getg_10k.htm

GREEN EARTH TECHNOLOGIES, INC.

Form 10-K Annual Report

TABLE OF CONTENTS

		Page

PART I

Item 1.	Business	4

Item 1A.	Risk Factors	13

Item 1B.	Unresolved Staff Comments	19

Item 2.	Properties	19

Item 3.	Legal Proceedings	19

Item 4.	Mine Safety Disclosure	19

PART II

Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	20

Item 6.	Selected Financial Data	21

Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22

Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	28

Item 8.	Financial Statements and Supplementary Data	28

Item 9.	Changes in and disagreements with Accountants on Accounting and Financial Disclosure	28

Item 9A.	Controls and Procedures	28

Item 9B.	Other Information	29

PART III

Item 10.	Directors, Executive Officers and Corporate Governance	30

Item 11.	Executive Compensation	30

Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	30

Item 13.	Certain Relationships and Related Transactions, and Director Independence	30

Item 14.	Principal Accounting Fees and Services	30

PART IV

Item 15.	Exhibits and Financial Statement Schedules	31

	Signatures	33

FORWARD LOOKING STATEMENTS

The discussions set forth in this Annual Report for the year ended June 30, 2015 on Form 10-K (this “Annual Report”) contain statements concerning potential future events. These forward-looking statements are based upon assumptions by management as of the date of this Annual Report, including assumptions about the risks and uncertainties we face. In addition, we may make forward-looking statements orally or in writing, including, but not limited to, in press releases, in our annual report to shareholders and in our other filings with the U.S. Securities and Exchange Commission (the “SEC”). Readers can identify these forward-looking statements by the use of such words as “may,” “will,” “could,” “would,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimate,” “predict,” “project,” “potential,” “continue,” “ongoing” or similar words or conjugations of such words. If any of our assumptions prove incorrect or should unanticipated circumstances arise, our actual results could materially differ from those contemplated by such forward-looking statements. The differences could be caused by a number of factors or combination of factors including, but not limited to, the risk factors identified and described in Part I, Item 1A, of this Annual Report, as well as our other periodic reports on Forms 10-Q and 8-K that we file with the SEC from time to time. Investors are strongly encouraged to consider those factors when evaluating any forward-looking statements about our business operation or financial condition. We will not update any forward-looking statements in this Annual Report to reflect future events or developments. Investors should also be aware that while we, from time to time, do communicate with securities analysts, it is against our policy to disclose to them any material non-public information or other confidential commercial information. Investors should not assume that we agree with any report issued by any analyst or with any statements, projections, forecasts or opinions contained in any analyst report.

Forward-looking statements in this Annual Report include statements relating to our operating results, the development of new products, the timing of the launch of new products and the timing of any revenue to be generated from any of our products as well as statements regarding our plans for acquisitions. Whether or not our expectations regarding forward-looking statements are ultimately realized depends on numerous factors, including our ability to increase revenues, control costs, complete the development of new products in a timely manner and on budget, our ability to successfully market our products, general economic conditions and our ability to successfully identify acquisition candidates and our ability to successfully complete those acquisitions and integrate the newly acquired business into our existing operating and business platform

Unless otherwise indicated, all references to the “Company,” “we,” “us,” “our,” and “Green Earth” include reference to our subsidiary, Get Well! Inc.

PART I

ITEM 1. BUSINESS.

OVERVIEW

We create, develop, market, sell and distribute an array of G-branded, environmentally-friendly, bio-based well service, automotive, marine and residential enhancement, performance and cleaning products. Our products, including our G-CLEAN® Well Wake-UP!™, G-OIL® and G-CLEAN® brands, are used primarily in the oil and gas well service industry, automotive aftermarket and the outdoor power equipment.

Our technology platform for manufacturing innovative proprietary and patented high performing “green” products is the end result of company created or licensed intellectual property. These technologies replace traditional petroleum/hydrocarbon and chemical/solvents derived bases typically associated with conventional non-green products without compromising performance or value while delivering a more environmentally safer choice. We believe our products deliver comparable or superior performance at competitive prices, thus giving our customers and industries alike the ability to ‘do their part’ in protecting the environment without paying more.

In fiscal 2015 we shifted our strategy to focus on a full range of products specifically engineered to help overcome the oil and gas industry’s challenges of working in the world’s oil fields. As part of this strategy, we will focus on acquiring and/or developing new and patent-pending technologies and then leveraging our bio-based solutions into the growing markets for oil field services. We believe the new strategy will result in higher revenues and profit margins. Increased energy demands have expanded the obstacles faced by this industry as they try to preserve and do ‘no harm’ to the delicate eco-system when drilling wells. Both patented and patent-pending products have been tested by Petróleos de Venezuela, S.A (PDVSA), the Venezuelan national oil company, and E&B Green Solutions, L.P., a well services company based in Bakersfield, California, owned by Francesco Galesi, one of our largest stockholders. Our oil field products are a natural fit as they will clean, optimize and restore safety to this industry and our environment. We are actively pursuing opportunities and relationships domestically and worldwide with oil field services providers, oil and gas exploration and production companies and distributors.

In November 2014, we received a 60-days’ Notice of Termination from Techtronic Industries Co., Ltd (“TTI”) effectively terminating the Exclusive Distribution Agreement dated November 1, 2009. Under the Agreement, TTI had the exclusive right to distribute our non-automotive products through certain retail channels of distribution (including The Home Depot). We will continue to sell a number of our lubricant and cleaning products through master distribution agreements with wholesalers and contractual arrangements with independent sales and marketing professionals.

Since inception in 2007, our goal has been to provide a superior green product at prices comparable to traditional products within the same category designation and to validate the proposition that by eliminating price and performance discrepancies, consumers and industries will usually go green. In oil and gas fields our products allow drillers, well operators, service providers and other potential customers to meet their production, maintenance and spill remediation challenges with green solutions that enhance production, eliminate unnecessary costs and keep their people and the environment safer. We trademarked the phrase “SAVE THE EARTH – SACRIFICE NOTHING®”, meaning that consumers and customers alike should not have to give up value or performance when choosing to go “green”.

INDUSTRY BACKGROUND

The industry in which we compete is highly competitive. Our products are part of the oil and gas well service market, automotive aftermarket and outdoor power equipment markets, which includes oil and gas rigs and storage tanks, rail cars, automobiles, lawn mowers, power washers, chain saws, leaf blowers and hedge trimmers.

Well Services Market

According to the Freedonia Group, despite the recent decline in oil prices, the global demand for oilfield chemicals is expected to reach $27.5 billion in 2018 as the increasing demand for energy stimulates new development, especially in unconventional and offshore fields. Nearly all types of chemicals will post healthy advances, but the best opportunities will continue to be in drilling fluids and stimulation chemicals. Worldwide demand for oil and gas well stimulation chemicals is projected to increase 12% per year to $23 billion by the end of 2017, buoyed by renewed efforts to reduce dependence on foreign energy sources. Well stimulation is necessary in order to maximize the output from aging US oil and gas fields; and, to optimize production in unconventional settings such as tight gas, shale and coal bed methane.

Well stimulation products are fluid-based stimulation services which are designed to improve the flow of oil from producing zones. These products enhance the flow rate of oil from wells with reduced flow caused by paraffin, asphaltenes and other materials. Well stimulation entails pumping large volumes of specially formulated liquids into a well bore to dissolve barriers thereby eliminating obstacles to the flow of oil. Sump remediation products deal with the removal of pollution or contaminants from soil, groundwater, sediment, or surface water for the general protection of the environment.

Oil refinery products, storage tank cleaners, rig and equipment cleaners and surface washing agents are products that clean and remove oil once it has solidified on surfaces. Our products are used at refineries, storage tanks, trucks, rail cars and oil field rigs. Surface washing agents are primarily used on solid surfaces and objects though if they are non-toxic, they can be used in the water, on plants and/or animals (including humans.) Most surface washing agents are required to be approved by the Environmental Protection Agency (“EPA”).

Automotive Aftermarket

The automotive aftermarket refers to the maintenance, repair, parts, accessories, chemicals and fluids for vehicles after their original sale. According to the Automotive Aftermarket Industry Association Digital Fact Book the size of the U.S. automotive aftermarket products market was roughly $322 billion in 2014. Retail sales of motor oil are primarily made through do-it-yourself (“DIY”) and do-it-for-me (“DIFM”) outlets. DIY refers to when consumers perform the maintenance and repair work needed on their vehicles. DIFM refers to when consumers use professionals to perform the maintenance and repair work needed on their vehicles.

Outdoor Power Equipment Market

The size of the United States market for outdoor power equipment products is expected to grow 4.0 percent per annum through 2017, reaching $10.6 billion according to the Outdoor Power Equipment Institute. In 2012, annual U.S. shipments of power washers were about 1,500,000 units. Most power washers are typically designed to require concentrated cleaners and 4-cycle engine oils. The “hand-held” gas powered units require 2-cycle engine oil and chain saws also require bar and chain oil.

Market Drivers

We believe the strongest market drivers are worldwide government impacts through legislation as well as the increasing environmental concerns of the public. These include:

●	Government regulation in applicable United States areas:

»	Occupational Safety and Health Administration (“OSHA”) regulations require non-hazardous materials in the workplace where there is direct human contact;

»	Food and Drug Administration (“FDA”) regulations requires non-hazardous products used in food productions;

»	Environmental Protection Agency (“EPA”) limits and fines oil spills and disposals; and

»	United States Department of Agriculture (“USDA’) BioPreferred® Program;

●	Increasing environmental concerns by the public;

●	Government procurement;

●	Research and development for new products and to improve the technical performance of existing products;

●	Improved performance and lifespan of products due to higher lubricity;

●	Government subsidies for base product providers and end-users; and

●	Advertising and other campaigns designed to increase public awareness of “green” products and to correct any misconceptions about the efficacy and benefits of such products.

OUR PRODUCTS

Our product categories include well stimulation products and surface washing agents, performance products, principally lubricants that substitute for petroleum-based motor and engine oils, automotive cleaning products and outdoor cleaning solutions.

All of our products are designed to be environmentally-friendly and most of them meet the “Ultimate Biodegradable” ranking of ASTM International, formerly known as the American Society for Testing and Materials (“ASTM”). “Ultimate Biodegradable” is ASTM’s highest ranking for biodegradability, meaning the product degrades in 28 days to the required levels.

For the fiscal year ended June 30, 2015, 72% of our revenues were generated by our performance products and 28% of our revenues were generated by our cleaning products.

Well Services Products

Our well services products are engineered to help overcome some of the practical challenges that arise in operating and maintaining oil wells. Our line of oil field products will clean equipment, oil field rigs and site areas and optimize and restore production while trying to preserve and “do no harm” to the delicate ecosystem in which our customers drill wells. Most of our products remove the need for transportation of waste fluids and reduce the volatile organic compounds (“VOC’s”) present in the well environment. Our well services products are sold under the G-CLEAN® and G-CLEAN® Well Wake-UP!™ brands and include storage tank, oil field rig and equipment cleaners, well stimulation, sump remediation and surface washing agents. The proprietary base of our well servicing products is listed on the EPA's National Contingency Plan (“NCP”) for oil spill clean-ups. These products are available in a number of formulations:

●

Refinery, storage tank, oil field rig and equipment cleaners removes the oil and grease from tank walls, machinery and equipment by cutting through and dissolving grease and oil deposits down to the surface of the machinery being cleaned. Our cleaners not only remove the oil and grease but it also encapsulates the harmful VOC’s associated with cleaning.

●

Well stimulation products are designed to improve the flow of oil from producing zones. Our Well Wake Up! TM well stimulation product attacks the buildup of paraffin and asphaltenes that can restrict well bore and reduce production. Used as part of a comprehensive service plan, Well Wake-UP! eliminates bore restriction and plugged screens.

●

Sump remediation utilizes a surfactant enhanced aquifer process which involves the injection of our specialty surfactants to enhance desorption and recovery of bound up otherwise recalcitrant non-aqueous phase liquid. Our product provides a cost effective and permanent solution to sites that have been previously unsuccessful utilizing other remedial approaches. This technology is also successful when utilized as the initial step in a multi-faceted remedial approach utilizing bioremediation enhancement.

●

Surface washing agents are a blend of water-based and ultimate biodegradable ingredients specifically formulated to emulsify and encapsulate fuel and oil by penetrating and breaking down long chain hydrocarbons bonds rendering them water soluble. Our surface washing agent has satisfied the regulatory requirements of the NCP, allowing it to be listed on the NCP product schedule under the surface washing agent category, meaning it can be used by “Federal on-scene coordinators” in accordance with such regulations and is posted on the EPA's website (www.epa.gov/emergencies/content/ncp/index.htm) in the Product Schedule and Technical Notebook.

Performance Products

G-OIL® “green” motor oils are proprietary blends of American sourced ultimate biodegradable non-toxic, renewable and/or less-toxic reusable “environmentally preferred” base stocks that meet and exceed the highest performance criteria. Available in a number of formulations, our performance products include motor oils, engine oils, fuel stabilizers and other lubricants that are sold under the G-OIL® brand:

●

Ultimate Biodegradable Bio-Based Advanced Full Synthetic “Green” Motor Oil is the world’s first and only API Service SM and USDA BioPrefered® certified motor oil for all gasoline engines requiring conventional or full synthetic motor oil, keeping pollutants out of the environment while reducing carbon emissions and our dependence on foreign oil.

●	Ultimate Biodegradable Bio Semi-Synthetic “Green” Motor Oil is for all gasoline engines and is also available as a conventional and re-refined motor oil. Our conventional formula replaces Group II base stock with green re-refined base stocks and our proprietary biodegradable additive.

●

Ultimate Biodegradable 2-Cycle Bio-Synthetic “Green” Engine Oil is a “no smoke – no smell superior performing engine oil that works with all brands and ratios, meeting and exceeding API service category TC and USDA BioPreferred® for all 2-cycle air cooled outdoor engines and Ultimate Biodegradable, the highest biodegradability ranking as determined by ASTM Standards (2.1 ASTM D-5864).

●

Ultimate Biodegradable 4-Cycle Bio-Synthetic “Green” Engine Oil exceeds API Service SM for use with all 4 cycle small engines, providing outstanding lubricant properties to ensure long lasting performance. USDA BioPreferred® certified, this product is the green solution for lawn and garden equipment, small tractors, log splitters, compressors, steam cleaners, pressure washers, pumps and generators requiring SAE 30 and SAE 10W-30 engine oils.

●	Ultimate Biodegradable Bar & Chain Bio-Based “Green” Oil is specifically designed to increase the life and efficiency of chainsaws with excellent lubricity, temperature stability and tackiness to minimize sling loss.

Outdoor Power Equipment and Cleaning Chemicals

We sell G-CLEAN® electric and gasoline powered pressure washing equipment and cleaning chemicals. Our pressure washers typically include pack-in of our concentrated cleaners and 4-cycle engine oils.

●	Pressure Washer Equipment is designed as a portable electric washer sold with a built-in G-CLEAN high pressure detergent injector. They are compacted designed to spray for long or short range applications.

●	All Purpose Cleaner is a multipurpose-multi surface cleaner designed to easily lift away dirt and debris as well as keeping surfaces cleaner longer by creating an invisible anti-static residue that reduces future dust and dirt buildup.

●	Concrete Cleaner & Degreaser, Siding & All Purpose Cleaner and Mold & Mildew Stain Remover are “heavy duty” cleaning solutions designed to be used in power washers. They are available in concentrated tubes, dissolvable packages and collapsible bags.

●	Foam Blaster and Oxy Foam Blaster is a highly concentrated “foam" all purpose cleaner which gets applied at high pressure and is designed to leave long lasting thick foam that sticks, extending the dwell time for better cleaning.

●	Grill & Surface Cleaner is designed to lift and remove baked on grease, dirt and food particles on outdoor grills and cooking surfaces while leaving a lasting shine that shields the surface for future cooking and easier cleaning the next time.

Automotive Appearance Products

G-CLEAN® automotive appearance cleaning chemicals includes car washes, glass cleaners, tire care solutions and all-purpose detergents currently available in a number of formulations:

●

Car Wash is a heavy duty hydrophobic (water repelling) solution that is designed to cause water to “bead up” and “roll off,” leaving no spots. Car Wash is not a detergent, soap or petroleum solvent, but a blend of natural plant based products (including soy, corn, grain and potatoes) that are designed to be safe for vegetation and groundwater.

●	Wheel Cleaner and Brake Dust Shield is a two-step wheel cleaner and brake dust repellent solution. Step one (Wheel Cleaner) is designed to remove tough dirt buildup, while step two (Brake Dust Shield) is designed to leave a shine and protective coating that repels brake dust.

●	Ultimate Tire Shine is designed to remove dirt and road grime while shining tires and protecting their surface.

●	Glass Cleaner is designed to be an easy-to-use, no streak organic formula that clings to glass and penetrates its surfaces, dissolving and removing dirt and forming an invisible anti-static residue that reduces dust and dirt build-up.

●	Interior Protectant is a cleaning solution designed to shield and shine interior surfaces while protecting automobiles dashboard and other rubber surfaces against UVA and UVB sun rays.

●	Rain Repellent & Anti-Fog are hydrophobic glass treatments. The products are designed to disperse nano-sized particles that penetrate glass surfaces to form a bond that repels rain, ice and snow on the outside and smoke, fog and other types of moisture on the inside for up to several months.

GROWTH STRATEGY

We believe that our aggressive sales and marketing effort together with our efficient distribution infrastructure will enable us to successfully and quickly place our proprietary products with oil and gas field services industry, commercial and government customers. In fiscal 2015 we shifted our strategy to focus on a full range of products specifically engineered to help overcome the oil and gas industry’s challenges of working in the world’s oil fields. As part of this strategy, we will focus on acquiring and/or developing new and patent-pending technologies and then leveraging our bio-based solutions into the growing markets for oil field services. We believe the new strategy will result in higher revenues and profit margins.

Develop New Products and Enhance Profitability of Our Existing Products

In an effort to continually satisfy unmet customer demands and needs, we are developing new products and working closely with our suppliers and strategic partners to develop high performance green products. We work with Inventek Colloidal Cleaners, LLC (“Inventek”) chemical engineers devoted to creating new products utilizing existing proven and accepted ingredients. We believe these new formulations will better address the marketplace needs and mandates/requirements (oil and gas fields, commercial, government and military) in order to enhance our products profit margins.

In fiscal 2015 we were issued a patent for our G-CLEAN® Well Wake-UP!™ oil well remediation and stimulation suite of products and method of use. We believe this suite of products is a first for the oil and gas industry. The patent includes a biodegradable non-reactive oil well stimulation and method of use based on a nano-scale colloidal chemistry.

We will continue to evaluate other opportunities to improve gross margins on our existing product line. We intend to further increase profitability of our product base through various measures which may include changing product formulations, reducing components cost by increasing volume and reducing expenses by improving operations.

Expand Our Customer Relationships

Due to the specialized nature associated with the development and production of many of our environmentally-friendly, bio-based products, our customers are incentivized to continue their relationships with us. This is due, in part, to the fact that we work closely with our customers from product design to delivery. We believe that our largest competitors are unable to deliver this kind of customer-focused attention. We intend to continue to work closely with our existing customers in their efforts to expand their product offerings, as well as marketing specialty product formulations to new customers even as we grow. By striving to maintain our long-term relationships with our existing customers and by adding new customers, we seek to limit our dependence on any one portion of our customer base.

Strategic Relationships

The following are the relationships that we deem to be “strategic” and material to our business.

In May 2014, we entered into an Intellectual Property Exclusive License and Distribution Agreement (the “2014 Inventek Agreement”) with Inventek and Dr. Paul N. Andrecola (“Dr. Andrecola”) to support our well service initiatives. Included in this agreement is an exclusive distribution and fully paid-up worldwide license to Inventek products and formulations related to applications in the oil and gas industry; including oil well stimulation and remediation products, grease, paraffin and asphaltenes degreasers and solvents, casing cutters, drilling lubricants and detergents, defoamers and surfactants, storage, mud and fractionation tank cleaners, oil and fuel spill surface washing agents and dispersants, oil field rig, refinery and equipment cleaners, heavy duty vehicle washing agents, hydraulic fracturing fluids and water treatments. The initial term of the exclusive license expires May 20, 2039 (25 years) and also contains five automatic ten year renewal periods.

In addition under an agreement dated January 2009, with Inventek (the “2009 Inventek Agreement”), we acquired the exclusive right in the United States and Canada and the non-exclusive right world-wide, outside the United States and Canada, to sell, market and distribute in retail channels of distribution any cleaning products manufactured by Inventek. In addition with respect to Inventek products we have the non-exclusive right world-wide to include all or selected portions of any certifications, products claims or descriptions, test results, safety or use instruction, or warnings, in labeling, packaging, documentation or any marketing materials or any other materials or media used in connection with the sale or distribution of Inventek products.

In exchange for these rights, we agreed to market and distribute the Inventek products under our line of “G” branded products and to refrain from distributing, promoting, marketing or selling any products that compete with Inventek products. There are no minimum purchase requirements under our agreements with Inventek. Our agreements also provides that we and Inventek will work together to establish testing procedures and reporting to ensure quality and consistency in our product batches. The 2009 Inventek Agreement has a ten-year term after which it continues indefinitely until either party gives the other 90-days prior written notice of its intent to terminate the agreement. We are currently in year six of the initial ten-year term.

In August 2014 we entered into a Strategic Relationship Agreement with Greentek Fluid Innovations, LLC (“GFI”). Under this agreement, we purchased all of the intellectual property owned by GFI and developed in collaboration with Inventek and/or Dr. Andrecola and appointed GFI as a master distributor with respect to our products and services related to and in support of efforts in which GFI has oil and gas expertise. The existing GFI distribution agreements will be amended to conform to the terms of the agreement as the GFI products related to their intellectual property will be re-branded G-CLEAN® or to reflect other company owned brands that are sold by us. The GFI agreement terminates June 30, 2019.

In December 2011 we entered into a ten-year limited exclusivity distribution agreement with E&B Green Solutions, L.P. (‘E&B”), an entity owned and controlled by Francesco Galesi (“Galesi”), one of our largest stockholders. E&B is a national independent oil and gas producer with subsidiaries in the oil and gas well service business and will be the primary distributor of our entire suite of G-CLEAN® Well Wake-UP!™ products specifically engineered for oil and gas fields. Our cleaning products for the oil and gas well service industry include Well Wake Up!, Sump Remediation, Casing Cutter, Frac and Storage Tank Cleaner & Water Treatment and Rig & Equipment Cleaner. The proprietary base of our well servicing products is listed on the EPA's NCP for oil spill clean-ups. We are currently renegotiating this agreement.

SALES AND MARKETING

The cornerstone of our marketing platform is “performance”, surrounded by environmental benefits as a result of producing and usage of our “green” products as well as the benefits of being domestically grown, sourced and manufactured (GROWN & MADE IN THE USA). This approached is designed to help us overcome some of the challenges, or less than desirable past experiences, of our end users with other green claiming products with the ultimate goal that our products are not only the green choice, but the logical choice as our performance meets or surpasses the performance of conventional non-green products.

With our focused shift towards the well service category of the oil and gas industry, we are entertaining a second tier distribution sales approach, favoring in-house sales expertise to work exclusively with well service providers as well as the distributors who supply chemical solutions to these providers; and, the end users requesting the services that also demand these chemical solutions. Bringing ‘our solution’ to market as part of the service provider’s total solution package will enable us to be embraced by them, not compete with them with the assurance of helping us reach our goals of getting our products and solutions into the hands of the end users. Our well service focused sales team. We will require a certain skill set and category expertise to properly explain the features and benefits of our products when pointing out the advantages of our products versus the competition as well as possessing the ability to demonstrate ‘on-site’ at the point of usage. This will be a critical component in achieving sales within this highly competitive and vertically integrated category.

We compete in a number of large industries populated by some enormous well-funded companies that have exceptional category expertise and well established products and brands. Our go-to-market or sales approach relies on relationships, legislative support, the understanding of government logistics and target audiences’ needs in order to satisfy them, the ability to gain confidence and credibility when seeking trial and third party endorsements and ultimately, getting our products into the hands of customers everywhere while enticing them to purchase. Our sales infrastructure includes master distribution agreements with wholesalers and arrangements with third party sales professionals. We are actively pursuing relationships with other distributors and wholesalers.

CUSTOMERS

A significant portion of our sales is derived from a limited number of customers. For the fiscal year ended June 30, 2015 and 2014, approximately 48% and 62%, respectively, of our sales were made to TTI, which is a principal supplier to The Home Depot. We are no longer targeting customers at leading national and regional retailers, primarily due to the lack of profits from these customers. We are primarily pursuing customers in the United States, South America and internationally in the oil and gas industry, industrial, municipality and military markets.

COMPETITION

Our well services competition includes small and mid-size independent contractors as well as major oilfield services companies with international operations. We compete with significant chemical companies and a number of smaller independent competitors for our well services products. We believe that the principal competitive factors in the market areas that we serve are price, product and technical proficiency. The market for specialized service chemical programs for well services and water and land clean-up is highly competitive.

Motor oil marketers continue to look to higher-priced specialized and high-performance formulations to lessen the price-driven, commodity nature of the business. Synthetic motor oils and synthetic blends remain the most promising development. They have strong appeal to marketers and retailers alike because of the much higher prices they command. Marketers are thus devoting much of their marketing and new product development efforts to synthetic and blended oils. We believe that the next opportunity in marketing motor oil is the environmentally-friendly, non-petroleum based and fully biodegradable “green” oil or “bio-synthetic”. We are not aware of any major provider of biodegradable lubricants.

INTELLECTUAL PROPERTY

We own certain intellectual property, including trade secrets, which we seek to protect, in part, through confidentiality agreements with employees and other parties. We regard our proprietary technology, trade secrets, trademarks, licenses and similar intellectual property as critical to our success, and we rely on a combination of trade secrets, contract, patent, copyright and trademark law to establish and protect our rights in and our products and technology. These include the following:

●	Exclusive license to market, distribute and sell Inventek products, which make up the bulk of our oil and gas field services, surface washing agents and cleaning products.

●	Our own formulations for motor oil, 2-cycle oil, 4-cycle oil and bar and chain lubricants.

As part of the 2014 Inventek Agreement we have an exclusive distribution and worldwide license to Inventek products and formulations related to applications in the oil and gas industry; including oil well stimulation and remediation products, grease, paraffin and asphaltenes degreasers and solvents, casing cutters, drilling lubricants and detergents, defoamers and surfactants, storage, mud and fractionation tank cleaners, oil and fuel spill surface washing agents and dispersants, oil field rig and equipment cleaners, heavy duty vehicle washing agents, hydraulic fracturing fluids and water treatments.

In August 2014, the Company enter into a Strategic Relationship Agreement with Greentek Fluid Innovations LLC (“GFI”). In consideration for this agreement we have an exclusive distribution and worldwide license for the intellectual property in support of our natural gas well services product line.

In June 2014 we were issued a U.S. patent for certain G-CLEAN® Well Wake-UP!™ oil well remediation and stimulation suite of products. We believe the products are the first environmentally friendly well remediation and stimulation fluids in the oil and gas Industry. The patent covers readily biodegradable fluids which are also non-reactive with the geological formation unlike traditional acid and organic solvent based fluids which damage the reservoir formations and involve risks of groundwater contamination. The products are based on a disruptive technology platform based on nano-scale colloidal chemistry. Since our inception we have invested significant amounts of capital into research and development of new products.

The following marks are registered to us in the United States Patent and Trademark Office: G-OIL®, SAVE THE EARTH– SACRIFICE NOTHING®, G OIL Design®, G CLEAN®, G MARINE® and G.E.T. GREEN! ®.

The following marks are registered to us in the United States Patent and Trademark Office: G-OIL®, SAVE THE EARTH– SACRIFICE NOTHING®, G OIL and Design®, G CLEAN®, G MARINE® and G.E.T. GREEN! ®. Foreign trademark registrations are held as follows: (1) for G OIL in the European Community, Argentina, China, Chile, Costa Rica, Honduras, Israel, Macau, Singapore and Taiwan; (2) for G OIL and Design in Australia; and (3) for G CLEAN in the European Community, Australia, Argentina (Class 7), China, Costa Rica, Columbia, Ecuador, Israel, Macau, Singapore and Venezuela.

An application is pending in Ghana for G OIL.

SUPPLIERS

We have a select group of suppliers and contract manufactures to develop, blend and bottle all of our products, benefiting by their intellectual know-how, buying power, increased capacity, freight savings as well as production and logistical expertise

Well Service Products

We purchase our oil and gas well services products from Inventek in concentrated or diluted form and either ship them directly to our distributors or customers. These products include oil well stimulation and remediation products, grease, paraffin and asphaltenes degreasers and solvents, casing cutters, drilling lubricants and detergents, defoamers and surfactants, storage, mud and fractionation tank cleaners, oil and fuel spill surface washing agents and dispersants, oil field rig and equipment cleaners, heavy duty vehicle washing agents, hydraulic fracturing fluids and water treatments.

Performance Products

We have successfully developed our own formulations for motor oil, 2- and 4-cycle engine oil and bar and chain oil. In September 2010 we entered into a three-year Product Production and Sale Agreement with the Delta Group (the “Production Agreement”) under which they produce our performance products for us based on our specifications and formulations. The Production Agreement was not renewed. We are currently evaluating a supply relationship with Olympic Oil, Ltd. which acquired Delta Group’s production facilities during 2015.

Cleaning Products

We purchase all our cleaning products in concentrated form from Inventek, and either bottle the products at Inventek or ship them to another blender/bottler for blending and bottling and then to our distributors.

DISTRIBUTION

In December 2011 we entered into a ten-year limited exclusivity distribution agreement with E&B and a separate agreement with Green Planet (“Green Planet”), which is also owned and controlled by Galesi. E&B is a national independent oil and gas producer with subsidiaries in the oil and gas well service business that will be responsible for the distribution of our full range of G-CLEAN products specifically engineered for oil and gas fields. Our cleaning products for the oil and gas well service industry include: Well Wake Up!, Sump Remediation, Storage Tank Cleaner and Rig & Equipment Cleaner. The proprietary base of our well servicing products is listed on the EPA's National Contingency Plan (NCP) for oil spill clean-ups. Galesi beneficially owned approximately 22.8% and 22.9% of our outstanding shares as of June 30, 2015 and October 9, 2015.

EMPLOYEES

As of October 13, 2015, we have one full-time employee.

CORPORATE HISTORY

We were organized under the laws of the State of Delaware on August 7, 2007.

We have one wholly-owned subsidiary, GET Well! Inc., formally GET Manufacturing, Inc., a Delaware corporation incorporated on June 3, 2008. We do not own equity interests in any other entity. Our executive offices are located at PO Box 4644, Greenwich, CT 06831 and our telephone number is (203) 918-1894.

ITEM 1A. RISK FACTORS.

The consolidated financial statements and notes thereto included in this Annual Report and the related discussion describe and analyze our business operations and financial performance and condition for the periods indicated. For the most part, this information is historical. Our prior results, however, are not necessarily indicative of our future performance and/or financial condition. We, therefore, have included the following discussion of various risk factors which, we believe, could affect our future performance and/or financial condition. These risk factors could cause our future performance or financial condition to differ materially from our prior performance or financial condition or from our expectations or estimates of our future performance or financial condition. These risk factors, among others, should be considered in assessing our future prospects and prior to making an investment decision with respect to our stock.

We have a history of losses and cash flow deficits and we expect to continue to operate at a loss and to have negative cash flow for the foreseeable future.

Since our inception in August 2007, we have incurred operating losses in every year. At June 30, 2015, we had cumulative net losses of approximately $90.2 million. We also have negative cash flows from operations. For the year ended June 30, 2015, we had an operating cash flow deficit of $1.4 million. Historically, we have funded our operations with proceeds from the sale of debt and equity securities and by settling some of our outstanding obligations with issuances of common stock. Our growth strategy is to increase our market share through a variety of sales and marketing initiatives, which require significant amounts of capital. We will also need capital to expand our production capacity and distribution capability. This is likely to result in additional losses and negative cash flow for the foreseeable future.

If we do not raise additional capital, we will not be able to achieve our growth objectives and we may need to curtail or even discontinue operations.

We do not currently have sufficient financial resources to fund operations. At June 30, 2015 we had a working capital deficit of $22.2 million. At the present time we have no firm commitments for investment capital and we have no debt facilities, such as a working line of credit or receivables factoring agreement. If we require additional capital, new sources for such capital may not be available to us when we need it or may be available only on terms that are unfavorable. If capital is not available on satisfactory terms, or is not available at all, we may be unable to continue to fully develop our business or take advantage of new business opportunities. In addition, our results of operations may decline from previous levels or may fail to meet expectations because of the higher cost of capital. As a result, the price of our publicly traded securities may decline, causing you to lose all or part of your investment.

If we cannot continue as a going concern, you will lose your entire investment.

In their report in connection with our financial statements for the fiscal year ended June 30, 2015, our independent registered public accounting firm included an explanatory paragraph stating that because we have incurred net losses and have a net capital deficiency and because we require additional funds to meet our obligations, there is substantial doubt as to our ability to continue as a going concern. If we cannot continue as a going concern, your entire investment may be worthless. Our ability to continue as a going concern will depend, in large part, on our ability to obtain additional financing and generate positive cash flow from operations, neither of which is certain.

We rely on strategic partners for basic business critical services, and we have no control over their operation and if this relationship terminates, our business and operations may be adversely impacted.

Our strategic partner is Inventek, which supplies us with our oil field services, cleaning products and our surface washing agent. The loss of this relationship could have an adverse material impact on our business because we do not have the internal resources to bring any of these functions in-house and we do not believe that we could quickly find a replacement for any of these strategic partners. We cannot assure you that our relationship with this entity will continue or that the services it provides to us will be adequate. If this relationship terminates or the level or quality of the services provided is inadequate, our business, operations and financial condition may be adversely impacted.

Our future success depends on broad market acceptance of our products, which may not happen.

Our entire business is based on the assumption that the demand for non-toxic, environmentally-friendly oil field services, performance and cleaning products will develop and grow. We cannot assure you that this assumption is or will be correct, particularly in an era where the prices of oil and petroleum products are declining. Our success depends, in large part, on the willingness of consumers, including individual retail users as well as corporations, governments and industrial users, to pay a premium for environmentally friendly products. The market for environmentally-friendly products is relatively new and currently is quite small. As is typical of a new and rapidly evolving industry, the demand for, and market acceptance of, “green-based” products is highly uncertain. In order to be successful, we must convince corporations to use and retailers to stock our products and educate consumers that our products perform as well as the petroleum- and chemical-based products they currently use and that the benefit of using our products is worth any additional cost. We believe that one of the major obstacles we face is the lack of knowledge of the importance of reducing the use of petroleum- and chemical-based products from an environmental and health perspective. We spend a considerable amount of our marketing budget educating consumers on the benefits associated with using our products as well as proving that our products work as well as the existing products they are accustomed to using. We can provide no assurances that these efforts will be successful or result in increased revenue. Similarly, we cannot assure you that the demand for our products will become widespread. If the market for our products fails to develop or develops more slowly than we anticipate, our business could be adversely affected.

We depend on a limited number of suppliers for our products and to provide us with ancillary supply chain services. If our suppliers cannot provide us with a sufficient quantity of high quality products on a timely basis, our reputation may be impaired, which, in turn, could adversely impact our business, results of operations and financial condition.

We rely on Inventek to supply us with our oil field services, cleaning products and our surface washing agent, on Infineum to provide us with our marine oil and on the Delta Group to supply us with our performance products. We also rely on the Delta Group or its successor Olympic Oil, Ltd. to provide us with testing, bottling, packaging, warehousing and shipping services. If our relationship with any of these suppliers were to terminate, we may not be able to find another supplier that could provide us with comparable replacement product. In addition, if any of these suppliers fail to provide us with product in a timely manner or in sufficient quantities or if the quality of the product they produce is below that which our customers expect, our ability to satisfy customer demand will be adversely impacted and our reputation will be harmed. In turn, this may adversely impact our ability to generate revenues and profits. Both Inventek and Infineum use their own respective proprietary technology and know-how to produce these products and we have little or no control over its methods of operations, including its processes and production schedules.

A number of factors may affect the timely delivery of our oil field services, performance and cleaning products, including production capacity, the availability of raw materials (i.e., vegetable and plant oils), labor issues (such as strikes, slow-downs and lock-outs), natural phenomena (such as inclement weather, tornados and earthquakes) and service disruptions (such as gas leaks and power outages). Similarly, the quality of our products may be adversely affected if our suppliers fail to blend the ingredients properly, if there are shortages of key ingredients or if we have to use a different supplier or suppliers. For example, if we are unable to obtain the bio-base from our suppliers, and we are unable to remedy the disruption within a reasonable time, we may have to reformulate our products, which would divert resources from other projects and add to product costs. This reformulation may take a substantial period of time, and we may be unable to maintain the “green” properties or performance qualities of our products or obtain necessary industry certifications on a timely basis, if at all. We cannot assure you that there are other suppliers that have the know-how or capability to supply us with a sufficient quantity of products of comparable quality. Products produced from a different bio-base or from a different supplier are likely to have a different formulation with different characteristics and may be inferior in terms of their performance. This could have a material adverse impact on our reputation, which could negatively affect our revenues.

There are a limited number of suppliers for the bio-base ingredient of our performance products. Our business and results of operations would be adversely affected if we are unable to obtain sufficient quantities of this ingredient from those suppliers at favorable prices.

We rely on a limited number of suppliers for all of our products. One of our strategic goals is to diversify our supply base in order to reduce the risk of depending on a limited number of suppliers. However, we cannot assure you we will be able to expand our supply base as there are a limited number of producers of bio-based performance and cleaning products that would satisfy our standards for quality and performance. As a result, we would have limited options if we are unable to negotiate supply agreements with the larger consolidated suppliers on favorable terms. A significant decrease in the availability of bio-based ingredients or increase in costs would materially and adversely affect our business and results of operations.

Our future success depends, in part, on our ability to obtain and retain various certifications for our products. If we fail to do so, our reputation may suffer and our products may not be able to compete effectively.

We are required to comply with certain governmental guidelines in order to market our products as biodegradable. The cost to comply with the Federal Trade Commission’s Guides for the Use of Environmental Marketing Claims is significant. However, if we fail to comply with these guidelines, or any other applicable regulations, or if we fail to maintain required permits or licenses, we may be subject to substantial fines or revocation of our permits and authorities. Further, we must achieve and maintain certain certifications on our performance products based on performance tests established by API and ASTM in order to compete with the petroleum-based products of our competitors. Failure to achieve or maintain the proper API certifications could have a material adverse impact on our reputation and our ability to sell our products, which could negatively affect our business, financial condition and results of operations.

We may not succeed in establishing the “G” brand, which could prevent us from acquiring customers and increasing our revenues.

A significant element of our business strategy is to build market share in the oil field services industry and by continuing to promote and establish our “G” brand. If we are not successful in selling into the oil field services industry or cannot establish our brand identity, we may fail to build the critical mass of customers required to substantially increase our revenues. Promoting and positioning our products will depend largely on the success of our sales and marketing efforts and our ability to provide a consistent, high quality customer experience. To promote our products and brand, we expect that we will incur substantial expenses related to sales, advertising and other marketing efforts. If our sales and promotion activities fail, our ability to attract new customers and maintain customer relationships will be adversely affected, and, as a result, our financial condition and results of operations will suffer. Gaining market share for our G-branded products may prove to be extremely difficult as many of our competitors – including major oil field services companies and consumer products companies – are larger and better capitalized. Consequently, the rate of growth for sales of our G-branded oil field services, performance and cleaning products may be slower than we have anticipated. If we are unable to successfully achieve market acceptance of our products, our future results of operations and financial condition will be adversely affected.

As public awareness of the health risks and economic costs of petroleum- and chemical-based products grows, we expect competition to increase, which could make it more difficult for us to grow and achieve profitability.

We expect competition to increase as awareness of the environmental and health risks associated with petroleum- and chemical-based products increases and as we demonstrate the success of efficacy of our bio-based products. A rapid increase in competition could negatively affect our ability to develop new and retain our existing clients and the prices that we can charge. Many of our competitors and potential competitors have substantially greater financial resources, customer support, technical and marketing resources, larger customer bases, longer operating histories, greater name recognition and more established relationships than we do. We cannot be sure that we will have the resources or expertise to compete successfully. Compared to us, our competitors may be able to:

●	develop and expand their products and services more quickly;

●	adapt faster to new or emerging technologies and changing customer needs and preferences;

●	take advantage of acquisitions and other opportunities more readily;

●	negotiate more favorable agreements with vendors and customers;

●	devote greater resources to marketing and selling their products or services; and

●	address customer service issues more effectively.

Some of our competitors may also be able to increase their market share by providing customers with additional benefits or by reducing their prices. We cannot be sure that we will be able to match price reductions by our competitors. In addition, our competitors may form strategic relationships to better compete with us. These relationships may take the form of strategic investments, joint-marketing agreements, licenses or other contractual arrangements that could increase our competitors’ ability to serve customers. If our competitors are successful in entering our market, our ability to grow or even sustain our current business could be adversely impacted.

A significant portion of our sales is derived from a limited number of customers. If any of these customers decide they no longer will purchase our products, our financial performance will be severely and adversely impacted.

For the year ended June 30, 2015, we derived approximately 48% of our sales from one customer, TTI. We cannot assure you that we can sustain these levels of sales to this customer. If we do not diversify our customer base and this customer eliminates or reduces its reliance on us, our losses will increase.

We rely on board members. If any of our board members leave and we cannot replace them with persons with comparable skills, our business will suffer.

Our performance depends, to a significant extent, upon the efforts and abilities of our senior executive officers. The departure of any of our executive officers could have an adverse effect on our business and we cannot assure you that we would be able to find qualified replacements for any of those individuals if their services were no longer available for any reason.

Our success will also depend upon our ability to recruit and retain qualified personnel to fill other positions. Demand for highly skilled executives is still great and, accordingly, no assurance can be given that we will be able to hire or retain sufficient qualified personnel to meet our current and future needs.

Our future success depends on our ability to utilize certain intellectual property rights, some of which belong to third parties and some of which we own. If we cannot do so, or if we were found to be infringing on the proprietary rights of others, our business could be substantially harmed.

We cannot assure you that we can adequately protect our existing intellectual property rights or that we will be able to develop or obtain via contract any further intellectual property rights that are necessary to maintain and improve our competitive position in the markets in which we compete. In order to protect our rights to these assets, we file patent claims, trademark and trade name applications where appropriate and whenever we can we enter into confidentiality and/or non-use agreements with suppliers, vendors, distributors, contract-manufacturers, consultants and employees to protect against unauthorized use of our trade secrets, know-how and other proprietary information.

Our success depends on our ability to use and/or exploit the intellectual property of third parties as well as our ability to protect our own intellectual property. For example, we rely on Inventek to provide us with high-quality bio-based oil field services, cleaning products and our surface washing agent, based on its proprietary technology. In addition, in May 2014, we entered into an Intellectual Property Exclusive License and Distribution Agreement with Inventek and Dr. Andrecola to support our well service initiatives. Included in this agreement is an exclusive distribution and fully paid-up worldwide license to all Inventek products and formulations related to applications in the oil and gas industry. None of the intellectual property used by Inventek to produce our products is protected by patents. Thus, if another party were able to replicate the process or if there is a determination that they are infringing on the rights of others, our exclusive rights may be worthless. Similarly, we may become aware of other products, technologies or processes that either enhance the performance of or complement our existing products or that will enable us to expand our product offerings. Our ability to market, sell and distribute our products will depend on our ability to use the intellectual property of these companies. We cannot assure you that we will be able to obtain the rights to those products, technologies or processes on terms that make economic sense. If we are unable to obtain the licenses that are necessary for us to remain competitive, our business, results of operations and financial condition could be adversely impacted.

In addition, our business also depends on intellectual property rights that we own, including patent claims, trademarks and trade names. In particular, our performance products are based on our own formulations and specifications, which we have provided to the Delta Group under the Product Production and Sale Agreement. Despite our efforts to protect these rights, we cannot assure you that our intellectual property rights are adequately protected. Our patent claims may not be recognized as valid and even if they are, they may be challenged by third parties. Alternatively, third parties may be able to develop alternative processes and know-how enabling them to produce products that will compete with our products. Finally, our competitors or other third parties may attempt to use our trademarks or trade names or develop similar marks and names despite our registrations. In that case, our sole remedy may be to bring a legal action to enforce our rights, which could be costly and divert management’s time and effort away from our core business.

We cannot assure you that another party might claim that we are infringing on their proprietary rights. If such a claim is upheld, we could incur significant penalties.

Risks Relating to Ownership of Common Stock

There is, at present, only a limited trading market for our common stock and we cannot assure you that an active trading market for either or both of these securities will develop.

Since March 9, 2011 our stock has been quoted on the OTCBB under the symbol GETG.OB. There may not be sufficient liquidity in the market for our securities in order for investors to sell their securities. There is currently only a limited trading market for our common stock, and there can be no assurance that a trading market will develop further or be maintained in the future. We have not applied for listing on any national securities exchange and have no plans of doing so in the near term. Accordingly, we cannot assure you that there will ever be an active trading market in our common stock. If there is no active trading market, it may be difficult for you to sell your shares. If an active trading market for our common stock does develop, the prices at which our common stock would trade will depend upon many factors, including the number of holders, investor expectations and other factors that may be beyond our control.

Generally, holders of securities not eligible for inclusion on a national exchange may have difficulty in selling their securities should they desire to do so. In such event, due to the low price of the securities, many brokerage firms will not affect transactions in such securities and it is unlikely that any bank or financial institution will accept such securities as collateral, which would have an adverse effect in developing or sustaining any market for such securities.

We are subject to the “penny stock” rules, which could adversely affect the trading volume and market price of our shares.

Trades of our common stock are subject to the “penny stock” rules promulgated by the SEC under the Securities Exchange Act of 1934, as amended (“Exchange Act”), which imposes certain requirements on broker/dealers who sell securities subject to the rule to persons other than established customers and accredited investors. For transactions covered by the rule, broker/dealers must make a special suitability determination for purchasers of the securities and receive the purchaser’s written agreement to the transaction prior to sale. The SEC also has other rules that regulate broker/dealer practices in connection with transactions in “penny stocks.” Penny stocks generally are equity securities with a price of less than $5.00 (other than securities listed on a national securities exchange, provided that current price and volume information with respect to transactions in that security is provided by the exchange or system). The penny stock rules require a broker/dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document prepared by the SEC that provides information about penny stocks and the nature and level of risks in the penny stock market. The broker/dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker/dealer and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer’s account. The bid and offer quotations, and the broker/dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer’s confirmation. These disclosure requirements have the effect of reducing the level of trading activity for our common stock. As a result of the foregoing, investors may find it difficult to sell their shares.

Our stock price is extremely volatile, which could result in substantial losses for investors and significant costs related to litigation.

The market price for our common stock is highly volatile. Since August 2007, the price of a share of our common stock has traded from a low of $0.01 to a high of $4.59. This extreme volatility could result in substantial losses for investors. The market price of our securities may fluctuate significantly in response to a number of factors, some of which are beyond our control. These factors include:

	●	quarterly and seasonal variations in operating results;

	●	changes in financial estimates and ratings by securities analysts;

	●	announcements by us or our competitors of new product and service offerings, significant contracts, acquisitions or strategic relationships;

	●	publicity about our company, our services, our competitors or business in general;

	●	additions or departures of key personnel;

	●	fluctuations in the costs of materials and supplies;

	●	any future sales of our common stock or other securities; and

	●	stock market price and volume fluctuations of publicly-traded companies in general and in the automotive aftermarket industry in particular.

In addition, this volatility may give rise to investor lawsuits diverting management’s attention and valuable company resources from our business.

We are controlled by a limited number of stockholders, which will limit your ability to influence the outcome of key decisions and which adversely impact the trading price of our stock.

At October 9, 2015, Inventek, Galesi and Walter Raquet (“Raquet”) beneficially owned 37.5%, 22.9% and 17.7%, respectively, of the outstanding shares of our common stock. As a result, each of these stockholders have the ability to exercise substantial control over our affairs and corporate actions requiring stockholder approval, including electing and removing directors, selling all or substantially all of our assets, merging with another entity or amending our certificate of incorporation. This de facto control could be disadvantageous to our other stockholders with interests that differ from those of the control group, if these stockholders vote together. For example, the control group could delay, deter or prevent a change in control even if a transaction of that sort would benefit the other stockholders. In addition, concentration of ownership could adversely affect the price that investors might be willing to pay in the future for our securities.

Future sales or the potential for sale of a substantial number of shares of our common stock could cause the trading price of our common stock to decline and could impair our ability to raise capital through subsequent equity offerings.

Sales of a substantial number of shares of our common stock in the public markets, or the perception that these sales may occur, could cause the market price of our stock to decline and could materially impair our ability to raise capital through the sale of additional equity securities. As of October 9, 2015, we had 298,088,154 shares of common stock issued and outstanding. We had reserved an additional 197,261,131 shares for issuance as follows:

	●	40,000,000 shares reserved for issuance under our stock option plan, of which 25,174,062 underlie outstanding options at October 9, 2015;

	●	128,842,000 shares reserved for the conversion of the convertible debentures; and

	●	32,168,823 shares underlying outstanding warrants.

The sale of a significant number of shares of our common stock, or the perception of such a sale, could cause the market price of our common stock to decline. Depending upon market liquidity at the time, a sale of shares under this prospectus at any given time could cause the trading price of our common stock to decline.

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

In April 2015, we issued 2,296,000 shares of our common stock, with an aggregate fair market value of $162,000 to pay the accrued interest on the convertible debentures.

All of the foregoing shares were issued in reliance upon the exemptions from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(2) thereunder.

Equity Compensation Plan

Our 2008 Stock Award and Incentive Plan, as amended (the “Plan”) was adopted for the purpose of (i) attracting, retaining, motivating and rewarding our employees and non-employee directors, (ii) providing for equitable and competitive compensation opportunities, recognize individual contributions and reward achievement of our goals, and (iii) promoting the creation of long-term value for stockholders by closely aligning the interests of Plan participants with those of stockholders. The terms of the Plan provide for the granting of both stock-based and cash-based incentives, including incentive and non-qualified stock options, stock appreciation rights, restricted stock and restricted stock unit. The total number of shares of our common stock that may be awarded under the Plan and issued on the exercise of awards is equal to 40,000,000 shares, subject to adjustments in certain circumstances. In addition, the Plan limits the maximum amount of shares that may be subject to awards under the Plan granted to any one individual per year to 5,000,000 shares. The persons eligible to receive awards under the Plan are our employees, including any of our executive officer or non-employee directors, any person who has been offered employment by us, provided that such prospective employees may not receive any payments or exercise any rights relating to their awards until their commencement of employment with us, or our consultants. The Plan is administered by the Compensation Committee of the Board of Directors.

The Board may terminate the Plan without stockholder approval or ratification at any time. Unless sooner terminated, the Plan will terminate in 2018. The Board may also further amend the Plan, provided that no amendment will be effective without approval of our stockholders if stockholder approval is required to satisfy any applicable statutory or regulatory requirements.

The following table summarizes the options granted under the Plan as of June 30, 2015. The shares covered by outstanding options are subject to adjustment for changes in capitalization stock splits, stock dividends and similar events.

	Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights		Weighted Average Exercise Price of Outstanding Options, Warrants and Rights		Number of Securities Remaining Available For Future Issuance Under Equity Compensation Plans (excluding securities reflected in column (a))
	(a)		(b)		(c)
Equity compensation plans approved by stockholders		25,174,062	$	0.31		14,825,938
Equity compensation plans not approved by stockholders		--		--		--

Total		25,174,062	$	0.31		14,825,938

___________________

ITEM 6. SELECTED FINANCIAL DATA.

As a “smaller reporting company” we are not required to provide the information required by this Item.

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

The following discussion of our financial condition and results of operations should be read in conjunction with our audited consolidated financial statements and related notes included elsewhere in this Annual Report. Certain statements in this discussion and elsewhere in this Report constitute forward-looking statements within the meaning of Section 21E of the Securities and Exchange Act of 1934. See “Forward-Looking Statements” following the Table of Contents of this Annual Report. Because this discussion involves risk and uncertainties, our actual results may differ materially from those anticipated in these forward-looking statements.

Overview of our Business

Manufactured domestically under supply and requirement contracts, our proprietary environmentally preferred base oils are comprised of fatty acids procured from either plant and vegetable oils or animal fats and are on the USDA BioPreferred® list. We also have a BODA™ technology that accelerates the biodegradability of petroleum based lubricants which even further broadens the array of environment goals that our company is able to help end users procure.

As of May 2015, we eliminated personnel to preserve capital and are relying on the Board of Directors and contacts to help run the company on a day to day basis.

Results of Operations

Comparison of the years 2015 and 2014

Overview

Our activities for the years ended June 30, 2015 and 2014 essentially included product development, manufacturing, marketing and sales of our bio-degradable performance and cleaning products, development of mass market product distribution networks for the intended distribution of our products, and development of an infrastructure to support the planned business and increasing of revenues.

Our results of operations for the years ended June 30, 2015 and 2014 are as follows:

	Years Ended June 30,
	2015			2014
	($000’s)
Net sales	$	766		$	4,050
Loss from operations		(3,741	)		(4,629	)
Change in revaluation of derivatives		2,130			2,954
Loss on issuance of convertible debt		-			(884	)
Loss on impairment of intangible assets		(2,469	)
Interest expense, net		(4,009	)		(4,283	)
Net loss	$	(8,089	)	$	(6,842	)

Net Sales

Net sales for the year ended June 30, 2015 were $766, primarily attributed to sales of G-OIL® 4-cycle engine oils and G-OIL® 2-cycle engine oils. Net sales for year ended June 30, 2014 were $4,050, primarily attributed to sales of G-OIL® 4-cycle engine oils, G-CLEAN® grill cleaner, G-CLEAN® pressure washing equipment and G-OIL® 5W-30 motor oil. The decrease in net sales from 2014 to 2015 is primarily due to decreased sales of G-CLEAN® pressure washing equipment and G-CLEAN® oil and gas well service cleaners.

For the fiscal years ended June 30, 2015, approximately 48% of our sales were from our customer TTI. For the fiscal years ended June 30, 2014, approximately 78% of our sales were from four customers: TTI, companies owned and/or controlled by Galesi, Walmart and Menards, Net sales are comprised as follows:

	Years Ended June 30,
	2015		2014
	($000’s)
Performance products	$	555	$	3,098
Cleaning products		211		952

Total	$	766	$	4,050

Cost of Sales (exclusive of depreciation and amortization)

Cost of sales (exclusive of depreciation and amortization) primarily consists of the cost of obtaining bio solvents, plant oils, additives, packaging components and fees paid to our affiliates for the costs of bottling and blending our products. Cost of sales (exclusive of depreciation and amortization) for the years ended June 30, 2015 and 2014 were approximately $644 and $3,910, respectively. The decrease in cost of sales from 2015 to 2014 is primarily due to the decrease in net sales.

Selling, General and Administrative Expenses

Selling, general and administrative expenses consist primarily of salaries and benefits, product development and testing fees, advertising and marketing expenses, public relations, insurance and fees for professional services. Selling, general and administrative expenses for the years ended June 30, 2015 and 2014 include the following:

	Years Ended June 30,
	2015		2014
	($000’s)
Salaries	$	320	$	585
Selling, marketing, public relations and related		641		1,394
Development, product release and testing		261		319
Management and operating fees		406		522
Legal and professional		258		230
Occupancy, communications and all other, net		391		644

Total selling, general and administrative expenses	$	2,277	$	3,694

The decrease in salaries is due to a decrease in headcount. The decrease in selling, marketing and public relations expenses is due to decreased sponsorship fees, advertising spending and the termination of the Marharg consulting agreement. The decrease in occupancy, communications and all other, net is primarily due to our overall efforts to reduce expenses.

Stock-based compensation

Stock-based compensation expense for the years ended June 30, 2015 and 2014 was approximately $223, and $739, respectively. The decrease is due to stock options grants issued in prior years being fully expensed.

Depreciation and amortization

Depreciation and amortization expense for the years ended June 30, 2015 and 2014 was approximately $1,363 and $336, respectively. Depreciation charges totaled $10 and $15 for the years ended June 30, 2015 and 2014, respectively, and amortization expense for intangible assets totaled $1,352 and $321 for the years ended June 30, 2015 and 2014, respectively. Depreciation and amortization expense is excluded from cost of sales.

Change in revaluation of derivatives

The change in fair value of our derivative liabilities resulted in a favorable adjustment of $2,130 and $2,954 for the years ended June 30, 2015, and 2014, respectively. The value of the derivative liabilities was determined using the Black-Scholes method. See note 10 to our financial statements for inputs used to calculate the fair value of our derivatives liabilities.

Loss on issuance of convertible debt

We recorded a charge of $0 and $884 for the years ended June 30, 2015 and 2014. The charge was in connection with the issuance of our 6.0% secured convertible debentures and associated warrants. See note 11 to our financial statements.

Loss on impairment of intangible assets

A valuation of all our intangible assets was completed as of June 30, 2015. It was determined that intangible assets should be impaired by $2,469. Management believes that its estimates and assumptions underlying the value of intangible assets are reasonable. The Company is utilizing an expected life for the intangible assets of seven years.

Interest expense, net

Net interest expense for the years ended June 30, 2015 and 2014 was approximately $4,009 and $4,283, respectively. As of June 30, 2015, interest expense consists of $3,096 in connection with the amortization of the debt discount on our outstanding secured convertible debentures, $634 in connection with the interest on the outstanding secured convertible debentures, $260 for interest on the note payable to a related party and $15 in connection with the deferred financing costs relating to the outstanding secured convertible debentures. Interest income, which was not significant, consists of interest earned on bank deposits and an institutional money market fund.

LIQUIDITY AND CAPITAL RESOURCES

At June 30, 2015 and 2014, we had $34 and $108, respectively, in cash and an accumulated deficit of $90,234 and $82,145 respectively. At June 30, 2015 and 2014, we had a working capital deficit of $22,165 and $12,008, respectively.

Net cash used by operating activities was $1,389 and $2,396 for the years ended June 30, 2015 and 2014, respectively. The decrease from 2015 to 2014 was primarily due to the decrease in funding and sales which generated less cash to spend on operations.

Net cash provided in financing activities was $1,315 and $2,324 for the years ended June 30, 2015 and 2014, respectively. The decrease in financing activities is primarily due to proceeds from the issuance of note payables in the amount of $1,315 in 2015 compared to issuance of note payable of $2,354 in 2014. The net proceeds from our financing activities were used to support purchases from suppliers, salaries and administrative expenses.

We currently have no material commitments for capital expenditures. Our capital requirements are not significant as the majority of our performance and cleaning products are outsourced to third party suppliers. In the foreseeable future, we will require capital for the payment of the related party notes payable disclosed in note 9 to our financial statements. Capital is required for the growth of our business, including increases in personnel, sales and marketing, and purchasing finished goods to fulfill orders.

Losses from operations are continuing subsequent to June 30, 2015 and we anticipate that we will continue to generate losses from operations in the near future. Since inception, we have financed our operations by issuing securities (common stock and debt instruments) in various private placement transactions and from revenue generated by sales of our products.

Debentures and Warrants

In fiscal 2012 and 2013, we realized gross proceeds of $7,500 ($2,250 in December 2011, $4,000 in October 2012 and $1,250 in March 2013) from the sale of 6.0% Secured Convertible Debentures. In fiscal 2014, we realized gross proceeds of $2,354 ($1,080 in November 2013, $870 in March 2014 and $404 in June 2014) from the sale of additional 6.0% Secured Convertible Debentures. In fiscal 2015, we realized gross proceeds of $1,315 ($350 in September 2014, $300 in December 2014, $520 in March 2015 and $145 in June 2015) from the sale of additional 6.0% Secured Convertible Debentures, due March 31, 2016, and warrants to purchase 3,288,000 shares of Common Stock on or before March 31, 2019 to four accredited investors. The fiscal 2015 debentures have a conversion price of $0.06 per share.

Due to the weighted average anti-dilution provision the conversion price of $7,500 of debentures was reduced from $0.17 to $0.13 per share. In addition the attached warrants exercise price was reduced from $0.21 to $0.15 per share. We may prepay the Debentures at any time without penalty upon ten business days prior written notice to the Investors provided there is, at that time, an effective registration statement covering the resale of the shares issuable upon conversion of the Debentures and exercise of the Warrants.

Management Change

In May 2015, Jeffrey Loch resigned as President and Chief Marketing Officer. In July 2015, Mr. Adams resigned from his positions as Chief Financial Officer, Chief Operating Officer and Secretary of the Company.

Subsequent Event

In fiscal 2016, we realized gross proceeds of $200 from the sale of additional 6.0% Secured Convertible Debentures, due March 31, 2016, and warrants to purchase 1,500,000 shares of Common Stock on or before March 31, 2019 to five accredited investors. The fiscal 2016 debentures have a conversion price of $0.02 per share.

In July 2015, we issued 3,090,000 shares of our common stock, with an aggregate fair market value of $168,000 to pay the accrued interest on the convertible debentures.

Going Concern Consideration

Due to our limited amount of additional committed capital, recurring losses, negative cash flows from operations and our ability to pay outstanding liabilities, in their report for the fiscal year ended June 30, 2015, our independent auditors stated that there is substantial doubt about our ability to continue as a going concern. These consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles, assuming that we will continue as a going concern.

Since inception, we have incurred operating losses and negative cash flows from operations. As of June 30, 2015, we had an accumulated deficit of $90,234, with total stockholders’ deficit of $17,098. We had a working capital deficit of $22,165 at June 30, 2015 and are currently in default of the 3.25% Secured Note, the Promissory Note and the 6% Secured Notes issued to related party disclosed in notes 8 and 9. These notes matured on September 30, 2013 and June 30, 2013, respectively, and have not been extended and are payable upon demand.

We have undertaken, and will continue to implement, various measures to address our financial condition, including:

●	Continue discussions with existing and potential new investors to invest in us.

●	Seek debt, equity and other forms of financing, including funding through strategic partnerships.

●	Attempt to increase revenues in order to reduce or eliminate our operating losses and enable us to meet our financial obligations.

●	Reduce expenses to conserve cash.

●	Defer certain marketing activities.

●	Investigate and pursue transactions with third parties, including strategic transactions and relationships.

There can be no assurance that we will be able to secure the additional funding we need. If our efforts to do so are unsuccessful, we will be required to further reduce or eliminate our operations. These factors, among others, raise substantial doubt about our ability to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result from the outcome of these uncertainties.

Contractual Arrangements

Significant contractual obligations as of June 30, 2015 are as follows:

Type of Obligation		Total Obligation		Amount Due in Less than 1 year
Sponsorship Agreements		$325		$325

Off Balance Sheet Arrangements

We have no material off balance sheet arrangements that are likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital resources or capital expenditures.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

We have identified critical accounting principles that affect our consolidated financial statements by considering accounting policies that involve the most complex or subjective decisions or assessments as well as considering newly adopted principals. They are:

Share-Based Payments – We adhere with U.S. GAAP, which establishes standards for share-based transactions in which an entity receives employees’ or consultants’ services for (a) equity instruments of the entity, such as stock options or warrants, or (b) liabilities that are based on the fair value of the entity’s equity instruments or that may be settled by the issuance of such equity instruments. We expense the fair value of stock options and similar awards, as measured on the awards’ grant date. This applies to all awards granted after the date of adoption, and to awards modified, repurchased or cancelled after that date.

We estimate the value of stock option awards on the date of grant using the Black-Scholes option-pricing model (the “Black-Scholes model”). The determination of the fair value of share-based payment awards on the date of grant is affected by our stock price as well as assumptions regarding a number of complex and subjective variables. These variables include our expected stock price volatility over the term of the awards, expected term, risk-free interest rate, expected dividends and expected forfeiture rates.

Intangible Assets – Intangible assets are carried at cost less accumulated amortization. For financial reporting purposes, amortization of intangibles has been computed over an estimated useful life of seven years using the straight-line method.

Income Taxes – The Company accounts for income taxes by the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the recognition of tax effects for financial statement and income tax reporting purposes by applying enacted income tax rates applicable to future years to differences between the financial statement carrying amounts and tax bases of existing assets and liabilities. A valuation allowance has been recorded to reduce net deferred tax assets to only that portion that is judged more likely than not to be realized.

Impairment of Long-Lived Assets – Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Determination of recoverability is generally based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition, as well as specific appraisal in certain instances. Measurement of an impairment loss for long-lived assets is based on the fair value of the asset as estimated using a discounted cash flow model. Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell.

Fair Value Measurements – Accounting standards have been issued which define fair value, establishes a market-based framework or hierarchy for measuring fair value and expands disclosures about fair value measurements. The standard is applicable whenever another accounting pronouncement requires or permits assets and liabilities to be measured at fair value. The standard does not expand or require any new fair value measures; however its application may change current practice.

Fair value is defined under the standard as the price that would be received to sell an asset or paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants on the measurement date. The standard also establishes a three-level hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value.

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

As a “smaller reporting company” we are not required to provide the information required by this Item.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

The financial statements required by this Item 8 are set forth elsewhere in this Annual Report beginning on page F-1.

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

There were no changes in and disagreements with accountants on accounting and financial disclosure within the two most recent fiscal years or any subsequent interim period.

ITEM 9A. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

We carried out an evaluation with the participation of our chief executive officer who serves as our principal executive officer and principal financial officer, required by Rules 13a-15 and 15d-15 of the Securities Exchange Act of 1934 (the “Exchange Act”) of the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act. Based on this evaluation our chief executive officer concluded that our disclosure controls and procedures were not effective at June 30, 2015 so as to ensure that the information relating to our company required to be disclosed in our SEC reports (i) is recorded, process, summarized and reported within the time periods specified in SEC rules and forms and (ii) is accumulated and communicated to our management, including our chief executive officer, to allow timely decisions regarding required disclosures due to the existence of material weaknesses.

The material weaknesses are as follows:

	●	A lack of sufficient resources including a designated chief financial officer and an insufficient level of monitoring and oversight, which restricted the Company’s ability to gather, analyze and report information relative to the financial statement assertions in a timely manner, including insufficient documentation and review of selection of generally accepted accounting principles.

	●	The limited size of the accounting department makes it impractical to achieve an appropriate level of segregation of duties. Specifically, due to lack of personnel, effective controls were not designed and implemented to ensure accounting functions were properly segregated for and

	●	Due to a lack of adequate staffing within the finance department and adequate staffing within operational departments that provide information to the finance department, we did not establish and maintain effective controls over certain of our period-end financial close and reporting processes. Specifically, effective controls were not designed and implemented to ensure that journal entries were properly prepared with sufficient support or documentation or were reviewed and approved to ensure the accuracy and completeness of the journal entries recorded.

The Company may add additional personnel and procedures, which we believe will remedy these weaknesses in disclosure controls and procedures in future periods. However, there are no assurances we will be able to devote the necessary capital to hire the additional personnel and institute the additional systems, policies and procedures to the level necessary. In that event, there are no assurances that the material weaknesses described above will be timely remediated or not result in errors in our financial statements in future periods.

Management’s Annual Report on Internal Control over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements in accordance with GAAP. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projection of any evaluation of effectiveness to future periods is subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Our management has conducted, with the participation of our chief executive officer who serves as our principal executive officer and principal financial officer, an assessment of our internal control over financial reporting as of June 30, 2015. Management’s assessment of internal control over financial reporting was conducted using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework of 2013. Our management has concluded that, as of June 30, 2015, there may be an existence of material weaknesses in our internal control over financial reporting.

Changes in Internal Control Over Financial Reporting

During the period covered by this report there have been material changes in our internal control over financial reporting as defined in Rule 13a-15(f). These changes have resulted from the resignation of our Chief Financial Officer. This may materially affect, or is reasonably likely to materially affect, our internal control over financial reporting. As part of our remediation efforts, the Company may hire qualified accounting personnel to implement a Company-wide improvement and remediation program.

Limitation of the Effectiveness of Internal Control

A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the internal control system are met. Because of the inherent limitations of any internal control system, no evaluation of controls can provide absolute assurance that all control issues, if any, within a company have been detected.

ITEM 9B. OTHER INFORMATION.

None.

PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.

Incorporated herein by reference to our proxy statement for our 2015 annual meeting of stockholders, to be filed no later than 120 days after the fiscal year ended June 30, 2015.

ITEM 11. EXECUTIVE COMPENSATION

Incorporated herein by reference to our proxy statement for our 2015 annual meeting of stockholders, to be filed no later than 120 days after the fiscal year ended June 30, 2015.

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

Incorporated herein by reference to our proxy statement for our 2015 annual meeting of stockholders, to be filed no later than 120 days after the fiscal year ended June 30, 2015.

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

Incorporated by reference herein to our proxy statement for our 2015 annual meeting of stockholders, to be filed no later than 120 days after the fiscal year ended June 30, 2015.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.

Incorporated by reference herein to our proxy statement for our 2015 annual meeting of stockholders, to be filed no later than 120 days after the fiscal year ended June 30, 2015.

Exhibit Numbers		Description
3.1(a)		Certificate of Incorporation(1)
3.1(b)		Certificate of Amendment of Certificate of Incorporation(1)
3.1(c)		Certificate of Merger of Foreign Corporation into a Domestic Corporation(1)
3.1(d)		Certificate of Correction of Certificate of Incorporation(1)
3.1(e)		Certificate of Correction of Certificate of Amendment(1)
3.1(f)		Certificate of Correction of Certificate of Merger(1)
3.1(g)		Certificate of Ownership and Merger(1)
3.2		By-Laws(1)
4.1		Specimen Stock Certificate(1)
4.2		Form of Option Agreement(1)
4.3		Final form of 6% Convertible Debenture due and payable on December 31, 2014(2)
4.4		Final form of Series A Common Stock Purchase Warrant exercisable at any time on or before December 31, 2016 at an exercise price is $0.21(2)
4.5		Final form of 6% Convertible Debenture due and payable on March 31, 2016(4)
4.6		Final form of Series A Common Stock Purchase Warrant expiring on March 31, 2018(4)
4.7		Final form of Series A Common Stock Purchase Warrant expiring on June 30, 2018(4)
4.8		Final form of Series A Common Stock Purchase Warrant expiring on September 30, 2018(4)
10.1		2008 Stock Award and Incentive Plan, as amended(1)
10.2		**Employment Agreement with William J. Marshall(1)
10.3		**Employment Agreement with Greg Adams(1)
10.4		Agreement with Inventek Colloidal Cleaners, LLC(1)
10.5		Distribution Agreement with Techtronics Industries North America, Inc.(1)
10.6		Promissory Note in the aggregate principal amount of $300,000(1)
10.7		Promissory Note in the aggregate principal amount of $125,000(1)
10.8		Agreement with Bio Tec Fuel and Chemical, LLC(1)
10.9		Letter Agreement with Kwik Paint Products(1)
10.10		Agreement with Marketiquette, Inc.(1)
10.11		Investment Agreement with Techtronics Industries Co., Inc.(1)
10.12		**Amendment No. 1 to Employment Agreement with Greg Adams(1)
10.13		Assignment of Invention, Priority Rights and Rights to Apply for Patents by Mathew Zuckerman(1)
10.14		Final form of Securities Purchase Agreement, dated as of December 12, 2011, between Green Earth Technologies, Inc., and each Investor identified on the signature pages thereto(2)
10.15		Final form of Registration Rights Agreement dated as of December 12, 2011, between Green Earth Technologies, Inc., and certain of the Investors(2)
10.16		Final form of Patent Security Agreement dated as of December 12, 2011, between Green Earth Technologies, Inc., and the Investors(2)
10.17		Final form of Trademark Security Agreement dated as of December 12, 2011, between Green Earth Technologies, Inc., and the Investors(2)
10.18		Final form of Security Agreement dated as of December 12, 2011, between Green Earth Technologies, Inc., and the Investors(2)
10.19		Intellectual Property Exclusive License and Distribution Agreement dated as of May 20, 2014. (3)
10.20		Amendment, dated as of December 16, 2014, to the 6% Secured Convertible Debentures in the aggregate principal of $7.5 million due December 31, 2014 (5)
21.1		Subsidiaries of Green Earth Technologies(1)
23.1		Consent of Friedman LLP*
31.1		Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes Oxley Act of 2002 *
31.2		Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes Oxley Act of 2002 *
32.1		Certification of Chief Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
101.INS		XBRL Taxonomy Extension Schema Document*
101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document*
101.SCH		XBRL Taxonomy Extension Label Linkbase Document*
101.LAB		XBRL Taxonomy Extension Presentation Linkbase Document*
101.PRE		XBRL Taxonomy Extension Definition Linkbase Document*
101.DEF		XBRL Taxonomy Extension Schema Document*

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

Green Earth Technologies, Inc.

We have audited the accompanying consolidated balance sheets of Green Earth Technologies, Inc. and subsidiaries (the “Company”) as of June 30, 2015 and 2014, and the related consolidated statements of operations, cash flows, stockholders’ deficit for each of the years in the two-year period ended June 30, 2015. The Company’s management is responsible for these financial statements. Our responsibility is to express an opinion on these financial statements based on our audits.

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

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Company and subsidiaries as of June 30, 2015 and 2014, and the consolidated results of operations and cash flows for each of the years in the two-year period ended June 30, 2015, in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial statements, the Company's losses, negative cash flows from operations, working capital deficit, related party note in default payable upon demand and its ability to pay its outstanding liabilities through fiscal 2016 raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of these uncertainties.

Friedman LLP

East Hanover, New Jersey

October 13, 2015

	June 30, 2015			June 30, 2014
ASSETS
Current assets:
Cash and cash equivalents	$	34		$	108
Restricted Cash		-			72
Trade receivables, less allowance of $11 and $0		22			502
Deferred cost, related party		6,227			6,227
Inventories, net		-			230
Prepaid expenses and other current assets		391			1,305
Total current assets		6,674			8,444
Property and equipment, net		3			14
Intangibles, net		5,064			8,184
Total Assets	$	11,741		$	16,642

LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Accounts payable		486			676
Accounts payable, related parties		-			171
Accrued expenses		1,509			1,428
Accrued expenses, related parties		663			306
Deferred revenue, related parties		6,000			6,502
Notes payable, related parties		5,605			-
Notes payable		1,232			1,232
Secured convertible debentures, net of debt discount		9,393			5,000
Derivative liability		3,951			5,136
Total current liabilities		28,839			20,451
Notes payable, related parties		-			5,605
Secured convertible debentures, net of debt discount		-			928
Total Liabilities		28,839			26,984

Commitments and contingencies

Stockholders’ deficit
Common stock, $0.001 par value, 500,000,000 shares authorized, 294,998,477 and 286,462,091 shares issued and outstanding, as of June 30, 2015 and June 30, 2014		295			286
Additional paid-in capital		72,841			71,517
Accumulated deficit		(90,234	)		(82,145	)
Total stockholders' deficit		(17,098	)		(10,342	)
	$	11,741		$	16,642

							Additional
	Common Stock						Paid			Accumulated
	Shares			Amount			In Capital			Deficit			Total

Balance at June 30, 2013		157,697,103		$	158		$	61,688		$	(75,303	)	$	(13,457	)

Shares issued for interest		4,478,738			4			485			-			489
Restricted shares for employee compensation		4,655,000			5			357			-			362
Shares issued for consulting services		12,000,000			12			948			-			960
Shares issued for business acquisition		105,200,000			105			7,467			-			7,572
Issuance of common stock to settle payables, related party		2,156,250			2			170			-			172
Issuance of common stock to settle trade payable		250,000			-			25			-			25
Shares issued for services		25,000			-			3			-			3
Stock-based compensation		-			-			374			-			374
Net loss		-			-			-			(6,842	)		(6,842	)
Balance at June 30, 2014		286,462,091		$	286		$	71,517		$	(82,145	)	$	(10,342	)

Shares issued for interest		10,236,386			10			615			-			625
Shares issued for business acquisition		10,000,000			10			690			-			700
Issuance of common stock to settle payables, related party		300,000			1			20			-			21
Shares cancelled due to terminated consulting services		(12,000,000	)		(12	)		(654	)		-			(666	)
Forgiveness of debt, related parties		-			-			430			-			430
Stock-based compensation		-			-			223			-			223
Net loss		-			-			-			(8,089	)		(8,089	)
Balance at June 30, 2015		294,998,477		$	295		$	72,841			(90,234	)	$	(17,098	)

	Year Ended June 30,
	2015			2014
Cash flows from operating activities:
Net loss	$	(8,089	)	$	(6,842	)
Adjustments to reconcile net loss to net cash used in operating activities
Loss on impairment of intangible assets		2,469			-
Interest paid in common stock		625			489
Depreciation and amortization		1,363			336
Amortization of debt discount and deferred financing costs		3,096			3,323
Increase in allowance for inventory		200			268
Loss on issuance of convertible debt		-			884
Change in fair value of derivative liability		(2,130	)		(2,954	)
Bad debt expense		11			-
Stock-based compensation expense		223			736
Amortization of prepaid expenses paid in stock		160			133
Changes in assets and liabilities:
Restricted cash		72			(72	)
Accounts receivable		469			224
Inventories		30			306
Prepaid expenses and other current assets		87			(228	)
Prepaid advertising		-			296
Accounts payable		(190	)		370
Accounts payable, related parties		(121	)		(549	)
Accrued expenses		81			320
Accrued expenses, related parties		356			437
Deferred revenue		(101	)		127
Net cash used in operating activities		(1,389	)		(2,396	)

Cash flows from financing activities:
Proceeds from secured convertible debentures		1,315			2,354
Repayment of notes payable		(-	)		(39	)
Net cash provided by financing activities		1,315			2,315
Net decrease in cash		(74	)		(81	)
Cash and cash equivalent
Beginning of year		108			189
End of year	$	34		$	108

Supplemental information

Income taxes paid	$	3		$	4

Non-cash investing and financing activities
Issuance of common stock to settle trade payable	$	21		$	25
Issuance of common stock to settle related party payable and accrued expenses	$	-		$	172
Shares cancelled due to terminated consulting services	$	(666	)	$	-
Issuance of common stock for purchased technology	$	700		$	7,572
Issuance of common stock for prepaid consultant fees	$	-		$	960
Related party payable and accrued expenses converted into note payable	$	-		$	5,605
Forgiveness of debt, related parties	$	430		$	1,211

1. SUMMARY OF BUSINESS AND BASIS FOR PRESENTATION

Organization and Business

Green Earth Technologies, Inc. and its wholly-owned subsidiary, GET Well! Inc., formally GET Manufacturing, Inc. (collectively, the “Company”), were each formed on August 7, 2007 under the laws of the state of Delaware. The Company markets, sells and distributes environmentally safe lubricants, cleaning products and oil well service products. The Company’s product line crosses multiple channels including the oil well services, automotive aftermarket, marine and outdoor power equipment and cleaning markets. The Company sells to home centers, mass retail outlets, automotive stores, equipment manufacturers and over the Internet.

Liquidity and Going Concern

Due to the Company’s limited capital, recurring losses and negative cash flows from operations and the Company’s limited ability to pay outstanding liabilities, there is substantial doubt about its ability to continue as a going concern. The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles, assuming that the Company will continue as a going concern.

Since inception, the Company has incurred operating losses and negative cash flows from operations. As of June 30, 2015, the Company had an accumulated deficit of $90,234, with total stockholders’ deficit of $17,098. The Company had a working capital deficit of $22,165 at June 30, 2015 and is currently in default of the 3.25% Secured Note, Promissory Note and the 6% Secured Notes issued to related parties disclosed in notes 8 and 9. These notes matured on September 30, 2013 and June 30, 2013, respectively, and have not been extended and are payable upon demand. The Promissory note matures on February 2016 but since the February 2015 payment was not made it is in default.

The Company has undertaken, and will continue to implement, various measures to address its financial condition, including:

●	Continue discussions with existing and potential new investors regarding an investment in the Company.

●	Seek debt, equity and other forms of financing, including funding through strategic partnerships.

●	Attempt to increase revenues in order to reduce or eliminate the Company’s operating losses and enable it to meet its financial obligations.

●	Reduce expenses to conserve cash.

●	Defer certain marketing activities.

●	Investigate and pursue transactions with third parties, including strategic transactions and relationships.

The Company plans to increase revenues in order to reduce, or eliminate, its operating losses. Additionally, the Company will attempt to raise capital from external sources in order to enable it to continue to meet its financial obligations until it achieves profitability or generates positive cash flow.

There can be no assurance that the Company will be able to secure the additional funding the Company needs. If the Company’s efforts to do so are unsuccessful, the Company will be required to further reduce or eliminate the Company’s operations. These factors, among others, raise substantial doubt about the Company’s ability to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result from the outcome of these uncertainties.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Principles of Consolidation – The accompanying consolidated financial statements include the accounts of the Company. All significant intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates – The preparation of consolidated financial statements in accordance with U.S. GAAP requires that management make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Management periodically assesses the accuracy of these estimates and assumptions. Actual results could differ from those estimates. Estimates are used when accounting for various items, including but not limited to allowances for doubtful accounts; net realizable value of inventory, derivative financial instruments; asset impairments; revenue recognition; depreciation and amortization; and other contingencies.

Cash and Cash Equivalents - Cash balances in banks are insured by the Federal Deposit Insurance Corporation subject to certain limitations. For purposes of the statement of cash flows, the Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents.

Restricted Cash - At June 30, 2015 and 2014, the Company had $0 and $72, respectively of restricted cash that was maintained at a blocked bank account created for the purpose of making payments, under agreements on a Promissory Note with a third party manufacturer (see Note 9).

Revenue Recognition – Revenue is recognized when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the fee is fixed and determinable and collectability is reasonably assured. The Company recognizes revenue when product is shipped or when it is received by the customer, depending on the contractual terms. The Company’s revenue is comprised of the sale of its products to retailers and distributors.

Allowance for Doubtful Accounts – The Company maintains an allowance for uncollectible accounts receivable for estimated losses resulting from the likelihood that customers will fail to make payments. Management determines the estimate of the allowance for uncollectible accounts receivable by considering a number of factors, including: (1) historical experience; (2) aging of the accounts receivable; and (3) specific information obtained by the Company on the financial condition and the current creditworthiness of its customers.

Inventories – Inventories are valued at the lower of cost or market. Cost is determined principally by the first-in, first-out method. The costs of finished goods and work-in-process inventories include material, manufacturing labor and overhead components. The Company periodically reviews the net realizable value of the inventory and, if necessary, records a reserve to reflect the net realizable value of the inventory.

Property and Equipment – Property and equipment is stated at cost less accumulated depreciation. Depreciation of property and equipment is provided using the straight-line method over the assets’ estimated useful lives. Leasehold improvements are amortized over the shorter of the assets’ economic lives or the lease term.

Deferred Revenue – Deferred revenue is comprised of all unearned revenue that has been collected in advance, primarily for future oil well service, performance and appearance product purchases, and is recorded as deferred revenue on the balance sheet until the revenue is earned.

Impairment of Long-Lived Assets – Long-lived assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. When it becomes apparent that indicators such as a significant decrease in the market value of the long-lived asset group or if material differences between operating results and the Company’s forecasted expectations occur, then an impairment analysis is performed.

If indicators arise, an initial determination of recoverability is performed based on an estimate of the undiscounted future cash flows resulting from the use of the asset and its eventual disposition compared with the carrying value. If the carrying value of the asset group exceeds the undiscounted cash flows, a measurement of an impairment loss for long-lived assets is performed. The impairment charge is the excess of the carrying value of the asset group over the fair value, as determined utilizing appropriate valuation techniques.

Segments – The Company has grouped its long-lived assets in accordance with the methodologies of how it manages the business. Currently, the Company is one segment with multiple products, and as such the Company’s asset group is based upon this one segment methodology.

Stock Based Compensation – The Company accounts for stock-based awards to recipients in accordance with applicable accounting principles, which requires compensation expense related to share-based transactions, including employee stock options, to be measured and recognized in the financial statements based on a determination of the fair value of the stock options. The grant date fair value is determined using the Black-Scholes-Merton (“Black-Scholes”) pricing model. For all employee stock options, the Company recognizes compensation expense over the requisite service period (generally, the vesting period of the stock-based award). The Company’s option pricing model requires the input of highly subjective assumptions, including the expected stock price volatility, expected term, and forfeiture rate. Any changes in these highly subjective assumptions could significantly impact stock-based compensation expense.

Advertising and Promotional Costs – Advertising and promotion costs, which are included in selling, general and administrative expense, are expensed as incurred. During the years ended June 30, 2015 and 2014, advertising and promotion costs totaled $641 and $1,394 respectively.

Shipping Costs – Shipping costs are included in selling, general and administrative expenses. During the years ended June 30, 2015 and 2014, shipping cost totaled $42 and $149, respectively.

Research and Development Costs – Research and development costs, which are included in selling, general and administrative expense, consist primarily of salaries and employment related expenses, independent testing fees and allocated facility costs. All such costs are charged to expense as incurred. During the years ended June 30, 2015 and 2014, research and development costs totaled $261 and $319, respectively.

Net Loss Per Share – Basic net loss per share is based upon the weighted average number of common shares outstanding. Diluted net loss per share is based on the assumption that all dilutive convertible shares and stock options were converted or exercised. Dilution is computed by applying the treasury stock method. Under this method, options, warrants and restricted stock are assumed to be exercised at the beginning of the period (or at the time of issuance, if later), and as if funds obtained thereby were used to purchase common stock at the average market price during the period. Since the Company has incurred losses from all periods presented, the dilutive per share calculation is the same as the basic calculation. Anti-dilutive securities not included in net loss per share calculation for the year include:

	Years Ended June 30,
	2015		2014
Potentially dilutive securities:
Outstanding time-based stock options		25,174,000		26,452,000
Convertible note		118,842,000		96,926,000
Warrants		31,231,000		27,944,000

F-9

●

Level 1 — inputs to the valuation methodology are quoted prices (unadjusted) for an identical asset or liability in an active market

●

Level 2 — inputs to the valuation methodology include quoted prices for a similar asset or liability in an active market or model-derived valuations in which all significant inputs are observable for substantially the full term of the asset or liability

●

Level 3 — inputs to the valuation methodology are unobservable and significant to the fair value measurement of the asset or liability

The Company’s financial instruments at June 30, 2015 consist of accounts receivable, accounts payable, notes payable and derivative liability. The Company believes the reported carrying amounts of its accounts receivable, accounts payable, derivative instruments and related party debt approximate fair value, based upon the short-term nature of these instruments.

3. INVENTORIES, NET

Inventories consist of the following:

	June 30, 2015		June 30, 2014
Raw materials	$	-	$	37
Finished goods		-		193
	$	-	$	230

Inventories are presented net of reserves of $1,611 and $1,411 at June 30, 2015 and 2014, respectively. The Company increased the obsolescence reserve by $200 for the year ended June 30, 2015.

4. DEFERRED COST, RELATED PARTY

In December 2012, the Company received an advance of $6,000 from E&B Green Solutions L.P., a Company owned by Francesco Galesi (“Galesi”), a related party, for the purchase of well service products from Inventek Collodial Cleaners, LLC (“Inventek”), also a related party. The Company advanced the $6,000 received from E&B Green Solutions L.P. and additional funds totaling $6,227 to Inventek for the production of the well service products in anticipation of future sales to E&B Green Solutions L.P. The Company did not report the receipt of the funds from E&B Green Solutions L.P. as revenue as of June 30, 2015 because the transaction did not meet the Company’s revenue recognition criteria in accordance with generally accepted accounting principles. As of June 30, 2015, $6,227 of Deferred Cost and $6,000 of Deferred Revenue was included on the accompanying consolidated balance sheet as a result of this transaction. The anticipated proceeds from the sales of oil field services products are expected to be greater than the current value of the Deferred Cost.

5. PROPERTY AND EQUIPMENT

Property and equipment consist of the following:

	June 30, 2015		June 30, 2014		Estimated Useful Lives
Research & Development equipment	$	77	$	77	5-10
Furniture, fixtures and office equipment		16		37	3-5
Total property and equipment, gross		93		114
Less: accumulated depreciation		90		100
	$	3	$	14

Depreciation charges totaled $10 and $15 for the years ended June 30, 2015 and 2014, respectively.

6. INTANGIBLE ASSETS

Oil Field Services

In fiscal 2014, the Company entered into an Intellectual Property Exclusive License and Distribution Agreement (the “Agreement”) with Inventek Colloidal Cleaners, LLC (“Inventek”) and Dr. Paul N. Andrecola (“Dr. Andrecola”) in support of the Company’s oil and gas well services product line. In consideration for the exclusive licenses and Inventek’s technology the Company issued 105,200,000 shares of its common stock to Inventek/ Dr. Andrecola. The initial term of the exclusive license expires May 20, 2039 (25 years) and also contains five automatic ten year renewal periods. These transactions were accounted for as a purchase business transaction. In July 2014 the Company was granted a patent by the U.S. Trademark and Patent Office for biodegradable non-reactive oil well stimulation and method of use based on nano-scale colloidal chemistry. In connection with the share issuances the Company recorded a purchase price allocation of $7,572, in the aggregate, as intangible assets. The Company is utilizing an expected life for the intangible assets of seven years.

Natural Gas Well Services

In August 2014, the Company enter into a Strategic Relationship Agreement with Greentek Fluid Innovations LLC (“GFI”). In consideration for this agreement and for intellectual property purchased in support of the Company’s natural gas well services product line the Company issued 10,000,000 shares of Common Stock, with an aggregate fair market value of $700 to GFI. The agreement has an initial term through June 30, 2019 after which it continues annually until either party gives the other 60-days prior written notice of its intent to terminate the agreement. This transaction is accounted for as a purchase business transaction. The Company is utilizing an expected life for the intangible assets of seven years. The Company completed a valuation of the license, distribution rights and intellectual property related to the GFI Management Strategic Relationship Agreement. The company utilized financial projections based on current opportunities and relationships with existing customers and distributors. Based on the analysis of future discounted cash flows it was determined that the carrying amount of the intangible assets is recoverable at June 30, 2015.

The final purchase price allocation is pending the finalization of valuations for the license, distribution rights and intellectual property which may ultimately impact the overall level of intangible assets associated with the acquisition. The Company will consider any additional information which existed as of the acquisition date but was unknown to the Company at that time, that may become known to the Company during the remainder of the measurement period, a period not to exceed 12 months from the acquisition date, and may result in a change in the purchase price allocation. While management believes that its preliminary estimates and assumptions underlying the value of intangible assets are reasonable, different estimates and assumptions could result in different valuations assigned which may change the amount of the purchase price allocations.

F-11

Cleaning Products

In fiscal 2008, the Company entered into royalty-free license and exclusivity rights agreements with Inventek pursuant to which the Company was granted the exclusive right to sell, market and distribute any Inventek cleaning products in the United States and Canada and the non-exclusive right world-wide. In consideration for the exclusivity rights the Company issued 13,750,000 shares of its Common Stock to Inventek with an aggregate fair market value of $2,550.

Impairment

Periodically, the Company assesses the recoverability of its long lived assets. During Fiscal year 2015, the Company recorded impairment losses of $1,909 and $560 associated with its oil field services and cleaning products intellectual property, respectively.

The Company completed a discounted cash flow analysis to determine if the carrying value on the books was reasonable for the oil field services. It utilized financial projections based on current opportunities and relationships with existing customers and distributors. Since the company is a new entrant into the oil services industry and does not have historical financial results in this industry, it was determined that the carrying amount of the intangible assets from future discounted cash flows as it relates to the Inventek IP Agreement and technology/patents is impaired and warrants the write-down in accordance with applicable accounting rules.

During the fiscal year ended June 30, 2015 the Company continued to sell cleaning products however certain retailers and customers discontinued our product line of cleaning products. Based on our forecasts we deemed that future cash flows from the cleaning products does not support the carrying value of the intangible asset. As such it was determined the carrying amount of the intangible asset was to be written-off in accordance with applicable accounting rules.

Intangible assets consist of the following:

	June 30, 2015		June 30, 2014		Estimated Useful Lives
Purchased technology and exclusivity rights
Oil field services	$	7,572	$	7,572	7
Natural gas well services		700		-	7
Cleaning products		2,550		2,550	7
		10,822		10,122
Less: accumulated amortization		3,289		1,938
Less: impairment loss		2,469		-
	$	5,064	$	8,184

F-12

GREEN EARTH TECHNOLOGIES, INC.AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share data)

Expected amortization of intangible assets is as follows:

2016	$	859
2017		859
2018		859
2019		859
2020		859
Thereafter		769
	$	5,064

Amortization expense included in depreciation and amortization totaled $1,352 and $321 for the years ended June 30, 2015 and 2014, respectively.

7. ACCRUED EXPENSES AND RELATED PARTIES

Accrued liabilities consist of the following:

	June 30, 2015		June 30, 2014
Accrued payroll and taxes	$	566	$	387
Accrued interest		282		296
Accrued sponsorship fees		325		415
Accrued advertising		161		161
Accrued board of director fees		155		148
Other		20		21
	$	1,509	$	1,428

Accrued liabilities, related party consist of the following:

	June 30, 2015		June 30, 2014
Accrued interest	$	377	$	100
Accrued other		286		206
	$	663	$	306

8. NOTES PAYABLE

Notes payable, consist of the following:

	June 30, 2015		June 30, 2014
Promissory Note	$	1,172	$	1,172
3.25 % Secured note	$	60	$	60
	$	1,232	$	1,232

Promissory Note

In October 2013 the Company entered into an agreement with its primary supplier of lubricants, Olympic Oil, owned by Delta Petroleum Company (“Delta”). Pursuant to the agreement, the Company executed and delivered a $1,211 promissory note to Delta, reflecting amounts due and owing by the Company to Delta. At June 30, 2015 and 2014 the balance of the promissory note is $1,172. In February 2014 the Company entered into a two year Intercreditor, Forbearance, Security and Account Control Agreements with Delta (the “Intercreditor Agreement”). The Intercreditor Agreement provides that Delta will continue to manufacturing and deliver the Company’s lubricant products to its customers. The receivables generated from these sales will be used as collateral and customer payments will be sent directly to a blocked bank account controlled by Delta. The profits generated from these sales will be applied to the promissory note. If by February 26, 2015 the balance of the promissory note is greater than $606 then the Company will have to pay Delta the difference between the outstanding balances of the note less $606. The full repayment of the promissory note is due in February 2016. The Company did not make the required installment of $566 in February 2015. The promissory note has not been extended and currently is in default and payable upon demand. The Company considers the cash held in the blocked bank account to be restricted cash. As of June, 2015 and June 30, 2014 restricted cash is $0 and $72, respectively. The Company believes it has claims and offsets against the balance of this note which may reduce the outstanding balance.

F-13

GREEN EARTH TECHNOLOGIES, INC.AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(in thousands, except share and per share data)

3.25% Secured note

At June 30, 2015 and 2014, the balance of the 3.25% secured note payable is $60. As of June 30, 2015 and 2014, accrued interest was $241 and $237, respectively. The note matured on September 30, 2013. It has not been extended and currently is in default and payable upon demand. Since the note is in default, the outstanding principal amount per the agreement bears default interest at a rate three percent (3.0%) greater than the stated rate per annum. Until the default is cured the note will accrue interest at a rate of 6.25%.

Notes payable, related party, consist of the following:

	June 30, 2015		June 30, 2014
6 % Secured Note	$	3,888	$	3,888
3.25% Promissory Note		1,717		1,717
	$	5,605	$	5,605

In September 2014, Techtronic Industries Co., Ltd. and certain of its wholly-owned subsidiaries (collectively, “TTI”), entered into a Confidential Settlement Agreement and Mutual Release (the “Settlement Agreement”) with the Galesi group of companies, Walter Raquet and FWD, LLC (collectively, “FWD”) and the Company. Under the Settlement Agreement TTI in effect sold to FWD for cash consideration their shares of the Company’s Common Stock, rights and claims arising under the Company’s 6% Secured Note, dated January 27, 2012, as amended, in the principal amount of $3,400 plus accrued interest of $488. In addition $1,717 due to TTI for accounts payable and accrued expenses and any other rights, title or interest against company assets were assigned to FWD (see note 11).

In April 2015, FWD and the Company entered into a Second Amendment to the Loan Extension Agreement for the 6% Secured Note and Promissory Note. Under the Loan Extension Agreement the promissory note will bear interest at a rate of three and a quarter (3.25%) percent. The maturity date of the outstanding notes balances were extended to April 1, 2016.

The tables below summarizes the fair values of the Company’s financial liabilities:

	Fair Value at
	June 30,		Fair Value Measurement Using
	2015		Level 1		Level 2		Level 3
Derivative liability - Debentures	$	2,989	$	-	$	-	$	2,989

	Fair Value at
	June 30,		Fair Value Measurement Using
	2014		Level 1		Level 2		Level 3
Derivative liability - Debentures	$	3,701	$	-	$	-	$	3,701

The table below sets forth a summary of changes in the fair value of the Company’s Level 3 financial liabilities (Derivative liability - Debentures) for the periods ended June 30, 2015 and June 30, 2014:

	June 30, 2015			June 30, 2014
Balance at beginning of period	$	3,701		$	2,794
Additions to derivative instruments		812			2,824
Change in fair market value of the derivative liability		(1,524	)		(1,917	)
Balance at end of period	$	2,989		$	3,701

These instruments were valued using pricing models that incorporate the price of a share of Common Stock (as quoted on the Over the Counter Bulletin Board), volatility, risk free rate, dividend rate and estimated life. The Company computed the fair value of the conversion feature using the Black-Scholes model.

The following are the key assumptions used in connection with this computation:

	June 30, 2015			June 30, 2014
Number of shares		118,842,000			96,926,000
Fair market value of stock	$	0.05		$	0.08
Conversion Price	$	0.06-$0.13		$	0.06-$0.13
Volatility		194	%		142% -170	%
Risk-free interest rate		0.22	%		0.03%-.88	%
Expected dividend yield		0	%		0	%
Life of Debentures (years)		.75			.5-1.75

Warrant Liability

In connection with the issuance of Debentures, the Company issued warrants to purchase up to 31,231,000 shares of Common Stock (the “Warrants”). The Warrants have an exercise price of $0.15-$0.21 per share (the “Exercise Price”). Warrants covering up to 18,382,000 shares of Common Stock are exercisable at any time on or before December 31, 2016 and Warrants covering up to 8,552,000, 1,010,000, 875,000 and 2,050,000 shares of Common Stock are exercisable at any time on or before March 31, 2018, June 30, 2018, September 30, 2018, and March 31, 2019, respectively. The Warrants are accounted for as derivative liabilities because the agreement provides for weighted average anti-dilution protection in the event that any shares of Common Stock, or securities convertible into Common Stock, are issued at less than the Exercise Price.

The table below summarizes the fair values of the Company’s financial liabilities:

	Fair Value at
	June 30,		Fair Value Measurement Using
	2015		Level 1		Level 2		Level 3
Derivative liability - Warrants	$	962	$	-	$	-	$	962

	Fair Value at
	June 30,		Fair Value Measurement Using
	2014		Level 1		Level 2		Level 3
Derivative liability - Warrants	$	1,435	$	-	$	-	$	1,435

The table below sets forth a summary of changes in the fair value of the Company’s Level 3 financial liabilities (warrant derivative liability) for the periods ended June 30, 2015 and June 30, 2014:

	June 30, 2015			June 30, 2014
Balance at beginning of period	$	1,435		$	2,058
Additions to derivative instruments		133			414
Change in fair market value		(606	)		(1,037	)
Balance at end of period	$	962		$	1,435

These instruments were valued using pricing models that incorporate the price of a share of Common Stock (as quoted on the Over the Counter Bulletin Board), volatility, risk free rate, dividend rate and estimated life. The Company computed the value of the warrants using the Black-Scholes model.

The following are the key assumptions used in connection with this computation:

	June 30, 2015			June 30, 2014
Number of shares underlying the Warrants		31,231,000			27,944,000
Fair market value of stock	$	0.05		$	0.08
Exercise Price	$	0.14-$0.21		$	0.15-$0.21
Volatility		151%-180	%		127%-141	%
Risk-free interest rate		0.49%-1.15	%		0.80%-.1.42	%
Expected dividend yield		0	%		0	%
Warrant life (years)		1.5-3.75			2.5-4

11. SECURED CONVERTIBLE DEBENTURE, NET OF DEBT DISCOUNT

Secured convertible debentures, net of debt discount, consist of the following:

	June 30, 2015			June 30, 2014
Convertible Debentures	$	11,169		$	9,854
Debt discount		(1,776	)		(3,926	)
	$	9,393		$	5,928

F-16

Debt discount of $10,800 is being amortized over the life of the Debentures and is included in interest expense in the accompanying consolidated statement of operations.

In December 2014, pursuant to an amendment, the holders of the Debentures in the aggregate principal of $7.5 million due March 31, 2015, agreed to extend the maturity date of the Debentures to March 31, 2016. The aggregate principal payments of $11,169 for the secured convertible debentures are due on March 31, 2016.

In October 2014 the Company filed a registration statement for the Debentures issued prior to October 1, 2014. The registration statement became effective in December 2014. All the Debentures after December 2014 are subject to a registration rights agreement and the Company has until December 31, 2015 to file. If the Company does not file by this date, it may be subject to default penalties.

12. STOCKHOLDERS DEFICIT

Shares issued for interest

For the year ended June 30, 2015, the Company issued 10,236,000 shares of our common stock to pay accrued interest from April 1, 2014 to March 31, 2015 on the outstanding Debentures. The fair value of the shares in connection with this transaction totaled $625.

Shares issued for intangible asset

In August 2014, the Company issued 10,000,000 shares of restricted Common Stock to GFI for to the purchase of technology utilized in the Company’s natural gas well services product line. The fair value of the shares in connection with this transaction totaled $700.

Shares issued for payables, related party

In October 2014, the Company issued 300,000 restricted shares to Inventek for their agreement to settle a portion of an amount owed by the Company. The fair value of the shares in connection with this transaction totaled $21.

Shares cancelled due to terminated consulting services

In February 2015 the Company entered into a Distribution Agreement with Marharg Holdings Corporation (Marharg). In connection with the agreement the Company terminated its Marharg consulting agreement for sales and marketing services and cancelled 12,000,000 shares of restricted common stock previously issued to Marharg in February 2014. The fair value of the shares cancelled in connection with this transaction totaled $666.

Forgiveness of debt, related parties

In September 2014, TTI and FWD agreed to the forgiveness of $430 of claims due from the Company with respect to advances for future sales included in deferred revenue. The $430 is included in additional paid-in capital on the consolidated financial statements.

Stock Options

Common stock available for equity awards under the 2008 Employee Stock Award and Incentive Plan, as amended (the “2008 Plan”), is 40,000,000 shares as of June 30, 2015. Under the 2008 Plan, stock option grants may be exercised for a period up to ten years from the date of grant. Option awards are granted with an exercise price equal to the market price of the Company’s stock on the date of grant and generally vest over three years. At June 30, 2015, 14826,000 shares are available for future grants under the 2008 Plan.

Option activity for the year ended June 30, 2015 and 2014 is as follows:

	Number of Options			Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value
Outstanding at June 30, 2013		24,757,000		$	0.32	7.5 years
-Granted		1,750,000
Exercised		-0-
Forfeited and Cancelled		-0-
Outstanding June 30, 2014		26,452,000		$	0.32	6.7 years
Granted		-0-
Exercised		-0-
Forfeited and Cancelled		(1,278,000	)
Outstanding June 30, 2015		25,174,000		$	0.32	5.6 years
Exercisable June 30, 2015		24,674,000		$	0.32	5.5 years

The fair value of each time-based option award is estimated on the date of grant using a Black-Scholes option pricing model with the following assumptions:

	For the Period Ended June 30, 2014
Average expected life (years)		6.0
Average risk free interest rate		1.31	%
Expected volatility		139	%
Expected dividend rate		0	%
Expected forfeiture rate		5	%

Stock based compensation expense for the years ended June 30, 2015 and 2014 was $223 and $374, respectively.

As of June 30, 2015 the unrecognized compensation expense is $112.

Warrants

Warrant activity for the fiscal year ended June 30, 2015 and June 30, 2014 is as follows:

The aggregate intrinsic value represents the difference between the exercise price of the underlying awards and the market price of the Company’s common stock for those awards that have an exercise price below the market price at June 30, 2015. In connection with the dilutive issuance of the fiscal 2015 and 2014 debentures and shares, the associated warrants exercise price is reduced from $0.21 to $0.14 per share.

13. COMMITMENTS AND CONTINGENCIES

Resignation of Greg Adams, Chief Financial Officer, Chief Operating Officer and Secretary

In July 2015, Mr. Adams resigned from his positions as Chief Financial Officer, Chief Operating Officer and Secretary of the Company. As of June 30, 2015 and 2014, the amounts due to Mr. Adams for deferred salary are $139 and $112, respectively. His deferred salary is being paid over 12 months. If the Company fails to pay the deferred salary a severance payment equal to the sum of (i) twenty-four months of his annual base salary; and (ii) all stock options held by the former executive shall immediately vest and remain exercisable for the lesser of their original term or five years

14. INCOME TAXES

The (provision) benefit for income taxes was $0 for the fiscal years ended 2015 and 2014, respectively.

The Company’s effective tax rate differs from the federal statutory rate of 34% as follows:

As of June 30, 2015, the Company had federal net operating loss carry forwards of approximately $66,564. If not used, these carry forwards will expire between 2029 and 2034.

The Company maintains a valuation allowance until it achieves and sustains an appropriate level of profitability.

Compensation expense recognized attributable to non-qualified stationary stock options give rise to temporary timing differences and are not tax deductible by the Company for federal and state income tax purposes until they are exercised. When stock options are cancelled, the Company does not receive any tax benefit and records a reduction of the deferred tax asset, with an offsetting reduction to the valuation allowance. Such reductions in deferred tax assets related to awards that were cancelled were $0 and $0 during the fiscal years ended 2015 and 2014.

During the fiscal years ended 2015 and 2014, the Company did not have unrecognized tax benefits and accordingly did not recognized interest expense or penalties related to unrecognized tax benefits.

The Company’s tax returns for fiscal years 2011 through 2014 are currently open to audit by the tax authorities under the statute limitations for relevant federal and state jurisdictions.

15. RELATED PARTY TRANSACTIONS

Inventek

The Company purchased inventory from Inventek totaling $93 and $201 for the years ended June 30, 2015 and 2014, respectively. As of June 30, 2015 and 2014, a credit of $423 and $435, respectively was due from Inventek, which is recorded in prepaid expenses and other current assets. As of June 30, 2015, Inventek beneficially owned approximately 37.9% of the Company’s issued and outstanding shares of Common Stock.

FWD, LLC (“FWD”)

In September 2014, TTI and the Galesi group of companies, Walter Raquet, the Company’s interim chief executive officer and FWD, LLC (collectively, “FWD”) and the Company entered into a Confidential Settlement Agreement and Mutual Release (the “Settlement Agreement”). Each of Galesi, Raquet and FWD LLC are affiliates of the Company. Under the Settlement Agreement TTI in effect sold to FWD for cash consideration (i) 30,600,778 shares of the Company’s common stock owned by TTI and its chairman, representing all of the shares of common stock owned by TTI and (ii) assigned all of their rights and claims arising under the Company’s 6% Secured Note, dated January 27, 2012, as amended, in the principal amount of $3,888 which includes $3,400 plus accrued interest of $488 held by TTI as well as $1,717 of accounts payable and accrued expenses due TTI and any other rights, title or interest against company assets (see note 7). In addition, as part of the settlement, TTI and FWD agreed to the forgiveness of $430 of claims due from the Company with respect to advances for future sales included in deferred revenue. The $430 is included in additional paid-in capital on the condensed consolidated financial statements. As of June, 2015 the amounts due to FWD for accrued interest was $250. Principal of $100 on the Debentures is due March 31, 2016

Galesi

For the year ended June 30, 2015 and 2014, approximately 2% and 1% of the Company’s revenues, respectively, were to companies owned or controlled by Galesi. As of June 30, 2015 and 2014, amounts due from these entities totaled $0 and $5, respectively. As of June 30, 2015 and 2014, amounts due to Galesi included $3,612 and $2,273 for the 6% Debentures, net of debt discount plus accrued interest and other expenses, respectively. Principal of $3,725 on the Debentures is due March 31, 2016. As of June 30, 2015, Galesi beneficially owned approximately 22.8% of the Company’s issued and outstanding shares of Common Stock.

In December 2012, the Company received $6,000 from Galesi for future sales of well service products, which is included in deferred revenue, related parties on the accompanying consolidated statement of operations (See Note 4).

Walter Raquet (“Raquet”)

Walter Raquet is a Director, a member of the audit committee and interim chief executive officer. As of June 30, 2015 and 2014, the amounts due to Mr. Raquet included $2,449 and $1,220 for the 6% Debentures, net of debt discount plus accrued interest and other expenses, respectively. Principal of $2,904 on the Debentures is due March 31, 2016. As of June 30, 2015, Mr. Raquet beneficially owned approximately 17.7% of the Company’s issued and outstanding shares of Common Stock.

D&L Partners

Doug Von Allmen is the managing member of the D&L Partners. As of June 30, 2015 and 2014, the amounts due to D&L Partners included $1,508 and $1,285 for the 6% Debentures, net of debt discount plus accrued interest and other expenses, respectively. Principal of $1,805 on the Debentures is due March 31, 2016. As of June 30, 2015, Mr. Von Allmen beneficially owned approximately 9.0% of the Company’s issued and outstanding shares of Common Stock.

Marketiquette

As of May 2015, the Marketiquette agreement expired and Jeffrey Loch resigned as President of the Company.

16. CONCENTRATIONS OF RISK

Cash

The Company maintains cash balances at financial institutions that are insured by the Federal Deposit Insurance Corporation subject to certain limitations.

Sales and Accounts Receivable

The following customers represent the majority of the Company’s sales for the years ended June 30, 2015 and 2014, respectively, and accounts receivable for the years ended June 30, 2015 and 2014, respectively:

	June 30, 2015			June 30, 2014
Sales
TTI		48	%		62	%

Accounts Receivable
Tractor Supply Company		63	%		6	%
Canadian Tire Corporation		28	%		-
Walmart		-			18	%
Lowes		-			51	%

Inventory and Accounts Payable

The Company purchases its performance products from Delta Petroleum Company, its cleaning and well service products from Inventek and its power washer equipment products from TTI. The following is the Company’s inventory purchased from these vendors for the years ended June 30, 2015 and 2014, respectively and accounts payable to these vendors for the years ended June 30, 2015 and 2014, respectively:

	June 30, 2015		June 30, 2014
Inventory purchased
Inventek		93	$	201
Delta		490		1,671
TTI		-		273

Accounts Payable
Delta		1,172		1,498

Included in Delta accounts payable is a promissory note of $1,172 (see note 9).

17. SUBSEQUENT EVENTS

In fiscal 2016, the Company realized gross proceeds of $200 from the sale of additional 6.0% Secured Convertible Debentures, due March 31, 2016, and warrants to purchase 1,500,000 shares of Common Stock on or before March 31, 2019 to five accredited investors. The fiscal 2016 debentures have a conversion price of $0.02 per share.

In July 2015, the Company issued 3,090,000 shares of its common stock, with an aggregate fair market value of $168,000 to pay the accrued interest on the convertible debentures.

Delaware		26-0755102
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Large accelerated filer o		Accelerated filer o
Non-accelerated filer o		Smaller reporting company þ
(Do not check if a smaller reporting company)

	Price Range Per Share
	High ($)		Low ($)
Year Ended June 30, 2015:
First Quarter		0.10		0.05
Second Quarter		0.09		0.01
Third Quarter		0.09		0.04
Fourth Quarter		0.08		0.03

Year Ended June 30, 2014:
First Quarter		0.17		0.10
Second Quarter		0.15		0.05
Third Quarter		0.15		0.05
Fourth Quarter		0.13		0.07

	Green Earth Technologies, Inc.

Date: October 13, 2015	By:	/s/ WALTER RAQUET
		Walter Raquet
		Chief Executive Officer
		(Principal Executive Officer )

		Page

Report of Independent Registered Public Accounting Firm		F-2

Consolidated Balance Sheets as of June 30, 2015 and 2014		F-3

Consolidated Statements of Operations for the Years Ended June 30, 2015 and 2014		F-4

Consolidated Statements of Changes in Stockholders’ Deficit for the Years Ended June 30, 2015 and 2014		F-5

Consolidated Statements of Cash Flows for the Years Ended June 30, 2015 and 2014		F-6

Notes to Consolidated Financial Statements		F-7

Signature	Title	Date

/s/ DAVID M. BUICKO	Chairman of the Board of Directors	October 13, 2015
David M. Buicko	Director


/s/ HUMBERT POWELL	Director	October 13, 2015
Humbert Powell


/s/ WALTER RAQUET	Director	October 13, 2015
Walter Raquet	Chief Executive Officer and Principal Financial Officer
	(Principal Executive Officer and Principal Financial Officer)

	Number of Warrants		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value
Outstanding at June 30, 2013		22,059,000	$	0.26			-
Granted		5,885,000		0.21
Exercised		-0-
Forfeited and Cancelled		-0-
Outstanding at June 30, 2014		27,944,000	$	0.20
Granted		3,287,500
Exercised		-0-
Forfeited and Cancelled		-0-
Outstanding and exercisable at June 30, 2015		31,232,000	$	0.20	1.8 years	$	-

	June 30, 2015			June 30, 2014
Statutory federal tax (benefit) rate		(34	%)		(34	%)
State and local taxes, net of federal benefit		(5	%)		(5	%)
Loss on issuance of debentures		-	%		5	%
NOL True-up federal and state		2	%		5	%
Other various permanent differences		-	%		2	%
Valuation Allowance		37	%		27	%
Effective Tax Rate		0	%		0	%

	June 30, 2015			June 30, 2014
Net Operating loss carry forwards - Federal	$	22,483		$	20,993
Net Operating loss carry forwards – State		1,625			1,283
Stock based compensation		6,812			6,756
Debt discount		3,486			2,295
Long-term assets		603			348
Deferred Compensation		54			150
Deferred revenue		(10	)		194
Impairment of intangibles		952			-
Change in fair value of derivative		(3,797	)		(2,988	)
Other		4			11
Reserves and allowances		615			546
Total deferred assets		32,827			29,588
Valuation allowance		(32,827	)		(29,588	)
Net deferred tax assets	$	0		$	0