UNITED
STATES
 SECURITIES
AND EXCHANGE COMMISSION
 Washington,
D.C. 20549
 
 
  FORM
10-Q
  
 (MARK
      ONE)x
              QUARTERLY
      REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF
      1934For
      the quarterly period ended March 31, 2009ORo
              TRANSITION
      REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF
      1934For
      the transition period from  ______________ to
      ______________
 
 COMMISSION
FILE NUMBER: 000-29341
  iVOICE,
INC.
 (Exact
name of registrant as specified in its charter)
  New Jersey
                51-0471976(State
      or Other Jurisdiction of Incorporation or Organization)
                (I.R.S.
      Employer Identification No.)
  750 Highway 34, Matawan, NJ
07747
 (Address
of Principal Executive Offices)(Zip Code)
  Registrant’s
Telephone Number, Including Area Code:    (732)
441-7700
  Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.  Yes xNoo
  Indicate by check mark
whether the registrant has submitted electronically and posted on its Web site,
if any, every Interactive Data File required to be submitted and posted pursuant
to Rule 405 of Regulation S-T during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such
files).   Yes oNox
  Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated files, or a smaller reporting company. See
the definitions of “large accelerated filer”, “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the exchange act:
 
 Large
accelerated filero
Accelerated filero
Non-accelerated filero Smaller reporting companyx
  Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).  Yes o  No x




Number
of shares of Class A, common stock,No par value, outstanding as of May 15, 2009: 
2,602,170,527




Table of Contents




iVOICE,
INC. AND SUBSIDIARIES


CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS


MARCH
31, 2009 AND 2008







TABLE OF CONTENTS




Page No.PART
      I. FINANCIAL INFORMATIONItem
      1.
                                      Condensed Consolidated Financial Statements
      (Unaudited)Condensed Consolidated Balance Sheet – March 31, 2009 and
      December 31, 2008
                                      2Condensed Consolidated Statements of Income - For the three
      months ended March 31, 2009 and 2008
                                      3Condensed Consolidated Statement of Accumulated Other
      Comprehensive Loss – For the three months ended March 31,
      2009
                                      4Condensed Consolidated Statements of Cash Flows - For the three
      months ended March 31, 2009 and 2008
                                      5-6Notes to Condensed Consolidated Financial
      Statements
                                      7-14Item
      2.
                                      Management’s Discussion and Analysis of Financial Condition and
      Results of Operations
                                      15Item
      4T.
                                      Controls and Procedures
                                      17PART
      II. OTHER INFORMATIONItem
      5.
                                      Other Information
                                      18Item
      6.
                                      Exhibits
                                      18







Table of Contents




iVOICE, INC. AND SUBSIDIARIES


CONDENSED
CONSOLIDATED BALANCE SHEET


(UNAUDITED)





March
      31,
                                2009
                              
                              
                              December
      31,2008(reclassified)ASSETSCURRENT
      ASSETSCash
      and cash equivalents, net of restricted cash of $0 and $1,512,104,
      respectively
                              
                              $
                              2,699,785
                              
                              
                              $
                              3,442,590Securities
      available for sale
                              
                              
                              6,559
                              
                              
                              
                              13,016Accounts
      receivable, net of allowance for doubtful accounts $12,083
                              
                              
                              1,151
                              
                              
                              
                              --Inventory
                              
                              
                              5,449
                              
                              
                              
                              6,246Prepaid
      expenses and other current assets
                              
                              
                              159,557
                              
                              
                              
                              21,811Total current
      assets
                              
                              
                              2,872,501
                              
                              
                              
                              3,483,663PROPERTY
      AND EQUIPMENT, net of accumulated depreciation of $225,374 and $221,162,
      respectively
                              
                              
                              20,344
                              
                              
                              
                              23,556OTHER
      ASSETSIntangible
      assets, net of accumulated amortization of $1,792 and $1,608,
      respectively
                              
                              
                              235,039
                              
                              
                              
                              233,939Deposits
      and other assets
                              
                              
                              6,666
                              
                              
                              
                              6,666Total
      other assets
                              
                              
                              241,705
                              
                              
                              
                              240,605TOTAL
      ASSETS
                              
                              $
                              3,134,550
                              
                              
                              $
                              3,747,824LIABILITIES
      AND DEFICITCURRENT
      LIABILITIESAccounts
      payable and accrued expenses
                              
                              $
                              1,995,533
                              
                              
                              $
                              2,171,229Convertible
      debentures payable, net of discounts of $136,075 and $170,808,
      respectively
                              
                              
                              1,030,825
                              
                              
                              
                              996,092Derivative
      liability on convertible debentures
                              
                              
                              1,661,769
                              
                              
                              
                              1,659,991Due
      to related parties
                              
                              
                              504,929
                              
                              
                              
                              648,058Deferred
      revenues
                              
                              
                              12,971
                              
                              
                              
                              9,407Total
      current liabilities
                              
                              
                              5,206,027
                              
                              
                              
                              5,484,777COMMITMENTS
      AND CONTINGENCIESSTOCKHOLDERS’
      DEFICITiVoice
      Inc shareholders’ equity (deficit):Preferred
      stock, $1 par value; authorized 1,000,000 shares; no shares issued and
      outstanding
                              
                              
                              --
                              
                              
                              
                              --Common
      stock, Class A, no par value; authorized 10,000,000,000
      shares;2009
      – 2,602,173,527 shares issued; 2,602,170,527 shares
      outstanding2008
      - 2,602,173,527 shares issued; 2,602,170,527 shares
      outstanding
                              
                              
                              24,613,184
                              
                              
                              
                              24,613,184Common
      stock, Class B, $0.01 par value; authorized 50,000,000
    shares;2009
      - 2,204,875 shares issued; 0 shares outstanding2008
      - 2,204,875 shares issued; 1,512,104 shares outstanding
                              
                              
                              --
                              
                              
                              
                              --Additional
      paid-in capital
                              
                              
                              733,920
                              
                              
                              
                              719,702Accumulated
      other comprehensive gain
                              
                              
                              1,469
                              
                              
                              
                              1,785Accumulated
      deficit
                              
                              
                              (25,598,925
                              )
                              
                              
                              (25,250,499
                              )Treasury
      stock, 3,000 Class A shares, at cost
                              
                              
                              (28,800
                              )
                              
                              
                              (28,800
                              )Total iVoice Inc.
      stockholders' equity (deficit)
                              
                              
                              (279,152
                              )
                              
                              
                              55,372Non-controlling
      (deficit)
                              
                              
                              (1,792,325
                              )
                              
                              
                              (1,792,325
                              )Total
      deficit
                              
                              
                              (2,071,477
                              )
                              
                              
                              (1,736,953
                              )TOTAL
      LIABILITIES AND STOCKHOLDERS’ DEFICIT
                              
                              $
                              3,134,550
                              
                              
                              $
                              3,747,824


See
accompanying notes to condensed consolidated financial statements.





2
 Table of Contents




iVOICE, INC. AND SUBSIDIARIES


CONDENSED
CONSOLIDATED STATEMENTS OF INCOME


(UNAUDITED)




For
      the three monthsEnded
      March 31,2009
                                
                                
                                2008SALES
                                
                                $
                                15,030
                                
                                
                                $
                                37,736COST
      OF SALES
                                
                                
                                9,221
                                
                                
                                
                                --GROSS
      PROFIT
                                
                                
                                5,809
                                
                                
                                
                                37,736GENERAL
      AND ADMINISTRATIVE EXPENSESGeneral
      and administrative expenses
                                
                                
                                322,105
                                
                                
                                
                                346,818Amortization
      of financing costs
                                
                                
                                --
                                
                                
                                
                                43,438Depreciation
      and amortization
                                
                                
                                3,396
                                
                                
                                
                                1,735Total
      selling, general and administrative expenses
                                
                                
                                325,501
                                
                                
                                
                                391,991LOSS
      FROM OPERATIONS
                                
                                
                                (319,692
                                )
                                
                                
                                (354,255
                                )OTHER
      INCOME (EXPENSE)Other
      income
                                
                                
                                12,190
                                
                                
                                
                                185,119Gain
      (loss) on revaluation of derivatives
                                
                                
                                (1,778
                                )
                                
                                
                                1,174,661Amortization
      of discount on debt
                                
                                
                                (34,733
                                )
                                
                                
                                (1,341,642
                                )Interest
      expense
                                
                                
                                (4,413
                                )
                                
                                
                                (406,904
                                )Total
      other income (expense)
                                
                                
                                (28,734
                                )
                                
                                
                                (388,766
                                )LOSS
      FROM OPERATIONSBEFORE
      PROVISION FOR INCOME TAXES
                                
                                
                                (348,426
                                )
                                
                                
                                (743,021
                                )PROVISION
      FOR INCOME TAXES
                                
                                
                                --
                                
                                
                                
                                --LOSS
      FROM OPERATIONS
                                
                                
                                (348,426
                                )
                                
                                
                                (743,021
                                )LESS:
      NET INCOME ATTRIBUTABLE TOTHE
      NONCONTROLLING INTEREST
                                
                                
                                --
                                
                                
                                
                                (16,349
                                )NET
      LOSS APPLICABLE TO iVOICE, INC.
                                
                                $
                                (348,426
                                )
                                
                                $
                                (759,370
                                )NET
      LOSS ATTRIBUTABLE TO iVOICECOMMON
      SHAREHOLDERSBasic
      and diluted
                                
                                $
                                (0.00
                                )
                                
                                $
                                (0.00
                                )WEIGHTED
      AVERAGE SHARES OUTSTANDINGBasic
      and diluted
                                
                                
                                2,602,170,527
                                
                                
                                
                                685,024,562


See
accompanying notes to condensed consolidated financial statements.





3
 Table of Contents




iVOICE, INC. AND SUBSIDIARIES


CONDENSED
CONSOLIDATED STATEMENT OF


ACCUMULATED
OTHER COMPREHENSIVE INCOME (LOSS) (UNAUDITED)


FOR
THE THREE MONTHS ENDED MARCH 31,




2009
                          
                          
                          2008Balance
      at beginning of the period
                          
                          $
                          1,785
                          
                          
                          $
                          (1,096,000
                          )Unrealized
      gain (loss) on securities available for sale:Unrealized
      gain arising during the period
                          
                          
                          206
                          
                          
                          
                          32,838Less:
      reclassification adjustment and gains included in net loss
                          
                          
                          (522
                          )
                          
                          
                          --Net
      change for the period
                          
                          
                          (316
                          )
                          
                          
                          32,838Balance
      at end of the period
                          
                          $
                          1,469
                          
                          
                          $
                          (1,063,162
                          )
 See
accompanying notes to condensed consolidated financial
statements.





4
 Table of Contents




iVOICE, INC. AND SUBSIDIARIES


CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)


FOR
THE THREE MONTHS ENDED MARCH 31,






2009
                    
                    
                    2008CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      loss
                    
                    $
                    (348,426
                    )
                    
                    $
                    (759,370
                    )Adjustments
      to reconcile net loss to net cash used in operating
      activities:Depreciation
      of fixed assets and amortization of intangibles
                    
                    
                    3,396
                    
                    
                    
                    1,618Amortization
      of prepaid finance costs
                    
                    
                    --
                    
                    
                    
                    43,438Amortization
      of discount on debt conversion
                    
                    
                    34,733
                    
                    
                    
                    833,013Beneficial
      interest on issuance of stock
                    
                    
                    --
                    
                    
                    
                    86,076Gain
      on sales of securities available for sale
                    
                    
                    (1,196
                    )
                    
                    
                    (3,606
                    )Interest
      and dividends earned on investments
                    
                    
                    --
                    
                    
                    
                    (35,124
                    )(Gain)
      loss on revaluation of derivatives
                    
                    
                    1,778
                    
                    
                    
                    (311,198
                    )Minority
      interest in consolidated subsidiary net income
                    
                    
                    --
                    
                    
                    
                    16,349Changes
      in certain assets and liabilities:(Increase)
      in accounts receivable
                    
                    
                    (1,151
                    )
                    
                    
                    --Decrease
      in inventory
                    
                    
                    787
                    
                    
                    
                    --(Increase)
      decrease in prepaid expenses and other assets
                    
                    
                    (137,746
                    )
                    
                    
                    10,263Increase
      (decrease) in accounts payable and accrued liabilities
                    
                    
                    (175,696
                    )
                    
                    
                    226,484Increase
      in deferred revenues
                    
                    
                    3,564
                    
                    
                    
                    --Increase
      (decrease) in related party liabilities
                    
                    
                    (143,129
                    )
                    
                    
                    23,230Total
      cash provided by (used in) operating activities
                    
                    
                    (763,076
                    )
                    
                    
                    131,173CASH
      FLOWS FROM INVESTING ACTIVITIES:Costs
      of trademarks and other intangibles
                    
                    
                    (1,284
                    )
                    
                    
                    (2,020
                    )Net
      proceeds from sales of securities available for sale
                    
                    
                    7,337
                    
                    
                    
                    4,349Net
      redemption of principal and interest on marketable
    securities
                    
                    
                    --
                    
                    
                    
                    11,113Net
      effect on cash flow from consolidation of majority owned
      investment
                    
                    
                    --
                    
                    
                    
                    (612,637
                    )Total
      cash provided by (used in) investing activities
                    
                    
                    6,053
                    
                    
                    
                    (599,195
                    )CASH
      FLOWS FROM FINANCING ACTIVITIES:Stock
      issued to non-controlling shareholders
                    
                    
                    14,218
                    
                    
                    
                    --Proceeds
      from short term borrowings
                    
                    
                    --
                    
                    
                    
                    5,406,065Total cash provided by
      financing activities
                    
                    
                    14,218
                    
                    
                    
                    5,406,065NET
      INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
                    
                    
                    (742,805
                    )
                    
                    
                    4,938,043CASH
      AND CASH EQUIVALENTS – BEGINNING OF PERIOD
                    
                    
                    3,442,590
                    
                    
                    
                    79,919CASH
      AND CASH EQUIVALENTS – END OF PERIOD
                    
                    $
                    2,699,785
                    
                    
                    $
                    5,017,962CASH
      PAID DURING THE PERIOD FOR:Interest
      expense
                    
                    $
                    -
                    
                    
                    $
                    -Income
      taxes
                    
                    $
                    -
                    
                    
                    $
                    -  See
accompanying notes to condensed consolidated financial statements.
   5
 Table of Contents
 iVOICE,
INC. AND SUBSIDIARIES
 CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)(Continued)
 FOR
THE THREE MONTHS ENDED MARCH 31, 2009 and 2008


SUPPLEMENTAL
CASH FLOW INFORMATION:
 
 a)
              On
      March 12, 2008, the Company acquired 1,444.44 shares of iVoice Technology,
      Inc.’s Series A 10% Convertible Preferred Stock for
      $1,444,444.  This transaction was eliminated in
      consolidation.
 
 b)
              For
      the three months ended March 31, 2008, the Company exchanged an aggregate
      of $126,607 of amounts due from iVoice Technology, Inc. and B Green
      Innovations, Inc. into Convertible Promissory Notes of the same amount.
      These transactions were eliminated in
  consolidation.


SUPPLEMENTAL
SCHEDULE OF NON-CASH FINANCING ACTIVITIES:





For the three months ended
March 31, 2009:





a)
            The
      holder of the Class B Common Shares elected for the Company to redeem
      1,512,104 shares of Class B Common Stock for cash pursuant to the
      provisions of the redemption rights in the Certificate of
      Incorporation.  This transactions was reflected in the accounts
      of the Company at December 31, 2008 in anticipation of this
      event.





b)
            The
      Company received 16,724,000 shares of iVoice Technology, Inc. Class A
      common stock on conversion of $5,352 of convertible notes
      receivable.  This transaction was eliminated in
      consolidation.





c)
            The
      Company received 54,000,000 shares of Thomas Pharmaceuticals, Ltd. Class A
      common stock on conversion of $4,320 of convertible debentures receivable.
      The market value of these shares were impaired for the same amount because
      the Company will not be able to sell these on the open
    market.





For the three months ended
March 31, 2008:





d)
            The
      Company issued 441,087,447 shares of Class A common stock to YA Global
      Investments, LP. as repayment of principal on outstanding convertible
      debentures, valued at $385,076.





e)
            The
      Company issued 82,000,000 shares of Class A Common upon the conversion of
      27,900 shares of Class B Common
Stock





f)
            The
      Company received 25,000,000 shares of Thomas Pharmaceuticals, Ltd. Class A
      common stock on conversion of $2,000 of convertible debentures
      receivable.





g)
            The
      Company exchanged $44,972 of amounts due from SpeechSwitch, Inc. into a
      Convertible Promissory Note of the same
amount.





h)
            The
      Company received 71,000,000 shares of SpeechSwitch, Inc. Class A common
      stock on conversion of $5,680 of convertible notes
    receivable.





i)
            The
      Company received 42,000,000 shares of iVoice Technology, Inc. Class A
      common stock on conversion of $13,440 of convertible notes
      receivable.  This transaction was eliminated in
      consolidation.







See
accompanying notes to condensed consolidated financial statements.




6
 Table of Contents


iVOICE, INC. AND SUBSIDIARIES
 NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
 MARCH
31, 2009 AND 2008




NOTE
1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES





Basis of
      Presentation


The
accompanying unaudited condensed consolidated financial statements include the
accounts of iVoice, Inc. (the “Company” or “iVoice”) and its wholly owned
subsidiary, iVoice Innovations, Inc. and its majority owned public company,
iVoice Technology, Inc.  These condensed consolidated financial
statements have been prepared in accordance with accounting principles generally
accepted in the United States for interim financial information and with the
instructions to Form 10-Q and Regulation S-X.  Accordingly, they do
not include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements.  In the
opinion of management, all adjustments (consisting only of normal recurring
adjustments) considered necessary for a fair presentation have been
included.  It is suggested that these condensed consolidated financial
statements be read in conjunction with the December 31, 2008 audited financial
statements and the accompanying notes thereto.





Between
February 11, 2004 and August 5, 2005, the Company completed the transfer of
certain business segments and their related assets and liabilities to its four
wholly owned subsidiaries Trey Resources, Inc, SpeechSwitch, Inc, iVoice
Technology, Inc and Deep Field Technologies, Inc.  These companies
were then spun-off from iVoice as special dividends of the shares of Class A
common Stock of the respective companies to the iVoice stockholders. Effective
with the spin-off of the four subsidiaries, SpeechSwitch, iVoice Technology,
Trey Resources and Deep Field Technologies now operate as independent publicly
traded entities.





On March
12, 2008, the Company acquired 1,444.44 shares of iVoice Technology, Inc.’s
Series A 10% Convertible Preferred Stock for $1,444,444.  At the time
that the Company acquired these shares, the holder of each share of Series A
Preferred Stock had the right to one vote for each share of Common Stock into
which such Series A Preferred Stock could then be converted, and the holders of
the Series A Preferred Stock shall not have in the aggregate more than seventy
percent (70%) of the total votes of all classes of voting stock of the
Corporation that would vote at a meeting of shareholders. On March 6, 2009,
iVoice Technology amended their Certificate of Incorporation to remove the
voting and conversion rights of the Series A Convertible Preferred Stock. Based
on this change, the Company no longer has any voting rights in the stock of
iVoice Technology. The Company and iVoice Technology continue to share common
management and as such, according to FASB Interpretation No. 46R “Consolidation of Variable Interest
Entities”, iVoice, Inc. is required to consolidate the results of
operations of iVoice Technology with those of iVoice and its other
subsidiary.





The
Company is publicly traded and is currently traded on the Over The Counter
Bulletin Board (“OTCBB”) under the symbol “IVOI”.





Principles of
Consolidation


The
accompanying condensed consolidated financial statements include the accounts of
the Company and its wholly owned subsidiary, iVoice Innovations, Inc. and its
majority owned public company, iVoice Technology, Inc. (“iVoice Technology”).
All significant inter-company transactions and balances have been eliminated in
consolidation.





Use of
Estimates


The
preparation of financial statements are in conformity with accounting principles
generally accepted in the United States of America which requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenue and expenses during
the reporting period.  Actual results could differ from those
estimates.





Revenue
Recognition


The
parent Company obtains its income primarily from the sales or licensing of its
patents and patent applications. Revenues for the sales of our patents are
recorded upon transfer of title. The patent revenues are reported net of any
broker fees or commissions.





The
Company also is reporting revenues for iVoice Technology which derives its
revenues from the licensing of its software product and optional customer
support (maintenance) service. iVoice Technology’s standard license agreement
provides for a one-time fee for use of the company's product in perpetuity for
each computer or CPU in which the software will reside. iVoice Technology’s
software application is fully functional upon delivery and implementation and
does not require any significant modification or alteration. iVoice Technology
also offers customers an optional annual software maintenance and support
agreement for the subsequent one-year periods.





iVoice
Technology’s wholly owned subsidiary, B Green Innovations, Inc., derives
revenues from the shipments of “green products” which are recognized at the time
of shipment to, or acceptance by customer, provided title and risk of loss is
transferred to the customer. Provisions, when appropriate, are made where the
right to return exists.





Cash and Cash
Equivalents


The
Company considers all highly liquid investments purchased with original
maturities of three months or less to be cash equivalents. The Company had cash
and cash equivalents at March 31, 2009 and December 31, 2008 of $2,699,785 and
$3,442,590 (net of restricted cash of $1,512,104), respectively.





Concentration of Credit
Risk


The
Company maintains cash balances at a financial institution that is insured by
the Federal Deposit Insurance Corporation up to $250,000. The cash equivalents
are not insured. The Company has uninsured cash balances at March 31, 2009 and
December 31, 2008 of $2,183,796 and $4,604,226, respectively.





7
 Table of Contents


iVOICE,
INC. AND SUBSIDIARIES
 NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
 MARCH
31, 2009 AND 2008





Securities
Available-for-sale


The
Company has evaluated its investment policies consistent with FAS No. 115,
Accounting for Certain Investments in Debt and Equity Securities, and determined
that all of its investment securities are to be classified as
available-for-sale. Available-for-sale securities are carried at fair value,
with the unrealized gains and losses reported in Stockholders' Equity under the
caption Accumulated Other Comprehensive Income (Loss).  The Company
had securities available for sale at March 31, 2009 and December 31, 2008 of
$6,559 and $13,016, respectively.





Fair Value of Financial
Instruments


The
Company estimates that the fair value of all financial instruments at March 31,
2009 and December 31, 2008, as defined in FAS 107, does not differ materially,
except for the items discussed below,  from the aggregate carrying
values of its financial instruments recorded in the accompanying condensed
consolidated balance sheet. The estimated fair value amounts have been
determined by the Company using available market information and appropriate
valuation methodologies. Considerable judgment is required in interpreting
market data to develop the estimates of fair value, and accordingly, the
estimates are not necessarily indicative of the amounts that the Company could
realize in a current market exchange.





During
the 4th Quarter
2008, management of the Company determined that the carrying value of the of
Thomas Pharmaceuticals, Ltd. Series B Convertible Preferred Stock, the
Convertible Promissory notes of Thomas Pharmaceuticals, Ltd. and SpeechSwitch,
Inc. and the Class A Common Stock of Deep Field Technologies, Inc. were severely
impaired due to poor liquidity of their Common Stock in the
marketplace.  Management has taken a fair value adjustment of
$2,982,833 to write down these investments in prior year.





In
addition, the amounts due on the Atire Technologies, Inc. Promissory Note was
reserved as bad debt on the books of iVoice Technology for $28,850, due to
non-payment of Atire’s current obligations.





(Loss) Per
Share


FAS No.
128, “Earnings Per Share” requires presentation of basic earnings per share
(“basic EPS”) and diluted earnings per share (“diluted EPS”).





The
computation of basic EPS is computed by dividing income available to common
stockholders by the weighted average number of outstanding Common shares during
the period.  Diluted earnings per share gives effect to all dilutive
potential Common shares outstanding during the period. The computation of
diluted EPS for the three months ended March 31, 2009 and 2008 does not assume
conversion, exercise or contingent exercise of securities that would have an
anti-dilutive effect on earnings.





The
shares used in the computations are as follows:




Three
      months ended March 31,2009
                                          
                                          
                                          2008Net
      (loss) from operations
                                          
                                          $
                                          (348,426
                                          )
                                          
                                          $
                                          (743,021
                                          )Less:
      net income attributable to non-controlling interest
                                          
                                          $
                                          --
                                          
                                          
                                          $
                                          (16,349
                                          )Net
      (loss) applicable to iVoice, Inc.
                                          
                                          $
                                          (348,426
                                          )
                                          
                                          $
                                          (759,370
                                          )Weighted
      average shares outstanding
                                          
                                          
                                          2,602,170,527
                                          
                                          
                                          
                                          685,024,562Net
      (loss) attributable to iVoice, Inc common shareholders
                                          
                                          $
                                          (0.00
                                          )
                                          
                                          $
                                          (0.00
                                          )


The
Company has shares issuable upon conversion of the Class B Common Stock, YA
Global Convertible Debentures and YA Global Warrants. The Company had common
stock equivalents of 16,700,000,000 and 23,456,703,002 at March 31, 2009 and
2008, respectively. During the first quarter of 2009, the holder of the Class B
Common Shares, elected for the Company to redeem 1,512,104 shares of Class B
Common Stock for cash and eliminated approximately 5.1 billion of the common
stock equivalents at March 31, 2008.





Comprehensive Income
(Loss)


FAS No.
130, “Reporting Comprehensive Income”, establishes standards for the reporting
and display of comprehensive income (loss) and its components in the financial
statements. The items of other comprehensive income (loss) that are typically
required to be displayed are foreign currency items, minimum pension liability
adjustments, and unrealized gains and losses on certain investments in debt and
equity securities. As of March 31, 2009 and 2008, the Company has several items
that represent comprehensive loss, and thus, has included a statement of
comprehensive income (loss).




8
 Table of Contents




iVOICE,
INC. AND SUBSIDIARIES
 NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
 MARCH
31, 2009 AND 2008


Reclassification of
accounts


Subsequent
to the year ended December 31, 2008, the Company amended the Certificate of
Incorporation to enable the holders of the Class B Common Stock to elect, at the
holder’s discretion, the redemption for cash by the Corporation at the rate of
$1.00 for each Class B Common Share presented to the Corporation for redemption.
Consequently, the Company reclassified the redemption amount of the Class B
Common Stock from Shareholders’ deficit to current liabilities. The
reclassification had no effect on operations or cash flows.





Concurrent
with the adoption of SFAS No. 160, the Company reclassified certain accounts in
the shareholders’’ equity (deficit) section to conform to the current year
presentation. The reclassifications had no effect on operations or cash
flows.





Derivative
Liabilities


During
April 2003, the Financial Accounting Standards Board issued SFAS 149, "Amendment
of Statement 133 on Derivative Instruments and Hedging
Activities."  SFAS 149 amends and clarifies accounting for derivative
instruments, including certain derivative instruments embedded in other
contracts, and for hedging activities under SFAS 133, "Accounting for Derivative
Instruments and Hedging Activities." The statement requires that contracts with
comparable characteristics be accounted for similarly and clarifies when a
derivative contains a financing component that warrants special reporting in the
statement of cash flows.  SFAS 149 is effective for contracts entered
into or modified after September 30, 2003, except in certain circumstances, and
for hedging relationships designated after September 30, 2003. The financial
statements for the three months ended March 31, 2009 and 2008 include the
recognition of the derivative liability on the underlying securities issuable
upon conversion of the YA Global Convertible Debentures.





Recent Accounting
Pronouncements


In
December 2007, the FASB issued SFAS No. 160 “Non-controlling Interests
in Consolidated Financial Statements — an amendment of ARB No. 51” (“SFAS
160”).  SFAS 160 requires that ownership interests in subsidiaries
held by parties other than the parent, and the amount of consolidated net
income, be clearly identified, labeled, and presented in the consolidated
financial statements within equity, but separate from the parent’s equity. It
also requires once a subsidiary is deconsolidated, any retained non-controlling
equity investment in the former subsidiary be initially measured at fair value.
Sufficient disclosures are required to clearly identify and distinguish between
the interests of the parent and the interests of the non-controlling owners. The
adoption of SFAS 160 on January 1, 2009, did not have a material effect on the
Company’s condensed consolidation financial statements.





In April
2008, the FASB issued FSP No. 142-3, “Determination of the Useful Life of
Intangible Assets”. FSP 142-3 amends the factors an entity should consider in
developing renewal or extension assumptions used in determining the useful life
of recognized intangible assets under SFAS 142, Goodwill and Other Intangible
Assets, and adds certain disclosures for an entity’s accounting policy of the
treatment of the costs, period of extension, and total costs
incurred.  FSP 143-3 must be applied prospectively to intangible
assets acquired after January 1, 2009.  The Company’s adoption of FSP
142-3 did not have a material impact on the Company’s condensed consolidated
financial statements.





In May
2008, the Financial Accounting Standards Board (the “FASB”) issued FAS No. 162,
“The Hierarchy of Generally Accepted Accounting Principles” (“FAS 162”). This
statement identifies the sources of accounting principles and the framework for
selecting the principles used in the preparation of financial statements of
nongovernmental entities that are presented in accordance with GAAP. With the
issuance of this statement, the FASB concluded that the GAAP hierarchy should be
directed toward the entity and not its auditor, and reside in the accounting
literature established by the FASB as opposed to the American Institute of
Certified Public Accountants (AICPA) Statement on Auditing Standards No. 69,
“The Meaning of Present Fairly in Conformity With Generally Accepted Accounting
Principles.” This statement is effective 60 days following the SEC’s approval of
the Public Company Accounting Oversight Board amendments to AU Section 411, “The
Meaning of Present Fairly in Conformity With Generally Accepted Accounting
Principles.” The adoption of FAS 162 is not expected to have a material impact
on the Company’s results from operations or financial position.





In June
2008, the FASB ratified Emerging Issues Task Force (EITF) Issue No. 08-3,
Accounting for Lessees for Maintenance Deposits Under Lease Arrangements ("EITF
08-3"). EITF 08-3 provides guidance for accounting for nonrefundable maintenance
deposits. It also provides revenue recognition accounting guidance for the
lessor. EITF 08-3 is effective for fiscal years beginning after December 15,
2008. The Company’s adoption of EITF 08-3 is not expected to have a material
impact on the Company’s condensed consolidated financial
statements.





In
November 2008, the FASB issued EITF Issue No. 08-7, Accounting for Defensive
Intangible Assets (“EITF 08-7”). EITF 08-7 addresses the accounting for assets
acquired in a business combination or asset acquisition that an entity does not
intend to actively use, otherwise referred to as a ‘defensive asset.’ EITF 08-7
requires defensive intangible assets to be initially accounted for as a separate
unit of accounting and not included as part of the cost of the acquirer’s
existing intangible asset(s) because it is separately identifiable. EITF 08-7
also requires that defensive intangible assets be assigned a useful life in
accordance with paragraph 11 of SFAS 142 and is effective for financial
statements issued for fiscal years beginning after December 15, 2008. The
Company’s adoption of this EITF is not expected to have a material impact on the
Company’s condensed consolidated financial statements.






9
 Table of Contents




iVOICE,
INC. AND SUBSIDIARIES
 NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
 MARCH
31, 2009 AND 2008


In April
2009, the FASB issued FSP FAS 115-2 and FAS 124-2, Recognition and Presentation
of Other-Than-Temporary Impairments. This FSP amends the other-than-temporary
impairment guidance for debt securities to make the guidance more operational
and to improve the presentation and disclosure of other-than-temporary
impairments in the financial statements. The most significant change the FSP
brings is a revision to the amount of other-than-temporary loss of a debt
security recorded in earnings. FSP FAS 115-2 and FAS 124-2 is effective for
interim and annual reporting periods ending after June 15, 2009. The Company
does not believe that the implementation of this standard will have a material
impact on its condensed consolidated financial statements.




In April
2009, the FASB issued FSP FAS 157-4, Determining Fair Value When the Volume and
Level of Activity for the Asset or Liability Have Significantly Decreased and
Identifying Transactions That Are Not Orderly. This FSP provides additional
guidance for estimating fair value in accordance with FASB Statement No. 157,
Fair Value Measurements, when the volume and level of activity for the asset or
liability have significantly decreased. This FSP also includes guidance on
identifying circumstances that indicate a transaction is not orderly. This FSP
emphasizes that even if there has been a significant decrease in the volume and
level of activity for the asset or liability and regardless of the valuation
technique(s) used, the objective of a fair value measurement remains the same.
Fair value is the price that would be received to sell an asset or paid to
transfer a liability in an orderly transaction (that is, not a forced
liquidation or distressed sale) between market participants at the measurement
date under current market conditions. FSP FAS 157-4 is effective for interim and
annual reporting periods ending after June 15, 2009, and is applied
prospectively. The Company does not believe that the implementation of this
standard will have a material impact on its condensed consolidated financial
statements.





In April
2009, the FASB issued FSP FAS 107-1 and APB 28-1, Interim Disclosures about Fair
Value of Financial Instruments. This FSP amends FASB Statement No. 107,
Disclosures about Fair Value of Financial Instruments, to require disclosures
about fair value of financial instruments for interim reporting periods of
publicly traded companies as well as in annual financial statements. This FSP
also amends APB Opinion No. 28, Interim Financial Reporting, to require those
disclosures in summarized financial information at interim reporting periods.
FSP FAS 107-1 and APB 28-1 is effective for interim and annual reporting periods
ending after June 15, 2009. The Company does not believe that the implementation
of this standard will have a material impact on its condensed consolidated
financial statements.





NOTE
2 – FAIR VALUE MEASUREMENTS





In
September 2006, the FASB issued SFAS 157, which defines fair value, establishes
a framework for measuring fair value, and expands disclosures about fair value
measurements. The provisions of SFAS 157 were effective January 1, 2008. The
FASB has also issued Staff Position (FSP) SFAS 157-2 (FSP No. 157-2), which
delays the effective date of SFAS 157 for nonfinancial assets and liabilities,
except for items that are recognized or disclosed at fair value in the financial
statements on a recurring basis (at least annually), until fiscal years
beginning after November 15, 2008.





As
defined in SFAS 157, fair value is the price that would be received to sell an
asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date (exit price). The Company utilizes market
data or assumptions that market participants would use in pricing the asset or
liability, including assumptions about risk and the risks inherent in the inputs
to the valuation technique. These inputs can be readily observable, market
corroborated, or generally unobservable. The Company classifies fair value
balances based on the observability of those inputs. SFAS 157 establishes a fair
value hierarchy that prioritizes the inputs used to measure fair value. The
hierarchy gives the highest priority to unadjusted quoted prices in active
markets for identical assets or liabilities (level 1 measurement) and the lowest
priority to unobservable inputs (level 3 measurement).





SFAS 157
classifies these inputs into the following hierarchy:





Level
      1 Inputs– Quoted prices are available in active markets for identical
      assets or liabilities as of the reporting date. Active markets are those
      in which transactions for the asset or liability occur in sufficient
      frequency and volume to provide pricing information on an ongoing basis.
      Level 1 primarily consists of financial instruments such as
      exchange-traded derivatives, marketable securities and listed
      equities.


Level
      2 Inputs– Pricing inputs are other than quoted prices in active markets
      included in level 1, which are either directly or indirectly observable as
      of the reported date. Level 2 includes those financial instruments that
      are valued using models or other valuation methodologies. These models are
      primarily industry-standard models that consider various assumptions,
      including quoted forward prices for commodities, time value, volatility
      factors, and current market and contractual prices for the underlying
      instruments, as well as other relevant economic measures. Substantially
      all of these assumptions are observable in the marketplace throughout the
      full term of the instrument, can be derived from observable data or are
      supported by observable levels at which transactions are executed in the
      marketplace. Instruments in this category generally include
      non-exchange-traded derivatives such as commodity swaps, interest rate
      swaps, options and collars.


Level
      3 Inputs– Pricing inputs include significant inputs that are generally
      less observable from objective sources. These inputs may be used with
      internally developed methodologies that result in management’s best
      estimate of fair value.





10
 Table of Contents
  iVOICE,
INC. AND SUBSIDIARIES
 NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
 MARCH
31, 2009 AND 2008





The
following table sets forth by level within the fair value hierarchy the
Company’s financial assets and liabilities that were accounted for at fair value
as of March 31, 2009 and June 30, 2008. As required by SFAS 157, financial
assets and liabilities are classified in their entirety based on the lowest
level of input that is significant to the fair value measurement. The Company’s
assessment of the significance of a particular input to the fair value
measurement requires judgment, and may affect the valuation of fair value assets
and liabilities and their placement within the fair value hierarchy
levels.





March 31,
2009





Assets
                        
                        Level
      I
                        
                        
                        Level II
                        
                        
                        Level III
                        
                        
                        TotalSecurities
      available for sale
                        
                        $
                        6,559
                        
                        
                        $
                        -
                        
                        
                        $
                        -
                        
                        
                        $
                        6,559Total
      Assets
                        
                        $
                        6,559
                        
                        
                        $
                        -
                        
                        
                        $
                        -
                        
                        
                        $
                        6,559Convertible
      debentures
                        
                        $
                        -
                        
                        
                        $
                        1,030,825
                        
                        
                        $
                        -
                        
                        
                        $
                        1,030,825Derivative
      liabilities
                        
                        
                        -
                        
                        
                        
                        1,661,769
                        
                        
                        
                        -
                        
                        
                        
                        1,661,769Total
      Liabilities
                        
                        $
                        -
                        
                        
                        $
                        2,692,594
                        
                        
                        $
                        -
                        
                        
                        $
                        2,692,594





December
31, 2008




Assets
                        
                        Level
      I
                        
                        
                        Level II
                        
                        
                        Level III
                        
                        
                        TotalSecurities
      available for sale
                        
                        $
                        13,016
                        
                        
                        $
                        -
                        
                        
                        $
                        -
                        
                        
                        $
                        13,016Total
      Assets
                        
                        $
                        13,016
                        
                        
                        $
                        -
                        
                        
                        $
                        -
                        
                        
                        $
                        13,016Convertible
      debentures
                        
                        $
                        -
                        
                        
                        $
                        996,092
                        
                        
                        $
                        -
                        
                        
                        $
                        996,092Derivative
      liabilities
                        
                        
                        -
                        
                        
                        
                        1,659,991
                        
                        
                        
                        -
                        
                        
                        
                        1,659,991Total
      Liabilities
                        
                        $
                        -
                        
                        
                        $
                        2,656,083
                        
                        
                        $
                        -
                        
                        
                        $
                        2,656,083




The
Company’s derivatives are classified within Level 2 of the valuation hierarchy.
The Company’s derivatives are valued using internal models that use as their
basis readily observable market inputs, such as time value, forward interest
rates, and volatility factors. Refer to Note 5 for more discussion on
derivatives.





NOTE
3 – CONSOLIDATED FINANCIAL STATEMENTS AND NON-CONTROLLING INTEREST





On March
12, 2008, the Company acquired 1,444.44 shares of iVoice Technology, Inc.’s
Series A 10% Convertible Preferred Stock for $1,444,444.  At the time
that the Company acquired these shares, the holder of each share of Series A
Preferred Stock had the right to one vote for each share of Common Stock into
which such Series A Preferred Stock could then be converted, and the holders of
the Series A Preferred Stock shall not have in the aggregate more than seventy
percent (70%) of the total votes of all classes of voting stock of the
Corporation that would vote at a meeting of shareholders. On March 6, 2009,
iVoice Technology amended its Certificate of Incorporation to remove the voting
and conversion rights of the Series A Convertible Preferred Stock. Based on this
change, the Company no longer has any voting rights in the stock of iVoice
Technology. The Company and iVoice Technology continue to share common
management and as such, according to FIN 46(R) “ Consolidation of Variable
Interest Entities — an interpretation of ARB No. 51” iVoice, Inc. is
required to consolidate the results of operations of iVoice Technology with
those of iVoice and its other subsidiary.





NOTE
4  - CONVERTIBLE DEBENTURES PAYABLE





On May
11, 2006 the Company issued to YA Global a $5,544,110 secured convertible
debenture due on May 11, 2008 bearing interest of 7.5% (see Note 15). This
debenture replaced a promissory note with a principal balance of $5,000,000 and
$544,110 of accrued interest due to YA Global from June 15, 2005. During the
period of January 1, 2008 until May 12, 2008, we issued 882,165,877 shares of
Class A common stock, with a value of $529,640, as repayment of $401,700 of
principal. The difference of $127,940 is charged to the Statement of Operations
as beneficial interest. On May 12, 2008, the remaining principal balance of
$4,796,510 was repaid in cash from the proceeds of the Smith Barney short term
loans and sales of the ARPSs discussed above. As of March 31, 2009, the unpaid
balance of accrued interest was $799,139.





On May
25, 2006, the Company issued to YA Global a $1,250,000 secured convertible
debenture due on May 25, 2008 bearing interest of 7.5% per annum pursuant to a
Securities Purchase Agreement entered into between us and YA Global. On February
21, 2008, this debenture was amended to extend the maturity date until May 25,
2010 and to raise the interest rate to 15% per annum. During the year ended
December 31, 2008, we issued 923,333,332 shares of Class A common stock, with a
value of $249,111, as repayment of $83,100 of principal. The difference of
$166,011 was charged to the Statement of Operations as beneficial interest. As
of March 31, 2009, the unpaid principal balance on the secured convertible
debenture is $1,166,900 plus accrued interest of $319,916.




11
 Table of Contents
 
 iVOICE,
INC. AND SUBSIDIARIES
 NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
 MARCH
31, 2009 AND 2008





On
October 31, 2007, the Company executed a waiver agreement with YA Global that
provides that if the Company reduces the debt to $141,523 that YA Global will
waive its rights to any future payments and will consider the account paid in
full. This waiver agreement was executed to compensate the Company for losses
incurred on the sales of the Corporate Strategies investments.





The
aggregate principal value of the remaining debentures at March 31, 2009 and
December 31, 2008 is $1,166,900. This amount is shown on the balance sheet net
of the unamortized portion of the discount on conversion of $136,075 and
$170,808, respectively. This discount is being amortized over the life of the
debenture and is being amortized as debt discount on the statement of
operations.





NOTE
5 - DERIVATIVE LIABILITY





In
accordance with SFAS 133, "Accounting for Derivative Instruments and Hedging
Activities" and EITF 00-19, "Accounting for Derivative Financial Instruments
Indexed to, and Potentially Settled in, a Company’s Own Stock", the conversion
feature associated with the YA Global Secured Convertible Debentures represents
embedded derivatives. As such, the Company had recognized embedded derivatives
in the amount of $6,908,078 as a derivative liability in the accompanying
condensed consolidated balance sheet, and it is now measured at its estimated
fair value of $1,661,769.





The
estimated fair value of the embedded derivative has been calculated based on a
Black-Scholes pricing model using the following assumptions:




At Issue
                      
                      
                      At 3/31/09Fair
      market value of stock
                      
                      $
                      0.096
      - $0.125
                      
                      
                      $
                      0.00010Exercise
      price
                      
                      $
                      0.086
      - $0.113
                      
                      
                      $
                      0.00007Dividend
      yield
                      
                      
                      0.00
                      %
                      
                      
                      0.00
                      %Risk
      free interest rate
                      
                      
                      5.47
                      %
                      
                      
                      3.2
                      %Expected
      volatility
                      
                      
                      195.36%
      - 196.54
                      %
                      
                      
                      332.86
                      %Expected
      life
                      
                      2.00
      years
                      
                      
                      3.00
      years




Changes
in the fair value of the embedded derivatives are calculated at each reporting
period and recorded in gain on revaluation of derivatives in the condensed
consolidated statements of operations. During the three months ended March 31,
2009, there was a change in the fair value of the embedded derivatives, which
resulted in a loss of $1,778.





In
accordance with SFAS 133, SFAS 150, “Accounting for Certain Financials
Instruments With Characteristics of Both Liabilities and Equity” and EITF 00-19,
the fair market value of the derivatives and warrants are bifurcated from the
convertible debentures as a debt discount.  The debt discount of is
being amortized over the life of the convertible debentures. Amortization
expense on the debt discount on the convertible debentures for the three months
ended March 31, 2009 was $34,733.





NOTE
6 - RELATED PARTY ACCOUNTS





From time
to time, the Company has entered into various loan agreements and employment
agreements with Jerome R. Mahoney, President and Chief Executive Officer of the
Company. In March 2009, the Company repaid $2,295 on the balance of the loan and
$185,600 of deferred compensation to Mr. Mahoney. As of March 31, 2009, the
balances due to Mr. Mahoney were: a) accrued interest of $5,285 and b) deferred
compensation is $142,476. Balances due to Mr. Mahoney are convertible into
either (i) one Class B common stock share of iVoice, Inc., $.01 par value, for
each dollar owed, or (ii) the number of Class A common stock shares of iVoice,
Inc. calculated by dividing (x) the sum of the principal and interest that the
Note holder has decided to prepay by (y) fifty percent (50%) of the lowest issue
price of Series A common stock since the first advance of funds under this Note,
whichever the Note holder chooses, or (iii) payment of the principal of this
Note, before any repayment of interest.  The Board of Directors of the
Company maintains control over the issuance of shares and may decline the
request for conversion of the repayment into shares of the Company.




In August
2005, iVoice Technology had assumed an outstanding promissory demand note in the
amount of $190,000 payable to Jerome Mahoney, then, the Non-Executive Chairman
of the Board of iVoice Technology.  The note bears interest at the
rate of prime plus 2.0% per annum (5.25% at March 31, 2009) on the unpaid
balance until paid.  Under the terms of the Promissory Note, at the
option of the Note holder, principal and interest can be converted into either
(i) one share of Class B Common Stock of iVoice Technology, Inc., par value
$.01, for each dollar owed, (ii) the number of shares of Class A Common Stock of
iVoice Technology, Inc. calculated by dividing (x) the sum of the principal and
interest that the Note holder has requested to have prepaid by (y) eighty
percent (80%) of the lowest issue price of Class A Common Stock since the first
advance of funds under this Note, or (iii) payment of the principal of this
Note, before any repayment of interest. The Board of Directors of iVoice
Technology maintains control over the issuance of shares and may decline the
request for conversion of the repayment into shares of the iVoice Technology. As
of March 31, 2009, the outstanding balance was $141,708, plus accrued interest
of $89,309.  On May 8, 2007, iVoice Technology executed a Security
Agreement providing Jerome Mahoney, President and Chief Executive Officer of
iVoice Technology, with a security interest in all of the assets of iVoice
Technology to secure the promissory note dated August 5, 2005 and all future
advances including, but not limited to, additional cash advances: deferred
compensation, deferred expense reimbursement, deferred commissions and income
tax reimbursement for the recognition of income upon the sale of common stock
for the purpose of the holder advancing additional funds to iVoice
Technology.


12
 Table of Contents
  iVOICE,
INC. AND SUBSIDIARIES
 NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
 MARCH
31, 2009 AND 2008





On August
1, 2004, iVoice Technology entered into a five-year employment agreement with
Jerome Mahoney to serve as Non-Executive Chairman of the Board of Directors of
iVoice Technology with a base salary of $85,000 for the first year with annual
increases based on the Consumer Price Index.  On March 9, 2009, the
term of the employment agreement between iVoice Technology and Mr. Mahoney, the
Company’s CEO, was extended to July 31, 2016.  A portion of Mr.
Mahoney’s compensation shall be deferred until such time that the Board of
Directors of iVoice Technology determines that it has sufficient financial
resources to pay his compensation in cash. As of March 31, 2009, iVoice
Technology has recorded $200,745 of deferred compensation due to Mr. Mahoney.
The Board of iVoice Technology has the option to pay Mr. Mahoney’s compensation
in the form of Class B Common Stock. Pursuant to the terms of the Class B Common
Stock, a holder of Class B Common Stock has the right to convert each share of
Class B Common Stock into the number of shares of Class A Common Stock
determined by dividing the number of Class B Common Stock being converted by a
20% discount of the lowest price for which the Company had ever issued its Class
A Common Stock. On August 30, 2006 Mr. Mahoney was elected to the position of
President and Chief Executive Officer of iVoice Technology and no longer serves
as Non-Executive Chairman of the Board of iVoice Technology.




On March
5, 2008, the Company converted its outstanding accounts due from iVoice
Technology, Inc. for unpaid administrative services in the amount of $50,652
into a convertible promissory note at the rate of prime plus 1 percent per annum
(4.25% at March 31, 2009). During the three months ended March 31, 2009 an
additional $12,663 was added to this note based on any unpaid administrative
services, and will accrue interest at the above specified rate from date of
advance until paid. The principal and interest shall be due and payable as
follows: (a) interest shall accrue monthly on the unpaid balance and shall be
paid annually, and (b) principal shall be payable on demand. On February 9, 2009
the Company received 16,724,000 shares of iVoice Technology, Inc. Class A Common
Stock upon conversion of $5,352 of Promissory Notes Receivable. As of March 31,
2009, the balance of the note is $90,167 which includes accrued interest of
$3,434. This transaction is eliminated in consolidation.





On March
11, 2008, the Company entered into a Stock Purchase Agreement with iVoice
Technology, Inc. for the purchase of 1,444.44 shares of iVoice Technology’s
Series A 10% Secured Convertible Preferred Stock valued at
$1,444,444.  The holders of the stock are entitled to receive
dividends at a rate 10% per annum and will have voting rights for each share of
Common Stock that the Series A Preferred Stock would be converted into using the
applicable conversion price. The holders of the Series A Preferred Stock shall
not have in the aggregate more than 70% of the total votes of all classes of
voting stock. The Company also received $144,444 in funding fees on the
transaction. This transaction is eliminated in consolidation.





On March
11, 2008, the Company received a warrant to purchase common stock of iVoice
Technology, Inc. pursuant to the terms of the Stock Purchase Agreement. The
warrant provides that the Company can purchase shares of Class A common stock at
a price calculated by dividing $144,444 by the lowest price that iVoice
Technology has ever issued its Class A common stock, provided, that in no event
shall the holder be entitled to exercise this Warrant for a number of shares
which, upon giving effect to such exercise, would cause the aggregate number of
shares of Common Stock beneficially owned by the holder and its affiliates to
exceed 9.99% of the outstanding shares of the Common Stock following such
exercise.





On June
30, 2008, the Company converted its outstanding accounts due from B Green
Innovations, Inc. for unpaid administrative services in the amount of $4,000
into a convertible promissory note at the rate of prime plus 1 percent per annum
(4.25% at March 31, 2009). During the three months ended March 31, 2009 an
additional $11,475 was added to this note based on any unpaid administrative
services, and will accrue interest at the above specified rate from date of
advance until paid. The principal and interest shall be due and payable as
follows: (a) interest shall accrue monthly on the unpaid balance and shall be
paid annually, and (b) principal shall be payable on demand. As of March 31,
2009, the balance of the note is $40,602 which includes accrued interest of
$727. This transaction is eliminated in consolidation.





Effective
on May 1, 2008, Mr. Mahoney entered into a consulting agreement with B Green
Innovations for annual compensation of $24,000 and upon every annual anniversary
thereafter, his base salary will increase at the rate based on the increase in
the Consumer Price Index for All Urban Consumers (New York-Northern N.J.-Long
Island). Mr. Mahoney agreed to accept compensation pursuant to this Consulting
Agreement in the form of Class B Common Stock, par value $.01 per share, in lieu
of cash, for as long as the Board of Directors decides in its sole discretion
that the Company does not have the financial resources to pay the Consultant in
cash.  The number of Class B Common Stock shares to be issued to the
Consultant pursuant to this Paragraph 2 shall be equal to one share of Class B
common stock for every dollar of compensation due and owing the Consultant. As
of March 31, 2009, Mr. Mahoney is due $20,000, and no shares have been
issued.




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iVOICE,
INC. AND SUBSIDIARIES
 NOTES
TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
 MARCH
31, 2009 AND 2008


NOTE
7 - COMMON STOCK





Pursuant
to the Company’s certificate of incorporation, as amended, iVoice, Inc. is
authorized to issue 1,000,000 shares of preferred stock, par value of $1.00 per
share, 10,000,000,000 shares of Class A common stock, no par value per share,
and 50,000,000 shares of Class B common stock, par value $.01 per
share.





a)
            Preferred
      Stock


Preferred
Stock consists of 1,000,000 shares of authorized preferred stock with $1.00 par
value.  As of March 31, 2009, no shares were issued or
outstanding.


b)
              Class A
      Common Stock




Class A
common stock consists of 10,000,000,000 shares of authorized common stock with
no par value. As of March 31, 2009, 2,602,173,527 shares were issued and
2,602,170,527 shares were outstanding.





Each
holder of Class A common stock is entitled to one vote for each share held of
record.  Holders of our Class A common stock have no preemptive,
subscription, conversion, or redemption rights.  Upon liquidation,
dissolution or winding-up, the holders of Class A common stock are entitled to
receive our net assets pro rata.  Each holder of Class A common stock
is entitled to receive ratably any dividends declared by our board of directors
out of funds legally available for the payment of dividends.  The
Company has not paid any dividends on its common stock and management does not
contemplate doing so in the foreseeable future.  The Company
anticipates that any earnings generated from operations will be used to finance
growth.





For the
three months ended March 31, 2009, the Company had no transactions in its Class
A Common Stock.





c)
            Class B Common
      Stock


Class B
Common Stock consists of 50,000,000 shares of authorized common stock with $.01
par value. Each share of Class B common stock is convertible into Class A common
stock calculated by dividing the number of Class B shares being converted by
fifty percent (50%) of the lowest price that the Company had previously issued
its Class A common stock since the Class B shares were issued.  Each
holder of Class B common stock has voting rights equal to the number of Class A
shares that would be issued upon the conversion of the Class B shares, had all
of the outstanding Class B shares been converted on the record date used for
purposes of determining which shareholders would vote.  Holders of
Class B common stock are entitled to receive dividends in the same proportion as
the Class B common stock conversion and voting rights have to Class A common
stock.  Jerome R. Mahoney is the sole owner of the Class B common
stock and on March 11, 2009, Mr. Mahoney, the holder of the Class B Common
Shares, elected for the Company to redeem the remaining balance of shares
outstanding.  As of March 31, 2009, there are 2,204,875 shares issued
and no shares outstanding.


d)
              Treasury
      Stock


On
February 11, 2002, the Company repurchased 600,000 shares of Class A common
stock from a previous employee for $28,800. Following the reverse stock split on
April 27, 2006, the shares were converted into 3,000 shares of Class A common
stock.


NOTE
8 - GOING CONCERN





The
Company has incurred substantial accumulated deficits, has an obligation to
deliver an indeterminable amount of common stock due on derivative liabilities
and has completed the process of spinning out the five operating subsidiaries.
These issues raise substantial doubt about the Company’s ability to continue as
a going concern. Therefore, recoverability of a major portion of the recorded
asset amounts shown in the accompanying balance sheets is dependent upon
continued operations of the Company, which in turn, is dependent upon the
Company’s ability to raise capital and/or generate positive cash flow from
operations.





Since the
spinoff of the three operating subsidiaries in 2005, the Company has
transitioned itself into a company focused on the development and licensing of
proprietary technologies. Following the sales of patents to Lamson Holdings LLC,
the Company has 9 remaining patent applications, which have been awarded or are
pending.  These applications include various versions of the
“Wirelessly Loaded Speaking Medicine Container”, which is also filed
internationally, the “Voice Activated Voice Operated Copier”, the “Voice
Activated Voice Operational Universal Remote Control”, “Wireless Methodology for
Talking Consumer Products” which is also filed internationally, “Product
Identifier and Receive Spoken Instructions” and “Traffic Signal System with
Countdown Signaling with Advertising and/or News Message”.




The
Company also continues to search for potential merger candidates with or without
compatible technology and products, which management feels may make financing
more appealing to potential investors.





The
financial statements do not include any adjustments relating to the
recoverability and classification of recorded assets, or the amounts and
classification of liabilities that might be necessary in the event the Company
cannot continue in existence.








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ITEM 2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS





Some
information included in this Quarterly Report on Form 10-Q and other materials
filed by us with the Securities and Exchange Commission, or the SEC, contains
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of
1934. Such forward-looking information involves important risks and
uncertainties that could significantly affect anticipated results in the future
and, accordingly, such results may differ materially from those expressed in any
forward-looking statements made by or on behalf of us. For a discussion of
material risks and uncertainties that the Company faces, see the discussion in
the Form 10−KSB for the fiscal year ended December 31, 2008 entitled “Risk
Factors”.  This discussion and analysis of financial condition and
plan of operations should be read in conjunction with our Condensed Consolidated
Financial Statements included herein.





Overview





Since
2005, the Company has transitioned itself into a company focused on the
development and licensing of proprietary technologies. As an example, in March
2006 we sold four of our voice activated product and item locator patents to
Lamson Holdings LLC for net proceeds of $136,000 and on December 6, 2007 we were
issued Patent 7,305,344 for a patent for Methodology for Talking Consumer
Products with Voice Instructions via Wireless Technology. On January 8, 2008,
the Company entered into a Technology Transfer Agreement with GlynnTech to
market its recently issued patent. GlynnTech will provide assistance in
developing a DVD of the patents capabilities. GlynnTech will also be obligated
to solicit licensing opportunities and/or acquisition of the
patent.




The
Company also continues to search for potential merger candidates with or without
compatible technology and products, which management feels may make financing
more appealing to potential investors.




On March
12, 2008, the Company acquired 1,444.44 shares of iVoice Technology, Inc.’s
Series A 10% Convertible Preferred Stock for $1,444,444.  At the time
that the Company acquired these shares, the holder of each share of Series A
Preferred Stock had the right to one vote for each share of Common Stock into
which such Series A Preferred Stock could then be converted, and the holders of
the Series A Preferred Stock shall not have in the aggregate more than seventy
percent (70%) of the total votes of all classes of voting stock of the
Corporation that would vote at a meeting of shareholders. On March 6, 2009,
iVoice Technology amended their Certificate of Incorporation to remove the
voting and conversion rights of the Series A Convertible Preferred Stock. Based
on this change, the Company no longer has any voting rights in the stock of
iVoice Technology. The Company and iVoice Technology continue to share common
management and as such, according to FASB Interpretation No. 46R “Consolidation of Variable Interest
Entities”, iVoice, Inc. is required to consolidate the results of
operations of iVoice Technology with those of iVoice and its other
subsidiary.




Results of
Operations





Three
months ended March 31, 2009 compared to three months ended March 31,
2008





Total
sales for the three months ended March 31, 2009 and 2008 were $15,030 and
$37,736, respectively. Sales in 2009 include $9,786 of maintenance revenues of
iVoice Technology and $5,244 of product sales of B Green Innovations new green
products. Sales in 2008 include $13,073 of maintenance revenues of iVoice
Technology and revenues from the administrative services agreements of $24,663
in the Company. The Company no longer provides administrative service for
several of our joint tenants. Declines in the maintenance revenues are due to
the general decline in the economies of our customers. Sales of the new “green”
products are through distributors and by direct sales to our
customers.




Total
cost of sales for the three months ended March 31, 2009 and 2008 were $9,221 and
$0, respectively. Maintenance and administrative services revenues carry no
direct costs. The cost of sales for the “green” products include purchases of
certain packaging materials that were charged directly to cost of
sales.




Total
operating expenses for the three months ended March 31, 2009 and 2008, were
$325,501 and $391,991, respectively, for a decrease of $66,490.  The
decreases primarily consist of amortization of finance costs of $43,438,
professional fees in the parent of $49,730 and overhead and office expenses of
the parent of $8,087. These decreases were offset by increases of $34,765
attributable to the expenses of iVoice Technology for the staffing and roll-out
of the new “green” products of B Green Innovations.




Total
other income (expense) for the three months ended March 31, 2009 was an expense
of $28,734. This total was primarily comprised of $34,733 amortization of the
discount on debt, $4,413 of accrued interest expense on the YA Global notes and
other debt and a $1,778 loss on revaluation of the derivatives. This amount was
offset by $12,190 of interest income and other income. Total other income
(expense) for the three months ended March 31, 2008 was an expense of $388,766.
This total was primarily comprised of $1,341,642 amortization of the discount on
debt and $406,904 of accrued interest expense on the YA Global notes and other
debt. These are offset by $1,174,661 gain on revaluation of the derivatives,
$165,647 of interest income on the cash accounts and promissory notes receivable
and other income of $19,472.




Loss from
operations for the three months ending March 31, 2009 and 2008 were $348,426 and
$743,021, respectively. The decrease in net loss of $394,595 was primarily due
to the reduced amortization of the discount on debt, decreases in operating
expenses and decreases in interest expenses on lower debt, offset by lower
sales, increased loss on revaluation of derivatives and lower interest income on
the cash and marketable securities, and as the result of the factors discussed
above.





As
required by SFAS 160, the Company is required to record non-controlling interest
in net income of iVoice Technology.  For the three months ended March
31, 2008, iVoice Technology reported a net gain of $54,497 and as such, the
Company recorded a non-controlling interest for the period of
$16,349.




Net loss
applicable to iVoice, Inc, for the three months ended March 31, 2009 was
$348,426 as compared to the net loss of $759,370 for the three months ended
March 31, 2008.  The decrease in net loss of $410,944 was the result
of the factors discussed above.







15
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Liquidity and Capital
Resources





We are
currently seeking additional operating income opportunities through potential
acquisitions or investments. Such acquisitions or investments may consume cash
reserves or require additional cash or equity. Our working capital and
additional funding requirements will depend upon numerous factors, including:
(i) strategic acquisitions or investments; (ii) an increase to current Company
personnel; (iii) the level of resources that we devote to sales and marketing
capabilities; (iv) technological advances; and (v) the activities of
competitors.





During
the year ended December 31, 2008, we had incurred net losses from operations of
$2,565,001 and we used $203,554 is cash for operations.  These matters
raise doubt about our ability to generate cash flows internally through our
current operating activities sufficient enough that its existence can be
sustained without the need for external financing. Our primary need for cash is
to fund our ongoing operations until such time that we can identify sales
opportunities for new products or identify strategic acquisitions that generate
enough revenue to fund operations.  There can be no assurance as to
the receipt or timing of revenues from operations.  These expenses are
anticipated to consist of the following: payroll and benefits of $400,000,
occupancy costs of $60,000, professional fees of $100,000, business insurance of
$70,000 and miscellaneous administrative expenses of $70,000.  We
expect to fund these obligations from cash on hand or otherwise from the sale of
equity or debt securities.  We believe that we have sufficient funds
on-hand to fund our operations for at least 24 months.





During
the three months ended March 31, 2009, the Company had a net decrease in cash of
$742,805. The Company’s principal sources and uses of funds in the three months
ended March 31, 2009 were as follows:




Cash flows from operating
activities.  The Company used $763,076 in cash from operations
in the three months ended March 31, 2009, a decrease of $894,249 compared to
$131,173 in cash provided for operations in the three months ending March 31,
2008.  This decrease was primarily attributed to the pay-down of
current liabilities and related party accounts, an increase in cash operating
expenses and an increase in prepaid and other assets.




Cash flows from investing
activities.  The Company had a net increase in funds from
investing activities of $6,053 for the three months ended March 31, 2009. This
was primarily due to the net proceeds from the sales of securities of $7,337
offset by spending for trademarks and other intangibles. For the three months
ended March 31, 2008, the Company used $599,195 in financing activities. The net
use of funds was primarily from the net effect of the consolidation of iVoice
Technology of $612,637. The Company had invested $1.4 million in iVoice
Technology’s Series A Convertible Preferred Stock and iVoice Technology has used
a portion of these proceeds to pay down a portion of the YA Global Convertible
Debentures and their investment in B Green Innovations, a wholly owned
subsidiary of iVoice Technology.




Cash flows from financing
activities. The Company provided $14,218 in cash for financing activities
in the three months ended March 31, 2009. This was from the issuance of stock of
iVoice Technology to the minority shareholders. For the three months ended march
31, 2008, the Company received $5,406,065 of funds from the Smith Barney Credit
Line which were used in subsequent periods to pay down the YA Global convertible
debentures.




Below is
a description of iVoice’s principal sources of funding:





On May
11, 2006 we issued to YA Global a $5,544,110 secured convertible debenture due
on May 11, 2008 with an interest of 7.5%. This debenture replaced a promissory
note with a principal balance of $5,000,000 and $544,110 of accrued interest due
to YA Global from June 15, 2005. On May 12, 2008, the remaining principal
balance of $4,796,510 was repaid in cash from the proceeds of the Smith Barney
short term loans.




On May
25, 2006, we issued to YA Global a $1,250,000 secured convertible debenture due
on May 25, 2008 with an interest of 7.5% per annum pursuant to a Securities
Purchase Agreement entered into between us and YA Global. On February 21, 2008,
this debenture was amended to extend the maturity date until May 25, 2010 and to
raise the interest rate to 15% per annum.




On March
7, 2008 and May 8, 2008, the Company received proceeds from an Express
Creditline Loan from Smith Barney that were collateralized by the proceeds
available from the sales of the auction rate preferred shares (“ARPS”) discussed
in Note 3. The interest rate charged on the loan is tied to the dividend rates
earned on the ARPSs. When an ARPS were sold in October 2008, a portion of the
proceeds is applied to pay down the short term loan and the balance is wired to
the Company’s savings account.




There is
no assurance that the future funding, if any, offered by YA Global or from other
sources will enable us to raise the requisite capital needed to implement our
long-term growth strategy.  Current economic and market conditions
have made it very difficult to raise required capital for us to implement our
business plan.





Off Balance Sheet
Arrangements





During
the three months ended March 31, 2009, we did not engage in any material
off-balance sheet activities nor have any relationships or arrangements with
unconsolidated entities established for the purpose of facilitating off-balance
sheet arrangements or other contractually narrow or limited purposes. Further,
we have not guaranteed any obligations of unconsolidated entities nor do we have
any commitment or intent to provide additional funding to any such
entities.




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Contractual
Obligations





The
Company has no material changes in its contractual obligations during the three
months ended March 31, 2009.





Forward Looking Statements -
Cautionary Factors





Certain
information included in this Form 10-Q and other materials filed or to be filed
by us with the Securities and Exchange Commission (as well as information
included in oral or written statements made by us or on our behalf), may contain
forward-looking statements about our current and expected performance trends,
growth plans, business goals and other matters.  These statements may
be contained in our filings with the Securities and Exchange Commission, in our
press releases, in other written communications, and in oral statements made by
or with the approval of one of our authorized officers.  Information
set forth in this discussion and analysis contains various “forward-looking
statements” within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934.  The Private
Securities Litigation Reform Act of 1995 (the “Act”) provides certain “safe
harbor” provisions for forward-looking statements.  The reader is
cautioned that such forward-looking statements are based on information
available at the time and/or management’s good faith belief with respect to
future events, and are subject to risks and uncertainties that could cause
actual performance or results to differ materially from those expressed in the
statements.  Forward-looking statements speak only as of the date the
statement was made.  We assume no obligation to update forward-looking
information to reflect actual results, changes in assumptions or changes in
other factors affecting forward-looking information.  Forward-looking
statements are typically identified by the use of terms such as “anticipate,”
“believe,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,”
“predict,” “project,” “should,” “will,” and similar words, although some
forward-looking statements are expressed differently.  Although we
believe that the expectations reflected in such forward-looking statements are
reasonable, we can give no assurance that such expectations will prove to be
correct.





ITEM 4T - CONTROLS AND PROCEDURES





Management's
report on internal control over financial reporting.





Management
of the Company has evaluated, with the participation of the Chief Executive
Officer and Chief Financial Officer of the Company, the effectiveness of the
Company's disclosure controls and procedures (as defined in Rules 13a-15(e) or
15d-15(e) promulgated by the Securities and Exchange Commission pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) as of the end
of the period covered by this Quarterly Report on Form 10-Q. Based on that
evaluation, the Chief Executive Officer and Chief Financial Officer of the
Company had concluded that the Company's disclosure controls and procedures as
of the period covered by this Quarterly Report on Form 10-Q were not effective
for the following reasons:





a)           The
deficiency was identified as the Company's limited segregation of duties amongst
the Company's employees with respect to the Company's control activities. This
deficiency is the result of the Company's limited number of employees. This
deficiency may affect management's ability to determine if errors or
inappropriate actions have taken place. Management is required to apply its
judgment in evaluating the cost-benefit relationship of possible changes in our
disclosure controls and procedures.





b)           The
deficiency was identified in respect to the Company's Board of Directors. This
deficiency is the result of the Company's limited number of external board
members. This deficiency may give the impression to the investors that the board
is not independent from management. Management and the Board of Directors are
required to apply their judgment in evaluating the cost-benefit relationship of
possible changes in the organization of the Board of Directors.





Changes
in internal control over financial reporting.





Management
of the Company has also evaluated, with the participation of the Chief Executive
Officer of the Company, any change in the Company’s internal control over
financial reporting that occurred during the period covered by this Quarterly
Report on Form 10-Q and determined that there was no change in the Company’s
internal control over financial reporting that has materially affected, or is
reasonably likely to materially affect, the Company’s internal control over
financial reporting.




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PART
II – OTHER INFORMATION





ITEM 5 - OTHER INFORMATION





(b)
            The
      Company does not have a standing nominating committee or a committee
      performing similar functions as the Company’s Board of Directors consists
      of only two members and therefore there would be no benefit in having a
      separate nominating committee that would consist of the same number of
      members as the full board of directors.  Both members of the
      Board of Directors participate in the consideration of director
      nominees.








ITEM 6 - EXHIBITS




3.1
                
                Amendment
      to the Certificate of Incorporation dated March 6, 2009 filed as Exhibit
      3.1 to the Current Report on Form 8-K dated March 6, 2009 and incorporated
      herein by reference.10.1
                
                Amendment
      Agreement dated February 21, 2008 by and between iVoice, Inc. and YA
      Global Investments LP. filed as Exhibit 10.1 to the Current Report on Form
      8-K/A Amendment No. 1 dated February 22, 2008 and incorporated herein by
      reference.10.2
                
                Amendment
      No. 7 to the Employment Agreement between iVoice Technology Inc. and
      Jerome Mahoney dated March 9, 2009 filed as Exhibit 10.2 to the Current
      Report on Form 8-K dated March 6, 2009 and incorporated herein by
      reference.31.1
                
                Certification required under
      Section 302 of the Sarbanes-Oxley Act of
  2002.32.1
                
                Certification required under
      Section 906 of the Sarbanes-Oxley Act of
  2002.




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SIGNATURES





Pursuant
to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.


iVoice,
      Inc.Date:
      May 20, 2009
                By:
                /s/
      Jerome R. MahoneyJerome
      R. Mahoney, President,
                  Chief
      Executive Officer and
                  Principal
      Financial Officer








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Index of Exhibits






3.1
                  
                  Amendment
      to the Certificate of Incorporation dated March 6, 2009 filed as Exhibit
      3.1 to the Current Report on Form 8-K dated March 6, 2009 and incorporated
      herein by reference.10.1
                  
                  Amendment
      Agreement dated February 21, 2008 by and between iVoice, Inc. and YA
      Global Investments LP. filed as Exhibit 10.1 to the Current Report on Form
      8-K/A Amendment No. 1 dated February 22, 2008 and incorporated herein by
      reference.10.2
                  
                  Amendment
      No. 7 to the Employment Agreement between iVoice Technology Inc. and
      Jerome Mahoney dated March 9, 2009 filed as Exhibit 10.2 to the Current
      Report on Form 8-K dated March 6, 2009 and incorporated herein by
      reference.31.1
                  
                  Certification required under
      Section 302 of the Sarbanes-Oxley Act of
  2002.32.1
                  
                  Certification required under
      Section 906 of the Sarbanes-Oxley Act of
  2002.


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