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Quarterly Report



You should read the following discussion together with "Selected Historical Financial Data" and our consolidated financial statements and the related notes included elsewhere in this Quarterly Report. This discussion contains forward-looking statements, which involve risks and uncertainties. Our actual results may differ materially from those we currently anticipate as a result of many factors.

Some of the information in this section contains forward-looking statements that involve substantial risks and uncertainties. You can identify these statements by forward-looking words such as "may," "will," "expect," "anticipate," "believe," "estimate" and "continue," or similar words. You should read statements that contain these words carefully because they:

discuss our future expectations of which there is significant uncertainty; ;;

contain projections of our future results of operations or of our financial condition; and

state other "forward-looking" information.

Unless stated otherwise, the words "we," "us," "our," "the Company" or "Fresh Harvest Products, Inc." in this Quarterly Report collectively refers to the Company.

Plan of Operations

We began realizing revenues from operations during the quarter ending July 31, 2006, and, as of November 1, 2007 we are no longer a development stage company.

We were formed in New Jersey as a blank check company on April 21, 2005 with no operations, assets or purpose other than the purpose of seeking a privately held operating company as an acquisition or merger candidate. On December 16, 2005, we acquired Fresh Harvest Products, Inc., a New York corporation, a development stage company in the organic food business, and assumed its operations as our new business. As a result of the acquisition, we were no longer a blank check company, and the controlling shareholders of the acquired company became the controlling shareholders of our company. The acquisition was considered a reverse acquisition for accounting and financial reporting purposes.

Since the acquisition, our business plan has been to develop proprietary products to sell, market and distribute. Some of our products include: organic snack and coffee bars that have no refined sugar, are cholesterol free, trans fat free, low in sodium and gluten free and organic coffee from South America and Africa. Our goal is to bring healthy, great tasting organic food products at affordable prices to the mass markets. We are now selling the product line to select supermarkets chains in the eastern part of the United States.

Our primary efforts have been devoted to selling our line of organic food and beverage products and raising capital. Accordingly, we have limited capital resources and have experienced net losses and negative cash flows from operations since inception and expect these conditions to continue for the foreseeable future.

As of January 31, 2010, the Company had current assets of 64,758 that includes 1,474 cash, net accounts receivable of 25,823 and inventory of 37,461.
Management believes that the liquid cash

and other liquid assets on hand as of January 31, 2010 are not sufficient to fund operations for the next 12 months. Accordingly, we will be required to raise additional funds to meet our short and long-term planned goals. There can be no assurance that such funds, if available at all, can be obtained on terms reasonable to us. In this regard, we have obtained and will continue to attempt to obtain (short and long term) loans for inventory purchases, new product development, expansion, advertising and marketing. We cannot assure you that we will be successful in obtaining the aforementioned financings (either debt or equity) on terms acceptable to us, or otherwise.

Three months ended January 31, 2010 compared to January 31, 2009

For the three months ended January 31, 2010, we recorded revenues of 17,889 compared to 40,637 in the same period of 2009. The decrease in revenues is attributed to no new marketing initiatives and programs.

Gross profit, defined as revenues less cost of goods sold, was 9,202 for the quarter ended January 31, 2010, compared to 9,090 for the quarter ended January 31, 2009. The difference is attributed to the fact that there was a decrease in revenues of products though distributors and there was a decrease in the cost of goods sold, The gross profit in 2009 contained some products with a lower gross profit, which decreased our overall gross profit, which although there was greater revenue considerably decreased our gross profit.

We incurred operating expenses in the amount of 151,219 for the three months ended January 31, 2010, and 135,959 for the three months ended January 31, 2009. This increase in operating expenses is attributed to the Company's increase in non-cash activity, such as share issuances for services rendered.

Our net loss was 170,819 for the three months ended January 31, 2010 which was an increase from 153,584 for the quarter ended January 31, 2009. The increase was primarily a result of a decrease in revenues, a decrease in operating expenses, but an increase in expense related to the issuance of shares for services rendered.

Liquidity and Capital Resources; Going Concern

Since inception, we have not been able to finance our business from cash flows from operations and have been reliant upon loans and proceeds from the sale of equity which may not be available to us in the future, or if available, on reasonable terms. Accordingly, if we are unable to obtain funding from loans and the sale of our equity, it is unlikely that we will be able to continue as a going concern.

At January 31, 2010, we had current assets of 64,758 including 1,474 cash, inventory of 37,461 and accounts receivable of 25,823. We had net fixed assets with a net book value of $32,757.

As of January 31, 2010, we had notes payable in the total principal amount of 381,936, all but 45,000 of which are overdue. While management believes that the note holders will not seek to declare the notes in default, there is no assurance of this. All but $19,636 of the note principal due is convertible into shares of our common stock. However, due to the current per share trading price of our common, we cannot be certain if any portion of the loan principal will be converted by the convertible note holders. To the extent that debt is converted into shares of common stock, if any, Current shareholders equity positions will be diluted without any new capital being invested into the Company.

Off Balance Sheet Arrangements

We do not have any off balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, revenues, results of operations, liquidity or capital expenditures.

Critical Accounting Policies

Our financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of financial statements in accordance with generally accepted accounting principles requires our management to make estimates and assumptions that affect the reported amounts of assets and liabilities, including the recoverability of tangible and intangible assets, disclosure of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of expenses during the periods covered.

We evaluate our estimates on an on-going basis. The most significant estimates relate to intangible assets, deferred financing and issuance costs, and the fair value of financial instruments. We base our estimates on historical company and industry experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which, form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Our actual results may differ materially from those estimates.

See Note 2 to the interim unaudited consolidated financial statements for a listing of our critical accounting policies.


As of January 31, 2010, we do not believe that inflation had a significant impact on our results of operations for the periods presented.