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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

[X]  ANNUAL REPORT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended July 31, 2012

[   ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________to ___________.

Commission file number 000-53942

URBAN BARNS FOODS INC.
(Exact name of registrant as specified in its charter)

Nevada	20-0215404
(State or Other Jurisdiction of Incorporation of	(I.R.S. Employer Identification No.)
Organization)
7170 Glover Road
Milner BC V0Z 1T0	604-888-0420
(Address of principal executive offices) (ZIP Code)	(Registrant’s telephone number, including area code)

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

Securities registered pursuant to Section12 (g) of the Act: Common Stock, $0.001 par value

Indicate by check mark whether the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes [   ]          No [X]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes [   ]          No [X]

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for shorter period that the registrant as required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes [X]           No [   ] 

Indicate by check mark whether the registration has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that he registrant was required to submit and post such files).

Yes [   ]          No [   ]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.

[   ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer  [   ]

Accelerated filer   [   ]

Non-accelerated filer  [   ]

Smaller reporting company  [X]

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

Yes [   ]          No [X]

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State the aggregate market value of voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and ask price of such common equity, as of the last business day of the registrant’s most recently completed second fiscal quarter.

The aggregate market value of Common Stock held by non-affiliates of the Registrant on October 30, 2012 was $1,836,427.06 based on a $0.027 closing price for the Common Stock on October 30, 2012. For purposes of this computation, all executive officers and directors have been deemed to be affiliates. Such determination should not be deemed to be an admission that such executive officers and directors are, in fact, affiliates of the Registrant.

Indicate the number of shares outstanding of each of the registrant’s classes of common stock as of the latest practicable date.

145,266,817 shares of common stock issued & outstanding as of October 30, 2012

DOCUMENTS INCORPORATED BY REFERENCE

None.

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TABLE OF CONTENTS
PART I		4
Item 1.	Business	4
Item 1A.	Risk Factors	10
Item 1B.	Unresolved Staff Comments	17
Item 2.	Properties	17
Item 3.	Legal Proceedings	17
Item 4.	[Removed and Reserved]	17
PART II		17
Item 5.	Market for Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	17
Item 6.	Selected Financial Data	18
Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	18
Item 8.	Financial Statements and Supplementary Data	23
Item 9.	Changes In and Disagreements with Accountants on Accounting and Financial Disclosure	24
Item 9A.	Controls and Procedures	24
Item 9B.	Other Information	25
PART III		25
Item 10.	Directors, Executive Officers and Corporate Governance	25
Item 11.	Executive Compensation	32
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	34
Item 13.	Certain Relationships and Related Transactions, and Director  Independence	35
Item 14.	Principal Accountant Fees and Services.	36
PART IV		36
Item 15.	Exhibits, Financial Statement Schedules	36
Exhibits		37
SIGNATURES		38

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PART I

Item 1.

Business

Forward-looking Statements

This annual report contains forward-looking statements. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology such as "may", "will", "should", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential" or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions and involve known and unknown risks, uncertainties and other factors that may cause our or our industry's actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable laws, including the securities laws of the United States, we do not intend to update any of the forward-looking statements so as to conform these statements to actual results.

As used in this annual report, the terms "we", "us", "our", “our company”, and "Urban Barns" mean Urban Barns Foods Inc. and of our subsidiary, unless otherwise indicated.

All dollar amounts refer to US dollars unless otherwise indicated.

Overview

We were incorporated as HL Ventures Inc. on May 21, 2007 under the laws of the State of Nevada. Non Industrial Manufacture Inc. was incorporated on February 10, 2010 under the laws of the Province of Alberta. On June 2, 2011 we acquired all of the issued and outstanding common shares of Non Industrial Manufacture Inc. pursuant to a share exchange agreement dated May 2, 2011. As a result, Non Industrial Manufacture Inc. is now our wholly owned subsidiary. Our principal executive office is located at 7170 Glover Drive, Milner, British Columbia, Canada V0X 1T0. Our telephone number is 604.888.0420. Our fiscal year end is July 31.

Current Business

We are an urban produce production company that aims to be the supplier of choice of fresh, locally grown, high-quality organic and conventional fruits and vegetables for urban consumers.

We have identified a revenue opportunity in the produce industry which we believe is currently underutilized. This consists primarily of producing select fruits and vegetables in a secure, indoor environment in close proximity to urban centers, where the population of potential consumers exceeds that of rural locales, regardless of regional climate or outdoor growing season constraints. Our business plan therefore seeks to eliminate two of the most important logistical problems facing both producers and consumers of organic and conventional fruits and vegetables today:

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• costs and delays related to shipping fresh produce from where it is grown to where it can be sold; and

• variations in climate that prevents certain produce from being grown in certain markets.

Our strategy is to develop a series of “Urban Barns” that we use to grow our fruits and vegetables in a number of urban centers, beginning with Montreal, Canada. To do this, we plan to lease and retrofit a series of warehouse-type facilities in high density strategic locations and purchase and install proprietary growing machines to grow our organic and conventional produce. We hope that this will provide consumers with a desirable degree of food security in addition to the other benefits associated with cubic farming, such as a reduced ecological footprint. As of the date of this Prospectus, we have not secured any such locations and have not begun growing fruit and vegetables in commercially viable quantities.

Our mission is to become the first company to create brand-name awareness for its produce by providing locally-grown fruits and vegetables to local retailers and businesses at prices that compete with those at which conventional and organic produce is typically offered. We believe that this will permit consumers to substitute fresh, healthy, high-quality local equivalents into their diet in place of fruits and vegetables grown in distant regions at a similar or more competitive price point.

Currently, geography and logistics make local grown organic fruit and vegetables specialty or seasonal produce in areas with harsh winters such as the Northeast and Mid-West of the USA and all of Canada. The most common method of tapping into this market is with greenhouses. Unfortunately, this is a solution with high fixed costs and high variable costs. Due to the harsh winters and the encroachment on prime agricultural land, there is no realistic way for greenhouse growers to rapidly scale their operations to service all major urban markets. The main suppliers in the sector are large commercial enterprises in South California, or foreign enterprises in Mexico, Chile and Holland. According to figures generated by our management, shipping currently constitutes about seventy percent of the produce supply chain cost. As such, we believe there is an opportunity for Urban Barns to do two things: lower shipping costs without raising the fixed costs, and differentiate its product from other available produce.

Technology

The technology that we plan to use to cultivate our fruits and vegetables consists of a proprietary cubic farming apparatus used to grow produce indoors which takes up a limited amount of space and subjects plants to a variety of light spectrums over the course of their growing cycles. In addition to the land-use benefits it provides, we believe that the growing apparatus makes efficient use of light, energy, water, temperature, production cycle, transportation and labor, and is capable of producing safe, healthy, fresh, high-quality produce in controlled indoor environments. Our strategy of using this technology strategically located in densely populated urban areas will allow us to reduce the cost of production, water usage, carbon emissions and herbicide and pesticide use as compared to traditional methods of farming.

Our technology was developed by us and although the machine is not yet protected by patent, we have filed Patent Corporation Treaty (which covers approximately 145 member countries), USA and Kingdom of Saudi Arabia patent applications to protect this proprietary technology. Currently, we rely on business secrets and know-how to protect our proprietary technology.

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In addition to our proprietary technology, we are also actively seeking to acquire the rights to patented growing equipment developed by third parties. Our management believes that our growing machines, which are set to occupy approximately 150 square feet of floor space, will be able to yield as much output as 1500 square feet of greenhouse space, and allow a single plant to produce up to five times the crop yield that it would using standard greenhouse cultivation practices.

Products and Services

We plan to initially offer the following fruits and vegetables for sale, as we have found that they are relatively easy to propagate and can be grown to maturity in short production cycles: multiple varieties of lettuce, spinach, basil, various herbs, and strawberries. We have identified these items due to their high demand and profit potential, but this list is by no means exhaustive.

We have identified major urban centers in the United States and Canada, where the population is dense and many people live in areas serviced by a relatively small number of distant large food growers situated in South California, Mexico and Chile. We envision a network of ‘Urban Barns’ delivering hundreds of tons of food daily to retailers servicing these urban centers, and millions of people gaining access to our locally grown, fresh, high-quality produce instead of being shipped from Mexico, California or Chile. We believe that this will effectively increase quality of the produce as well as reduce shipping times and costs to bring fresh produce to market.

Market

Currently, geography and logistics make produce farming a specialty or seasonal enterprise. We are dedicated to changing this perception by growing fresh, safe, healthy organic and conventional fruits and vegetables in urban facilities regardless of climate on a year-round basis in a more environmentally-sustainable manner than traditional or greenhouse cultivation would permit. Through the use of our specialized growing machines and the selection of strategic locations for our “Urban Barns”, we believe that we can both service and expand the ever-increasing market for locally-grown produce in a cost-effective and competitive manner.

The value of the 2008 US vegetable crop was estimated at $10.4 billion, up 4 percent from 2007. In terms of production, the three largest crops were onions, head lettuce and watermelons, which combined to account for 37 percent of the total production. Tomatoes, head lettuce and onions claimed the highest values, accounting for 32 percent of the total value when combined. California continued to be the leader in fresh vegetable and melon production, accounting for 49 percent of annual fresh vegetable and melon output. (Vegetables Annual Summary, NASS, USDA, 2009.)

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There are strong indications that consumers are now, more than ever, interested in purchasing safe, locally-grown produce that is subject to a standard of quality such as organic certification. The recent growth of farmer’s markets and the expansion of supermarket chains such as Whole Foods demonstrates that demand for such produce exists, as do public concern over herbicide and pesticide use, country-of-origin labeling and greenhouse gas emissions associated with shipping produce hundreds, and even thousands, of miles from farm to retail outlet. The “eat locally” movement has even been touted in the mainstream U.S. media as a method of reducing one’s carbon footprint.

Organic products account for less than 2% of Canada’s food supply and occupy less than 1% of its dedicated cropland. Nevertheless, over the past decade the market for such products has grown by approximately 20% and it is projected to continue to grow for the foreseeable future.

We plan to capitalize on the opportunity presented by this shift in consumer attitudes by offering them fresh; locally-grown organic and conventional produce alternatives that are competitively-priced and capable of instilling a measure of brand recognition. To achieve the latter, we plan to employ shop-floor selling techniques (i.e. “taste-before-you-buy” campaigns) at the retail level, engage in targeted print advertising and leverage existing social networks on the Internet. We also plan to target additional markets that require bulk produce on a continuous basis, such as produce processors, hotels and restaurants, and we believe that our ability to provide a constant supply of select high volume fruits and vegetables regardless of the local climate will differentiate our produce from that of our competitors.

Distribution Methods

We plan to become a leading supplier of produce to large retail chains by differentiating our fruits and vegetables from other available produce and substantially lowering the shipping costs required to transport most produce from its point of origin to point of sale. To accomplish this, we plan to acquire and retrofit a network of buildings in high density urban locations and equip them with proprietary growing machines to cultivate a variety of fruits and vegetables. The technology will allow us to grow produce with high yields using a fast growing cycle in any location regardless of the local climate.

Once we have grown our produce, we plan to leverage the infrastructure established by Robyn Jackson, our Vice President, Logistics and Director, to distribute our fruits and vegetables on a cost-effective basis. We anticipate entering into agreements with a variety of regional distributors in any other locations in which we plan to operate once we have established the validity of our business model. Mr. Jackson will be in charge for establishing logistics solutions for Urban Barns fruit and produce as well as development of relationships with local distributors and major retailers.

Locations

We plan to establish our first production “Urban Barn” in Montreal, Quebec, Canada. We have entered into negotiations with property owners, to supply space for our first commercial facility. We targeted Montreal based on the presence of a large potential customer base totaling 4 million population, and a thriving tourism industry whose hotels and restaurants require a supply of fresh, high-quality produce year-round.

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Following the set-up of our first “urban barn”, we anticipate investigating other potential locations in the “Quebec City through Windsor, Ontario, corridor which is home to 18.5 million urban residents. From both our first planned location in Montreal and from Windsor, Ontario offers two strategic locations to expand into the United States.

Competition

We will compete with a number of unrelated seasonal operators of greenhouses spread across our target market areas. This common method of growing high-quality produce is limited in terms of cost and scale. Operators must incur both high fixed and variable costs to build and maintain specialized structures for this purpose, which makes it difficult for them to scale their operations to optimal size in multiple locations.

We plan to establish a network of controlled indoor environments in multiple urban locations for the purpose of growing fresh fruit and vegetables and supplying this produce to major food retailers on a year-round basis. Since we plan to acquire and retrofit existing vacant buildings and use proprietary technology to grow our fruits and vegetables, we will not have to incur a significant capital outlay to establish our “urban barns”, and the only limitations we will face in terms of scale will be related to the cost of acquiring and renovating similar facilities in close proximity to multiple urban centers.

We also face competition from producers of organic fruits and vegetables that are grown and shipped from such locations as California, Mexico and Chile. In many cases, these producers are able to grow produce year-round, but they face uncertainty related to shipping costs and delays and variations in climate, as well as environmental risks related to runoff exposure and the presence of airborne agents from surrounding farms.

Intellectual Property

We own the copyright of our logo and all of the contents of our website, www.urbanbarnsfoods.com. We have not filed for any protection of our trademark and we do not currently own any other intellectual property rights. However, we have filed for patent protection for our growing technology and growing methods in Canada, USA and Internationally. The technology and growing methods that we plan to use to cultivate our fruits and vegetables consists of a proprietary cubic farming apparatus used to grow produce indoors which takes up a limited amount of space and subjects plants to a variety of light spectrums over the course of their growing cycles. In addition to the land-use benefits it provides, we believe that the growing apparatus makes efficient use of light, energy, water, temperature, production cycle, transportation and labor, and is capable of producing safe, healthy, fresh, high-quality produce in controlled indoor environments.

Research and Development

We have spent $3,287 on research and development activities, $33,211 researching, developing and designing our technology for our patent protection filings, and $144,931 on R&D growing machines, lighting and environmental control systems from our inception on February 10, 2010 to July 31, 2012.

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Reports to Security Holders

Although we are not currently subject to the reporting and other requirements of the Exchange Act, we intend to furnish our shareholders with annual reports containing financial statements audited by our independent auditors and to make available quarterly reports containing unaudited financial statements for each of the first three quarters of our fiscal year.

The public may read and copy any materials that we file with the SEC at the SEC's Public Reference Room at 100 F Street NE, Washington, DC 20549. The public may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC maintains an Internet site at www.sec.gov that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC.

Government Regulation

We do not currently require any government approvals for our current business activities. However, once we have established our planned “urban barns” locations, we anticipate that we will have to obtain the necessary government licenses, authorizations and labor permits to legally manage our facilities in the locations in which we plan to operate. Many of our facilities and products will be subject to various laws and regulations administered by the United States Department of Agriculture, the Federal Food and Drug Administration, the Occupational Safety and Health Administration, and other federal, state, local, and foreign governmental agencies relating to the quality and safety of products, sanitation, safety and health matters, and environmental control. We believe that we comply with such laws and regulations in all material respects, and that continued compliance with such regulations will not have a material effect upon capital expenditures, earnings, or our competitive position.

While our intended business activities do not currently violate any laws, any regulatory changes that impose restrictions or requirements on us or on our potential customers could adversely affect us by increasing our operating costs, which could have a material adverse effect on our results of operations.

We do not currently incur any significant expenses related to compliance with environmental regulations, and do not believe that this will be a significant expense once we establish our ‘Urban Barns’.

Employees

As of October 30, 2012 we did not have any employees. Our directors and officers provide us with services on a consulting basis. We plan to hire a number of full-time employees in the near future to engage in administrative tasks and the development of our first “urban barn” facility in Montreal, Quebec, Canada. Once we have entered into definitive agreements to distribute our produce, we anticipate hiring additional employees to operate this facility and engaging various consultants to provide legal, accounting, and marketing services to us.

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Item 1A.

Risk Factors

Risks Related to Our Business

We are a Developmental Company

We are an early stage company and may face various challenges confronting such companies, including, for example, limited financial and other resources, inability to penetrate markets and recognize sufficient revenues, and the ability to attain profitability.

Moreover, we have a history of operating losses, expect to continue to incur losses, and may never be profitable, and we must be considered to be in the developmental stage. Further, in the past, we have been dependent on sales of our equity securities and debt financing to meet our cash requirements. We have incurred losses totaling approximately $391,314 from inception to July 31, 2012 and incurred losses of approximately $353,320 during fiscal year ended July 31, 2012. Further, we do not expect positive cash flow from operations in the near term. There is no assurance that actual cash requirements will not exceed our estimates. In particular, additional capital may be required in the event that: (i) the costs to develop our technology and facilities and products may be more than management currently anticipates; and (ii) we encounter greater costs associated with general and administrative expenses.

There is limited evidence that technology used by producers of select organic and conventional fruits and vegetables in secure and controlled indoor environments to grow vegetables will be profitable in a commercial application.

Although we believe that our technology will enable us to implement our business plan, as of the date hereof, the technology is still in the early stage of commercialization and has only limited results in a research and development setting. As of the date of this Annual Report, only one facility is in operation employing our technology to produce vegetables and that facility has been operating as a Research and Development test for three years. If the technology does not perform as anticipated, we will be unable to achieve profitability.

We are substantially dependent on our indoor cubic farming technology. A disruption in this technology may have a negative effect on our results of operations, financial condition and cash flow.

We use certain equipment associated with our indoor cubic farming technology. In the event that this equipment is not readily available to use or the equipment malfunctions without a source of repair, it could have a material adverse effect on our business.

Our business is dependent on locating suitable facilities, acquiring or leasing such facilities on favorable terms and successfully completing the custom construction necessary to install and operate our indoor cubic farming equipment. If we are not able to accomplish any one of these goals, our growth potential, results of operations and business will be materially and adversely affected.

We expect to raise capital to construct our initial cubic farming facility. This requires that we lease and retrofit appropriate facilities. Assuming we can obtain suitable leasing arrangements, specialized construction will be required to adapt these facilities for our business model. We have not entered into any contracts to build and or operate any indoor cubic farming facilities. There can be no assurance that construction of the facilities will be completed within our anticipated time frame or budget. Construction projects are subject to cost overruns and delays not within our control or that of our subcontractors, such as those caused by acts of governmental entities, financing delays or bad weather. Delays can also arise from design changes and material equipment shortages or delays in delivery. Our inability to construct any facility in a timely fashion and within our projected construction budget could have a material adverse effect on our business and our anticipated financial performance.

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Our facilities will require certain permits to operate, which we may not be able to obtain at all or obtain on a timely basis.

The specific permit and approval requirements are set by the state and the various local jurisdictions, including but not limited to city, town, county, township, and state agencies having control over the specific properties. Permits once given may be withdrawn. We may not be able to secure all the necessary permits for future facilities on a timely basis or at all, which may prevent us from operating such facilities according to our business plan. Inability to obtain or maintain permits to construct, operate or maintain our facilities will severely and adversely affect our business.

Outbreaks of plant diseases or pest infestations can significantly restrict our ability to conduct our operations.

We intend to take all reasonable precautions to ensure that our crops are healthy and that our indoor cubic farming facilities operate in a sanitary and environmentally sound manner. However, notwithstanding our precautions, plant diseases or pest infestations could destroy all or a significant portion of the crops in a facility and could eliminate or significantly reduce production from that facility until we are able to disinfect the facility and grow replacement crops. We do not believe that insurance against crop damage from disease or pest infestations will be available. Therefore, such an infestation or contamination could have a significant adverse impact on our business.

A significant interruption in the operation of our indoor cubic farming facility could potentially disrupt our operations.

Our business plan is to diversify and operate multiple locations, however, initially, we will have only one indoor cubic farming facility supporting our operations. A significant interruption impacting this facility, whether as a result of plant diseases or pest infestations, a natural disaster, technical or labor difficulties, fire or other causes, could impair our ability to timely grow or deliver products, potentially resulting in a material adverse effect on our business, financial position and results of operations.

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Water or power shortages could disrupt our production and have a material adverse effect on our business, financial position and results of operations.

Our production will require a continual supply of utilities such as water and electricity. Interruptions of water or electricity supply could result in temporary shutdowns of our irrigation, HVAC and electrical systems. Any suspension or termination of water or electricity of any significant duration or other unexpected business interruptions could have a material and adverse impact on our crops and consequently on our business, financial condition and results of operations.

Energy and fuel cost variations could adversely affect operating results and expenses.

Energy costs, particularly electricity and natural gas, constitute a substantial portion of our operating expenses. The price and supply of energy and natural gas are unpredictable and fluctuate based on events outside our control, including demand for oil and gas, weather, actions by OPEC and other oil and gas producers, and conflict in oil-producing countries. Price escalations in the cost of electricity or reductions in the supply of natural gas could increase operating expenses and negatively affect our results of operations. We may not be able to pass through all or part of the increased energy and fuel costs to our customers.

Our income will depend on sales of perishable merchandise, which can lose its value quickly; such losses could harm our operating results.

Although the cubic farming concept is intended to reduce the time between harvest and sale, our crops will still be subject to all the risks of any perishable food, including spoilage. Accordingly, any delay in harvesting or shipping our crops could result in losses due to spoilage, which would adversely affect our revenues and net income.

Our business is sensitive to fluctuations in market prices and demand for our products.

Fresh vegetables are highly perishable and generally must be brought to market and sold very shortly after harvest. The selling price for certain types of vegetables depends on factors such as the supply of and demand for such vegetables and the availability and quality of such vegetables in the marketplace.

We will plan our production schedule and crop selection based on our analysis and estimate of future market demand. Demand for our products will depend primarily on consumer-related factors, such as demographics, local preferences and food consumption trends, as well as macroeconomic factors, such as the condition of the economy and the level of consumer confidence. To remain competitive, we will need to continually monitor and adapt to the changing market demand. Our failure or inability to follow or adapt to changes in market demand in a timely manner, if at all, may have a material and adverse effect on our business and our results of operation.

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We face the risk of fluctuations in the cost, availability and quality of our raw materials.

Increases in the cost of raw materials essential to our operations, particularly plant seeds, nutrients, and packaging materials, would increase our costs of production, which we may be unable to recoup through higher prices for our crops. A scarcity of these raw materials could require us to curtail production, which also would have a material adverse effect on our results of operations.

We are subject to the risk of product contamination and product liability claims as well as negative publicity associated with food safety issues.

External factors may depress the prices for our products. General public concerns regarding the quality, safety or health risks associated with particular vegetables could reduce demand and prices for some of our products. Harm to the health of consumers may result from tampering by unauthorized third parties, product contamination or spoilage, including the presence of foreign objects, substances, chemicals, other agents, or residues introduced during the growth, storage, handling or transportation phases. We could become subject to claims or lawsuits relating to consumption of our products that are alleged to cause harm to the health of consumers. Even if a product liability claim is unsuccessful or is not fully pursued, the negative publicity surrounding any assertion that our products caused illness or discomfort could adversely affect our reputation with existing and potential customers and our corporate and brand image.

Market demand for our products may also be adversely affected by negative publicity concerning food safety of vegetables produced by other vegetable producers in our target markets. Such negative publicity may lead to a loss of consumer confidence and a decrease in the demand and prices for our products. Despite such decreased demand, circumstances may require us to bring our produce to market promptly, in which case we may experience losses on those products.

A decrease in the selling price received for our products due to product liability claims or perceived issues relating to quality, safety or health risks associated with our products could have a material adverse effect on our business, results of operations and financial condition.

The fresh vegetable market is highly competitive and our growth and results of operations may be adversely affected if we are unable to compete effectively.

Our competitors include, but are not limited to, local, regional, national and international producers of produce of all kinds. Their businesses compete with us for customers and locations. In addition, some are expanding more aggressively in marketing a range of natural and organic foods. Some of these potential competitors may have been in business longer or may have greater financial or marketing resources than we do and may be able to devote greater resources to sourcing, promoting and selling their products.

In addition, although indoor cubic farming is a new business and we believe that our technology gives us certain competitive advantages, there are other indoor agriculture systems available and the cost of entry into the indoor farming business may not prove to be a significant competitive barrier. There can be no assurance that others have not developed or will not independently develop proprietary technology similar to ours. The extent that we may be required in the future to obtain licenses with respect to patents or other proprietary rights obtained by others and the availability and cost of any such licenses are currently unknown. Additional costs incurred as a result of acquiring any patents or licenses may adversely affect our cash flow and net income.

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Our operations will be highly regulated in the areas of food safety and protection of human health and we may be subject to the risk of incurring compliance costs and the risk of potential claims and regulatory actions.

We will be subject to various federal, state and local laws, regulations and administrative practices affecting our business, and we will have to comply with provisions regulating health and sanitation standards, food labeling, equal employment, and minimum wages and licensing, in addition to building codes and fire and other safety regulations. These laws and regulations directly affect our day-to-day operations, and violations of these laws and regulations can result in substantial fines or penalties. There can be no assurance that these fines or penalties would not have a material adverse effect on our business, results of operations and financial condition. To stay compliant with all of the laws and regulations that apply to our operations and produce, we may be required in the future to modify our operations, purchase new raw materials or make capital improvements, which could have a material adverse effect on our operations.

Risks Related to our Common Stock

Sales of a Substantial Number of Shares of Common Stock Into the Public Market by Certain Stockholders May Result in Significant Downward Pressure on the Price of our Common Stock and Could Affect Your Ability to Realize the Current Trading Price of our Common Stock.

Sales of a substantial number of shares of our common stock in the public market by certain stockholders could cause a reduction in the market price of our common stock. As of the date of this Annual Report, we have 145,266,817 shares of common stock issued and outstanding. Of the total number of shares of common stock issued and outstanding, certain stockholders are able to resell shares pursuant to a Registration Statement on S-8 filed with the Securities and Exchange Commission.

As of the date of this Annual Report, there are 109,149,674 outstanding shares of common stock that are restricted securities as that term is defined in Rule 144 under the Securities Act of 1933, as amended (the "Securities Act"). Although the Securities Act and Rule 144 place certain prohibitions on the sale of restricted securities, restricted securities may be sold into the public market under certain conditions. Any significant downward pressure on the price of our common stock as the selling stockholders sell their shares of our common stock could encourage short sales by the selling stockholders or others. Any such short sales could place further downward pressure on the price of our common stock.

The Trading Price of Our Common Stock on the OTC Bulletin Board Will Fluctuate Significantly and Stockholders May Have Difficulty Reselling Their Shares.

As of the date of this Annual Report, our common stock trades on the Over-the-Counter Bulletin Board. There is a volatility associated with Bulletin Board securities in general and the value of your investment could decline due to the impact of any of the following factors upon the market price of our common stock: (i) disappointing results from our development efforts; (ii) failure to meet our revenue or profit goals or operating budgets; (iii) decline in demand for our common stock; (iv) downward revisions in securities analysts' estimates or changes in general market conditions; (v) technological innovations by competitors or in competing technologies; (vi) lack of funding generated for operations; (vii) investor perception of our industry or our prospects; and (viii) general economic trends.

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In addition, stock markets have experienced price and volume fluctuations and the market prices of securities have been highly volatile. These fluctuations are often unrelated to operating performance and may adversely affect the market price of our common stock. As a result, investors may be unable to sell their shares at a fair price and you may lose all or part of your investment.

Additional Issuance of Equity Securities May Result in Dilution to our Existing Stockholders.

Our Articles of Incorporation authorize the issuance of 500,000,000 Class A, 25,000,000 Class B and 100,000,000 Preferred shares of common stock. The board of directors has the authority to issue additional shares of our capital stock to provide additional financing in the future and the issuance of any such shares may result in a reduction of the book value or market price of the outstanding shares of our common stock. If we do issue any such additional shares, such issuance may also cause a reduction in the proportionate ownership and voting power of all other stockholders. As a result of such possible dilution, your proportionate ownership interest and voting power will be decreased accordingly. Further, any such issuance could result in a change of control.

Because we have complied with rules requiring the adoption of certain corporate governance measures, our stockholders have limited protections against interested director transactions, conflicts of interest and similar matters.

The Sarbanes-Oxley Act, as well as the rules enacted by the SEC and the national stock exchanges as a result of the Sarbanes-Oxley Act, requires the implementation of various measures relating to corporate governance. These measures are designed to enhance the integrity and efficiency of corporate management and the securities markets and apply to securities which are listed on those exchanges. Because we have complied with many of the corporate governance provisions, our stockholders have limited protections. Certain of these corporate governance provisions are as follows: (i) establishment of an audit committee charter and appointment of members to the audit committee; (ii) adoption of an ethics code; (iii) conduct analysis of our internal and financial control procedures; and (iv) establishment of a compensation committee. Management intends to address these issues within our organizational structure during fiscal year 2012/2013 to ensure the best effective corporate governance and financial management. Management has adopted certain corporate governance practices as follows: (i) adherence to a clear ethical basis within all business operations; (ii) alignment of business goals with such ethical basis; (iii) strategic management which incorporates shareholder value; (iv) identifying corporate organizational structure to effect good corporate governance; and (v) creating reporting systems to provide transparency and accountability.

Until we comply with the corporate governance measures adopted by the national securities exchanges after the enactment of Sarbanes-Oxley Act, regardless of whether such compliance is required, the absence of standards of corporate governance may leave our stockholders without protections against interested director transactions which may not be favorable to the shareholders, conflicts of interest and similar matters, and investors may be reluctant to provide us with funds in the future if we determine it is necessary to raise additional capital. We intend to comply with all applicable corporate governance measures relating to director independence as soon as practicable.

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Our Common Stock is Classified as a “Penny Stock” Under SEC Rules Which Limits the Market for Our Common Stock.

The SEC has adopted 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 registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system). Penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document prepared by the SEC, which specifies information about penny stocks and the nature and significance of risks of the penny stock market. A broker-dealer must also provide the customer with bid and offer quotations for the penny stock, the compensation of the broker-dealer, and sales person in the transaction, and monthly account statements indicating the market value of each penny stock held in the customer's account. In addition, the penny stock rules require that, prior to a transaction in a penny stock not otherwise exempt from those rules; the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement to the transaction. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for stock that becomes subject to those penny stock rules.

Securities analysts may not provide coverage of our common stock or may issue negative reports, which may have a negative impact on the market price of our common stock.

Securities analysts have not historically provided research coverage of our common stock and may elect not to do so in the future. If securities analysts do not cover our common stock, the lack of research coverage may cause the market price of our common stock to decline. The trading market for our common stock may be affected in part by the research and reports that industry or financial analysts publish about our business. If one or more of the analysts who elects to cover us downgrades our stock, our stock price would likely decline substantially. If one or more of these analysts ceases coverage of us, we could lose visibility in the market, which in turn could cause our stock price to decline. In addition, rules mandated by the Sarbanes-Oxley Act of 2002 and a global settlement reached in 2003 between the SEC, other regulatory agencies and a number of investment banks have led to a number of fundamental changes in how analysts are reviewed and compensated. In particular, many investment banking firms are required to contract with independent financial analysts for their stock research. It may be difficult for companies such as ours, with smaller market capitalizations, to attract independent financial analysts that will cover our common stock. This could have a negative effect on the market price of our stock.

Our Officer and Directors are Outside the United States with the Result That it May Be Difficult for Investors to Enforce Within the United States Any Judgments Obtained Against Us or Our Directors or Officers.

Our officers and directors are nationals and/or residents of a country other than the United States, and all or a substantial portion of such person's assets are located outside the United States. As a result, it may be difficult for investors to effect service of process on our directors or officers, or enforce within the United States or Canada any judgments obtained against us or our officers or directors, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state thereof. Consequently, you may be effectively prevented from pursuing remedies under U.S. federal securities laws against them. In addition, investors may not be able to commence an action in a Canadian court predicated upon the civil liability provisions of the securities laws of the United States.

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Item 1B.

Unresolved Staff Comments

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

Item 2.

Properties

Our executive office is located at 7170 Glover Drive, Milner, British Columbia, Canada V0X 1T0. We have not entered into any agreement regarding this office, which is provided to us at no charge by Jacob Benne, our President, Chief Executive Officer and Director.

Item 3.

Legal Proceedings

We are not aware of any pending or threatened legal proceedings which involve us or any of our products or services.

Item 4.

[Removed and Reserved]

PART II

Item 5.

Market for Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

Our common stock is not traded on any exchange. Our common stock is quoted on OTC Bulletin Board under the trading symbol “URBF.QB”. We cannot assure you that there will be a market in the future for our common stock.

OTC Bulletin Board securities are not listed and traded on the floor of an organized national or regional stock exchange. Instead, OTC Bulletin Board securities transactions are conducted through a telephone and computer network connecting dealers. OTC Bulletin Board issuers are traditionally smaller companies that do not meet the financial and other listing requirements of a national or regional stock exchange.

The following table reflects the high and low bid information for our common stock obtained from Stockwatch and reflects inter-dealer prices, without retail mark-up, markdown or commission, and may not necessarily represent actual transactions.

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The high and low bid prices of our common stock for the periods indicated below are as follows:

Holders

As of October 30, 2012 there were 92 holders of record of our common stock.

Dividends

To date, we have not paid dividends on shares of our common stock and we do not expect to declare or pay dividends on shares of our common stock in the foreseeable future. The payment of any dividends will depend upon our future earnings, if any, our financial condition, and other factors deemed relevant by our Board of Directors.

Equity Compensation Plans

On July 25, 2011 our board of directors approved the establishment of the 2011 Employee Stock and Option Plan which provides for the issuance of 7,000,000 shares or options to acquire our common stock to our directors, officers, employees and consultants. As of October 30, 2012, 1,400,000 shares and 5,100,000 options had been issued.

Recent Sales of Unregistered Securities

We have not made any previously unreported sales to July 31, 2012.

Recent Purchases of Equity Securities by us and our Affiliated Purchases

We have not repurchased any of our common stock and have no publicly announced repurchase plans or programs as of October 30, 2012.

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

We are a development stage company with limited operations and revenues from our business operations. Our auditors have issued a going concern opinion. This means that our auditors believe there is substantial doubt that we can continue as an on-going business for the next twelve months unless we obtain additional financing to fund our operations. Our only source of cash at this time is investments by others in our company.

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Forward-Looking Statements

This report contains forward-looking statements that involve risks and uncertainties. These statements relate to future events or our future financial performance. In some cases, you can identify forward-looking statements by terminology including, "could" "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential" and the negative of these terms or other comparable terminology. These statements are only predictions. Actual events or results may differ materially.

While these forward-looking statements, and any assumptions upon which they are based, are made in good faith and reflect our current judgment regarding the direction of our business, actual results will almost always vary, sometimes materially, from any estimates, predictions, projections, assumptions or other future performance suggested in this Annual Report.

Liquidity and Capital Resources

As of July 31, 2012 we had cash of $24,051, total current assets of $36,259, total current liabilities of $175,898 and working capital deficit of $139,639 compared to working capital deficit of $134,149 as of July 31, 2011.

During the year ended July 31, 2012, we received net cash of $208,320 from financing activities, compared to net cash received of $104,867 from financing activities during the year ended July 31, 2011. The increase in cash from financing activities was due to the issuance of common stock.

During the year ended July 31, 2012, we used net cash of $112,323 on operating activities, compared to $12,955 net cash used on operating activities during the year ended July 31, 2011. The increase in cash used on operating activities was due to the increase of activities after our reverse merger with Non Industrial Manufacture Inc.

During the year ended July 31, 2012, we used net cash of $104,853 from investing activities compared to $56,291 used from investing activities during the year ended July 31, 2011. The reason for the decrease in cash was due to the investment in our patents pending and additional growing equipment.

Since February 10, 2010 (inception) to July 31, 2012, our accumulated deficit was $526,299. We are dependent on the funds raised through our equity or debt financing, investing activities, and revenue generated through the sales of our products to fund our operations.

We anticipate that we will meet our ongoing cash requirements by retaining income as well as through equity or debt financing. We plan to cooperate with various individuals and institutions to acquire the financing required to produce and distribute our products and anticipate this will continue until we accrue sufficient capital reserves to finance all of our productions independently.

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Plan of Operation

We are an urban produce production company that aims to be the supplier of choice of fresh, locally grown, high-quality organic and conventional fruits and vegetables located close to urban consumers.

We estimate that our expenses over the next 12 months will be approximately $1,934,531 as summarized in the table below. These estimates may change significantly depending on the nature of our future business activities and our ability to raise capital from investors or other sources.

Our general and administrative expenses for the year will consist of professional fees, office maintenance, communication expenses (cellular, internet, fax and telephone), bank charges, courier and postage costs, office supply costs and fees related to our website. Our professional fees will include legal, accounting and auditing fees related to our regulatory filings throughout the year.

Based on our planned expenditures, we require additional funds of $2,000,000 to proceed with our business plan over the next 12 months. If we are not able to obtain additional financing on a timely basis, we will be unable to conduct our operations as planned, and we will not be able to meet our obligations as they become due. In such event, we will be forced to scale down or perhaps even cease our operations.

Results of Operations for the Years Ended July 31, 2012 and 2011

The following summary of our results of operations should be read in conjunction with our audited financial statements for the years ended July 31, 2012 and 2011.

Our operating results for the years ended July 31, 2012 and 2011 are summarized as follows:

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		Year Ended
		July 31
		2012			2011
Revenue	$	Nil		$	Nil
Depreciation		17,110		$	6,329
Foreign exchange (gain) loss		687		$	(17,041	)
General and administrative		173,635		$	26,377
Professional fees		144,058		$	18,345
Research and development		3,097		$	190

Revenues

We have not earned any revenues since inception.

Expenses

For the year ended July 31, 2012, we have total operating expenses of $338,587 compared to total operating expenses of $34,200 for the year ended July 31, 2011.

Our operating expenses increased due to increased general and administrative costs and professional fees as we are preparing to enter full revenue generating production.

Net Loss

Since our inception on February 10, 2010 to July 31, 2012, we incurred net a loss of $391,314. For the year ended July 31, 2012, we incurred net loss of $353,320 compared to $34,200 for the year ended July 31, 2011. Our net loss per share was $0.01 for the year ended July 31, 2012 and $0.00 for the year ended July 31, 2011.

Off-Balance Sheet Arrangements

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

Inflation

The amounts presented in the financial statements do not provide for the effect of inflation on our operations or financial position. The net operating losses shown would be greater than reported if the effects of inflation were reflected either by charging operations with amounts that represent replacement costs or by using other inflation adjustments.

Critical Accounting Policies

Our financial statements and accompanying notes have been prepared in conformity with accounting principles generally accepted in the United States of America for financial statements. Preparing financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. These estimates and assumptions are affected by management’s application of accounting policies. We believe that understanding the basis and nature of the estimates and assumptions involved with the following aspects of our financial statements is critical to an understanding of our financials.

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Use of Estimates

The preparation of these consolidated financial statements in conformity with generally accepted accounting principles in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. We regularly evaluate estimates and assumptions related to the useful life and recoverability of long-lived assets, fair value of convertible debt and share-based payments, and deferred income tax valuation allowances. We base our estimates and assumptions on current facts, historical experience and various other factors that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by us may differ materially and adversely from our estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

Stock-Based Compensation

We record stock-based compensation using the fair value method in accordance with ASC 718, Compensation – Stock Compensation. All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.

We use the Black-Scholes option pricing model to calculate the fair value of stock-based awards. This model is affected by our stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to our expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. The value of the portion of the award that is ultimately expected to vest is recognized as an expense in the consolidated statement of operations over the requisite service period.

Loss Per Share

We compute net loss per share in accordance with ASC 260 Earnings Per Share which requires presentation of both basic and diluted earnings per share (EPS) on the face of the income statement. Basic EPS is computed by dividing net income (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti dilutive.

Item 7A

Qualitative and Qualitative Disclosures about Market Risk

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

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Item 8.

Financial Statements and Supplementary Data