by the $2.4 million increase in operating expenses and
      a
      $619,000 increase in depreciation and amortization.





*Interest
      Expense, Net-* Interest
      expense, net for the three months ended September 30, 2007, decreased from
      the
      comparative prior year period to approximately $45,000. The decrease was
      primarily due to lower debt balances due primarily to the conversion to equity
      of $5.3 million of debt in March 2007.





*Net
      Loss -* Net
      loss
      for the three months ended September 30, 2007, increased to approximately $3.7
      million as compared with $2.2 million for the three months ended September
      30, 2006.





**Nine
      months ended September 30, 2006 and 2007**





*Sales
      -* Sales
      for
      the nine months ended September 30, 2007 increased approximately 67%, to $11.2
      million, as compared with $6.7 million for the comparative prior year
      period. Retail sales were $5.0 million during the nine months ended September
      30, 2007, an increase of 25% over $4.0 million during the comparative prior
      year
      period. Retail sales comprised 45% of total sales in the 2007 period as
      compared with 59% in the comparative prior year period. Delivery/Catering
      sales were $4.7 million during the nine months ended September 30, 2007, an
      increase of $2.7 million, or 135%, over $2.0 million for the comparative prior
      year period. Delivery/Catering sales comprised 42% of total sales in the 2007
      period as compared with 30% for the comparative prior year period.
      Wholesale sales were $1.5 million during the nine months ended September 30,
      2007, an increase of $800,000 as compared to $700,000 during the comparative
      prior year period. Wholesale sales comprised 13% of total sales in the 2007
      period as compared with 10% in 2006. The increases in Retail,
      Delivery/Catering and Wholesale were due to increased business volume.





18




*Cost
      of Sales -* Cost
      of
      sales includes the cost of food and paper products. Cost of sales for the nine
      months ended September 30, 2007, increased approximately 63%, to $5.4 million,
      as compared with $3.3 million for the comparative prior year period. Cost
      of sales for the nine months ended September 30, 2007 were approximately 48%
      as
      a percent of sales as compared with 49% during the comparative prior year
      period.





*Gross
      Profit-* Gross
      profit increased approximately 71%, to $5.8 million for the nine months ended
      September 30, 2007, as compared with $3.4 million for the nine months ended
      September 30, 2006. Gross profit for the nine months ended September 30, 2007
      were approximately 52% of sales as compared with 51% during the comparative
      prior year period.





*Operating
      Expenses -* Operating
      expenses for the nine months ended September 30, 2007 increased approximately
      82%, to $12.2 million, as compared with $6.7 million for the nine months
      ended September 30, 2006. Operating expenses are comprised primarily of labor,
      and, to a lesser extent, occupancy, utilities, and selling, general and
      administrative expenses. Operating expenses increased during the nine months
      ended September 30, 2007, as compared with the nine months ended September
      30, 2006, primarily due to increased labor and related costs as a result of
      continued growth since the prior year, including the acquisition of two catering
      businesses, and preparing for future growth. During the nine months ended
      September 30, 2007, we recorded $498,000 in non-recurring, one-time expenses,
      including significant upfront expenses to research and open locations in San
      Diego, the first new geographic territory since the acquisition of Briazz in
      2005.





*Depreciation
      and Amortization -* Depreciation
      and amortization expense for the nine months ended September 30, 2007 increased
      to $2.0 million as compared with $592,000 for the nine months ended
      September 30, 2006, due primarily to amortization of identifiable intangible
      assets acquired in the catering businesses acquisitions in October 2006 and
      March 2007, and to having more assets in service. Depreciation and amortization
      for the nine months ended September 30, 2007 were approximately 18% of sales
      as
      compared with 9% during the comparative prior year period.





*Loss
      from Operations -* Loss
      from
      operations for the nine months ended September 30, 2007, increased to
      approximately $8.4 million as compared with $3.9 million for the nine
      months ended September 30, 2006. The increase in loss from operations over
      the
      comparative prior year period is the result of the increase in gross profit
      of
      $2.4 million being offset by the $5.5 million increase in operating expenses,
      and increase in depreciation and amortization of $1.4 million





*Interest
      Expense, Net -* Interest
      expense, net for the nine months ended September 30, 2007, decreased to $460,000
      as compared with $714,000 for the nine months ended September 30, 2006. The
      decrease was primarily due to the increase in debt from July 2006 through March
      2007, prior to $5.3 million of debt being converted into equity in March 2007.





*Net
      Loss -* Net
      loss
      for the nine months ended September 30, 2007 increased to approximately $8.9
      million as compared with $4.6 million for the nine months ended September
      30, 2006.





**Liquidity
      and Capital Resources**





As
      planned, we have funded operations through financing activities consisting
      primarily of private placements of debt and equity securities. Our management
      intends to raise additional debt and equity financing to fund future expansion
      and capital expenditures, operations and to provide additional working capital,
      and in this regard, during 2006, we raised approximately $8.1 million pursuant
      to sales of debt and equity securities in connection with our 2006 private
      placement and subordinated debt offerings. Further, during the three months
      ended March 31, 2007, proceeds of approximately $6.9 million were received
      from
      the sale of equity securities in connection with the merger and private
      placement, and approximately $5.3 million of notes payable were converted into
      shares of common stock.  Additionally, during the three months ended June
      30, 2007, proceeds of approximately $6.7 million were received from the sales
      of
      debt and equity securities. In October 2007, we closed a private placement
      offering and issued approximately 3.2 million shares of common stock and
      warrants to purchase approximately 1.5 million shares of common stock. The
      aggregate gross proceeds raised by us was approximately $5.7 million. We intend
      to continue to be engaged in additional fund-raising activities to fund future
      capital expenditures, potential acquisitions of businesses, and provide
      additional working capital.





Net
      cash
      used by operating activities was approximately $ 7.3 million in the nine
      months ended September 30, 2007 and $3.6 million in the nine months ended
      September 30, 2006. The increase in cash used by operating activities was due
      primarily to the increase in net loss as adjusted for depreciation and
      amortization expense.





Net
      cash
      used in investing activities was approximately $4.4 million and $314,000 for
      the nine months ended September 30, 2007 and 2006, respectively. Uses of
      cash flow for investing activities in 2007 primarily relate to capital
      expenditures associated with business expansion for the acquisition of store
      and
      kitchen fixtures, equipment and leasehold improvements.




19




Net
      cash
      provided by financing activities was approximately $11.7 million and $4.4
      million for the nine months ended September 30, 2007 and 2006,
      respectively. The increase of net cash provided in 2007 was due to an increase
      in proceeds, net of issuance costs, from the issuance of common stock in March
      and June, 2007 private placements.





In
      October 2007, we entered into a securities purchase agreement with select
      accredited investors related to the sale of common stock and warrants to
      purchase shares of common stock at an exercise price of $1.75 for one share
      and
      .45 warrants. We closed the private placement in October 2007, and issued an
      aggregate of 3,264,426 shares of common stock and warrants to purchase an
      aggregate of 1,468,990 shares of common stock at an exercise price of $2.50
      per
      share with a five year term. The aggregate gross proceeds raised by the us
      was
      approximately $5.7 million, before placement fees of $140,000. In connection
      with the private placement, we entered into a registration rights agreement
      with
      the investors, requiring the Company to file with the Securities and Exchange
      Commission an initial registration statement covering the resale of common
      stock
      and the common stock issuable upon exercise of the warrants within 30 days
      following the closing of the private placement. In addition, we are required
      to
      cause the registration statement to be declared effective by the Securities
      and
      Exchange Commission 90 to 180 days following the close of the private placement,
      depending on certain conditions. If we do not file the registration statement
      by
      the required filing date or the Securities and Exchange Commission does not
      declare the registration statement effective by the required effective date,
      then we will be required to pay liquidated damages to each investor equal to
      1%
      of the aggregate investment amount paid by each such investor on the Event
      Date
      and on each monthly anniversary of the Event Date until such filing or effective
      date has occurred, with the maximum liquidated damages payable by the Company
      capped at 10% of the aggregate investment amount paid by each such
      investor.





On
      October 18, 2007, pursuant to terms an asset purchase agreement, we acquired
      for
      $2.4 million cash, shares of common stock having a fair value of $250,000 based
      on the closing price as of the date of the agreement, $150,000 due 90 days
      from
      the closing date and another $150,000 due 120 days after the close, and upon
      the
      occurrence of certain events, additional shares of common stock having a fair
      value of $50,000 based on the closing price as of the date of the agreement,
      all
      inventory, furniture, fixtures, equipment, customer lists, leasehold
      improvements, and owned vehicles used in connection with a catering and retail
      business operating three stores in San Diego, California. No liabilities were
      assumed by us. We also assumed the leases for the three locations.





We
      lease
      our cafes, central kitchens and office facilities under non-cancelable operating
      leases, some with renewal options. Rents are fixed base amounts, some with
      escalating rents and some with contingent rentals based on sales. We also lease
      certain point-of-sale computer hardware and software pursuant to capital leases.
      Subsequent to December 31, 2006, we have entered into new leases, for two
      locations in Seattle, which provide for minimum future lease payments over
      five
      year terms of approximately $811,000, three store leases in Los Angeles, which
      provide for minimum future lease payments over their five to six year terms
      of
      approximately $908,000, and five store leases in San Diego, which provide for
      minimum future lease payments over their four to five year terms of
      approximately $1.8 million. In addition, we have also entered into three leases
      for delivery vehicles pursuant to capital leases, which provide for additional
      minimum future lease payments over their four and five year terms of
      approximately $572,000.





**Item
      3. Controls and Procedures**





(a) Evaluation
      of Disclosure Controls and Procedures .





Our
      management, with the participation of our Chief Executive Officer and Chief
      Financial Officer, evaluated the effectiveness of our disclosure controls and
      procedures (as defined in the rules and regulations of the Securities and
      Exchange Commission under the Securities Exchange Act of 1934, as amended)
      as of
      the end of the period covered by this report (the “Evaluation Date”). Based on
      this evaluation, our Chief Executive Officer and Chief Financial Officer have
      concluded that our disclosure controls and procedures were effective as of
      the
      Evaluation Date.





(b) Changes
      in Internal Control Over Financial Reporting .





During
      the fiscal quarter ended September 30, 2007, there were no changes to our
      internal controls over financial reporting that have materially affected, or
      are
      reasonably likely to materially affect, our internal controls over financial
      reporting.




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**PART
      II. OTHER INFORMATION**





**Item
      6. Exhibits**





(a) Exhibits .





31.1
      Certification of Chief Executive Officer pursuant to Section 302 of the
      Sarbanes-Oxley Act of 2002


31.2
      Certification of Chief Financial Officer pursuant to Section 302 of the
      Sarbanes-Oxley Act of 2002


32.1
      Certification of Chief Executive Officer and Chief Financial Officer under
      Section 906 of the Sarbanes-Oxley Act of 2002





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**SIGNATURES**




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




ORGANIC
                TO GO FOOD CORPORATIONDated: November 13, 2007
            By:
            /s/ Jason BrownJason
                Brown, Chairman and Chief Executive Officer(Principal
                Executive Officer)




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