**U.S. SECURITIES AND EXCHANGE COMMISSION**

Washington, D.C. 20549

**FORM 10-Q**

(Mark One)

[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES        EXCHANGE ACT OF 1934        For the quarterly period ended June 30, 2009

**[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT**

For the transition period from _____________ to ______________        Commission File Number: 0-27445Enviro Voraxial Technology, Inc.(Exact name of Small Business Issuer as specified in its Charter)

| IDAHO                                                                           |  | 82-0266517                                      |  |
|---------------------------------------------------------------------------------|--|-------------------------------------------------|--|
| (State or other jurisdiction of  incorporation or organization)  |  | (I.R.S. Employer  Identification No.) |  |

821 NW 57th Place, Fort Lauderdale, Florida 33309(Address of principal executive offices)

(954) 958-9968(Issuer's telephone number)                              (Former Name, former address and former fiscal year, if changed since last Report.)

Check mark whether the Issuer (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the past 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 [X]    No [ ]        Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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 filer [ ]                                                                                                      Accelerated filer [ ] 

Non-accelerated filer [ ] (Do not check if a smaller reporting company)       Smaller reporting company [X] 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ]   No [X]

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: June 30, 2009, we had 25,028,994 shares of our Common Stock outstanding.

**INDEX**

|                                                                                                                                                 |  | **Page No.** |  |
|-------------------------------------------------------------------------------------------------------------------------------------------------|--|--------------|--|
| **PART I. CONSOLIDATED FINANCIAL INFORMATION**                                                                                             |  |              |  |
| Item 1.     Financial Statements.                                                                                 |  |              |  |
|            Condensed Consolidated Balance Sheets                                              |  | 3            |  |
|            Condensed Consolidated Statements of Operations           |  | 4            |  |
|            Condensed Consolidated Statements of Cash Flows           |  | 5            |  |
|            Notes to Condensed Consolidated Financial Statements      |  | 6            |  |
| Item 2.     Management's Discussion and Analysis of Financial Condition and Plan of Operations                         |  | 13           |  |
|                                                                                                                                                 |  |              |  |
| Item 3.     Quantitative and Qualitative Disclosures About Market Risk                                  |  | 15           |  |
|                                                                                                                                                 |  |              |  |
| Item 4T.   Controls and Procedures                                                                                          |  | 16           |  |
|                                                                                                                                                 |  |              |  |
| **PART II. OTHER INFORMATION**                                                                                                                  |  |              |  |
| Item 1.     Legal Proceedings                                                                 |  | 17           |  |
|                                                                                                                                                 |  |              |  |
| Item 1A.  Risk Factors                                                                                                                |  | 17           |  |
|                                                                                                                                                 |  |              |  |
| Item 2.     Unregistered Sales of Equity Securities and Use of Proceeds                                           |  | 17           |  |
|                                                                                                                                                 |  |              |  |
| Item 3.     Defaults Upon Senior Securities                                                                            |  | 17           |  |
|                                                                                                                                                 |  |              |  |
| Item 4.     Submission of Matters to a Vote of Security Holders                                                   |  | 17           |  |
|                                                                                                                                                 |  |              |  |
| Item 5.     Other Information                                                                                     |  | 17           |  |
|                                                                                                                                                 |  |              |  |
| Item 6.     Exhibits                                                                                                   |  | 17           |  |
|                                                                                                                                                 |  |              |  |
| Signatures                                                                                                                                      |  | 18           |  |

                 

 

 

    

           2

----

| ENVIRO VORAXIAL TECHNOLOGY, INC. AND SUBSIDIARY                   |   |   |         |   |         |
|-------------------------------------------------------------------|--------|--------|--------------|--------|--------------|
| CONSOLIDATED BALANCE SHEETS                                       |   |   |         |   |         |
|                                                              |   |   | June 30,     |   | December 31, |
|                                                              |   |   | 2009         |   | 2008         |
|                                                              |   |   | (Unaudited)  |   | (Audited)    |
| ASSETS                                                            |   |   |         |   |         |
| CURRENT ASSETS:                                                   |   |   |         |   |         |
|   Cash and cash equivalents                                  |   |   | $ 68,321     |   | $ 31,910     |
|   Accounts receivable                                        |   |   | 40,940       |   | 25,000       |
|   Inventory, net                                             |   |   | 174,582      |   | 174,581      |
|                                                              |   |   |         |   |         |
|     Total current assets                           |   |   | 283,843      |   | 231,491      |
|                                                              |   |   |         |   |         |
| FIXED ASSETS, NET                                                 |   |   | 192,270      |   | 203,594      |
| OTHER ASSETS                                                      |   |   | 13,695       |   | 13,695       |
|                                                              |   |   |         |   |         |
|     Total assets                                   |   |   | $ 489,808    |   | $ 448,780    |
|                                                              |   |   |         |   |         |
| LIABILITIES AND SHAREHOLDERS' DEFICIENCY                          |   |   |         |   |         |
| CURRENT LIABILITIES:                                              |   |   |         |   |         |
|   Accounts payable and accrued expenses                      |   |   | $ 1,566,930  |   | $ 1,176,089  |
|   Current portion of note payable                            |   |   | 30,836       |   | 30,836       |
|                                                              |   |   |         |   |         |
|     Total current liabilities                      |   |   | 1,597,766    |   | 1,206,925    |
|                                                              |   |   |         |   |         |
| LONG TERM NOTE PAYABLE                                            |   |   | 94,692       |   | 111,117      |
|                                                              |   |   |         |   |         |
|     Total liabilities                              |   |   | 1,692,458    |   | 1,318,042    |
|                                                              |   |   |         |   |         |
| COMMITMENTS AND CONTINGENCIES                                     |   |   |         |   |         |
|                                                              |   |   |         |   |         |
| SHAREHOLDERS' DEFICIENCY:                                         |   |   |         |   |         |
| Common stock, $.001 par value, 42,750,000 shares authorized;      |   |   |         |   |         |
|   25,028,994 and 24,631,494 shares issued and outstanding    |   |   |         |   |         |
|   as of June 30, 2009 and December 31, 2008, respectively    |   |   | 24,908       |   | 24,630       |
| Additional paid-in capital                                        |   |   | 9,378,071    |   | 9,219,348    |
| Deferred compensation                                             |   |   | (13,333)     |   | -            |
| Accumulated deficit                                               |   |   | (10,592,296) |   | (10,113,240) |
|                                                              |   |   |         |   |         |
|     Total shareholders' deficiency                 |   |   | (1,202,650)  |   | (869,262)    |
|                                                              |   |   |         |   |         |
|     Total liabilities and shareholders' deficiency |   |   | $ 489,808    |   | $ 448,780    |

The accompanying notes are an integral part of the consolidated financial statements.        3

|                   ENVIRO VORAXIAL TECHNOLOGY, INC. AND SUBSIDIARY                

CONSOLIDATED STATEMENTS OF OPERATIONS |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                               |
|                                                                                                                                                                                                                                                                                          |   | Three Months Ended June 30,   |   | Six Months Ended June 30,
     |
|                                                                                                                                                                                                                                                                                          |   | 2009 |   | 2008 |   | 2009 |   | 2008 |
|                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |
| Revenues, net                                                                                                                                                                                                                                                                                 |   | **$ 50,940** |   | **$ -** |   | **$ 130,940** |   | **$ 3,500** |
|                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |
| Cost of goods sold                                                                                                                                                                                                                                                                            |   | **-** |   | **-** |   | **32,000** |   | **-** |
|                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |
| Gross profit                                                                                                                                                                                                                                                                                  |   | 50,940 |   | - |   | 98,940 |   | 3,500 |
|                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |
| Costs and expenses:                                                                                                                                                                                                                                                                           |   |   |   |   |   |   |   |   |
|    General and administrative                                                                                                                                                                                                                                                       |   | **146,397** |   | **185,785** |   | **309,879** |   | **384,760** |
|    Research and development                                                                                                                                                                                                                                                         |   | **146,096** |   | **232,573** |   | **262,373** |   | **409,571** |
|                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |
|     Total costs and expenses                                                                                                                                                                                                                                                   |   | 292,493 |   | 418,358 |   | 572,252 |   | 794,331 |
|                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |
| Loss from operations                                                                                                                                                                                                                                                                          |   | (241,553) |   | (418,358) |   | (473,312) |   | (790,831) |
|                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |
| Other (expenses):                                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |   |
|     Interest expense                                                                                                                                                                                                                                                           |   | **(2,785)** |   | **(7,095)** |   | **(5,744)** |   | **(7,095)** |
|                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |
|     Total other expense                                                                                                                                                                                                                                                        |   | (2,785) |   | (7,095) |   | (5,744) |   | (7,095) |
|                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |
| NET LOSS                                                                                                                                                                                                                                                                                      |   | **$ (244,338)** |   | **$ (425,453)** |   | **$ (479,056)** |   | **$ (797,926)** |
|                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |
| Weighted average number of common                                                                                                                                                                                                                                                             |   |   |   |   |   |   |   |   |
|    shares outstanding-basic and diluted                                                                                                                                                                                                                                             |   | 25,001,302 |   | 23,684,635 |   | 24,852,897 |   | 23,684,635 |
|                                                                                                                                                                                                                                                                                          |   |   |   |   |   |   |   |   |
| Loss per common share - basic and diluted                                                                                                                                                                                                                                                     |   | $ (0.01) |   | $ (0.02) |   | $ (0.02) |   | $ (0.03) |

The accompanying notes are an integral part of the consolidated financial statements.        4

| ENVIRO VORAXIAL TECHNOLOGY, INC. AND SUBSIDIARY                           |   |                                                                                                                               |   |                                                                              |
|---------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------|
| CONSOLIDATED STATEMENTS OF CASH FLOWS                                     |   |                                                                                                                               |   |                                                                              |
|                                                                      |   | For the Six Months Ended June 30                                                                                         |
|                                                                      |   | 2009                                                                                                                               |   | 2008                                                                              |
| Cash Flows From Operating Activities:                                     |   |                                                                                                                               |   |                                                                              |
| Net loss                                                                  |   | $          (479,056)                                                             |   | $ (797,926)                                                                       |
| Adjustments to reconcile net loss to net                                  |   |                                                                                                                               |   |                                                                              |
|   cash provided by (used in) operating activities:                   |   |                                                                                                                               |   |                                                                              |
|      Depreciation                                     |   | 11,324                                                                                                                             |   | 11,325                                                                            |
|      Deferred compensation                            |   | (13,333)                                                                                                                           |   | -                                                                                 |
|      Issuance of common stock for consulting services |   | 80,000                                                                                                                             |   | -                                                                                 |
| Changes in assets and liabilities:                                        |   |                                                                                                                               |   |                                                                              |
|      Accounts receivable                              |   | 5,000                                                                                                                              |   | -                                                                                 |
|      Accounts payable and accrued expenses            |   | 390,841                                                                                                                            |   | 284,423                                                                           |
|                                                                      |   |                                                                                                                               |   |                                                                              |
|       Net cash (used in) operating activities    |   | (5,224)                                                                                                                            |   | (502,178)                                                                         |
|                                                                      |   |                                                                                                                               |   |                                                                              |
| Cash Flows From Financing Activities:                                     |   |                                                                                                                               |   |                                                                              |
|      Repayments from issuance of notes payable        |   | (16,425)                                                                                                                           |   | (15,092)                                                                          |
|      Proceeds from sales of common stock              |   | 79,000                                                                                                                             |   | 500,000                                                                           |
|                                                                      |   |                                                                                                                               |   |                                                                              |
|      Net cash provided by financing activities   |   | 62,575                                                                                                                             |   | 484,908                                                                           |
|                                                                      |   |                                                                                                                               |   |                                                                              |
|      Net increase in cash and cash equivalents        |   | 57,351                                                                                                                             |   | (17,270)                                                                          |
|                                                                      |   |                                                                                                                               |   |                                                                              |
|      Cash and cash equivalents, beginning of period   |   | 31,910                                                                                                                             |   | 201,066                                                                           |
|                                                                      |   |                                                                                                                               |   |                                                                              |
|      Cash and cash equivalents, end of period         |   |   $           89,261                                                        |   | $   183,796                                                             |
|                                                                      |   |                                                                                                                               |   |                                                                              |
| Supplemental Disclosures                                                  |   |                                                                                                                               |   |                                                                              |
|                                                                      |   |                                                                                                                               |   |                                                                              |
|      Cash paid during the year for interest           |   |  $             5,744                                              |   | $              - |
|      Cash paid during the year for taxes              |   | $                     -        |   | $              - |
|                                                                      |   |                                                                                                                               |   |                                                                              |
|      Non-cash investing and financing activities:     |   |                                                                                                                               |   |                                                                              |
|      Extension of stock options                       |   |   $                     - |   | $              - |
|      Common stock issued for conversion of            |   |                                                                                                                               |   |                                                                              |
|          accrued salary           |   | $                     -        |   | $              - |
|      Common stock options issued for services         |   | $                     -   |   | $              - |
|      Common stock issued for consulting services      |   |   $           80,000                                                        |   | $              - |

The accompanying notes are an integral part of the consolidated financial statements.5

 

ENVIRO VORAXIAL TECHNOLOGY, INC.         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JUNE30, 2009

NOTE A - ORGANIZATION AND OPERATIONS

Organization

Enviro Voraxial Technology, Inc. (the "Company") is a provider of environmental and industrial separation technology. The Company has developed and patented the Voraxial(R) Separator, which is a technology that efficiently separates liquid/liquid, liquid/solid or liquid/liquid/solid fluid streams with distinct        specific gravities. Current and potential commercial applications and markets include oil exploration and production, oil refineries, mining, manufacturing, waste-to-energy and food processing industry. The Company manufactures and sells the Voraxial Separator.        Florida Precision Aerospace, Inc. (FPA) is the wholly-owned subsidiary of the Company and is used to manufacture, assemble and test the Voraxial Separator.        NOTE B - GOING CONCERN        The Company has experienced net losses, has negative cash flows from operating activities, and has to raise capital to sustain operations. There is no assurance that the Company's developmental and marketing efforts will be successful, that the Company will ever have commercially accepted products, or that the Company will achieve a level of revenue sufficient to provide cash inflows to sustain operations. The Company will continue to require the infusion of capital until operations        become profitable. During the remainder of 2009, the Company anticipates seeking additional capital, increasing sales of the Voraxial Separator and reducing expenditures. As a result of the above, the accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.        NOTE C - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Interim Financial Statements

The interim financial statements presented herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted        in the United States of America have been condensed or omitted pursuant to such rules and regulations. The interim financial statements should be read in conjunction with the Company's annual financial statements, notes and accounting policies included in the Company's annual report on Form 10-K for the year ended December 31, 2008 as filed with the SEC. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) which are necessary to provide a        fair presentation of financial position as of June 30, 2009 and the related operating results and cash flows for the interim period presented have been made. The results of operations, for the period presented are not necessarily indicative of the results to be expected for the year.

Principles of Consolidation

The consolidated financial statements include the accounts of the parent company, Enviro Voraxial Technology, Inc., and its wholly-owned subsidiary, 

6

ENVIRO VORAXIAL TECHNOLOGY, INC.         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS        JUNE30, 2009

Florida Precision Aerospace, Inc. All significant intercompany accounts and transactions have been eliminated.Estimates

The preparation of consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures 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 may differ.

Revenue Recognition

The Company derives its revenue from the sale and short-term rental of the Voraxial Separator. The Company presents revenue in accordance with Staff Accounting Bulletin (SAB) No. 104 "Revenue Recognition in Financial Statements". Under SAB 104, revenue is realized when persuasive evidence of an arrangement        exists, delivery has occurred, the price is fixed or determinable and collectability is reasonably assured.        Revenues that are generated from sales of equipment are typically recognized upon shipment. Our standard agreements generally do not include customer acceptance or post shipment installation provisions. However, if such provisions have been included or there is an uncertainty about customer order, revenue is deferred until we have evidence of customer order and all terms of the agreement have been complied with. There were no agreements with such provisions as of June 30, 2009.        The Company recognizes revenue from the short term rental of equipment, ratably over the life of the agreement, which is usually three to six months.

Fair Value of Instruments

The carrying amounts of the Company's financial instruments, including cash and cash equivalents, inventory, accounts payable and accrued expenses at June 30, 2009, approximate their fair value because of their relatively short-term nature.

Cash and Cash Equivalents

The Company considers all highly liquid investments with a maturity of three months or less at the date of purchase to be cash equivalents. The Company maintains its cash balances with various financial institutions. Balances at these institutions may at times exceed the Federal Deposit Insurance Corporate        limits.

Inventory

Inventory consists of components for the Voraxial Separator and is priced at lower of cost or market. Inventory may include units being rented on a short term basis or components held by third parties in connection with pilot programs as part of the continuing evaluation by such third parties as to the effectiveness and usefulness of the service to be incorporated into their 7

ENVIRO VORAXIAL TECHNOLOGY, INC.         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JUNE30, 2009

respective operations. The third parties do not have a contractual obligation to purchase the equipment. The Company maintains the title and risk of loss. Therefore, these units are included in the inventory of the Company. As of June 30, 2009, there were no such components held by third parties.Fixed Assets

Fixed assets are stated at cost less accumulated depreciation. The cost of maintenance and repairs is expensed to operations as incurred. Depreciation is computed by the straight-line method over the estimated economic useful life of the assets (5-10 years). Gains and losses recognized from the sales or disposal        of assets is the difference between the sales price and the recorded cost less accumulated depreciation less costs of disposal.

Net Loss Per Share

Basic and diluted loss per share has been computed by dividing the net loss available to common stockholders by the weighted average number of common shares outstanding. The warrants and stock options have been excluded from the calculation since they would be anti-dilutive.        Such equity instruments may have a dilutive effect in the future and include the following potential common shares:      

| Warrants            |  | 5,741,867  |  |
|---------------------|--|------------|--|
| Stock options  |  | 6,710,666  |  |
|                     |  | 12,452,533 |  |

Research and Development Expenses

Research and development costs, which includes travel expenses, consulting fees, subcontractors and salaries are expensed as incurred.

Advertising Costs

Advertising costs are expensed as incurred and are included in general and administrative expenses.

Stock-Based Compensation

The Company adopted Statement of Financial Account Standard (SFAS) No. 123(R) effective January 1, 2006. This statement requires compensation expense relating to share-based payments to be recognized in net income using a fair-value measurement method. Under the fair value method, the estimated fair value of        awards is charged to income on a straight-line 

8

ENVIRO VORAXIAL TECHNOLOGY, INC.         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JUNE30, 2009

basis over the requisite service period, which is generally the vesting period. The company elected the modified prospective method as prescribed in SFAS No. 123 (R) and therefore,         prior periods were not restated. Under the modified prospective method, this statement was applied to new awards granted after the time of adoption, as well as to the unvested portion of previously granted equity-based awards for which the requisite service has not been rendered as of January 1, 2006.        Prior to January 1, 2006, the Company accounted for stock-based employee compensation under Accounting Principles Board (APB) Opinion No. 25, "Accounting for Stock Issued to Employees," and related interpretations. The Company has adopted the disclosure-only provisions of SFAS No. 123, "Accounting for Stock-Based Compensation," and SFAS No. 148, "Accounting for Stock-Based Compensation - Transition and Disclosure," which was released in December 2002 as an amendment of SFAS No. 123. The        Company currently accounts for stock-based compensation under the fair value method using the Black-Scholes option pricing model as indicated in Note E.

Accounting for the Impairment of Long-Lived Assets

The long-lived assets held and used by the Company are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of assets may not be recoverable. It is reasonably possible that these assets could become impaired as a result of technology or other industry changes.        Determination of recoverability of assets to be held and used is by comparing the carrying amount of an asset to future net undiscounted cash flows to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell. The Company has no such        assets and, therefore, no impairments of long-lived assets were recorded as of June 30, 2009.

NOTE D - RELATED PARTY TRANSACTIONS

For the six months ended June 30, 2009, the Company incurred consulting expenses from its chief executive officer of the Company of $152,500. Of these amounts, $35,350 has been paid for the six months ended June 30, 2009. The unpaid balance has been included in accrued expenses.        For the six months ended June 30, 2009, the Company incurred salary expenses from the vice president of the Company of $152,500. Of these amounts, $27,000 has been paid for the six months ended June 30, 2009. The unpaid balance has been included in accrued expenses.

NOTE E - CAPITAL TRANSACTIONS

Common stock

In February 2009, the Company entered into a six month consulting agreement. Under the terms of the agreement, the consultant will receive 200,000 shares at $.40 per share of the Company’s restricted stock.

During the six months ended June 30, 2009 the Company sold 137,500 shares of restricted common stock for $.40 per share in a private placement offering and 68,750 warrants at $.60 exercise price. Total proceeds from the sale were $55,000. The shares contain legends restricting their transferability absent        registration or applicable exemption. 

9

ENVIRO VORAXIAL TECHNOLOGY, INC.         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JUNE30, 2009

 

During the three months ended June 30, 2009 the Company sold 45,000 shares of restricted common stock for $.40 per share in a private placement offering and 22,500 warrants at $.60 exercise price. Total proceeds from the sale were $18,000. The shares contain legends restricting their transferability absent        registration or applicable exemption.

Warrants

In January 2009, the Company extended the exercisable life of certain warrants issued to investors to purchase an aggregate of 243,200 shares of common stock issued in 2000 for a period of one year. The warrants now expire in February 2010. The warrants have subsequently been extended for an additional twelve        months. The purchase price of these warrants ranges from $6.00 - $9.00 per share. The Company calculated the fair value of the extended warrants by using the Black-Scholes option-pricing model with the following weighted average assumptions: no dividend yield for all the years; expected volatility of 55%; risk-free interest rate of 5% and an expected life of one year. No increase in fair value was noted and, therefore, no adjustment has been made to the financial statements as of June        30, 2009.         In January 2009, the Company extended the exercisable life of certain warrants issued to investors to purchase an aggregate of 200,000 shares of common stock issued in 2001 for a period of one year. The warrants now expire in April 2010. The purchase price of the stock under these warrants ranges from $3.00-$4.00 per share. The Company calculated the fair value of the extended warrants by using the Black-Scholes option-pricing model with the following weighted average assumptions: no        dividend yield for all the years; expected volatility of 55%; risk-free interest rate of 5% and an expected life of one year. No increase in fair value was noted and, therefore, no adjustment has been made to the financial statements as of June 30, 2009. The warrants have subsequently been extended for an additional twelve months.         In October 2008, the Company extended the exercisable life of certain warrants issued to investors to purchase an aggregate of 1,033,333 shares of common stock issued in 2002 for a period of one year. The warrants now expire in October 2009. The purchase price of these warrants ranges from $1.00 - $1.25 per share. The Company calculated the fair value of the extended warrants by using the Black-Scholes option-pricing model with the following weighted average assumptions: no dividend        yield for all the years; expected volatility of 55%; risk-free interest rate of 5% and an expected life of one year. No increase in fair value was noted and, therefore, no adjustment has been made to the financial statements as of June 30, 2009.

In 2008, the Company extended the exercisable life of certain warrants issued to investors to purchase an aggregate of 1,346,665 shares of common stock issued in 2003 for a period of two years. The warrants now expire in January 2010. The purchase price of these warrants is $1.00 per share. The Company calculated        the fair value of the extended warrants by using the Black-Scholes option-pricing model with the following weighted average assumptions: no dividend yield for all the years; expected volatility of 55%; risk-free interest rate of 5% and an expected life of one year. No increase in fair value was noted and, therefore, no adjustment has been made to the financial statements as of June 30, 2009.

10

ENVIRO VORAXIAL TECHNOLOGY, INC.         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JUNE30, 2009

Information with respect to warrants outstanding and exercisable at June 30, 2009 is as follows:

|                       | Number                    Outstanding | Range of Exercise Price | Number                    Exercisable |
|----------------------------|---------------------------------------|-------------------------|---------------------------------------|
|                       |                                  |                    |                                  |
| Balance, December 31, 2008 | 5,589,367                             | $0.75 - $9.00           | 5,389,367                             |
| Issued                     | -                                     |                    | -                                     |
|                       |                                  |                    |                                  |
| Balance, June 30, 2009     | 5,589,367                             | $0.75-$9.00             | 5,389,367                             |

Information with respect to employee stock options outstanding and employee stock options exercisable at June 30, 2009 is as follows:

|                                                    | Options                    Outstanding | Vested                    Shares | Exercise Price Per                    Common Share | Weighted Average Exercise Price Per Option Outstanding |
|---------------------------------------------------------|----------------------------------------|----------------------------------|----------------------------------------------------|--------------------------------------------------------|
|                                                    |                                   |                             |                                               |                                                   |
| Balance, December 31, 2008                              | 6,335,666                              | 6,315,666                        | $0.15-$1.00                                        | $0.46                                                  |
| Granted/vested during the year ended June 30, 2009 | -                                      | -                                | -                                                  | -                                                      |
| Expired during 2009                                     | -                                      | -                                | -                                                  | -                                                      |
| Balance, June 30, 2009                                  | 6,335,666                              | 6,315,666                        | $0.15-$1.00                                        | $0.46                                                  |
|                                                    |                                   |                             |                                               |                                                   |

The following table summarizes information about the stock options outstanding at June 30, 2009:

| Exercise                    Price | Number Outstanding at June 30, 2009    | Weighted Average Remaining Contractual Life | Weighted Average Exercise Price | Number Exercisable at June 30, 2009    | Weighted Average Exercise Price |
|-----------------------------------|----------------------------------------|---------------------------------------------|---------------------------------|----------------------------------------|---------------------------------|
|                              |                                   |                                        |                            |                                   |                            |
| 0.30                              | 45,000                                 | 3.25                                        | 0.30                            | 45,000                                 | 0.30                            |
| 0.77                              | 200,000                                | 4.25                                        | 0.77                            | 200,000                                | 0.77                            |
| 0.15                              | 2,000,000                              | 4.25                                        | 0.15                            | 2,000,000                              | 0.15                            |
| 1.00                              | 10,000                                 | .08                                         | 1.00                            | 10,000                                 | 1.00                            |
| 0.60                              | 697,333                                | 1.25                                        | 0.60                            | 697,333                                | 0.60                            |
| 1.00                              | 697,333                                | 1.25                                        | 1.00                            | 697,333                                | 1.00                            |
| 1.00                              | 50,000                                 | 3.00                                        | 1.00                            | 50,000                                 | 1.00                            |
| 0.71                              | 30,000                                 | .25                                         | 0.71                            | 30,000                                 | 0.71                            |
| 0.40                              | 2,981,000                    6,710,666 | 4.25                                        | 0.40                            | 2,981,000                    6,710,666 | 0.40                            |

11

ENVIRO VORAXIAL TECHNOLOGY, INC.         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

JUNE30, 2009

NOTE F - COMMITMENTS AND CONTINGENCIES

Employment Agreements 

The Company entered into an employment agreement dated January 17, 2002 with an individual to serve as the Vice President and Director of Business Development.  The agreement provides for a contingent bonus to be paid to this employee in the amount of $300,000 to improve        the financial condition of the Company.  Such bonus is payable upon the Company obtaining a total of $3 million of financing or when revenue exceeds $1 million. In 2002, this individual was granted stock options to purchase 2 million shares of common stock with an exercise price of $0.15 per share. The market price at the date of grant was $0.12 per share.  Operating Lease

The Company leases office and warehouse space in Ft. Lauderdale, Florida under a business lease agreement for a one-year term ending in September 2009.  The Company has extended the lease for an additional twelve months, with the option to cancel the lease with sufficient notice.   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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**Item 2. ****Management's Discussion and Analysis of Financial Condition and Results of Operations****General**

Forward-Looking Statements

The following discussion of the financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes thereto. The following discussion contains forward-looking statements. Enviro Voraxial Technology, Inc. is referred to herein as "the Company",        "we" or "our.” The words or phrases "would be," "will allow," "intends to," "will likely result," "are expected to," "will continue," "is anticipated," "estimate," "project," or similar expressions are intended to identify "forward-looking statements". Such statements include those concerning our expected financial performance, our corporate strategy and operational plans. Actual results could differ materially from those projected in the forward-looking statements as a result of        a number of risks and uncertainties. Statements made herein are as of the date of the filing of this Form 10-Q with the Securities and Exchange Commission and should not be relied upon as of any subsequent date. Unless otherwise required by applicable law, we do not undertake, and we specifically disclaim any obligation, to update any forward-looking statements to reflect occurrences, developments, unanticipated events or circumstances after the date of such statement. 

Application of Critical Accounting Policies

The Company’s consolidated condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America. Certain accounting policies have a significant impact on amounts reported in the financial statements. A summary of these significant        accounting policies can be found in Note B to the Company’s financial statements in the Company’s 2008 Annual Report on Form 10-K. The Company has not adopted any significant new policies during the quarter ended June 30, 2009.        Among the significant judgments made in preparation of the Company’s financial statements are the determination of the allowance for doubtful accounts and adjustments of inventory valuations. These adjustments are made each quarter in the ordinary course of accounting.

**Results of Operations for the Three Months ended June 30, 2009 and 2008:**

Revenue

Our revenues were $50,940 for the three months ended June 30, 2009 as compared to zero for the three months ended June 30, 2008. The markets for the Voraxial are developing as companies with high volume water separation problems are becoming aware of the Voraxial. This is resulting in more revenue generating        opportunities for the Company from various market segments. These markets include mining, waste-to-energy and oil industry, specifically the produced water, deckwater drainage, refinery and tar sands markets. The Company continues to focus on its sales and marketing program for the Voraxial Separator and management believes such efforts will result in increasing revenues in 2009.           

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Research and Development Expenses

Research and Development expenses decreased by approximately 21% to $146,096 for the three months ended June 30, 2009, as compared to $232,573 for the previous three months ended June 30, 2008. The decrease in R&D relates to the further acceptance of the Voraxial for oil/water/sand separation. Even though the        Company has finalized the development of the Voraxial Separator, we targeted expenditures for specific applications for the technology within the oil industry during the three months ended June 30, 2009.

General and Administrative Expenses

General and Administrative expenses decreased approximately 37% to $146,397 for the three months ended June 30, 2009 from $185,785 for the three months ended June 30, 2008. The decrease was primarily due to nominal        adjustments to sales and marketing activity.We continue to focus our efforts on marketing of the Voraxial Separator.

**Results of Operations for the Six Months ended June 30, 2009 and 2008:**

Revenue

Our revenues increased to $130,940 for the six months ended June 30, 2009 as compared to $3,500 for the six months ended June 30, 2008. The markets for the Voraxial are developing as companies with high volume water separation problems are becoming aware of the Voraxial. This resulted in more revenue generating        opportunities for the Company from various market segments. These markets include mining, waste-to-energy and oil industry, specifically the produced water, deckwater drainage, refinery and tar sands markets. The Company is currently working on numerous opportunities with customers for produced water and refinery applications in the oil industry and oil/water separation in the waste-to-energy industry. We believe some of these opportunities will result in additional purchase orders in        the third quarter. The Company continues to focus on its sales and marketing program for the Voraxial Separator and management believes such efforts have resulted in increased revenues in 2009. 

Cost of Goods 

Our cost of goods increased to $32,000 for the six months ended June 30, 2009 as compared to zero for the six months ended June 30, 2008. This increase is due to the increase in sales activity. Our cost of goods continues to be reviewed by management to guarantee the best available pricing while maintaining high quality standards.

Research and Development Expenses

Research and Development expenses decreased by 36% to $262,373 for the six months ended June 30, 2009, as compared to $409,571 for the six months ended June 30, 2008. Although the Company has finalized the development of the Voraxial Separator, we targeted expenditures for specific applications for the technology        within the oil industry during the six months ended June 30, 2009.

General and Administrative Expenses

**General and Administrative expenses decreased by $74,881 or 20% to $309,879 for the six months ended June 30, 2009 from $384,760 for the six months ended June 30, 2008. The decrease was primarily due to nominal adjustments to sales and marketing        activity. We continue to focus our efforts on marketing of the Voraxial Separator.**

**14**

Liquidity and Capital Resources:

Cash at June 30, 2009 was $68,321. Working capital deficit at June 30, 2009 was $1,313,923 as compared to a working capital deficit at December 31, 2008 of approximately $975,434.         At June 30, 2009, the Company had an accumulated deficit of $10,592,296. We anticipate generating positive cash flow from the Voraxial Separator by the end of 2009. To the extent such revenues and corresponding cash flows do not materialize, we will require infusion of capital to sustain our operations. We cannot be assured that we will generate revenues or that the level of any future revenues will be self-sustaining. The Company has funded working capital requirements and intends to        fund current working capital requirements through third party financing, including the private placement of securities. We cannot provide any assurances that required capital will be obtained or that terms of such required capital may be acceptable to us. If the Company is unable to obtain adequate financing, it may reduce its operating activities until sufficient funding is secured or revenues are generated to support operating activities. 

Continuing Losses

We may be unable to continue as a going concern, given our limited operations and revenues and our significant losses to date. Since 2001, we have encountered greater expenses in the development of our Voraxial Separators and have had limited sales income from this development. Consequently, our working capital        may not be sufficient and our operating costs may exceed those experienced in our prior years. In light of these recent developments, we may be unable to continue as a going concern. The Company has experienced net losses, has a working capital deficit and sustained cash outflows from operating activities and had to raise capital to sustain operations. There is no assurance that the Company’s developmental and marketing efforts will be successful, that the Company will ever have        commercially accepted products, or that the Company will achieve significant revenues. However, we believe that the exposure received in the past year for the Voraxial Separator has positioned the Company to begin generating sales and supply us with sufficient working capital.         In May 2009, we received two orders for a combined value of $350,000. The orders were for various models of the Voraxial 2000 Separator. The equipment, valued at $275,000, was paid for, shipped and installed in July 2009.         As a result of the above, the accompanying condensed consolidated financial statements have been prepared assuming that the Company will continue as a going concern. The condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. **Item 3.** **Quantitative and Qualitative Disclosures About Market Risk**

Not applicable to smaller reporting company.

 

 

 

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**Item 4T. Controls and Procedures**

Evaluation of disclosure controls and procedures

As of the end of the period covered by this report, we carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Exchange Act Rule 13a-15(e). This evaluation was done under the supervision and with the participation of our Principal Executive        Officer and Principal Financial Officer. Based upon that evaluation, our Principal Executive Officer and Principal Financial Officer concluded that our disclosure controls and procedures are effective in gathering, analyzing and disclosing information needed to satisfy our disclosure obligations under the Exchange Act.

Changes in internal controls

There were no changes in our internal controls or in other factor during the period covered by this report that have materially affected, or is likely to materially affect the Company’s internal controls over financial reporting.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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**PART II.****OTHER INFORMATION**

**Item 1. Legal Proceedings**                     None.**Item 1A. Risk Factors**                     None.

**Item 2. Unregistered Sales of Equity Securities and Use of Proceeds**

During the three month period ended June 30, 2009, the Company received $18,000 from several accredited investors that purchased an aggregate of 45,000 shares of the Company’s restricted common stock at $0.40 per share and warrants to purchase 22,500 shares of common stock exercisable at $0.60 per share.        The warrants are exercisable for a period of one year from the date of closing. The transactions were exempt from registration under Section 4(2) of the Securities Act. The investors received information concerning the Company and had the opportunity to ask questions concerning the viability of the Company. The shares and warrants contain legends restricting their transferability absent registration or applicable exemption.

         During February 2009 the Company issued 200,000 shares of its common stock to a consultant for consulting services valued at $80,000. The issuance of the shares were exempt from registration under Section 4(2) of the Securities Act. The consultant received information concerning the Company and had the opportunity to ask questions concerning the viability of the Company. The shares contained legends restricting the        transferability absent registration or applicable exemption.**Item 3. Defaults Upon Senior Securities**

              None.**Item 4.  Submission of Matters to a Vote of Security Holders**

              None.**Item 5. Other Information**

             None.**Item 6. Exhibits**

    Exhibits required by Item 601 of Regulation S-K

    31.1     Form 302 Certification of Chief Executive Officer

    31.2     Form 302 Certification of Principal Financial Officer

    32.1     Form 906 Certification of Chief Executive Officer and Principal Financial Officer

 

17

**SIGNATURE**

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned as a duly authorized officer of the Registrant.

Enviro Voraxial Technology, Inc.                            By: /s/ Alberto DiBella                       Alberto DiBella        Chief Executive Officer and         Principal Financial Officer                  DATED: August 13, 2009

 

 

 

 

 

 

 

 

 

 

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