|   | (Mark      One)                                                                                              |
|--------|--------------------------------------------------------------------------------------------------------------|
| þ | QUARTERLY      REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF      1934        |
|   | For      the quarterly period ended June 30, 2008                                                            |
|   | or                                                                                                           |
|   |                                                                                                         |
| o      | TRANSITION      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF      1934           |
|   |                                                                                                         |
|   | For      the transition period      from           to |

| New      Jersey                      | 22-3720628               |
|--------------------------------------|--------------------------|
| (State      or other jurisdiction of | (I.R.S.      Employer    |
| incorporation      or organization)  | Identification      No.) |

----

|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |
|----------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | Page   |
| PART      I   FINANCIAL INFORMATION |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| Item      1                                        | Condensed      Consolidated Financial Statements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | F-1    |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |
|                                               | Condensed      Consolidated Balance Sheets as of June 30, 2008 (unaudited) and December      31, 2007                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | F-1    |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |
|                                               | Condensed      Consolidated Statements of Operations for the Three and Six Month Periods      Ended June 30, 2008 and 2007 (unaudited)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | F-2    |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |
|                                               | Condensed      Consolidated Statements of Changes in Shareholders’ Capital Deficit for      the Three and Six Month Periods Ended June 30, 2008 and      2007  (unaudited)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | F-3    |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |
|                                               | Condensed      Consolidated Statements of Cash Flows for the Three and Six Month Periods      Ended June 30, 2008 and 2007  (unaudited)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | F-4    |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |
|                                               | Notes      to Condensed Consolidated Financial Statements (unaudited)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | F-5    |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |
| Item      2                                        | Management’s      Discussion and Analysis of Financial Condition and Results of      Operations                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | 3      |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |
| Item      3                                        | Quantitative      and Qualitative Disclosures About Market      Risk                                                                                                                     | 6      |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |
| Item      4                                        | Controls      and      Procedures                                                                                                                                                        | 6      |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| PART      II OTHER INFORMATION                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| Item      1                                        | Legal      Proceedings                                                                                                                                                                   | 8      |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |
| Item      1A                                       | Risk      Factors                                                                                                                                                                        | 8      |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |
| Item      2                                        | Unregistered      Sales of Equity Securities and Use of      Proceeds                                                                                                                    | 8      |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |
| Item      3                                        | Defaults      Upon Senior      Securities                                                                                                                                                | 8      |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |
| Item      4                                        | Submission      of Matters to a Vote of Security      Holders                                                                                                                            | 8      |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |
| Item      5                                        | Other      Information                                                                                                                                                                   | 8      |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |
| Item      6                                        | Exhibits                                                                                                                                                                                 | 9      |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| SIGNATURES                                         | 10                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|                                               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| CERTIFICATIONS                                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |

----

----

|                                                      |   |          |       |   |      |   |
|-----------------------------------------------------------|--------|---------------|------------|--------|-----------|--------|
|                                                      |   | June      30, |       |   | 2007      |   |
|                                                      |   | 2008          |       |   | (Audited) |   |
| ASSETS                                                    |   |          |       |   |      |   |
|                                                      |   |          |       |   |      |   |
| Current      Assets                                       |   |          |       |   |      |   |
| Cash                                                      |   | $             | 58,362     |   |      | $      | - |   |
|                                                      |   |          |       |   |      |   |   |   |
| Total      Current Assets                                 |   |          | 58,362     |   |      |   | - |   |
|                                                      |   |          |       |   |      |   |   |   |
| Total      Assets                                         |   | $             | 58,362     |   |      | $      | - |   |
|                                                      |   |          |       |   |      |   |   |   |
|                                                      |   |          |       |   |      |   |   |   |
| LIABILITIES      AND STOCKHOLDERS' DEFICIT                |   |          |       |   |      |   |   |   |
|                                                      |   |          |       |   |      |   |   |   |
| Liabilities                                               |   |          |       |   |      |   |   |   |
| Accounts      Payable                                     |   | $             | -          |   |      | $      | 59,478 |   |
| Notes      Payable - Shareholders                         |   |          | 94,950     |   |      |   | 1,204,950 |   |
|                                                      |   |          |       |   |      |   |   |   |
| Total      Liabilities                                    |   |          | 94,950     |   |      |   | 1,264,428 |   |
|                                                      |   |          |       |   |      |   |   |   |
| Stockholders'      Deficit                                |   |          |       |   |      |   |   |   |
|                                                      |   |          |       |   |      |   |   |   |
| Preferred      Stock, authorized                          |   |          |       |   |      |   |   |   |
| 20,000,000      shares, par value $0.0001,                |   |          |       |   |      |   |   |   |
| no      preferred stock is outstanding                    |   |          | -          |   |      |   | - |   |
|                                                      |   |          |       |   |      |   |   |   |
| Common      Stock, authorized                             |   |          |       |   |      |   |   |   |
| 100,000,000      shares, par value $0.0001,               |   |          |       |   |      |   |   |   |
| issued:      55,178,449 and 51,228,450;                   |   |          |       |   |      |   |   |   |
| outstanding:  49,042,329      and 45,228,450 on |   |          |       |   |      |   |   |   |
| June      30, 2008 and December 31, 2007 respectively     |   |          | 5,519      |   |      |   | 5,124 |   |
|                                                      |   |          |       |   |      |   |   |   |
| Paid      in Capital                                      |   |          | 3,838,442  |   |      |   | 2,633,887 |   |
|                                                      |   |          |       |   |      |   |   |   |
| Accumulated      Deficit During                           |   |          |       |   |      |   |   |   |
|      Development      Stage      |   |          | (3,689,163 | )      |      |   | (3,712,053 | ) |
|                                                      |   |          |       |   |      |   |   |   |
| Common      Stock in Treasury: 6,136,120 shares           |   |          |       |   |      |   |   |   |
| at      cost                                              |   |          | (191,386   | )      |      |   | (191,386 | ) |
|                                                      |   |          |       |   |      |   |   |   |
| Total      Stockholders' Deficit                          |   |          | (36,588    | )      |      |   | (1,264,428 | ) |
|                                                      |   |          |       |   |      |   |   |   |
| Total      Liabilities and Stockholders' Deficit          |   | $             | 58,362     |   |      | $      | - |   |
|                                                      |   |          |       |   |      |   |   |   |
|                                                      |   |          |       |   |      |   |   |   |

----

|                                       |   |                                  |       |   |                                     |   |       |                              |   |   |       |   |   |               |       |
|--------------------------------------------|--------|---------------------------------------|------------|--------|------------------------------------------|--------|------------|-----------------------------------|--------|--------|------------|--------|--------|--------------------|------------|
|                                       |   |                                  |       |   |                                     |   |       |                              |   |   |       |   |   |               |       |
|                                       |   |                                  |       |   |                                     |   |       |                              |   |   |       |   |   | June      24, 2003 |       |
|                                       |   | Three Months Ended      June      30, |       |   | Six Months      Ended June      30, |   |       | (Inception) to      June      30, |   |
|                                       |   | 2008                                  |       |   | 2007                                     |   |       | 2008                              |   |   | 2007       |   |   | 2008               |       |
| Operating      Expenses                    |   |                                  |       |   |                                     |   |       |                              |   |   |       |   |   |               |       |
| General      and Administrative            |   | $                                     | 12,098     |   |                                     | $      | 258,479    |                              |   | $      | 2,098      |   |   | $                  | 351,505    |   |   | $ | 338,559 |   |
| Interest      Expense                      |   |                                  | 90         |   |                                     |   | 1,106      |                              |   |   | 10,090     |   |   |               | 1,106      |   |   |   | 13,613 |   |
| Advertising      and Promotion             |   |                                  | -          |   |                                     |   | 77,429     |                              |   |   | -          |   |   |               | 127,651    |   |   |   | 129,961 |   |
| Research      and Development              |   |                                  | -          |   |                                     |   | 656,000    |                              |   |   | -          |   |   |               | 1,356,000  |   |   |   | 1,066,327 |   |
| Professional      Fees                     |   |                                  | 24,400     |   |                                     |   | 199,161    |                              |   |   | 24,400     |   |   |               | 302,510    |   |   |   | 58,400 |   |
|                                       |   |                                  |       |   |                                     |   |       |                              |   |   |       |   |   |               |       |   |   |   |   |   |
| Total      Expenses                        |   |                                  | 36,588     |   |                                     |   | 1,192,175  |                              |   |   | 36,588     |   |   |               | 2,138,772  |   |   |   | 1,606,860 |   |
|                                       |   |                                  |       |   |                                     |   |       |                              |   |   |       |   |   |               |       |   |   |   |   |   |
| Net      (Loss) before Extraordinary Items |   |                                  | (36,588    | )      |                                     |   | (1,192,175 | )                                 |   |   | (36,588    | )      |   |               | (2,138,772 | ) |   |   | (1,606,860 | ) |
|                                       |   |                                  |       |   |                                     |   |       |                              |   |   |       |   |   |               |       |   |   |   |   |   |
| Extraordinary      Items                   |   |                                  |       |   |                                     |   |       |                              |   |   |       |   |   |               |       |   |   |   |   |   |
| Loss      on Discontinued Operations       |   |                                  | -          |   |                                     |   | -          |                              |   |   | -          |   |   |               | -          |   |   |   | (2,231,657 | ) |
| Gain      on Forgiveness of Debt           |   |                                  | -          |   |                                     |   | -          |                              |   |   | 59,478     |   |   |               | -          |   |   |   | 149,310 |   |
| Interest      Income                       |   |                                  | -          |   |                                     |   | -          |                              |   |   | -          |   |   |               | -          |   |   |   | 44 |   |
|                                       |   |                                  |       |   |                                     |   |       |                              |   |   |       |   |   |               |       |   |   |   |   |   |
| Net      Income/(Loss)                     |   | $                                     | (36,588    | )      |                                     | $      | (1,192,175 | )                                 |   | $      | 22,890     |   |   | $                  | (2,138,772 | ) |   | $ | (3,689,163 | ) |
|                                       |   |                                  |       |   |                                     |   |       |                              |   |   |       |   |   |               |       |   |   |   |   |   |
| Basic      and Diluted                     |   |                                  |       |   |                                     |   |       |                              |   |   |       |   |   |               |       |   |   |   |   |   |
| (Loss)      per Share                      |   | $                                     | (0.00      | )      |                                     | $      | (0.02      | )                                 |   | $      | (0.00      | )      |   | $                  | (0.04      | ) |   |   |   |   |
|                                       |   |                                  |       |   |                                     |   |       |                              |   |   |       |   |   |               |       |   |   |   |   |   |
| Weighted      Average                      |   |                                  |       |   |                                     |   |       |                              |   |   |       |   |   |               |       |   |   |   |   |   |
|    Number      of Shares    |   |                                  | 47,067,230 |   |                                     |   | 50,978,771 |                              |   |   | 47,067,230 |   |   |               | 50,978,771 |   |   |   |   |   |
|                                       |   |                                  |       |   |                                     |   |       |                              |   |   |       |   |   |               |       |   |   |   |   |   |
|                                       |   |                                  |       |   |                                     |   |       |                              |   |   |       |   |   |               |       |   |   |   |   |   |

----

|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   | Deficit     |   |     |   |   |   |       |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-----------|--------|----------|--------|--------|-------------------|------------|-------------|--------------|--------|--------|---------------|--------|--------|----------------------------|-----------|--------|-------------|--------|----------|--------|--------|--------|------------|--------|
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   | Accumulated |   |     |   |   |   |       |   |
|                                                                                                                                                                                                                               | Issue     |   | PricePer |   |   | Common      Stock |       |        | Paid      in |   |   | Subscriptions |   |   | During      theDevelopment |      |   | Treasury    |   |     | Total  |   |
|                                                                                                                                                                                                                               | Date      |   | Share    |   |   | Shares            |       |        | Amount       |   |   | Capital       |   |   | Receivable                 |      |   | Stage       |   |     | Stock  |   |   | Equity     |   |
| Balance      at inception, June      24, 2003                                                                                                                                                                                      |      |   |     |   |   |              | 25,000,000 |        |         | $      | 2,500  |          |   | $      | 502                        |      |   | $           | -      |     |   | $      | (4,502 | )          |   |   |   |   | $ | (1,500 | ) |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |
| Adjustment      effected in reverse                                                                                                                                                                                                |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |
|      acqusition                                                                                                                                                                                           | 15-Aug-03 |   | $        | 0.002  |   |              |       | 56,855,000  |         |   |   | 5,686         |   |   |                       | 111,944   |   |        |   |     |   |   |   | 4,502      |   |   |   |   |   |   | 122,132 |   |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |
| Net      (Loss)                                                                                                                                                                                                                    |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   | (152,649   | )      |   |   |   |   |   | (152,649 | ) |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |
| Balance,      December 31, 2003                                                                                                                                                                                                    |      |   |     |   |   |              |       | 81,855,000  |         |   |   | 8,186         |   |   |                       | 112,446   |   |        |   | -        |   |   |   | (152,649   | )      |   |   | - |   |   |   | (32,017 | ) |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Common      shares issued for cash                                                                                                                                                                                                 | 15-Mar-04 |   | $        | 0.04   |   |              |       | 375,000     |         |   |   | 38            |   |   |                       | 14,962    |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   | 15,000 |   |
| Common      shares issued for cash                                                                                                                                                                                                 | 15-Jul-04 |   | $        | 0.10   |   |              |       | 2,500,000   |         |   |   | 250           |   |   |                       | 249,750   |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   | 250,000 |   |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Net      (Loss)                                                                                                                                                                                                                    |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   | (186,297   | )      |   |   |   |   |   |   | (186,297 | ) |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Balance,      December 31, 2004                                                                                                                                                                                                    |      |   |     |   |   |              |       | 84,730,000  |         |   |   | 8,474         |   |   |                       | 377,158   |   |        |   | -        |   |   |   | (338,946   | )      |   |   | - |   |   |   | 46,686 |   |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Common      shares re-purchased by                                                                                                                                                                                                 |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
|      the      Company and retired                                                                                                                                                                         | 01-Jan-05 |   | $        | 0.001  |   |              |       | (46,655,000 | )            |   |   | (4,666        | )      |   |                       | (38,541   | )      |        |   |     |   |   |   |       |   |   |   |   |   |   |   | (43,207 | ) |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Net      (Loss)                                                                                                                                                                                                                    |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   | (87,334    | )      |   |   |   |   |   |   | (87,334 | ) |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Balance,      December 31, 2005                                                                                                                                                                                                    |      |   |     |   |   |              |       | 38,075,000  |         |   |   | 3,808         |   |   |                       | 338,617   |   |        |   | -        |   |   |   | (426,280   | )      |   |   | - |   |   |   | (83,855 | ) |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Common      shares issued for                                                                                                                                                                                                      |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
|      purchase      of technology                                                                                                                                                                          | 28-Sep-06 |   | $        | 0.0001 |   |              |       | 5,500,000   |         |   |   | 550           |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   | 550 |   |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Common      shares issued for cash                                                                                                                                                                                                 | 12-Dec-06 |   | $        | 0.30   |   |              |       | 6,284,000   |         |   |   | 628           |   |   |                       | 1,884,572 |   |        |   | (500,000 | )      |   |   |       |   |   |   |   |   |   |   | 1,385,200 |   |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Net      (Loss)                                                                                                                                                                                                                    |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   | (1,054,117 | )      |   |   |   |   |   |   | (1,054,117 | ) |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Balance,      December 31, 2006                                                                                                                                                                                                    |      |   |     |   |   |              |       | 49,859,000  |         |   |   | 4,986         |   |   |                       | 2,223,189 |   |        |   | (500,000 | )      |   |   | (1,480,397 | )      |   |   | - |   |   |   | 247,778 |   |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Cash      received on subscriptions                                                                                                                                                                                                |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   | 500,000  |   |   |   |       |   |   |   |   |   |   |   | 500,000 |   |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Common      shares issued for cash                                                                                                                                                                                                 | 07-Feb-07 |   | $        | 0.30   |   |              |       | 733,330     |         |   |   | 74            |   |   |                       | 219,926   |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   | 220,000 |   |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Common      shares issued to purchaseassets                                                                                                                                                                                        | 07-Feb-07 |   | $        | 0.30   |   |              |       | 636,120     |         |   |   | 64            |   |   |                       | 190,772   |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   | 190,836 |   |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Common      shares returned to                                                                                                                                                                                                     |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| treasury      for sale of assets                                                                                                                                                                                                   | 15-Nov-07 |   |     |   |   |              |       | (6,136,120  | )            |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   | (191,386 | ) |   |   | (191,386 | ) |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Net      (Loss)                                                                                                                                                                                                                    |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   | (2,231,656 | )      |   |   |   |   |   |   | (2,231,656 | ) |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Balance,      December 31, 2007                                                                                                                                                                                                    |      |   |     |   |   |              |       | 45,092,330  |         |   |   | 5,124         |   |   |                       | 2,633,887 |   |        |   | -        |   |   |   | (3,712,053 | )      |   |   | (191,386 | ) |   |   | (1,264,428 | ) |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Common      shares issued to settledebt                                                                                                                                                                                            | 31-Mar-08 |   | $        | 0.31   |   |              |       | 3,949,999   |         |   |   | 395           |   |   |                       | 1,204,555 |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   | 1,204,950 |   |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Net      (Loss)                                                                                                                                                                                                                    |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   | 22,890     |   |   |   |   |   |   |   | 22,890 |   |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| Balance,      June 30, 2008                                                                                                                                                                                                        |      |   |     |   |   |              |       | 49,042,329  |         |   | $      | 5,519         |   |   | $                          | 3,838,442 |   |        | $      | -        |   |   | $      | (3,689,163 | )      |   | $ | (191,386 | ) |   | $ | (36,588 | ) |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
| On      August 7, 2006 the Company exercised a 5:1 forward stock split that has      been retroactively applied to this schedule thereby increasing the      number      of shares issued and decreasing the price per share. |      |   |     |   |   |              |       |        |         |   |   |          |   |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                                                                               |      |   |     |   |   |              |       |        |         |   |   |          |   |   |                       |      |   |        |   |     |   |   |   |       |   |   |   |   |   |   |   |   |   |

----

|                                                                             |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |
|----------------------------------------------------------------------------------|--------|-------------------------|-----------|--------|----------------------------|--------|------------|---------------------|--------|--------|-----------|--------|--------|--------------------|------------|
|                                                                             |   |                    |      |   |                       |   |       |                |   |   |      |   |   | June      24, 2003 |       |
|                                                                             |   | Three      Months Ended |      |   | Six Months      Ended |   |       | (Inception)      to |   |
|                                                                             |   | June      30,           |      |   | June      30,              |   |       | June      30,       |   |
|                                                                             |   | 2008                    |      |   | 2007                       |   |       | 2008                |   |   | 2007      |   |   | 2008               |       |
|                                                                             |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |
| Operating      Activities                                                        |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |
|                                                                             |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |
| Net      Profit / (Loss)                                                         |   | $                       | (36,588   | )      |                       | $      | (1,192,175 | )                   |   | $      | 22,890    |   |   | $                  | (2,138,772 | ) |   | $ | (3,689,163 | ) |
|                                                                             |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
| Adjustments      to reconcile Net (Loss) to cash:                                |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
|      Stock      Issued to founders                      |   |                    | -         |   |                       |   | -          |                |   |   | -         |   |   |               | -          |   |   |   | 3,002 |   |
|      Gain      on Forgiveness of Debt                   |   |                    | -         |   |                       |   | -          |                |   |   | (59,478   | )      |   |               | -          |   |   |   | (59,478 | ) |
|      Adjustment      for reverse acquisition            |   |                    | -         |   |                       |   | -          |                |   |   | -         |   |   |               | -          |   |   |   | 117,630 |   |
|      Stock      issued to purchase asset                |   |                    | -         |   |                       |   | -          |                |   |   | -         |   |   |               | 190,856    |   |   |   | - |   |
|      Depreciation      and Amortization                 |   |                    | -         |   |                       |   | 3,847      |                |   |   | -         |   |   |               | 7,334      |   |   |   | - |   |
| Changes      in Assets and Liabilities                                           |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
|      (Increase)/Decrease      in Employee Loans         |   |                    | -         |   |                       |   | (3,697     | )                   |   |   | -         |   |   |               | -          |   |   |   | - |   |
|      Increase/(Decrease)      in Accounts Payable       |   |                    | -         |   |                       |   | 204,321    |                |   |   | -         |   |   |               | 204,321    |   |   |   | 59,478 |   |
|      Increase/(Decrease)      in Wages Payable          |   |                    | -         |   |                       |   | -          |                |   |   | -         |   |   |               | -          |   |   |   | - |   |
|                                                                             |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
| Net      Cash (Used) by Operating Activities                                     |   |                    | (36,588   | )      |                       |   | (987,704   | )                   |   |   | (36,588   | )      |   |               | (1,736,261 | ) |   |   | (3,568,531 | ) |
|                                                                             |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
| Investment      Activities                                                       |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
| Treasury      Stock                                                              |   |                    | -         |   |                       |   | -          |                |   |   | -         |   |   |               | -          |   |   |   | (191,386 | ) |
| Stock      Issued for asset purchase                                             |   |                    | -         |   |                       |   | -          |                |   |   | -         |   |   |               | -          |   |   |   | 191,386 |   |
| Equipment      (Purchase)/Sale                                                   |   |                    | -         |   |                       |   | (54,120    | )                   |   |   | -         |   |   |               | (254,023   | ) |   |   | - |   |
|                                                                             |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
| Cash      Used by Investment Activities                                          |   |                    | -         |   |                       |   | (54,120    | )                   |   |   | -         |   |   |               | (254,023   | ) |   |   | - |   |
|                                                                             |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
| Financing      Activities                                                        |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
| Net      Proceeds/(repayment) from loans                                         |   |                    | 94,950    |   |                       |   | 794,965    |                |   |   | 94,950    |   |   |               | 1,104,965  |   |   |   | 94950 |   |
| Related      Parties                                                             |   |                    | -         |   |                       |   | -          |                |   |   | -         |   |   |               | -          |   |   |   | - |   |
| Stock      issued to settle debt                                                 |   |                    | -         |   |                       |   | -          |                |   |   | -         |   |   |               | -          |   |   |   | 1,204,950 |   |
| Purchase      and Cancellation of Treasury Stock                                 |   |                    | -         |   |                       |   | -          |                |   |   | -         |   |   |               | -          |   |   |   | (43,207 | ) |
| Proceeds      from sale of Common Stock                                          |   |                    | -         |   |                       |   | -          |                |   |   | -         |   |   |               | 719,980    |   |   |   | 2,370,200 |   |
|                                                                             |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
| Cash      Provided by Financing Activities                                       |   |                    | 94,950    |   |                       |   | 794,965    |                |   |   | 94,950    |   |   |               | 1,824,945  |   |   |   | 3,626,893 |   |
|                                                                             |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
| Net      Increase/(Decrease) in Cash                                             |   |                    | 58,362    |   |                       |   | (246,859   | )                   |   |   | 58,362    |   |   |               | (165,339   | ) |   |   | 58,362 |   |
|                                                                             |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
| Cash,      Beginning of Period                                                   |   |                    | -         |   |                       |   | 264,377    |                |   |   | -         |   |   |               | 186,554    |   |   |   | - |   |
|                                                                             |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
| Cash,      End of Period                                                         |   | $                       | 58,362    |   |                       | $      | 17,518     |                |   | $      | 58,362    |   |   | $                  | 21,215     |   |   | $ | 58,362 |   |
|                                                                             |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
| Cash      Paid For:                                                              |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
| Interest                                                                         |   | $                       | -         |   |                       | $      | -          |                |   | $      | -         |   |   | $                  | -          |   |   | $ | 13,556 |   |
| Income      Taxes                                                                |   | $                       | -         |   |                       | $      | -          |                |   | $      | -         |   |   | $                  | -          |   |   | $ | - |   |
|                                                                             |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
| Non-cash      Activities:                                                        |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |
|      Stock      Issued to founders                      |   | $                       | -         |   |                       | $      | -          |                |   | $      | -         |   |   | $                  | -          |   |   | $ | 3,002 |   |
|      Gain      of Forgiveness of Debt                   |   | $                       | 59,478    |   |                       | $      | -          |                |   | $      | 59,478    |   |   | $                  | -          |   |   | $ | 59,478 |   |
|      Adjustment      for reverse acquisition            |   | $                       | -         |   |                       | $      | -          |                |   | $      | -         |   |   | $                  | -          |   |   | $ | 117,630 |   |
|      Stock      Issued to settle Debt                   |   | $                       | 1,204,950 |   |                       | $      | -          |                |   | $      | 1,204,950 |   |   | $                  | -          |   |   | $ | 1,204,950 |   |
|      Stock      issued to purchase assets               |   | $                       | -         |   |                       | $      | 190,856    |                |   | $      | -         |   |   | $                  | 190,856    |   |   | $ | 191,386 |   |
|      Stock      returned to treasury for sale of assets |   | $                       | -         |   |                       | $      | -          |                |   | $      | -         |   |   | $                  | -          |   |   | $ | (191,386 | ) |
|      Depreciation      and Amortization                 |   | $                       | -         |   |                       | $      | 3,487      |                |   | $      | -         |   |   | $                  | 3,487      |   |   | $ | - |   |
|                                                                             |   |                    |      |   |                       |   |       |                |   |   |      |   |   |               |       |   |   |   |   |   |

----

----

|                                                            |   | 30-Jun-2008 |       |          | 31-Dec-2007 |   |
|-----------------------------------------------------------------|--------|-------------|------------|---------------|-------------|--------|
|                                                            |   |        |       |          |        |   |
|  Numerators      for Basic and Diluted EPS                 |   | $           | (32,890    | )   |        | $      | (2,231,657 | ) |
|  Net      income/(loss) to common shareholders   |   |        |       |          |        |   |   |   |
|                                                            |   |        |       |          |        |   |   |   |
|  Denominators      for Basic and Diluted EPS               |   |        | 50,978,771 |          |        |   | 45,092,229 |   |
|  Weighted      average of shares outstanding          |   |        |       |          |        |   |   |   |
|                                                            |   |        |       |          |        |   |   |   |
|  Basic      and Diluted Earnings/(Loss) Per Share          |   | $           | (0.00      | )             |        | $      | (0.05 | ) |

----

----

| ·   | On      June 24, 2003, the Company issued 25,000,000 shares to its founder for      $3,002. |
|--------------------|---------------------------------------------------------------------------------------------|

| ·   | On      August 15, 2003 the Company issued 56,855,000 common shares to execute the      acquisition of Selectrics Corporation in a one for one share exchange for      a value of $121,882.  This acquisition was recorded as a reverse      merger with Selectrics the surviving historical accounting      company.  Accordingly, the equity and accumulated deficit are      adjusted to reflect Seletricshistory. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | On      March 15, 2004, the Company issued 375,000 shares for $15,000 cash in a      private placement. |
|--------------------|---------------------------------------------------------------------------------------------------------|

| ·   | On      July 23, 2004 the Company issued 2,500,000 shares in a private placement      for $250,000 cash. |
|--------------------|----------------------------------------------------------------------------------------------------------|

| ·   | On      September 28, 2006, the Company entered into an Asset Purchase Agreement      with Owen Consulting LLC to acquire the right, title and interest in      technology commonly known as the EncryptaKey Secure communication Portal      by issuing 5,500,000 shares of common stock at $0.0001 per      share.  The technology and associated intellectual property has      been memorialized by patent application.  However, it is still      in development and the associated costs are expensed to research and      development.  Because of the limited public market for the      Company stock, Par-value was used to record this    transaction. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | On      December 12, 2006, the Company issued 6,284,000 common shares in a private      offering at $0.30 per share for $1,385,200 and $500,000 subscriptions      receivable.  The Company extended the closing of the offering to      February 7, 2007. |
|--------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | On      February 7, 2007 the Company issued 733,330 common shares in a private      offering at $0.30 per share for $220,000 and received cash on outstanding      subscription receivable in the amount of  $500,000. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| ·   | On      February 7, 2007 the Company issued 636,120 common shares at $0.30 per      share to purchase fixed assets valued at  $190,836. |
|--------------------|-----------------------------------------------------------------------------------------------------------------------------------------|

| ·   | On      November 15, 2007 the Company received the return of 6,136,120 shares for      the sale of all assets with a total net value of $191,386. The shares have      not been cancelled and are held intreasury. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | On      March 31, 2008 the Company issued 3,949,999 common shares in settlement      and release of $1,204,950 in notespayable. |
|--------------------|---------------------------------------------------------------------------------------------------------------------------------|

----

| Year      Ended December 31, |   | 2007   |     |   | 2006   |   |
|------------------------------|--------|--------|----------|--------|--------|--------|
| Deferred      Tax Asset      |   | $      | 490,965  |   |   | $      | 231,906 |   |
| Valuation      Allowance     |   |   | (490,965 | )      |   |   | (231,906 | ) |
| Current      Taxes Payable   |   |   | 0.00     |   |   |   | 0.00 |   |
| Income      Tax Expense      |   | $      | 0.00     |   |   | $      | 0.00 |   |

| Year   |   | Amount |      | Expiration |
|--------|--------|--------|-----------|------------|
| 2003   |   | $      | 152,649   |       | 2023 |
| 2004   |   |   | 186,296   |       | 2024 |
| 2005   |   |   | 87,334    |       | 2025 |
| 2006   |   |   | 1,054,117 |       | 2026 |
| 2007   |   |   | 2,231,657 |       | 2027 |
|   |   |   |      |       |   |
| Total  |   | $      | 3,712,053 |       |   |
|   |   |   |      |       |   |

----

----

----

Item 2. Management’s Discussion and Analysis ofFinancial Condition and Results of Operations

----

----

----

----

----

None.

is the Chief FinancialOfficer and Director of Priviam, Inc.  He has held the top financialpositions in both Sycom International, Inc. and Klaire International,Inc.  In 1995, Mr. Urrea earned his bachelor's degree in BusinessAdministration with a concentration in Finance from the Robert O. AndersonSchool of Business at the University of New Mexico.

----

| EXHIBIT     |                                                                                                                                                                                                     |
|---------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| NUMBER      | DESCRIPTION                                                                                                                                                                                              |
|                            |                                                                                                                                                                                                     |
| 3.1                             | Restated      Certificate of Incorporation of Priviam, Inc. (f/k/a EncryptaKey, Inc.),      dated August 1, 2008 (incorporated by reference to Current Report on Form      8-K filed on August 7, 2008). |

| 3.2 | By-laws, as amended. (Incorporated by reference to Current report      on Form 8-K filed on October 4, 2006) |
|-----|--------------------------------------------------------------------------------------------------------------|

| 31.1        | Certification      of Principal Executive Officer pursuant to Rule 13a-14 and Rule 15d-14(a),      promulgated under the Securities and Exchange Act of 1934, as      amended. |
|------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 31.2        | Certification      of Principal Financial Officer pursuant to Rule 13a-14 and Rule 15d-14(a),      promulgated under the Securities and Exchange Act of 1934, as      amended. |
|------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32.1        | Certification      pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of      the Sarbanes-Oxley Act of 2002 (Chief Executive  Officer). |
|------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 32.2        | Certification      pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of      the Sarbanes-Oxley Act of 2002 (Chief Financial  Officer). |
|------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | PRIVIAM,      INC. |                                                             |
|--------|--------------------|------------------------------------------------------------------|
|   |               |                                                             |   |
|   | By:                | /s/ Louis      Jack Musetti                                 |   |
|   |               | Louis      Jack Musetti                                          |   |
|   |               | Chief      Executive Officer and Interim Chief Financial Officer |   |
|   |               |                                                             |   |

|   |   |                             |
|--------|--------|----------------------------------|
|   |   |                             |   |
|   | By:    | /s/ Daniel      Urrea  |   |
|   |   | Louis      Daniel Urrea          |   |
|   |   | Chief      Financial Officer     |   |
|   |   |                             |   |