| [X]                                                                   | QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
|-----------------------------------------------------------------------|-----------------------------------------------------------------------------------|
| For the quarterly period ended September 30, 2009                     |
|                                                                  |
| [ ]                                                              | TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT                   |
| For the transition period from _________________ to _________________ |
|                                                                  |
| Commission file number 000-53366                                      |

| CHINA VOICE HOLDING CORP.(Exact name of small business issuer as specified in its charter)         |
|----------------------------------------------------------------------------------------------------|
|                                                                                               |
| Nevada(State or other jurisdiction of incorporation or organization)                               | 16-1680725(IRS Employer Identification No.) |
|                                                                                               |
| 327 Plaza Real, Suite 319, Boca Raton, Florida 33432 (Address of principal executive offices) |
|                                                                                               |
| (561) 394-2482(Issuer’s telephone number)                                                    |
|                                                                                               |

|       PART I — FINANCIAL INFORMATION  Item 1. Financial Statements CHINA VOICE HOLDING CORP. |
|------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                   |   |   |   |   |   |   |   |
| Condensed Consolidated Balance SheetsSeptember 30, 2009 and June 30, 2009                                              |
|                                                                                                                   |   |   |   |   |   |   |   |
|                                                                                                                   |   |   |   |   |   |   |   |
|                                                                                                                   |   |   |   |   |   |   |   |
|                                                                                                                   |   |   |   |   |   |   |   |
|                                                                                                                   |   |  September 30, 2009 |         June 30, 2009 |   |   |   |
| ASSETS                                                                                                                 |   |   (Unaudited) |  (Audited) |   |   |   |
| Current assets:                                                                                                        |   |   |   |   |   |   |
|                                                                                                                   | Cash and cash equivalents |   | $ | 70,437 |   |   |   |   | $ | 185,420 |   |   |   |   |
|                                                                                                                   | Accounts receivable, net |   |   | 613,356 |   |   |   |   |   | 577,768 |   |   |   |   |
|                                                                                                                   | Inventories |   |   | 115 |   |   |   |   |   | 115 |   |   |   |   |
|                                                                                                                   | Prepaid expenses and other current assets |   |   | 150,771 |   |   |   |   |   | 53,247 |   |   |   |   |
|                                                                                                                   | Related party receivables |   |   | 116,599 |   |   |   |   |   | 92,300 |   |   |   |   |
|                                                                                                                   | Total current assets |   |   | 951,278 |   |   |   |   |   | 908,850 |   |   |   |   |
|                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Long-term assets:                                                                                                      |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                   | Note receivable |   |   | 3,850,000 |   |   |   |   |   | 3,850,000 |   |   |   |   |
|                                                                                                                   | Investment  in an affiliate |   |   | 6,788,442 |   |   |   |   |   | 7,821,566 |   |   |   |   |
|                                                                                                                   | Property and equipment, net |   |   | 368,125 |   |   |   |   |   | 381,645 |   |   |   |   |
|                                                                                                                   | Other assets |   |   | 15,000 |   |   |   |   |   | 15,000 |   |   |   |   |
|                                                                                                                   | Goodwill |   |   | 6,009,404 |   |   |   |   |   | 6,009,404 |   |   |   |   |
|                                                                                                                   | Other intangible assets, net |   |   | 39,196 |   |   |   |   |   | 41,896 |   |   |   |   |
|                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                   | Total assets |   | $ | 18,021,445 |   |   |   |   | $ | 19,028,361 |   |   |   |   |
|                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| LIABILITIES AND EQUITY                                                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Current liabilities:                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                   | Accounts payable and accrued expenses |   | $ | 413,250 |   |   |   |   |   | 400,464 |   |   |   |   |
|                                                                                                                   | Related party payables |   |   | 80,115 |   |   |   |   |   | 80,038 |   |   |   |   |
|                                                                                                                   | Current portion of long term debt, net of debt discount |   |   | 244,000 |   |   |   |   |   | 305,947 |   |   |   |   |
|                                                                                                                   | Current portion of capital lease obligation |   |   | 48,367 |   |   |   |   |   | 38,184 |   |   |   |   |
|                                                                                                                   | Current portion of related party notes |   |   | 617,000 |   |   |   |   |   | - |   |   |   |   |
|                                                                                                                   | Total current liabilities |   |   | 1,402,733 |   |   |   |   |   | 824,633 |   |   |   |   |
|                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Long-term  liabilities                                                                                       |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                   | Long-term debt, net of current portion |   |   | - |   |   |   |   |   | 16,667 |   |   |   |   |
|                                                                                                                   | Related party payables |   |   | 322,784 |   |   |   |   |   | 322,784 |   |   |   |   |
|                                                                                                                   | Capital lease obligation, net of current portion |   |   | 29,591 |   |   |   |   |   | 39,774 |   |   |   |   |
|                                                                                                                   | Non-current portion of related party notes |   |   | - |   |   |   |   |   | 341,000 |   |   |   |   |
|                                                                                                                   | Deferred gains on disposal of six subsidiaries |   |   | 3,850,000 |   |   |   |   |   | 3,850,000 |   |   |   |   |
|                                                                                                                   | Long-term contingent liabilities |   |   | - |   |   |   |   |   | - |   |   |   |   |
|                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                   | Total liabilities |   |   | 5,605,107 |   |   |   |   |   | 5,394,858 |   |   |   |   |

----

| Equity |                                                                         |   | September 30, 2009(unaudited) |        |    |   | June 30, 2009 |
|--------|------------------------------------------------------------------------------|--------|-------------------------------|-------------|---------|--------|---------------|
|   | Common stock: par value $0.001; 400,000,000                                  |   |                          |        |    |
|   | shares authorized; 185,409,438 and 185,273,438 shares issued                 |   |                          |
|   | at September 30, 2009 and June 30, 2009, respectively                   |   |                          | 185,409     |    |   |          |   | 185,273 |   |
|   | Series A preferred stock-par value $0.001                                    |   |                          |        |    |   |          |   |   |   |
|   |    20,000 shares authorized: 5,248 shares issued both         |   |                          | 5           |    |   |          |   | 5 |   |
|   |    at September 30, 2009 and June 30, 2009, respectively |   |                          |        |    |   |          |   |   |   |
|   |    (liquidation value of $5,248,000 on both                   |   |                          |        |    |   |          |   |   |   |
|   |    September 30, 2009 and June 30, 2009, respectively)        |   |                          |        |    |   |          |   |   |   |
|   | Subscriptions receivable                                                     |   |                          | (3,150,000  | )       |   |          |   | (3,150,000 | ) |
|   | Additional paid-in capital                                                   |   |                          | 46,441,634  |    |   |          |   | 46,401,473 |   |
|   | Accumulated deficit                                                          |   |                          | (30,825,963 | )       |   |          |   | (29,576,504 | ) |
|   | Cumulative currency translation adjustment                                   |   |                          | (203,447)   |    |   |          |   | (205,575 | ) |
|   | Total stockholders' equity                                                   |   |                          | 12,447,638  |    |   |          |   | 13,654,672 |   |
|   |                                                                         |   |                          |        |    |   |          |   |   |   |
|   | Noncontrolling interests                                                     |   |                          | (31,300     | )  |   |          |   | (21,168 | ) |
|   | Total stockholders' equity                                                   |   |                          | 12,416,338  |    |   |          |   | 13,633,504 |   |
|   | Total liabilities and equity                                                 |   | $                             | 18,021,445  |    |   |          | $ | 19,028,361 |   |

----

| CHINA VOICE HOLDING CORP.                                                               |   |
|-----------------------------------------------------------------------------------------|--------|
|                                                                                    |   |   |   |   |   |   |   |   |   |
| Condensed Consolidated Statements of Operations                                         |   |
| For the Three months Ended September 30, 2009 and 2008                                  |   |
| (Unaudited)                                                                             |   |
|                                                                                    |   |   |   |   |   |   |   |   |   |
|                                                                                    |   | 2009 |   |   |   |   |   | 2008 |   |
| Sales                                                                                   |   | $ | 13,423 |   |   |   |   |   | $ | 95,985 |   |
| Cost of revenues                                                                        |   |   | 18,318 |   |   |   |   |   |   | 181,181 |   |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |
| Gross loss                                                                              |   |   | (4,895 | ) |   |   |   |   |   | (85,196 | ) |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |
| Operating expenses:                                                                     |   |   |   |   |   |   |   |   |   |   |   |
| Professional fees                                                                       |   |   | 108,223 |   |   |   |   |   |   | - |   |
| Other selling, general and administration expenses                                      |   |   | 191,067 |   |   |   |   |   |   | 1,040,265 |   |
| Depreciation                                                                            |   |   | 24,206 |   |   |   |   |   |   | 12,947 |   |
|        Total operating expenses                      |   |   | 323,497 |   |   |   |   |   |   | 1,053,212 |   |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |
| Loss from operations                                                                    |   |   | (328,392 | ) |   |   |   |   |   | (1,138,408 | ) |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |
| Other income (expenses)                                                                 |   |   |   |   |   |   |   |   |   |   |   |
| Tax credit                                                                              |   |   | - |   |   |   |   |   |   | 2,035 |   |
| Interest income                                                                         |   |   | 26 |   |   |   |   |   |   | 7,140 |   |
| Interest expense                                                                        |   |   | (61,137 | ) |   |   |   |   |   | (25,080 | ) |
| Other nonoperating income (expense)                                                     |   |   | 120,440 |   |   |   |   |   |   | 15,357 |   |
|         Total other income (expense)            |   |   | 59,329 |   |   |   |   |   |   | (548 | ) |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |
| Loss before income taxes, loss on equity investment                                     |   |   |   |   |   |   |   |   |   |   |   |
| and noncontrolling interest                                                             |   |   | (269,063 | ) |   |   |   |   |   | (1,138,956 | ) |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |
| Income tax expenses                                                                     |   |   | - |   |   |   |   |   |   | - |   |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |
| Loss before loss on equity investment and noncontrolling interest                       |   |   | (269,063 | ) |   |   |   |   |   | (1,138,956 | ) |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |
| Loss on equity investment                                                               |   |   | (839,361 | ) |   |   |   |   |   | - |   |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |
| Net loss from continuing operations                                                     |   |   | (1,108,424 | ) |   |   |   |   |   |   | (1,138,956 | ) |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |
| Discontinued operations                                                                 |   |   |   |   |   |   |   |   |   |   |   |   |
| Income on discontinued operations, net of tax                                           |   |   | - |   |   |   |   |   |   |   | 270,352 |   |
| Net income from discontinuing operations                                                |   |   | - |   |   |   |   |   |   |   | 270,352 |   |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |
| Net loss                                                                                |   |   | (1,108,424 | ) |   |   |   |   |   |   | (868,604 | ) |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |
| Less: Net loss attributable                                                        |   |   |   |   |   |   |   |   |   |   |   |   |
|      to noncontrolling interest                                |   |   | (11,277 | ) |   |   |   |   |   |   | (977 | ) |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |
| Net loss before preferred dividend                                                      |   |   | (1,097,147 | ) |   |   |   |   |   |   | (869,581 | ) |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |
| Preferred dividend                                                                      |   |   | (152,312 | ) |   |   |   |   |   |   | (149,300 | ) |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |
| Net loss attributable to common stockholders                                            |   |   | (1,249,459 | ) |   |   |   |   |   |   | (1,018,881 | ) |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |
| Other comprehensive loss                                                                |   |   |   |   |   |   |   |   |   |   |   |   |
| Total foreign currency translation gain                                                 |   |   | 3,274 |   |   |   |   |   |   |   | - |   |
| Less: foreign currency translation gain attributable to noncontrolling interests        |   |   | 1,146 |   |   |   |   |   |   |   | - |   |
| Foreign currency translation gain attributable to common stockholders                   |   |   | 2,128 |   |   |   |   |   |   |   | - |   |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |
| Comprehensive loss attributable to common stockholders                                  |   | $ | (1,247,331 | ) |   |   |   |   |   | $ | (1,022,073 | ) |
|  Net loss attributable to common stockholders per common share - basic and diluted |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                    |   |   |   |   |   |   |   |   |   |
| Net loss from continuing operations per shares - basic and diluted                      |   | $ | (0.01 | ) |   |   |   |   |   | $ | (0.01 | ) |
| Net income from discontinued operations per shares - basic and diluted                  |   |   | 0.00 |   |   |   |   |   |   |   | 0.00 |   |
| Net loss attributable to                                                                |   |   |   |   |   |   |   |   |   |   |   |   |
| common stockholders per common share - basic and diluted                                |   | $ | (0.01 | ) |   |   |   |   |   | $ | (0.01 | ) |
|                                                                                    |   |   |   |   |   |   |   |   |   |   |   |   |
| Common shares used in calculation per share data- basic and diluted                     |   |   | 185,259,856 |   |   |   |   |   |   |   | 159,504,202 |   |

----

|                                                                         |   | 2009   |          |    | 2008   |   |
|------------------------------------------------------------------------------|--------|--------|---------------|---------|--------|--------|
| Operating activities                                                         |   |   |          |    |   |   |
| Net loss                                                                     |   | $      | (1,097,147    | )       |   | $      | (869,581 | ) |
| Loss from discontinued operations                                            |   |   | -             |    |   |   | (270,352 | ) |
| Loss from continuing operations                                              |   |   | (1,097,147    | )       |   |   | (599,229 | ) |
| Adjustments to reconcile net loss to net cash used in operations activities  |   |   |          |    |   |   |   |   |
| operating activities:                                                        |   |   |          |    |   |   |   |   |
| Depreciation and amortization                                                |   |   | 26,906        |    |   |   | 169,244 |   |
| Common shares issued for services                                            |   |   | 35,567        |    |   |   | 42,500 |   |
| Loss on equity investment                                                    |   |   | 839,361       |    |   |   | - |   |
| Loss from disposal of property and equipment                                 |   |   | -             |    |   |   | 164,224 |   |
| Net income attributable to noncontrolling interest                           |   |   | (11,277       | )       |   |   | 977 |   |
| Change in operating assets and liabilities                                   |   |   |          |    |   |   |   |   |
| Accounts receivable                                                          |   |   | (35,588       | )       |   |   | (514,189 | ) |
| Inventories                                                                  |   |   | -             |    |   |   | 115,683 |   |
| Prepaid expenses and other current assets                                    |   |   | (97,524       | )  |   |   | (39,407 | ) |
| Other assets                                                                 |   |   | -             |    |   |   | (26,741 | ) |
| Related party receivables                                                    |   |   | (24,299       | )       |   |   | (32,671 | ) |
| Accounts payable and accrued expenses                                        |   |   | 12,785        |    |   |   | 169,214 |   |
| Other current  liabilities                                         |   |   | -             |    |   |   | 24,278 |   |
| Total adjustments                                                            |   |   | 745,931       |    |   |   | 73,113 |   |
| Net cash used in operating activities of continuing operations               |   |   | (351,216      | )       |   |   | (526,116 | ) |
| Net cash used in operating activities of discontinuing operations            |   |   | -             |    |   |   | (270,352 | ) |
| Net cash used in operating activities                                        |   |   | (351,216      | )       |   |   | (796,468 | ) |
|                                                                         |   |   |          |    |   |   |   |   |
| Investing activities                                                         |   |   |          |    |   |   |   |   |
| Purchase of property and equipment                                           |   |   | (10,540       | )       |   |   | (197,323 | ) |
| Repayment of redeemable preferred stock from affiliate             |   |   | 193,763  |    |   |   | -  |   |
| Net cash provided by (used in) investing activities of continuing operations |   |   | 183,223       |    |   |   | (197,323 | ) |
| Net cash used in investing activities of discontinuing operations            |   |   | -             |    |   |   | - |   |
| Net cash provided by (used in) investing activities                          |   |   | 183,223       |    |   |   | (197,323 | ) |
|                                                                         |   |   |          |    |   |   |   |   |
| Financing activities                                                         |   |   |          |    |   |   |   |   |
|   Net increase (decrease) in:                                      |   |   |          |    |   |   |   |   |
| Repayments of long term debt                                                 |   |   | (78,614       | )       |   |   | (35,066 | ) |
| Redemption of preferred stock to related parties                             |   |   | -             |    |   |   | (454,500 | ) |
| Proceeds from issuance of common stock, net of issuance costs                |   |   | 4,730         |    |   |   | 512,636 |   |
| Proceeds from related party notes                                            |   |   | 276,000       |    |   |   | - |   |
| Payment of preferred dividends                                               |   |   | (152,312      | )       |   |   | (149,300 | ) |
|                                                                         |   |   |          |    |   |   |   |   |
| Net cash (used in) provided by financing activities of continuing operations |   |   | 49,804        |    |   |   | (126,230 | ) |
|                                                                         |   |   |          |    |   |   |   |   |
| Effect of exchange rate on changes in cash                                   |   |   | 3,206         |    |   |   | -  |   |
| Net decrease in cash and cash equivalents                                    |   | $      | (114,983      | )       |   | $      | (1,120,021 | ) |
| Cash and cash equivalents - beginning of period                              |   |   | 185,420       |    |   |   | 2,096,070 |   |
| Cash and cash equivalents - end of period                                    |   | $      | 70,437        |    |   | $      | 976,049 |   |

| Supplemental cash flow information |   |   |   |   |   |   |
|------------------------------------|--------|--------|--------|--------|--------|--------|
| Interest paid                      |   | $      | 61,137 |   |   | $      | 25,080 |   |
| Income taxes paid                  |   | $      | -      |   |   | $      | - |   |

----

|   | NOTE 1 – DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES |
|--------|--------------------------------------------------------------------------------------------------------------|

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|   | NOTE 1 – DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) |
|--------|--------------------------------------------------------------------------------------------------------------------------|

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|                                                                                                                       |  For the three monthsended September 30,  |   |  For the three monthsended September 30, |    |
|----------------------------------------------------------------------------------------------------------------------------|-----------------------------------------------------|--------|-----------------------------------------------|---------|
|                                                                                                                       | 2009                                                |   | 2008                                          |    |
| Warrants issued in conjunction with financing                                                                              | 350,000                                        |   |                                          | 563,200 |   |
|             Contingent shares potentially issuable for acquisitions | --                                             |   |                                          | 950,000 |   |
| Common stock options                                                                                                       | --                                             |   |                                          | 48,513  |   |

----

----

----

|   | A. | Businesses Owned as of September 30, 2009 |
|--------|----|-------------------------------------------|

|   | 1. | The Company has entered into an agreement with a licensed Chinese Telecommunications Company which will permit CHVC to offer advanced communications services along with domestic and international long distance service into and out of China.  Effective June 30, 2005, CHVC had issued 20,028,000 common shares valued at $5,007,000 toacquire all of the stock of East West Global Communications Inc., the Corporation which had obtained the Chinese licenses.  The telecommunications licenses associated with this acquisition were valued at $5,007,000.  The Company has acquired rights to these licenses which are owned by Chinese nationals and controlled by the Company.  The licenses are required to be utilized by entities authorized to operate in China.  Currently, one entity controlled by the Company usesthe licenses. |
|--------|----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | 2. | Effective January 18, 2006, the Company acquired a 65% interest in the operations of Candid Soft Technologies Co. Ltd of Beijing (“Candidsoft”), an international office-automation software and technology company headquartered in Beijing, China.  The purchase price was $5,171,250 in current consideration paid by issuanceof 4,925,000 shares of the Company’s common stock.  The shares were issued in September 2006.  As the effective date of the agreement was January 18, 2006 and management of the Company assumed control of its operations at that time.  The Company treated the stock issuance as being effective on the effective date of the acquisition.   In addition, the total purchase price also included contingent consideration of 2,000,000 shares of the Company’s commonstock which were issued on June 30, 2008 at a value of $1,033,000. The Company has valued the equity of Candidsoft  at $6,204,250 . |
|--------|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                  |   |   |      |
|-----------------------|--------|--------|-----------|
| Goodwill              |   | $      | 6,056,654 |   |
| Capitalized software  |   |   | 69,240    |   |
| Other assets          |   |   | 118,927   |   |
| Total assets acquired |   |   | 6,244,821 |   |
|                  |   |   |      |   |
| Minority interest     |   |   | (40,571   | ) |
| Net assets acquired   |   | $      | 6,204,250 |   |

|   | 3. | On March 23, 2007, the Company entered into an agreement to acquire 100% of the common stock of StreamJet.Net, Inc. (“StreamJet”), a broadband data streaming company.  The Company issued 4,725,000 shares of common stock to shareholders of StreamJet in escrow pending closing of a subsidiary merger agreement.  TheCompany had not completed the merger at March 31, 2007 because certain deliverables of StreamJet had not been received.  The shares are shown as outstanding at June 30, 2007, but no asset value has been placed on the Company’s books.  On October 22, 2007, the Company completed the merger and valued the equity of StreamJet at $2,882,250. |
|--------|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Software license    |   | $      | 2,974,293 |   |
|---------------------|--------|--------|-----------|--------|
|                |   |   |      |   |
| Liabilities assumed |   |   | (92,043   | )      |
|                |   |   |      |   |
| Net assets acquired |   | $      | 2,882,250 |   |

----

|   | B. | Companies disposed of prior to September 30, 2009 |
|--------|----|---------------------------------------------------|

|   | 1. | Effective August 1, 2006, the Company acquired a 70% interest in the operations of Beijing Techview System Engineering Co. Ltd. (“BTSE”), a network design and installation company headquartered in Beijing, China.  The purchase price was $1,920,000 in current consideration paid by issuance of 2,100,000 shares of the Company’scommon stock.  In addition, the total purchase price also includes contingent consideration of 4,000,000 shares of the Company’s common stock issuable upon the attainment of certain performance milestones, expiring December 31, 2009.  The Company has valued the equity of Techview at $1,920,000. |
|--------|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                  |   |   |
|-----------------------|--------|--------|
| Goodwill              |   | $      | 2,087,852 |   |
| Minority interest     |   |   | 61,278 |   |
| Total assets acquired |   |   | 2,149,130 |   |
|                  |   |   |   |   |
| Liabilities assumed   |   |   | (229,130 | ) |
|                  |   |   |   |   |
| Net assets acquired   |   | $      | 1,920,000 |   |

|   | 2. | Effective December 31, 2006, the Company acquired 100% of the common stock of VCG Technologies Inc. (“VCG”), a value added distributor of advanced broadband products and services company headquartered in Florida.  The purchase price was $2,150,000 in current consideration paid by issuance of 1,000,000 shares of the Company’scommon stock and notes payable for $1,000,000.  In addition, the total purchase price also includes contingent consideration of 1,000,000 shares of the Company’s common stock issuable upon the attainment of certain performance milestones, of which 595,360 were issued in satisfaction of the contingent consideration. The Company has valued the equity of VCG at $2,150,000 upon acquisition plus $509,521 (595,360 common shares) of contingent consideration for a total of $2,659,521. |
|--------|----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Goodwill            |   | $      | 2,811,028 |   |
|---------------------|--------|--------|-----------|--------|
|                |   |   |      |   |
| Liabilities assumed |   |   | (151,507  | )      |
|                |   |   |      |   |
| Net assets acquired |   | $      | 2,659,521 |   |

|   | 3. | On June 14, 2007, the Company closed a subsidiary merger agreement to acquire Phone House, Inc. (“Phone House”) a leading distributor of prepaid phone cards.  The Company paid cash of $100,000, issued a six month note for $159,179 and issued 650,000 shares of common stock at closing.  In addition, the totalpurchase price also includes contingent consideration of up to 1,500,000 shares of the Company’s common stock issuable upon the attainment of certain performance milestones, expiring June 30, 2010.  The Company has valued the equity of Phone House at $545,179 on acquisition plus $598,050 (1,500,000 common shares) of contingent consideration for a total $1,143,229. |
|--------|----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Accounts receivable                   |   | $      | 421,519   |   |
|---------------------------------------|--------|--------|-----------|--------|
| Inventory                             |   |   | 156,545   |   |
| Property and equipment                |   |   | 9,900     |   |
| Goodwill                              |   |   | 1,060,508 |   |
| Total assets acquired                 |   |   | 1,648,472 |   |
|                                  |   |   |      |   |
| Accounts payable and accrued expenses |   |   | (498,884  | )      |
| Other liabilities                     |   |   | (6,359    | )      |
| Total liabilities assumed             |   |   | (505,243  | )      |
|                                  |   |   |      |   |
| Net assets acquired                   |   | $      | 1,143,229 |   |

|   | 4.     | On July 19, 2007, the Company closed a subsidiary merger agreement to acquire Dial Tone Communications, Inc. (“Dial Tone”) a leading distributor of prepaid phone cards.  The Company paid cash of $27,501, issued a three month note for $20,000 and issued 450,000 shares of common stock at closing.  In addition,the total purchase price also includes contingent consideration of up to 200,000 shares of the Company’s common stock issuable upon the attainment of certain performance milestones, expiring July 31, 2010. On June 13, 2008, the Company renegotiated the terms of acquisition and canceled 300,000 of total 450,000 shares previously issued.  The Company has valued the equity of Dial Tone at $157,759 . |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |

----

|                      |   |   |    |
|---------------------------|--------|--------|---------|
| Accounts receivable       |   | $      | 45,933  |   |
| Goodwill                  |   |   | 111,826 |   |
| Total assets acquired     |   |   | 157,759 |   |
|                      |   |   |    |   |
| Total liabilities assumed |   | None   |    |
|                      |   |   |    |   |
| Net assets acquired       |   | $      | 157,759 |   |

|   | 6. | On March 31, 2008, CVC International, a subsidiary of the Company acquired all of the assets of Brilliant Telecom Group, LLC (“Brilliant Assets”) a VoIP service provider.  The Company issued 1,000,000 shares of common stock at closing.  The Company has valued the Brilliant Assets at $1,040,000. |
|--------|----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                      |   |   |      |
|---------------------------|--------|--------|-----------|
| Software                  |   | $      | 125,000   |   |
| Property and equipment    |   |   | 151,750   |   |
| Goodwill                  |   |   | 763,250   |   |
| Total assets acquired     |   |   | 1,040,000 |   |
|                      |   |   |      |   |
| Total liabilities assumed |   | None   |      |
|                      |   |   |      |   |
| Net assets acquired       |   | $      | 1,040,000 |   |

|              |   | For the three months ended September 30, |   |   | For the three months ended September 30, |   |
|-------------------|--------|------------------------------------------|--------|--------|------------------------------------------|--------|
|              |   | 2009                                     |   |   | 2008                                     |   |
| Revenue           |   |                                     | --     |   |                                     |   | 15,868,367 |   |
| Cost of revenues  |   |                                     | --     |   |                                     |   | 15,588,760 |   |
| Gross profit      |   |                                     |   |   |                                     |   | 279,607 |   |
| Expenses          |   |                                     | --     |   |                                     |   | 251,884 |   |
| Other income      |   |                                     | --     |   |                                     |   | 242,692 |   |
| Net income (loss) |   |                                     | --     |   |                                     |   | 270,352 |   |

----

|                                                            |   | September 30, 2009 |            |   | June 30, 2009 |   |     |   |   |
|-----------------------------------------------------------------|--------|--------------------|-----------------|--------|---------------|--------|----------|--------|--------|
|                                                            |   |               |            |   |          |   |     |   |   |
| Computer equipment                                              |   | $                  | 516,924         |   |          | $      | 266,217  |   |   |   |   |
| Furniture, fixtures and equipment                               |   |               | 25,665          |   |          |   | 265,657  |   |   |   |   |
| Motor vehicles                                                  |   |               | 61,513     |   |          |   | 61,448   |   |   |   |   |
|                                                            |   |               |            |   |          |   |     |   |   |   |   |
| Less:  accumulated depreciation and amortization |   |               | (235,977)  |   |          |   | (211,677 | )      |   |   | ) |
|                                                            |   |               |            |   |          |   |     |   |   |   |   |
| Total property and equipment                                    |   |  $            | 368,125    |   |          | $      | 381,645  |   |   |   |   |
|                                                            |   |               |            |   |          |   |     |   |   |   |   |

----

|   | NOTE 6 – GOODWILL AND OTHER INTANGIBLE ASSETS |
|--------|----------------------------------------------------------|

|                          |       Lives       |   | September 30, 2009 |         |   | June 30, 2009 |   |
|-------------------------------|-------------------------------------------------------------------------------|--------|--------------------|--------------|--------|--------------------|--------|
|                          |                                                                          |   |               |         |   |               |   |
| Telecom licenses              | 15 Years                                                                      |   | $                  | -            |   |               | $      | - |   |
| Software licenses             | 15 Years                                                                      |   |               | -            |   |               |   | - |   |
| Computer software             | 10 Years                                                                      |   |               | -            |   |               |   | - |   |
| Patent – software       | 10 Years                                                                      |   |               | 49,000       |   |               | 49,000 |   |
| Total                         |                                                                          |   |               | 49,000       |   |               |   | 49,000 |   |
| Less accumulated amortization |                                                                          |   |               |  (9,804 | )      |               |   | (7,104) |   |
|                          |                                                                          |   | $                  | 39,196       |   |               |   | 41,896 |   |

|   |   |
|--------|--------|

|                                                                  |   | September 30, 2009 |   |   | June 30, 2009 |   |    |
|-----------------------------------------------------------------------|--------|-------------------------|--------|--------|--------------------|--------|---------|
|                                                                  |   |                    |   |   |               |   |    |
| Capital lease obligation bearing an interest rate of 6.676% per annum |   |                    |   |   |               |   |    |   |  $ |  77,958 |   |  $ |  77,958 |   |   |   |   |
| Less: Current portion of capital lease obligation                     |   |                    |   |   | (48,367            | )      |    |   |    (38,184) |   |   |   |   |
| Non-current portion of capital lease obligation, less current portion |   |                    |   |   |               |   |  $ |   | 29,591  |   |  $ |   | 39,774  |   |   |   |   |

----

| 2010                                              |   | $      | 40,733  |   |
|---------------------------------------------------|--------|--------|---------|--------|
| 2011                                              |   |   | 40,733  |   |
| 2012                                              |   |   | 1,697   |   |
| Total minimum lease payments                      |   |   | 83,163  |   |
| Less: amount representing interest                |   |   | (5,205  | )      |
| Present value of net minimum lease payments       |   |   | 77,958  |   |
| Less: current portion of capital lease obligation |   |   | (48,367 | )      |
|                                              |   |   |    |   |
| Non-current portion capital lease obligation      |   | $      | 29,591  |   |

|   |   |   |   |   |
|--------|--------|--------|--------|--------|

----

|                                                                                                                                                                                                                                                                                                                                                    |   | September 30 |                                        |   | June 30 |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-------------------|---------------------------------------------|--------|--------------|--------|
|                                                                                                                                                                                                                                                                                                                                                    |   | 2009              |                                        |   | 2009         |   |
|                                                                                                                                                                                                                                                                                                                                                    |   |              |                                        |   |         |   |
| Not   Note payable to a third party with interest at 12% and collateralized by certain assets hheld by a related party.  The note is due on demand. Additionally, this note included   edetachable warrants to purchase 560,000 shares of the Company’s common stock, whiwhich expired May 31, 2006. |   | $                 |        - |   |         | $      | 25,614 |   |
|                                                                                                                                                                                                                                                                                                                                                    |   |              |                                        |   |         |   |   |   |
| Not  Note payable to an individual, interest accrues at 24% and is payable monthly.  The note is collateralized by certain assets held by a related party, and is due on demand.                                                                                                                                                    |   |              |      50,000                  |   |         |   |      50,000 |   |
|                                                                                                                                                                                                                                                                                                                                                    |   |              |                                        |   |         |   |   |   |
| Not  Note payable to an individual due October 5, 2009 with interest at 18% and collateralized by certain assets held by a related party.                                                                                                                                                                                                     |   |              |    44,000                         |   |         |   |    47,000 |   |
|                                                                                                                                                                                                                                                                                                                                                    |   |              |                                        |   |         |   |   |   |
| Not  Note payable to an individual due July 31, 2010 without interest and collateralized by certain Company Stock.                                                                                                                                                                                                                            |   |              |   150,000                              |   |         |   |    200,000 |   |
|                                                                                                                                                                                                                                                                                                                                                    |   |              |                                        |   |         |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                    |   |              |                                        |   |         |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                    |   |              |                                        |   |         |   |   |   |
| Les  Total discounts                                                                                                                                                                                                                                                                                                                          |   |              | -                                           |   |         |   | - |   |
|                                                                                                                                                                                                                                                                                                                                                    |   |              |                                        |   |         |   |   |   |
| Sub  Total                                                                                                                                                                                                                                                                                                                                    |   |              | 244,000                                     |   |         |   | 322,614 |   |
| Les  current portion                                                                                                                                                                                                                                                                                                                          |   |              |  244,000                               |   |         |   | 305,947 |   |
|                                                                                                                                                                                                                                                                                                                                                    |   |              |                                        |   |         |   |   |   |
| Lon  Long Term Debt                                                                                                                                                                                                                                                                                                                           |   | $                 | -                                           |   |         | $      | 16,667 |   |

----

|                                                                                                                                                                            |   |  September 30, |    |   | June 30, |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------|---------|--------|----------|--------|
|                                                                                                                                                                            |   | 2009                     |    |   | 2009     |   |
|                                                                                                                                                                            |   |                     |    |   |     |   |
|                                                                                                                                                                            |   |                     |    |   |     |   |   |   |
|                                                                                                                                                                            |   |                     |    |   |     |   |   |   |
| Not Notes Payable to investment entities controlled by a related party with interest at 18% and due on August 15, 2010. The notes are secured by certain assets of the Company. |   |                     | 517,000 |   |     |   |     341,000 |   |
|                                                                                                                                                                            |   |                     |    |   |     |   |   |   |

|                           |   |   | .             |   |   |   | .       |   |
|--------------------------------|--------|--------|---------------|--------|--------|--------|---------|--------|
|                           |   |   | 617,000       |   |   |   | 341,000 |   |
| Les  current portion |   |   |  617,000 |   |   |   | -       |   |
|                           |   |   |          |   |   |   |    |   |
| Lon Long term debt             |   | $      | -             |   |   | $      | 341,000 |   |

| 2009   |   |   | 861,000 |   |
|--------|--------|--------|---------|--------|
| 2010   |   |   | -       |   |
| 2011   |   |   | -       |   |
| 2012   |   |   | -       |   |
|   |   |   |    |   |
| Total  |   | $      | 861,000 |   |

----

----

|                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |            |           |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|-----------------|----------------|
|             Category                                 |   |   |   |   |   |   |   | Number ofShares |           |   |  Value |   |
|                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |            |           |   |   |   |
|                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |            |           |   |   |   |   |   |
| Net cash invested                                                                                                                                                                                                                                                                |   |   |   |   |   |   |   |            | 30,000         |   |   |   | 4,730 |   |
|                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |            |           |   |   |   |   |   |
| Issued for compensation                                                                                                                                                                                                                                                     |   |   |   |   |   |   |   |            | 106,000   |   |   |   | 35,431  |   |
| In                                                                                                                                                                                                                                                                               |   |   |   |   |   |   |   |            |           |   |   |   |   |   |
|                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |            |           |   |   |   |   |   |
|                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |            |      |   |   |   |     |   |
|                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |            |           |   |   |   |   |   |
|                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |            |   136,000 |   |   | $ | 40,161 |   |

----

----

|   | NOTE 11 - RELATED PARTY TRANSACTIONS |
|--------|--------------------------------------|

----

|   | NOTE 12 - CONCENTRATION OF RISK |
|--------|---------------------------------|

|                                              |   | September 30, 2009 |      |   | June 30, 2009 |   |
|---------------------------------------------------|--------|-------------------------|-----------|--------|--------------------|--------|
|                                              |   |                    |      |   |               |   |
| Tangible assets                                   |   | $                       | 867,566   |   |               | $      | 900,587 |   |
|                                              |   |                    |      |   |               |   |   |   |
| Goodwill and other identifiable intangible assets |   |                    | 6,051,300 |   |               |   | 6,051,300 |   |
|                                              |   |                    |      |   |               |   |   |   |
| Total assets                                      |   | $                       | 6,918,866 |   |               | $      | 6,951,887 |   |

----

|   | China Taxation – Prior to January 1, 2008, the Company’s subsidiaries were governed by the previous Income Tax Law (the “Previous IT Law”) of China. Under the Previous IT Law, the Company’s subsidiaries were generally subjected to enterprise income taxes at a statutory rate of 33% (30% state income tax plus 3%local income tax) or 15% for qualified new and high technology enterprises. Effective January 1, 2008, the new Enterprise Income Tax Law (the “EIT Law”) in China supersedes the Previous IT Law and unifies the enterprise income tax rate for FIEs at 25%. New and high technology enterprises will continue to enjoy a preferential tax rate of 15% but must meet the new set of criteria defined under the EIT Law and related regulations. The EIT Law provides a five-year transitional period for certain entitiesthat enjoyed a favorable income tax rate of less than 25% under the Previous IT Law and were established before March 16, 2007, to gradually increase their rates to 25%. The EIT Law also imposes a withholding income tax of 10% on dividends distributed by a Foreign-Invested Enterprises (“FIE”) to its immediate holding company outside of China, if such immediate holding company is considered as a no-resident enterprise without any establishment or place within China or if the received dividends haveno connection with the establishment or place of such immediate holding company within China, unless such immediate holding company’s jurisdiction of incorporation has a tax treaty with China that provides for a different withholding arrangement. Such withholding income tax was exempted under the Previous IT Law. In accordance with APB Option No. 23, “accounting for Income Taxes – Special Area,” all undistributed earnings are presumed to be transferred to the parent company and are subjectto the withholding taxes. The withholding tax imposed on the dividend income will reduce the Company’s net income. If a withholding tax were imposed to retained earnings prior to January, 2008, the Company would elect to reinvest these retained earnings in PRC. Accordingly, the Company has not recorded any withholding tax on the retained earnings of its FIEs in China. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | The EIT Law also provides that an enterprise established under the laws of foreign countries or regions but whose “de facto management body” is located in the PRC be treated as a resident enterprise for PRC tax purposes and consequently be subject to the PRC income tax at the rate of 25% for its global income. The ImplementingRules of the EIT Law merely defines the location of the “de facto management body” as “the place where the exercising, in substance, of the overall management and control of the production and business operation, personnel, accounting, properties, etc., of a non-PRC company is located.” The determination of tax residency requires a review of surrounding facts and circumstances of each case. If the Company is treated as a resident enterprise for PRC tax purposes, the Company will be subjectto PRC tax on worldwide income at a uniform tax rate of 25% starting from January 1, 2008. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | Like its predecessor, the EIT Law mainly provides a framework for general income tax provisions. There are currently divergent views on how the EIT Law will be implemented. Details on the definition of numerous terms as well as the interpretation and specific application of various provisions are left to the detailed implementing regulationsand supplementary tax circulars, which are still being issued. The Company’s ultimate effective tax rate will depend on many factors, including but not limited to, whether certain of the Company’s subsidiaries in China will receive the new and high technology enterprise status under the new criteria. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | The current and deferred portion of income tax expenses of the Company’s China subsidiaries, which were included in the consolidated statements for the periods presented have no significant deferred tax assets or liabilities and the statutory rate and effective rate for China operations approximates 30%. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                       |   | September 30, 2009 |   |   | September 30, 2008 |   |
|----------------------------|--------|--------------------|--------|--------|-------------------------|--------|
|                       |   |               |   |   |                    |   |
| Loss from operations       |   | 1,097,147          |   |   | 869,581                 |   |
|                       |   |               |   |   |                    |   |
| Tax benefit:               |   |               |   |   |                    |   |
| Federal current            |   |               | -      |   |                    |   | - |   |
| Federal deferred           |   |               | -      |   |                    |   | - |   |
| U.S. State                 |   |               | -      |   |                    |   | - |   |
| Foreign                    |   |               | -      |   |                    |   | - |   |
|                       |   |               |   |   |                    |   |   |   |
| Total tax benefit          |   | $                  | -      |   |                    | $      | - |   |
|                       |   |               |   |   |                    |   |   |   |
| Effective tax benefit rate |   |               | 0.0    | %      |                    |   | 0.0 | % |

|   | The difference between the tax benefit rate and the statutory benefit rate is as follows: |
|--------|-------------------------------------------------------------------------------------------|

|                       |   | September 30, 2009 |   |   | September 30, 2008 |   |
|----------------------------|--------|--------------------|--------|--------|--------------------|--------|
|                       |   |               |   |   |               |   |
| Statutory benefit rate     |   |               | 34.0   | %      |               |   | 34.0 | % |
|                       |   |               |   |   |               |   |   |   |
| Non taxable income         |   |               | (34.0  | %)     |               |   | (34.0 | %) |
|                       |   |               |   |   |               |   |   |   |
|                       |   |               |   |   |               |   |   |   |
| Effective tax benefit rate |   |               | 0.0    | %      |               |   | 0.0 | % |

----

|                                 |   | September 30, 2009 |      |   | June 30, 2009 |   |
|--------------------------------------|--------|-------------------------|-----------|--------|--------------------|--------|
|                                 |   |                    |      |   |               |   |
| Deductible temporary differences:    |   |                    |      |   |               |   |
| U.S. federal deferred operating loss |   | $                       | 3,921,881 |   |               | $      | 3,489,746 |   |
| State deferred operating loss        |   |                    | 337,799   |   |               |   | 337,799 |   |
| Foreign deferred operating loss      |   |                    | 135,343   |   |               |   | 129,032 |   |
|                                 |   |                    |      |   |               |   |   |   |
| Less:  valuation allowance |   | (4,395,023)             |      |   | (3,956,577)        |   |
|                                 |   |                    |      |   |               |   |   |   |
| Total tax assets                     |   | $                       | -         |   |               | $      | - |   |

| Expiration Year |   | Amount |      |
|-----------------|--------|--------|-----------|
|            |   |   |      |
| 2025            |   | $      | 109,872   |   |
| 2026            |   |   | 1,499,867 |   |
| 2027            |   |   | 4,790,794 |   |
| 2028            |   |   | 3,863,427 |   |

----

|                                                   |   | Exercise Price per Share |   |    Termination Date |                        | In connection with financing transactions |   |    |  Shares |   |
|--------------------------------------------------------|--------|--------------------------|--------|------------------------------------|-----------------------------|-------------------------------------------|--------|---------|--------------|--------|
|                                                   |   |                     |   |                               |                        |                                      |   |    |         |   |
|                                                   |   | $                        | 0.40   |                               |    July 2009 |                                      |   | 350,000 |         |   |   | 350,000 |   |
|                                                   |   |                     |   |                               |                        |                                      |   |    |         |   |   |   |   |
|          Total |   |                     |   |                               |                        |                                      |   | 350,000 |         |   |   | 350,000 |   |

|   |   |  Exercise Price per Share |   |    Termination Date |                        | In connection with financing transactions |   |    |   Shares |   |
|--------|--------|--------------------------------|--------|------------------------------------|-----------------------------|-------------------------------------------|--------|---------|--------------------|--------|
|   |   |                           |   |                               |                        |                                      |   |    |               |   |
|   |   | $                              | 0.40   |                               |    July 2009 |                                      |   | 350,000 |               |   |   | 350,000 |   |
|   |   | $                              | 0.40   |                               |  January 2009          |                                      |   | 213,200 |               |   |   | 213,200 |   |
|   |   |                           |   |                               |                        |                                      |   |    |               |   |   |   |   |
| Total  |   |                           |   |                               |                        |                                      |   | 563,200 |               |   |   | 563,200 |   |

----

----

----

----

----

| ITEM 3. | QUALITATIVE AND QUANTITATIVE DISCLOSURE ABOUT MARKET RISK |
|---------|-----------------------------------------------------------|

| ITEM 4T. | CONTROLS AND PROCEDURES |
|----------|-------------------------|

|   | (b) | Management’s Report on Internal Control over Financial Reporting |
|--------|-----|------------------------------------------------------------------------|

----

PART II — OTHER INFORMATION 

Item 1.                      Legal Proceedings 

Item 1A.  Risk Factors - Not applicable to Smaller Reporting Companies. 

Item 2.                      Unregistered Sales of Equity Securities 

|   | · | 136,000 shares were issued to 5 non-US persons in transactions under Regulation S, for net proceeds of $4,730. (3) |
|--------|--------|--------------------------------------------------------------------------------------------------------------------|

 

|   | (1) | Exempt under Section 4(2) of the Act as a sale for cash to a small group of accredited or otherwise sophisticated investors not involving any public offering. |
|--------|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | Exempt under Section 4(2) of the Act as an issuance of securities as consideration for an acquisition of a company or block of assets from a small group of sophisticated sellers. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (3) | Exempt under Regulation S promulgated under the Act as issuances of restricted shares to non-US persons who provided subscription representations in private transactions without any advertising or public solicitation. |
|--------|-----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (4) | Exempt under Regulation D promulgated under the Act and Rule 506 thereof as sales to all accredited investors who provided subscription representations in offerings that were not subject to public solicitation and in which Form D notices were filed. |
|--------|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (5) | Exempt under Section 4(2) as issuances of stock in lieu of compensation or consulting fees to a small member of sophisticated persons not involving any public offering. |
|--------|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|   | (6) | Exempt under such 3(a)(9) of the Act as an exchange of securities for other outstanding securities of the Registrant. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------|

|   | (7) | Exempt under Section 4(2) of the Act as issuance of shares as additional consideration for loans to the Registrant or in lieu of interest on loans, to institutional and other accredited investors. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

Item 3.                      Defaults Upon Senior Securities 

Item 4.                       Submission of Matters to a Vote of Security Holders 

Item 5.                       Other Information 

Item 6.                      Exhibits . 

|   | 31.1 | Certification by CEO pursuant to 18 USC Section 1350 as adopted by Section 302 of the Sarbanes-Oxley Act of 2002. |
|--------|------|-------------------------------------------------------------------------------------------------------------------|

|   | 31.2 | Certification by CFO pursuant to 18 USC Section 1350 as adopted by Section 302 of the Sarbanes-Oxley Act of 2002. |
|--------|------|-------------------------------------------------------------------------------------------------------------------|

|   | 32.1 | Certification by CEO/CFO pursuant to 18 USC Section 1350 as adopted by Section 906 of the Sarbanes-Oxley Act of 2002. |
|--------|------|-----------------------------------------------------------------------------------------------------------------------|

----

SIGNATURE 

----