UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549







FORM
10-Q










x
            QUARTERLY
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934For
      the quarterly period ended September 30, 2009o
            TRANSITION
      REPORT PURSUANT TO SECTION 13 OR  15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934





Commission
File No. 333-120490





iVOICE
TECHNOLOGY, INC.


(Exact
name of the Registrant as specified in Charter)





New Jersey
            20-1862731(State
      of Incorporation)
            (I.R.S.
      Employer ID Number)750 Highway 34, Matawan, New
      Jersey
            07747(Address
      of Principal Executive Offices)
            (Zip
      Code)Registrant’s
      Telephone No. including Area Code: 732-441-7700





Securities
registered under 12(b) of the Exchange Act:  None





Securities
registered under Section 12(g) of the Exchange Act: None





Indicateby checkmark 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 x  No o





Indicate
by checkmark whether the registrant is a shell company (as defined in Rule 12b-2
of the Securities Act).  Yes o No x





Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files).  Yes o No x





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. (Check one):





Large
      accelerated filer o
            Accelerated
      filer oNon-accelerated
      filer o(Do
      not check if a smaller reporting company)
            Smaller
      reporting company x





Indicate
the number of shares outstanding of the issuer's common stock, as of the latest
practical date: 571,309,870 shares of Class A Common stock, no par value as of
November 5, 2009.


Table of Contents





iVOICE TECHNOLOGY, INC


TABLE OF CONTENTS





PagePart
      I – Financial InformationItem
      1.
            Condensed
      Consolidated Financial Statements (Unaudited):
            1Condensed
      Consolidated Balance Sheets – September
      30, 2009 and December 31, 2008
            1Condensed
      Consolidated Statements of Operation – Three
      and Nine Months Ended September 30, 2009 and
      2008
            2Condensed
      Consolidated Statements of Cash Flows – Nine
      Months Ended September 30, 2009 and 2008
            3-5Notes to
      Condensed Consolidated Financial Statements
            6-17Item
      2.
            Management’s
      Discussion and Analysis of Financial Condition and Result of
      Operations
            18Item
      4T.
            Controls and
      Procedures
            22Part
      II – Other InformationItem
      5.
            Other
      Information
            23Item
      6.
            Exhibits
            23Signatures
            24Index of
      Exhibits
            25





Table of Contents




Item 1.       Condensed
Consolidated Financial Statements (Unaudited)


iVOICE TECHNOLOGY, INC.
 CONDENSED
CONSOLIDATED BALANCE SHEET


September
      30,
              
              
              December
      31,2009
              
              
              2008ASSETSCurrent
      assets:Cash
      and cash equivalents
              
              $
              253,828
              
              
              $
              460,869Accounts
      receivable, net of allowance for doubtful accounts of $12,083
                at September 30, 2009 and December 31, 2008
              
              
              11,412
              
              
              
              -Inventories
              
              
              97
              
              
              
              6,246Note
      receivable, net of allowance of $-0- at September 30, 2009 and $25,017 at
      December 31, 2008
              
              
              -
              
              
              
              -Prepaid
      expenses and other current assets
              
              
              7,518
              
              
              
              6,615Total
      current assets
              
              
              272,855
              
              
              
              473,730Property,
      Plant and Equipment, net
              
              
              59,354
              
              
              
              17,313Other
      assets
              
              
              59,934
              
              
              
              54,540Total
      assets
              
              $
              392,143
              
              
              $
              545,583LIABILITIES
      AND STOCKHOLDERS’ DEFICITCurrent
      liabilities:Accounts
      payable and accrued expenses
              
              $
              615,153
              
              
              $
              543,215Accrued
      dividends
              
              
              226,697
              
              
              
              117,562Due
      to related parties
              
              
              300,407
              
              
              
              263,704Deferred
      maintenance contracts
              
              
              4,269
              
              
              
              9,407Notes
      payable to related parties
              
              
              127,308
              
              
              
              141,708Convertible
      promissory note, net of unamortized debt discount of
                $125,115 at September 30, 2009 and $91,869 at December 31,
      2008
              
              
              51,343
              
              
              
              15,953Derivative
      liabilities
              
              
              1,059,405
              
              
              
              133,212Total
      current liabilities
              
              
              2,384,582
              
              
              
              1,224,761Stockholders'
      deficit:Preferred
      stock, $1.00 par value; authorized 1,000,000 shares; 10,000
                shares designated as follows; 990,000 available for further
      designationSeries
      A 10% Secured Preferred Stock; $1,000 stated value;
                authorized 10,000 shares; 1,444.44 shares issue and
      outstanding
              
              
              1,444,444
              
              
              
              1,444,444Common
      stock:Class
      A – no par value; authorized 10,000,000,000 shares; 571,309,870
                shares issued and 570,115,387 outstanding and1,194,483
      in escrow at September 30, 2009; 486,835,870 shares issued and
                485,641,387 outstanding, and 1,194,483 in escrow at December 31,
      2008;
              
              
              1,007,337
              
              
              
              915,166Class
      B - $.01 par value; authorized 50,000,000 shares; no shares issued and
      outstanding
              
              
              -
              
              
              
              -Class
      C - $.01 par value; authorized 20,000,000 shares; no shares issued and
      outstanding
              
              
              -
              
              
              
              -Additional
      paid-in capital
              
              
              6,899,510
              
              
              
              6,899,510Additional
      paid-in capital – beneficial conversion
              
              
              1,444,444
              
              
              
              1,444,444Accumulated
      deficit
              
              
              (12,788,174
              )
              
              
              (11,382,742
              )Total
      stockholders' deficit
              
              
              (1,992,439
              )
              
              
              (679,178
              )Total
      liabilities and stockholders' deficit
              
              $
              392,143
              
              
              $
              545,583
 See
accompanying notes to condensed consolidated financial statements.
  1
 Table of Contents




IVOICE TECHNOLOGY, INC.
 CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
 (Unaudited)


Three
      Months Ended
              
              
              Nine
      Months EndedSeptember 30, 2009
              
              
              September 30, 2008
              
              
              September 30, 2009
              
              
              September 30, 2008Net
      sales
              
              $
              28,721
              
              
              $
              9,786
              
              
              $
              73,969
              
              
              $
              35,164Cost
      of sales
              
              
              13,934
              
              
              
              -
              
              
              
              34,473
              
              
              
              -Gross
      margin
              
              
              14,787
              
              
              
              9,786
              
              
              
              39,496
              
              
              
              35,164Operating
      expenses:General
      and administrative expenses
              
              
              129,060
              
              
              
              153,068
              
              
              
              419,376
              
              
              
              419,374Total
      operating expenses
              
              
              129,060
              
              
              
              153,068
              
              
              
              419,376
              
              
              
              419,374Loss
      from operations
              
              
              (114,273
              )
              
              
              (143,282
              )
              
              
              (379,880
              )
              
              
              (384,210
              )Other
      income (expense):Interest
      income
              
              
              659
              
              
              
              3,304
              
              
              
              2,485
              
              
              
              10,488Interest
      expense
              
              
              (59,352
              )
              
              
              (12,322
              )
              
              
              (75,956
              )
              
              
              (156,132
              )Other
      income
              
              
              -
              
              
              
              -
              
              
              
              50,000
              
              
              
              -Amortization
      of debt discount
              
              
              (14,631
              )
              
              
              (52,005
              )
              
              
              (40,741
              )
              
              
              (624,051
              )Redemption
      premium
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (85,922
              )(Loss)
      gain on valuation of derivative
              
              
              (202,017
              )
              
              
              21,241
              
              
              
              (852,204
              )
              
              
              1,094,066Total
      other income (expense)
              
              
              (275,341
              )
              
              
              (39,782
              )
              
              
              (916,416
              )
              
              
              238,449Income
      (loss) from operations before
                provision
      for income taxes
              
              
              (389,614
              )
              
              
              (183,064
              )
              
              
              (1,296,296
              )
              
              
              (145,761
              )Provision
      for income taxes
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              -Net
      income (loss)
              
              
              (389,614
              )
              
              
              (183,064
              )
              
              
              (1,296,296
              )
              
              
              (145,761
              )Preferred
      stock accretion
              
              
              -
              
              
              
              -
              
              
              
              -
              
              
              
              (1,444,444
              )Preferred
      stock dividends
              
              
              (36,512
              )
              
              
              (36,913
              )
              
              
              (109,136
              )
              
              
              (80,648
              )Net
      loss attributable to common shareholders
              
              $
              (426,126
              )
              
              $
              (219,977
              )
              
              $
              (1,405,432
              )
              
              $
              (1,670,853
              )Basic
      and diluted loss per common share
              
              $
              (0.00
              )
              
              $
              (0.00
              )
              
              $
              (0.00
              )
              
              $
              (0.00
              )Weighted
      average shares outstandingBasic
      and diluted
              
              
              552,995,822
              
              
              
              485,641,387
              
              
              
              529,305,629
              
              
              
              425,116,755




See
accompanying notes to condensed consolidated financial statements.
  2
 Table of Contents




IVOICE TECHNOLOGY, INC.
 CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
 (Unaudited)


Nine Months EndedSeptember 30, 2009
              
              
              September 30, 2008Cash
      flows from operating activities:Net
      income (loss)
              
              $
              (1,296,296
              )
              
              $
              (145,761
              )Adjustments
      to reconcile net loss to net
                cash
      used in operating activities:Depreciation
              
              
              7,959
              
              
              
              352(Gain)
      loss on valuation of derivative
              
              
              852,204
              
              
              
              (1,094,066
              )Amortization
      of discount on debt
              
              
              40,741
              
              
              
              624,051Issuance
      of common stock for services
              
              
              14,219
              
              
              
              -Equipment
      received in exchange for note receivable
                previously
      written-off
              
              
              (50,000
              )
              
              
              -Beneficial
      conversion incurred in debt reduction
              
              
              53,100
              
              
              
              62,470Beneficial
      conversion incurred in conversion of debenture
              
              
              -
              
              
              
              21,783Common
      stock issued for investor relations
              
              
              -
              
              
              
              24,192Common
      stock issued for consulting fees
              
              
              -
              
              
              
              35,700Beneficial
      conversion incurred in conversion of
                promissory
      note
              
              
              5,100
              
              
              
              32,280Changes
      in assets and liabilities:(Increase)
      in accounts receivable
              
              
              (11,412
              )
              
              
              (5,840
              )Decrease
      (increase) in inventories
              
              
              6,149
              
              
              
              (6,080
              )Decrease
      (increase) in prepaid expenses
              
              
              (903
              )
              
              
              (6,985
              )Increase
      in other assets
              
              
              (5,394
              )
              
              
              -Increase
      in accounts payable and accrued liabilities
              
              
              145,927
              
              
              
              138,276Increase
      in amounts due to related parties
              
              
              36,703
              
              
              
              30,184(Decrease)
      increase in deferred maintenance contracts
              
              
              (5,138
              )
              
              
              5,096Net
      cash (used in) operating activities
              
              
              (207,041
              )
              
              
              (284,348
              )Cash
      flows from investing activities:Increase
      in note receivable
              
              
              -
              
              
              
              (28,290
              )Increase
      in other assets
              
              
              -
              
              
              
              (38,405
              )Net
      cash (used in) investing activities
              
              
              -
              
              
              
              (66,695
              )Cash
      flows from financing activities:Issuance
      of common stock through equity financing
              
              
              -
              
              
              
              102,835Cost
      of issuance of common stock through equity financing
              
              
              -
              
              
              
              (13,652
              )Net
      proceeds from sale of Series A Preferred Stock
              
              
              -
              
              
              
              1,300,000Payment
      of convertible debenture
              
              
              -
              
              
              
              (572,815
              )Net
      cash provided by financing activities
              
              
              -
              
              
              
              816,368Net
      increase (decrease) in cash and cash equivalents
              
              
              (207,041
              )
              
              
              465,625Cash
      and cash equivalents at beginning of period
              
              
              460,869
              
              
              
              182,577Cash
      and cash equivalents at end of period
              
              $
              253,828
              
              
              $
              647,902




See
accompanying notes to condensed consolidated financial statements.
  3
 Table of Contents




IVOICE
TECHNOLOGY, INC.
 CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
 (Unaudited)
   September 30, 2009
                
                
                September 30, 2008During
      the period, cash was paid for the following:Taxes
      paid
                
                $
                -
                
                
                $
                -Interest
      paid
                
                $
                -
                
                
                $
                32,284Supplemental
      Cash Flow Information:Non-Cash TransactionsAccounts payable converted into
      convertible promissory note
                
                $
                73,989
                
                
                $
                96,199Accrued
      expenses converted to convertible promissory note
                
                $
                -
                
                
                $
                186,557Equipment
      received in lieu of payment of note receivable
                
                $
                50,000
                
                
                $
                -Convertible
      promissory note converted to common stock
                
                $
                5,352
                
                
                $
                -Convertible
      debenture converted to common stock
                
                $
                -
                
                
                $
                109,940Promissory
      note converted to common stock
                
                $
                14,400
                
                
                $
                19,680Common
      stock issued for services
                
                $
                14,219
                
                
                $
                -
  See
accompanying notes to condensed consolidated financial statements.
   4
 Table of Contents
  IVOICE
TECHNOLOGY, INC.
 CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)
 (Unaudited)
  Supplemental
Schedule of Non-Cash Financing Activities:
 
 For the Nine Months Ended
September 30 2009:
 
 a)
                  During
      the nine months ended September 30, 2009, the Company issued 16,724,000
      shares of Class A common stock with a fair value of $10,452 to reduce the
      convertible promissory note in the amount of $5,352. The difference in the
      market value and the convertible promissory note reduction was charged to
      beneficial interest in the amount of
$5,100.
 
 b)
                  During
      the nine months ended September 30, 2009, the Company issued 22,750,000
      shares of Class A common stock with a fair value of  $14,219 for
      investor relations services.
 
 c)
                  During
      the nine months ended September 30, 2009, the Company converted accounts
      payable to a convertible promissory note in the amount of
      $73,989.
 
 d)
                  The
      Company accrued $109,136 of preferred stock
  dividends.
 
 e)
                  During
      the nine months ended September 30, 2009, the Company issued 45,000,000
      shares of Class A common stock with a fair value of $67,500 to an
      individual to reduce a promissory note in the amount of $14,400. The
      difference in the market value and the promissory note reduction was
      charged to beneficial interest in the amount of
  $53,100.
 
 f)
                  The
      Company received equipment valued at approximately $50,000 in lieu of
      payment of note receivable which was previously
    written-off.




Supplemental
Schedule of Non-Cash Financing Activities:
 
 For the Nine Months Ended
September 30, 2008:
 
 a)
              The
      Company issued 46,500,000 shares of Class A common stock with a fair value
      of $82,150 to an individual to reduce a promissory note in the amount of
      $19,680. The difference in the market value and the promissory note
      reduction was charged to beneficial interest in the amount of
      $62,470.
 
 b)
              The
      Company issued 87,653,565 shares of Class A common stock with a fair value
      of $118,283 to reduce a convertible debenture in the amount of $96,500.
      The difference in the market value and the reduction in the convertible
      debenture was charged to beneficial interest in the amount of
      $21,783.
 
 c)
              The
      Company issued 89,039,944 shares of Class A common stock pursuant to the
      Equity Line of Credit with YA Global Investments (f/k/a/ Cornell Capital
      Partners) valued at $102,835. Issuance costs of $13,652 were incurred and
      charged to additional paid-in capital for net proceeds of
      $89,183.
 
 d)
              The
      Company issued 42,000,000 shares of Class A common stock with a fair value
      of $45,720 to reduce a convertible promissory note in the amount of
      $13,440. The difference in the market value and the convertible promissory
      note reduction was charged to beneficial interest in the amount of
      $32,280.
 
 e)
              The
      Company converted accounts payable to a convertible promissory note in the
      amount of $96,199.
 
 f)
              The
      Company converted accrued expenses related to accrued interest due to YA
      Global to a convertible debenture in the amount of $186,557. In March
      2008, the Company and YA Global agreed that the Company would redeem all
      amounts outstanding under the Debenture, except for $186,557 of interest.
      The amount redeemed was $691,021, consisting of the remaining balance of
      the Debenture equal to $572,815, accrued interest of $32,284, and a
      redemption premium equal to
$85,922.
 
 g)
              The
      Company accrued $80,648 of preferred stock
  dividends.
 
 h)
              The
      Company recognized $1,444,444 of preferred stock accretion in the
      condensed statements of operations and as a credit in the balance sheet to
      Additional Paid-in Capital – Beneficial
  Conversion.
 
 i)
              The
      Company issued 21,600,000 shares of Class A common stock with a fair value
      of $24,192 to an individual for repayment of investor relations
      expenses.
 
 j)
              The
      Company issued 30,000,000 shares of Class A common stock with a fair value
      of $35,700 to two individuals for repayment of consulting
      fees.




5
 Table of Contents




iVOICE
TECHNOLOGY, INC.
 NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
 September 30, 2009 and
2008
 
 Note
1        Background
 
 iVoice
Technology, Inc. (“iVoice Technology” or the “Company”) was incorporated under
the laws of New Jersey on November 10, 2004 as a wholly owned subsidiary of
iVoice, Inc. (“iVoice”).  The Company received by assignment all of
the interests in and rights and title to, and assumed all of the obligations of,
all of the agreements, contracts, understandings and other instruments of iVoice
Technology, Inc., a Nevada corporation and affiliate of the
Company.  When we refer to or describe any agreement, contract or
other written instrument of the Company in these notes, we are referring to an
agreement, contract or other written instrument that had been entered into by
iVoice Technology Nevada and assigned to the Company.
 
 In May
2008, the Company formed B Green Innovations, Inc. (“B Green”), a wholly-owned
subsidiary, and has agreed to invest up to $500,000 in B Green, to commercialize
its “green” technology platforms. The Company has made investments by purchasing
160 shares of Series B Secured 10% Convertible Preferred Stock for net proceeds
of $144,000 to B Green.
 
 The
Company is a “Green” technology company, focused on acquiring and identifying
promising technologies that address environmental issues.
 
 Note
2        Business
Operations
 
 B Green
Innovations, Inc. (B Green) a Matawan, New Jersey-based corporation and wholly
owned subsidiary of iVoice Technology (OTC Bulletin Board: IVOT) is dedicated to
becoming a “green” technology company, focused on identifying  and
acquiring promising technologies that address environmental issues.
 
 The
Company has agreed to invest up to $500,000 in B Green to develop and
commercialize its “green” technology platforms. The Company believes that this
investment will allow B Green to further develop additional
technologies.
 
 The first
technology was used to create new products from recycled tire rubber. EcoPod®
and VibeAway® address important environmental concerns and problems facing the
planet today. EcoPod® and VibeAway® are 100% recycled rubber-based products that
can be utilized as support pads under any units that vibrate and make noise,
including washing machines, dryers, compressors, commercial condensers, and many
other units that advantageously benefit from sound and vibration control. In
addition, we announced that we had filed a new patent application for a process
described as “Recycled Tire Pod with Appliance Recess Guide.”
 The
Company also continues to service the Interactive Voice Response ("IVR"),
software that was developed by iVoice. The Company's Interactive Voice Response
line is designed to read information from and write information to, databases,
as well as to query databases and return information.
 
 IVR is an
application generator that allows full connectivity to many databases, including
Microsoft Access, Microsoft Excel, or to standard text files. The IVR software
is sold as an application generator that gives the end user the ability to
develop its own customized IVR applications or as a customized turnkey system.
IVR performs over 40 different customizable commands. Examples of IVR range from
simply selecting announcements from a list of options stored in the computer
(also known as audio text) to more complex interactive exchanges such as
querying a database for information.
 
 In
conjunction with the Spin-off, iVoice Technology entered into a temporary
administrative service agreement with iVoice. iVoice presently continues to
provide administrative services to the Company on a month to month basis until
the Company is able to replace the services provided by iVoice.
  Note
3        Going
Concern
 
 The
accompanying condensed consolidated financial statements have been prepared in
conformity with accounting principles generally accepted in the United States of
America, which contemplates continuation of the Company as a going concern. The
Company relies on iVoice, Inc. for administrative, management, research and
other services.
  As of
September 30, 2009, the Company had a net loss, a negative cash flow from
operations, as well as negative working capital. These matters 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.
  Management
plans on developing and selling products from its subsidiary, B Green
Innovations, Inc., to generate a positive cash flow. However, these plans are
dependent upon obtaining additional capital. There can be no assurance that the
Company will be able to obtain the necessary capital, and achieve its growth
objectives. 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.
 
 6
 Table of Contents
 
 iVOICE TECHNOLOGY,
INC.
 NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
 September 30, 2009 and
2008
 
 Note
4        Summary of Significant
Accounting Policies
 
 a)    Basis
of Presentation
 
 The
accompanying condensed consolidated unaudited interim financial statements
included herein have been prepared, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission ("SEC"). The condensed
consolidated financial statements and notes are presented as permitted on Form
10-Q and do not contain information included in the Company's annual statements
and notes. 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, although the Company believes that the
disclosures are adequate to make the information presented not misleading. It is
suggested that these condensed consolidated financial statements be read in
conjunction with the December 31, 2008 audited consolidated financial statements
and the accompanying notes thereto. While management believes the procedures
followed in preparing these condensed consolidated financial statements are
reasonable, the accuracy of the amounts are in some respects dependent upon the
facts that will exist, and procedures that will be accomplished by the Company
later in the year. These results are not necessarily indicative of the results
to be expected for the full year.
 
 These
condensed consolidated unaudited financial statements reflect all adjustments,
including normal recurring adjustments, which, in the opinion of management, are
necessary to present fairly the operations and cash flows for the periods
presented.
 
 b)    Use
of Estimates
 
 The
preparation of 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 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.
 
 c)    Revenue
Recognition
 
 For B
Green Innovations, Inc. revenues 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.
 
 The
Company also derives its revenues from the licensing of its software product and
optional customer support (maintenance) service. The Company'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. The
Company's software application is fully functional upon delivery and
implementation and does not require any significant modification or alteration.
The Company also offers customers an optional annual software maintenance and
support agreement for the subsequent one-year periods. Such maintenance and
support services are free for the first year the product is licensed and is
considered the warranty period. The software maintenance and support agreement
provides free software updates, if any, and
technical support the customer may need in deploying or changing the
configuration of the software. Generally, the Company does not license its
software in multiple element arrangements whereby the customer purchases a
combination of software and maintenance. In a typical arrangement, software
maintenance services are sold separately from the software product; are not
considered essential to the functionality of the software and are purchased at
the customer's option upon the completion of the first year
licensed.
 
 The
Company does not offer any special payment terms or significant discount
pricing. Normal and customary payment terms require payment for the software
license fees when the product is shipped. Payment for software maintenance is
due prior to the commencement of the maintenance period. It is also the
Company's policy to not provide customers the right to refund any portion of its
license fees. With respect to the sale of software license fees, the Company
recognizes revenue in accordance with in FASB ASC 985-605 (Prior authoritative
literature: Statement of Position 97-2, software Revenue Recognition (SOP
97-2)), as amended, and generally recognizes revenue when all of the following
criteria are met: (1) persuasive evidence of an arrangement exists generally
evidenced by a signed, written purchase order from the customer, (2) delivery of
the software product on Compact Disk (CD) or other means to the customer has
occurred, (3) the perpetual license fee is fixed or determinable and (4)
collectability, which is assessed on a customer-by-customer basis, is
probable.
 
 With
respect to customer support services, upon the completion of one year from the
date of sale, considered to be the warranty period, the Company offers customers
an optional annual software maintenance and support agreement for subsequent
one-year periods. Sales of purchased maintenance and support agreements are
recorded as deferred revenue and recognized over the respective terms of the
agreements.
  7
 Table of Contents
 iVOICE TECHNOLOGY,
INC.
 NOTES TO CONDENSED
CONSOLIADTED FINANCIAL STATEMENTS
 September 30, 2009 and
2008
 
 Note
4        Summary of Significant
Accounting Policies (continued)
 d)    Product
Warranties
 
 The
Company estimates its warranty costs based on historical warranty claims
experience in estimating potential warranty claims. Due to the limited sales of
the Company's products, management has determined that warranty costs are
immaterial and has not included an accrual for potential warranty claims.
Presently, costs related to warranty coverage are expensed as incurred. Warranty
claims are reviewed quarterly to verify that warranty liabilities properly
reflect any remaining obligation based on the anticipated expenditures over the
balance of the obligation period.
 
 e)    Research
and Development Costs
 
 Research
and development costs are charged to expense as incurred.
 
 f)    Advertising
Costs
 
 Advertising
costs are expensed as incurred and are included in selling expenses. For the
three months ended September 30, 2009 and 2008, the Company incurred $2,061 and
$625, respectively. For the nine months ended September 30, 2009 and 2008, the
Company incurred $6,987 and $625, respectively
 
 g)    Cash
and Cash Equivalents
 
 The
Company considers all highly liquid investments purchased with original
maturities of three months or less to be cash equivalents. There were no cash
equivalents at September 30, 2009 and December 31, 2008.
 
 The
Company maintains cash and cash equivalent balances at a financial institution
that is insured by the Federal Deposit Insurance Corporation up to $250,000. The
uninsured cash balances at September 30, 2009 and December 31, 2008 were $-0-
and $204,808, respectively.
 
 h)    Property
and Equipment
 
 Property
and equipment is stated at cost. Depreciation is computed using the
straight-line method based upon the estimated useful lives of the assets,
generally five to seven years. Maintenance and repairs are charged to expense as
incurred.
 
 i)    Income
Taxes
  The
Company accounts for income taxes using the asset and liability method described
in FASB ASC 740-10 (Prior authoritative literature: FASB Statement 109,
“Accounting for Income Taxes,”). Under this pronouncement, deferred tax assets
and liabilities are recognized for the future tax consequences attributable to
differences between the financial statement carrying amounts of existing assets
and liabilities and their respective tax basis. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are expected to be
recovered or settled. Under FASB ASC 740-10, the effect on deferred tax assets
and liabilities of a change in tax rates is recognized in income in the period
that includes the enactment date.
 j)    Derivative
Liabilities
 
 The
Company accounts for its embedded conversion features in its convertible
debentures in accordance FASB ASC 815-10 (Prior authoritative literature: SFAS
No. 133, "Accounting for Derivative Instruments and Hedging Activities", which
requires a periodic valuation of their fair value and a corresponding
recognition of liabilities associated with such derivatives, and FASB ASC 815-40
Section 05, “Accounting for Derivative Financial Instruments Indexed to, and
Potentially Settled in, a Company’s Own Stock. The recognition of derivative
liabilities related to the issuance of convertible debt is applied first to the
proceeds of such issuance as a debt discount, at the date of issuance, and the
excess of derivative liabilities over the proceeds is recognized as “Loss on
Valuation of Derivative” in other expense in the accompanying financial
statements. Any subsequent increase or decrease in the fair value of the
derivative liabilities is recognized as “Other expense” or “Other income”,
respectively.
  8
 Table of Contents
 iVOICE TECHNOLOGY,
INC.
 NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
 September 30, 2009 and
2008
 
 Note
4        Summary of Significant
Accounting Policies (continued)
 
 k)    Reclassifications
 
 Certain
prior year amounts have been reclassified to conform to the current year
presentation. The reclassifications have had no effect on the results of
operations or cash flows for the period ended September 30, 2008.
 
 l)    Fair
Value of Instruments
 
 The
carrying amount reported in the condensed consolidated balance sheet for cash
and cash equivalents, deposits, prepaid expenses, accounts payable, and accrued
expenses approximate fair value because of the immediate or short-term maturity
of these financial instruments.
 
 Note
5        Earnings (Loss) Per
Share
 
 FASB
Accounting Standards Codification (“ASC”) 260-10 (Prior authoritative
literature: FASB Statement 128, “Earnings Per Share”) requires the presentation
of basic earnings per share ("basic EPS") and diluted earnings per share
("diluted EPS").
 
 The
Company’s basic loss per common share is based on net loss for the relevant
period, divided by the weighted average number of common shares outstanding
during the period.  Diluted loss per common share is based on net
loss, divided by the weighted average number of common shares outstanding during
the period, including common share equivalents, such as outstanding stock
options.  Diluted loss per share does not include common stock
equivalents, as these shares would have no effect. The computation of diluted
loss per share also does not assume conversion, exercise or contingent exercise
of securities due to the beneficial conversion of related party accounts, as
this would be anti-dilutive.
 
 Three Months Ended
              
              
              Three Months EndedSeptember 30, 2009
              
              
              September 30, 2008Basic
      net loss per share computation:Net
      loss attributable to common stockholders
              
              $
              (426,126
              )
              
              $
              (219,977
              )Weighted-average
      common shares outstanding
              
              
              552,995,822
              
              
              
              485,641,387Basic
      net loss per share attributable to common stockholders
              
              $
              0.00
              
              
              $
              0.00Diluted
      net loss per share computationNet
      loss attributable to common stockholders
              
              $
              (426,126
              )
              
              $
              (219,977
              )Weighted-average
      common shares outstanding
              
              
              552,995,822
              
              
              
              485,641,387Incremental
      shares attributable to the assumed conversion of
                convertible
      debenture and convertible promissory note
              
              
              -
              
              
              
              -Total
      adjusted weighted-average shares
              
              
              552,995,822
              
              
              
              485,641,387Diluted
      net loss per share attributable to common stockholders
              
              $
              0.00
              
              
              $
              0.00
 
 Nine Months Ended
              
              
              Nine Months EndedSeptember 30, 2009
              
              
              September 30, 2008Basic
      net loss per share computation:Net
      loss attributable to common stockholders
              
              $
              (1,405,432
              )
              
              $
              (1,670,853
              )Weighted-average
      common shares outstanding
              
              
              529,305,629
              
              
              
              425,116,755Basic
      net loss per share attributable to common stockholders
              
              $
              0.00
              
              
              $
              0.00Diluted
      net loss per share computationNet
      loss attributable to common stockholders
              
              $
              (1,405,432
              )
              
              $
              (1,670,853
              )Weighted-average
      common shares outstanding
              
              
              529,305,629
              
              
              
              425,116,755Incremental
      shares attributable to the assumed conversion of
                convertible
      debenture and convertible promissory note
              
              
              -
              
              
              
              -Total
      adjusted weighted-average shares
              
              
              529,305,629
              
              
              
              425,116,755Diluted
      net loss per share attributable to common stockholders
              
              $
              0.00
              
              
              $
              0.00
 
 9
 Table of Contents
  iVOICE TECHNOLOGY,
INC.
 NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
 September 30, 2009 and
2008
 
 Note
6        Related Party
Transactions
 
 In
conjunction with the spin-off, iVoice Technology has entered into a temporary
administrative services agreement with iVoice. The administrative services
agreement will continue on a month-to-month basis until iVoice Technology has
found replacement services for those services being provided by iVoice or can
provide these services for itself.
  B Green
Innovations, Inc., a subsidiary of iVoice Technology, has entered into a
temporary administrative services agreement with iVoice. The administrative
services agreement continues on a month-to-month basis until B Green
Innovations, Inc. has found replacement services for those services being
provided by iVoice or can provide these services for itself.
 
 The
Company has assumed an outstanding promissory demand note in the amount of
$190,000 payable to Jerry Mahoney, President and Chief Executive Officer of
iVoice and Non-Executive Chairman of the Board of iVoice
Technology.  This amount is related to funds loaned to iVoice and is
unrelated to the operations of iVoice Technology.  The note will bear
interest at the rate of prime plus 2.0% per annum (5.25% at September 30, 2009)
on the unpaid balance until paid.  Interest payments are due and
payable annually. 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 the Company
maintains control over the issuance of shares and may decline the request for
conversion of the repayment into shares of the Company. As
of  September 30, 2009, the outstanding balance was $127,308, plus
accrued interest of $98,359.  On May 8, 2007, the Company executed a
Security Agreement providing Jerome Mahoney, President and Chief Executive
Officer of the Company, with a security interest in all of the assets of the
Company 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 the
Company.
 
 The
Company entered into a five-year employment agreement with Jerome Mahoney to
serve as Non-Executive Chairman of the Board of Directors, effective August 1,
2004. On March 9, 2009,  the term of the employment agreement between
the Company and Mr. Mahoney, the Company’s CEO, was extended to July 31,
2016.  The Company will compensate Mr. Mahoney with a base salary of
$85,000 for the first year with annual increases based on the Consumer Price
Index.  A portion of Mr. Mahoney’s compensation shall be deferred
until such time that the Board of Directors determines that the Company has
sufficient financial resources to pay his compensation in cash. As of September
30, 2009, the Company has recorded $214,547 of deferred compensation due to Mr.
Mahoney.
 
 The Board
has the option to pay Mr. Mahoney’s compensation in the form of Class B Common
Stock. Mr. Mahoney will also be entitled to certain bonuses based on mergers and
acquisitions completed by the Company. 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
29, 2005, the Company entered into an employment agreement with Mark
Meller.  Mr. Meller served as the Company’s President, Chief Executive
Officer and Chief Financial Officer until August 29, 2006.  As
compensation, the Company paid Mr. Meller a base salary of $85,000 the first
year with an annual increase based on the Consumer Price Index every year
thereafter.  Mr. Meller has agreed to defer all but $20,000 of his
compensation until such time that the Board of Directors determines, in its sole
discretion, that the Company has sufficient financial resources to pay his
compensation.  The Board of Directors may also elect to pay Mr. Meller
the balance of his compensation in the form of Company Class A or Class B Common
Stock.  As of September 30, 2009, total deferred compensation due to
Mr. Meller was $53,860.
 
 Mr.
Mahoney has a consulting agreement with B Green Innovations for annual
compensation of $24,000 and upon every annual anniversary thereafter, 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 September 30, 2009, Mr. Mahoney is due
$32,000, and no shares have been issued.
  10
 Table of Contents
 iVOICE TECHNOLOGY,
INC.
 NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
 September 30, 2009 and
2008
 
 Note
7        Convertible Promissory Note
and Derivative Liability
 
 iVoice
Technology has entered into a temporary administrative services agreement with
iVoice. The administrative services agreement will continue on a month-to-month
basis until iVoice Technology has found replacement services for those services
being provided by iVoice or can provide these services for itself. In March
2008, the administrative services agreement was amended to provide that accrued
and unpaid administrative services shall be aggregated and converted into a
Convertible Promissory Note. 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 March
5, 2008, the Company converted its outstanding accounts payable to iVoice, 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. Additional
amounts may be 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. For the nine months ended
September 30, 2009, unpaid administrative services in the amount of $37,989 were
added to the convertible promissory note.
 
 iVoice,
Inc. may elect payment of the principal and/or interest, at the its sole
discretion, owed pursuant to this Note by requiring the Company to issue to
iVoice, or his assigns either: (i) one Class B common stock share of the Company
par value $.01 per share, for each dollar owed, (ii) the number of Class A
common stock shares of the Company calculated by dividing (x) the sum of the
principal and interest that the Note holder has decided to have paid 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.
  Unless
otherwise provided, this Note may be prepaid in full or in part at any time
without penalty or premium. Partial prepayments shall be applied to installments
due in reverse order of their maturity.
 
 During
the nine months ended September 30, 2009, the Company issued 16,724,000 shares
of Class A common stock with a fair value of $10,452 to reduce the convertible
promissory note in the amount of $5,352. The difference in the market value and
the convertible promissory note reduction was charged to beneficial interest in
the amount of $5,100.
 
 In the
event of (a) default in payment of any installment of principal or interest
hereof as the same becomes due and such default is not cured within ten (10)
days from the due date, or (b) default under the terms of any instrument
securing this Note, and such default is not cured within fifteen (15) days after
written notice to maker, then in either such event the holder may, without
further notice, declare the remainder of the principal sum, together with all
interest accrued thereon, and the prepayment premium, if any, at once due and
payable. Failure to exercise this option shall not constitute a waiver of the
right to exercise the same at any other time. The unpaid principal of this Note
and any part thereof, accrued interest and all other sums due under this Note
shall bear interest at the rate of prime plus 2 percent per annum after default
until paid.
 
 The
promissory note holders have a security interest in substantially all of the
assets of the Company.
 
 As of
September 30, 2009, the outstanding balance on the Convertible Promissory Note
was $112,058.
 
 In
accordance with FASB ASC 815-10 (Prior authoritative literature: SFAS No. 133,
"Accounting for Derivative Instruments and Hedging Activities", the Company
determined that the conversion feature of the Debenture met the criteria of an
embedded derivative, and therefore the conversion feature of this Debenture
needed to be bifurcated and accounted for as a derivative. The fair value of the
embedded conversion was estimated at the date of issuance using the
Black-Scholes model with the following assumptions: risk free interest rate:
2.25%; expected dividend yield: 0%: expected life: 5 years; and volatility:
321.58%. The accounting guidance instructs that the conversion options are a
derivative liability. As such, on March 5, 2008 the Company recorded the
conversion options as a liability, recorded a debt discount of $50,652, and
charged Other Expense - Loss on Valuation of Derivative for $16,366, resulting
primarily from calculation of the conversion price. For the three months ended
September 30, 2009, the Company recorded a loss on Valuation of Derivative in
the amount of $114,777 as compared to a Loss on Valuation of Derivative of
$2,420 for the three months ended September 30, 2008.  For the nine
months ended September 30, 2009, the Company recorded a Loss on Valuation of
Derivative in the amount of $536,598 as compared to a Gain on Valuation of
Derivative in the amount of $27,491 for the nine months ended September 30,
2008. .  The fair value of the embedded conversion was estimated at
the September 30, 2009 using the Black-Scholes model with the following
assumptions: risk free interest rate: 1.45%; expected dividend yield: 0%:
expected life: 5 years; and volatility: 320.74%. The derivative liability was
$672,661 and $98,074 at September 30, 2009 and December 31, 2008,
respectively.
 
 11
 Table of Contents
  iVOICE TECHNOLOGY,
INC.
 NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
 September 30, 2009 and
2008
 
 Note7        Convertible Promissory Note
and Derivative Liability (continued)
 
 B Green
Innovations, Inc., a subsidiary of iVoice Technology, has entered into a
temporary administrative services agreement with iVoice. The administrative
services agreement continues on a month-to-month basis until B Green
Innovations, Inc. has found replacement services for those services being
provided by iVoice or can provide these services for itself. The administrative
services agreement provides that accrued and unpaid administrative services
shall be aggregated and converted into a Convertible Promissory Note. 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. The terms of this agreement are to similar
to the terms of the agreement between iVoice Technology, Inc. and iVoice, Inc.
as described above in this footnote.
 
 On June
30, 2008, the Company converted its outstanding B Green accounts payable to
iVoice, Inc., for unpaid administrative services, in the amount of $8,000 into a
convertible promissory note at the rate of prime plus 1 percent per annum.
Additional amounts may be 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. For the nine months ended September 30, 2009 total unpaid
administrative services in the amount of $36,000 was added to the convertible
promissory note. As of September 30, 2009, the outstanding balance on the B
Green Convertible Promissory Note was $64,400.
 
 In
accordance with FASB ASC 815-10 (Prior authoritative literature: SFAS No. 133,
"Accounting for Derivative Instruments and Hedging Activities", the Company
determined that the conversion feature of the Debenture met the criteria of an
embedded derivative, and therefore the conversion feature of this Debenture
needed to be bifurcated and accounted for as a derivative. The fair value of the
embedded conversion was estimated at the date of issuance using the
Black-Scholes model with the following assumptions, the same as used for iVoice
Technology as B Green as there is no market for B Green’s stock: risk free
interest rate: 2.25%; expected dividend yield: 0%: expected life: 5 years; and
volatility: 226.33%. The accounting guidance instructs that the conversion
options are a derivative liability. At June 30, 2008 the Company recorded the
conversion options as a liability, recorded a debt discount of $8,000, and
charged Other Expense - Loss on Valuation of Derivative for $16,366, resulting
primarily from calculation of the conversion price. For the three months ended
September 30, 2009 the Company recorded a Loss on Valuation of Derivative in the
amount of $87,240 as compared to $1,796 for the three months ended September 30,
2008.  For the nine months ended September 30, 2009 the Company
recorded a Loss on Valuation of Derivative in the amount of $315,606 as compared
to $3,700 for the nine months ended September 30, 2008.  The fair
value of the embedded conversion was estimated at the September 30, 2009 using
the Black-Scholes model with the following assumptions: risk free interest rate:
1.45%; expected dividend yield: 0%: expected life: 5 years; and volatility:
320.74%. The derivative liability was $386,744 and $35,138 at September 30, 2009
and December 31, 2008, respectively.
 
 Note
8        Convertible Debenture and
Derivative Liability
 
 On April
16, 2007, iVoice Technology, Inc. issued a Secured Convertible Debenture dated
March 30, 2007 (the "Debenture") to YA Global Investments (f/k/a/ Cornell
Capital Partners, LP) for the sum of $700,000 in exchange for a previously
issued note payable for the same amount. The Debenture has a term of three
years, and pays interest at the rate of 5% per annum. Cornell has the right to
convert a portion or the entire outstanding principal into the Company's Class A
Common Stock at a Conversion Price equal to eighty percent (80%) of the lowest
closing Bid Price of the Common Stock during the five (5) trading days
immediately preceding the Conversion Date. Cornell may not convert the Debenture
into shares of Class A Common Stock if such
conversion would result in Cornell beneficially owning in excess of 4.9% of the
then issued and outstanding shares of Class A Common Stock. The Conversion Price
and number of shares of Class A Common Stock issuable upon conversion of the
Debenture are subject to certain exceptions and adjustment for stock splits and
combinations and other dilutive events. Subject to the terms and conditions of
the Debenture, the Company has the right at any time provided that as of the
date of the Holder's receipt of a Redemption Notice (i) the Closing Bid Price of
the of the Common Stock, as reported by Bloomberg, LP, is less than the
Conversion Price and (ii) no Event of Default has occurred. The Company shall
pay an amount equal to the principal amount being redeemed plus a redemption
premium ("Redemption Premium") equal to twenty percent (15%) of the principal
amount being redeemed, and accrued interest, (collectively referred to as the
"Redemption Amount"). During the time that any portion of this Debenture is
outstanding, if any Event of Default has occurred, the full principal amount of
this Debenture, together with interest and other amounts owing in respect
thereof, to the date of acceleration shall become at the Holder's election,
immediately due and payable in cash, provided however, the Holder may request
(but shall have no obligation to request) payment of such amounts in Common
Stock of the Company. Furthermore, in addition to any other remedies, the Holder
shall have the right (but not the obligation) to convert this Debenture at any
time after (x) an Event of Default or (y) the Maturity Date at the Conversion
Price then in-effect.
 
 On March
14, 2008, the Company and YA Global Investments agreed that the Company would
redeem all amounts outstanding under the Debenture, except for the $186,557 of
the outstanding interest remaining on the original notes payable that were
originally exchanged for the Debenture. The amount redeemed was $691,021,
consisting of the remaining balance of the Debenture of $572,815, accrued
interest of $32,284, and a redemption premium of $85,922. The Debenture was
amended to change amount to $186,557 with a due date of March 14, 2009. The
Debenture shall accrue interest at the rate of 15% per annum, and shall be
convertible at a conversion price equal to 70% of the lowest closing bid price
of the Company’s common stock during the 30 trading days immediately proceeding
the conversion date. No conversions can be made prior to November 1,
2008.
  On
November 21, 2008, the Company entered into an Amendment Agreement (the
"Agreement") between the Company and YA Global Investments LP, f/k/a Cornell
Capital Partners, LP. ("YA Global") which paid off in full the Secured
Convertible Debenture dated March 30, 2007 (the "Debenture"). Under the terms of
the Agreement, the Company paid the sum of One Hundred and Thirty-five Thousand
Dollars ($135,000) in full payment of the Debenture with a remaining principal
balance of $186,557, with accrued interest of $17,788. The difference of $69,355
was included in other income in the condensed consolidated financial statements
for the year ended December 31, 2008. The security interest that YA Global held
in the assets of the Company was also terminated.
  12
 Table of Contents
  iVOICE TECHNOLOGY,
INC.
 NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
 September 30, 2009 and
2008
 
 Note
8        Convertible Debenture and
Derivative Liability (continued)
 
 In
accordance with FASB ASC 815-10 (Prior authoritative literature: SFAS No. 133,
"Accounting for Derivative Instruments and Hedging Activities", the Company
determined that the conversion feature of the Debenture met the criteria of an
embedded derivative, and therefore the conversion feature of this Debenture
needed to be bifurcated and accounted for as a derivative. The fair value of the
embedded conversion was estimated at the date of issuance using the
Black-Scholes model with the following assumptions: risk free interest rate:
5.6%; expected dividend yield: 0%: expected life: 3 years; and volatility:
383.29%. The conversion feature of the debenture was recorded as a derivative
liability. As such, in March 2007 the Company recorded the conversion options as
a liability, recorded a debt discount of $700,000, and charged Other Expense -
Loss on Valuation of Derivative for $492,403, resulting primarily from
calculation of the conversion price.
 
 For the
three months ended September 30, 2008, the Company recorded a Gain on Valuation
of Derivative in the amount of $25,457 and amortized the debt discount for a
charge of $47,023. For the nine months ended September 30, 2008, the Company
recorded a Gain on Valuation of Derivative in the amount of $1,125,257 and
amortized the debt discount for a charge of $602,163. For the three and nine
months ended September 30, 2009, the Company did not record any Gain or Loss on
Valuation of Derivative or amortization of debt discount as the convertible
debenture has been paid in full.
 
 Note
9        Income
taxes
 
 Deferred
income taxes will be determined using the liability method for the temporary
differences between the financial reporting basis and income tax basis of the
Company's assets and liabilities. Deferred income taxes will be measured based
on the tax rates expected to be in effect when the temporary differences are
included in the Company's tax return. Deferred tax assets and liabilities are
recognized based on anticipated future tax consequences attributable to
differences between financial statement carrying amounts of assets and
liabilities and their respective tax bases. At September 30, 2009 and December
31, 2008 deferred tax assets consist of the following:
 
 September
      30, 2009
              
              
              December
      31, 2008Net
      operating loss carry forwards
              
              $
              786,000
              
              
              $
              663,000Deferred
      compensation
              
              
              120,000
              
              
              
              105,000Deferred
      tax asset
              
              
              906,000
              
              
              
              768,000Less:
      valuation allowance
              
              
              (906,000
              )
              
              
              (768,000
              )Deferred
      tax asset, net
              
              $
              -0-
              
              
              $
              -0-
 
 At
September 30, 2009 and December 31, 2008, the Company had a federal net
operating loss carry forward in the approximate amounts of $1,966,000 and
$1,658,000, respectively, available to offset future taxable
income.  The Company established valuation allowances equal to the
full amount of the deferred tax assets due to the uncertainty of the utilization
of the operating losses in future periods.
 
 Note
10      Capital
Stock
 
 Pursuant
to iVoice Technology’s certificate of incorporation, as amended, the Company 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,
50,000,000 shares of Class B Common Stock, par value $0.01 per share, and
20,000,000 shares of Class C Common Stock, par value $0.01 per share. Below is a
description of iVoice Technology’s outstanding securities, including Preferred
Stock, Class A Common Stock, Class B Common Stock and Class C Common
Stock.
  a) Preferred
Stock
  iVoice
Technology is authorized to issue 1,000,000 shares of Preferred Stock, par value
$1.00 per share.
  Of the
1,000,000 shares of Preferred Stock, 10,000 shares are designated Series A 10%
Preferred Stock, par value $1.00 per share, with a stated value of $1,000 (the
“Series A Preferred Stock”). The stated value is used for calculation of
dividends and liquidation preferences. On March 12, 2008, the Company sold
1,444.44 shares of Series A 10% Preferred Stock to iVoice, Inc. for
$1,444,444.  With consent of the holders of the Series A Preferred
Stock, on March 6, 2009, the Company amended its Certificate of Incorporation
and amended the rights of the Series A Preferred by: (i) eliminating all voting
rights for the Series A Preferred Stock and (ii) eliminating the conversion
feature of the Series A Preferred Stock
  13
 Table of Contents
 iVOICE TECHNOLOGY,
INC.
 NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
 September 30, 2009 and
2008
 
 Note
10      Capital Stock
(continued)
  As of
September 30, 2009, 1,444.44 shares of Series A 10% Convertible Preferred Stock
are issued and outstanding.
  The fair
value of the embedded conversion was estimated at the date of issuance using the
Black-Scholes model with the following assumptions: risk free interest rate:
5.47%; expected dividend yield: 0%: expected life: 5 years; and volatility:
265.44%. Prior to amendment, the stock had a feature that grants holders the
right to convert the stock into common shares based upon 80% of the lowest price
the Company has ever issued its Class A Common Stock. Due to this conversion
feature the entire investment was deemed a dividend. For the year ended
December 31, 2008, $1,444,444 of preferred stock accretion was recognized
in the consolidated statements of operations. As noted above, an amendment was
made which eliminated the conversion feature.
 
 b) Class
A Common Stock
 
 As of
September 30, 2009, there are 10,000,000,000 shares of Class A Common Stock
authorized, no par value, and 571,309,870 shares were issued, and 570,115,387
shares were outstanding, and 1,194,483 shares were issued pending conversion by
YA Global Investments.
  Each
holder of Class A Common Stock is entitled to receive ratably dividends, if any,
as may be declared by the Board of Directors out of funds legally available for
payment of dividends.  The Company has never paid any dividends on its
common stock and does not contemplate doing so in the foreseeable
future.
  The
Company anticipates that any earnings generated from operations will be used to
finance its growth objectives.
 
 c) 
Class B Common Stock
 
 As of
September 30, 2009, there are 50,000,000 shares of Class B Common Stock
authorized, par value $.01 per share.  Each holder of Class B Common
Stock has voting rights equal to 100 shares of Class A 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 that iVoice Technology, Inc. had ever issued its Class A Common Stock.
Upon our liquidation, dissolution, or winding-up, holders of Class B Common
Stock will be entitled to receive distributions. As of September 30, 2009, no
shares were issued or outstanding. On July 27, 2009, the Company amended its
Certificate of Incorporation as follows: 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 that iVoice
Technology, Inc. had ever issued its Class A Common Stock. 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. Previously, each holder of
Class B Common Stock has voting rights equal to 100 shares of Class A Common
Stock.
 
 d) 
Class C Common Stock
 
 As of
September 30, 2009, there are 20,000,000 shares of Class C Common Stock
authorized, par value $.01 per share.  Each holder of Class C Common
Stock is entitled to 1,000 votes for each share held of record. Shares of Class
C Common Stock are not convertible into Class A Common Stock. Upon liquidation,
dissolution or wind-up, the holders of Class C Common Stock are not entitled to
receive our net assets pro rata. As of September 30, 2009, no shares were issued
or outstanding.
  Note
11Stock
Options
  During
2005, the Company adopted the 2005 Stock Incentive Plan and the 2005 Directors’
and Officers’ Stock Incentive Plan (“Plan”) in order to attract and retain
qualified personnel.  Under the Plan, the Board of Directors, in its
discretion may grant stock options (either incentive or non-qualified stock
options) to officers, directors and employees.  The Company has not
issued any stock options as of September 30, 2009.
 
 Note
12      New Accounting
Pronouncements
 
 InDecember 2007, the FASB issued FASB ASC 810-10 (Prior authoritative
literature: SFAS No. 160, Non-controlling Interests in Consolidated Financial
Statements — an amendment of ARB No. 51.  FASB ASC 810-10
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. FASB ASC 810-10 will be
effective beginning
January 1, 2009. The adoption of FASB ASC 810-10 did not have a material
impact on the Company’s condensed consolidated financial
statements.
  14
 Table of Contents
  iVOICE TECHNOLOGY,
INC.
 NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
 September 30, 2009 and
2008
 
 Note
12      New Accounting
Pronouncements (continued)
 
 In
December 2007, the FASB issued FASB ASC 805-10 (Prior authoritative literature
SFAS No 141(R), “Business Combinations.”  This statement provides new
accounting guidance and disclosure requirements for business
combinations.  FASB ASC 805-10 is effective for business combinations
which occur in the first fiscal year beginning on or after December 15, 2008.
The adoption of FASB ASC 805-10 did not have a significant impact on the
Company’s condensed consolidated financial statements or financial position, but
the nature and magnitude of the specific effects will depend upon the nature,
terms and size of the acquisitions the Company consummates after the effective
date.
 
 In
December 2007, the FASB finalized the provisions of the FASB ASC 808-10,
“Accounting for Collaborative Arrangements.”  FASB ASC 808-10 provides
guidance and requires financial statement disclosures for collaborative
arrangements. FASB ASC 808-10 is effect for financial statements issued for
fiscal years beginning after December 15, 2008.  The adoption of FASB
ASC 808-10 did not have a material impact on the Company’s condensed
consolidated financial statements.
 
 In March
2008, the Financial Accounting Standards Board (“FASB”) issued FASB ASC 815-10
(Prior authoritative literature (“SFAS”) No. 161, “Disclosures about Derivative
Instruments and Hedging Activities – an amendment of FASB Statement No. 133”
which modifies and expands the disclosure requirements for derivative
instruments and hedging activities.  FASB ASC 815-10requires that
objectives for using derivative instruments be disclosed in terms of underlying
risk and accounting designation and requires quantitative disclosures about fair
value amounts and gains and losses on derivative instruments.  It also
requires disclosures about credit-related contingent features in derivative
agreements. FASB ASC 815-10 is effective for financial statements issued for
fiscal years and interim periods beginning after November 15, 2008, with early
application encouraged.  FASB ASC 815-10 encourages, but does not
require, comparative disclosures for earlier periods at initial
adoption.  The Company adopted this standard effective January 1,
2009. The implementation of this standard did not have a material impact on the
Company’s condensed consolidated financial statements.
 
 In April
2008, the FASB issued FASB ASC 350-30, Determination of the Useful Life of
Intangible Assets. FASB ASC 350-30 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.  FASB ASC 350-30must be applied prospectively to intangible
assets acquired after January 1, 2009.  The Company’s adoption of FASB
ASC 350-30 did not have a material impact on the Company’s condensed
consolidated financial statements.
 
 In June
2008, the FASB ratified FASB ASC 840-10, Accounting for Lessees for Maintenance
Deposits Under Lease Arrangements. FASB ASC 840-10 provides guidance for
accounting for nonrefundable maintenance deposits. It also provides revenue
recognition accounting guidance for the lessor. FASB ASC 840-10 is effective for
fiscal years beginning after December 15, 2008. The Company’s adoption of FASB
ASC 840-10 did not have a material impact on the Company’s condensed
consolidated financial statements.
  In
November 2008, the FASB issued FASB ASC 350-30, Accounting for Defensive
Intangible Assets”. FASB ASC 350-30 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.’ FASB ASC 350-30
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. FASB ASC
350-30 also requires that defensive intangible assets be assigned a useful life
in accordance with FASB ASC 350-30-35 and is effective for financial statements
issued for fiscal years beginning after December 15, 2008. The Company has
adopted this standard effective January 1, 2009 and the Company’s adoption of
this pronouncement did not have a material impact on the Company’s condensed
consolidated financial statements.
 
 In April
2009, the FASB issued FASB ASC 320-10, Recognition and Presentation of
Other-Than-Temporary Impairments. FASB ASC 320-10 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 FASB ASC 320-10 brings is a revision to the amount of
other-than-temporary loss of a debt security recorded in earnings. FASB ASC
320-10 is effective for interim and annual reporting periods ending after June
15, 2009 The Company’s adoption of FASB ASC 320-10 did not have a material
impact on the Company’s condensed consolidated financial
statements.
  In April
2009, the FASB issued FASB ASC 820-10, 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. FASB ASC 820-10 provides
additional guidance for estimating fair when the volume and level of activity
for the asset or liability have significantly decreased. FASB ASC 820-10 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. FASB ASC 820-10 is
effective for interim and annual reporting periods ending after June 15, 2009,
and
is applied prospectively. The Company’s adoption of FASB ASC 820-10 did not have
a material impact on the Company’s condensed consolidated financial
statements.
  15
 Table of Contents
  iVOICE TECHNOLOGY,
INC.
 NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
 September 30, 2009 and
2008
 
 Note
12      New Accounting
Pronouncements (continued)
  In April
2009, the FASB issued FASB ASC 825-10, Interim Disclosures about Fair Value of
Financial Instruments. FASB ASC 825-10 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. FASB ASC
825-10 also amends APB Opinion No. 28, Interim Financial Reporting, to require
those disclosures in summarized financial information at interim reporting
periods FASB ASC 825-10 is effective for interim and annual reporting periods
ending after June 15, 2009. The Company’s adoption of issued FASB ASC 825-10 did
not have a material impact on the Company’s condensed consolidated financial
statements.
  In June
2009, the Financial Accounting Standards Board (“FASB”) issued FASB ASC 105-10,
The FASB Accounting Standards Codification and Hierarchy of Generally Accepted
Accounting Principles, a replacement of FASB Statement No. 162. FASB ASC 105-10
establishes the FASB Standards Accounting Codification (“Codification”) as the
source of authoritative GAAP recognized by the FASB to be applied to
nongovernmental entities. The only other source of authoritative GAAP is the
rules and interpretive releases of the SEC which only apply to SEC registrants.
The Codification will supersede all the existing non-SEC accounting and
reporting standards upon its effective date. Since the issuance of the
Codification is not intended to change or alter existing GAAP, adoption of this
statement will not have an impact on the Company’s financial position or results
of operations, but will change the way in which GAAP is referenced in the
Company’s financial statements. FASB ASC 105-10  is effective for
interim and annual reporting periods ending after September 15,
2009.
 
 In May
2009, the FASB issued FASB ASC 855-10, Subsequent Events, which establishes
general standards of accounting for and disclosure of events that occur after
the balance sheet date but before the financial statements are issued or are
available to be issued. The Company adopted FASB ASC 855-10 effective
April 1, 2009 and has evaluated subsequent events after the balance sheet
date of September 30, 2009 through the date the financial statements were
issued.
 
 In
October 2009, the FASB issued Accounting Standards Update 2009-13, “Revenue
Recognition (Topic 605)”. This Update provides amendments to the criteria in
Subtopic 605-24 for separating consideration in multiple-deliverable revenue
arrangements. It establishes a hierarchy of selling prices to determine the
selling price of each specific deliverable which includes vendor-specific
objective evidence (if available), third-party evidence (if vendor-specific
evidence is not available), or estimated selling price if neither of the first
two are available. This Update also eliminates the residual method for
allocating revenue between the elements of an arrangement and requires that
arrangement consideration be allocated at the inception of the arrangement.
Finally, this Update expands the disclosure requirements regarding a vendor’s
multiple-deliverable revenue arrangements. This Update is effective for fiscal
years beginning on or after June 15, 2010. We do not anticipate any
material impact from this Update.
 
 Note
13      Fair Value
Measurements
 
 In
September 2006, the FASB issued FASB ASC 820-10, which defines fair value,
establishes a framework for measuring fair value, and expands disclosures about
fair value measurements. The provisions of FASB ASC 820-10 were effective
January 1, 2008.
 
 As
defined in FASB ASC 820-10, 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. FASB ASC 820-10 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).
 
 The three
levels of the fair value hierarchy defined by FASB ASC 820-10 are as
follows:
 
 Level 1 –
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 –
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.
  16
 Table of Contents
 
 iVOICE TECHNOLOGY,
INC.
 NOTES TO CONDENSED
CONSOLIDATED FINANCIAL STATEMENTS
 September 30, 2009 and
2008
 
 Note
13      Fair Value Measurements
(continued)
  Level 3 –
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.
 
 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 September 30, 2009 and December 31, 2008. As required by FASB ASC 820-10,
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.
 
 September
      30, 2009
                
                Level
      I
                
                
                Level II
                
                
                Level III
                
                
                TotalTotal
      Assets
                
                $
                -
                
                
                $
                -
                
                
                $
                -
                
                
                $
                -Convertible
      promissory notes
                
                $
                -
                
                
                $
                51,343
                
                
                $
                -
                
                
                $
                51,343Note
      payable to related parties
                
                
                -
                
                
                
                127,308
                
                
                
                -
                
                
                
                141,708Derivative
      liabilities
                
                
                -
                
                
                
                1,059,405
                
                
                
                -
                
                
                
                1,059,405Total
      Liabilities
                
                $
                -
                
                
                $
                1,238,056
                
                
                $
                -
                
                
                $
                1,252,456
  December
      31, 2008
                
                Level
      I
                
                
                Level II
                
                
                Level III
                
                
                TotalTotal
      Assets
                
                $
                -
                
                
                $
                -
                
                
                $
                -
                
                
                $
                -Convertible
      promissory notes
                
                $
                -
                
                
                $
                15,943
                
                
                $
                -
                
                
                $
                15,943Note
      payable to related parties
                
                
                -
                
                
                
                141,708
                
                
                
                -
                
                
                
                141,708Derivative
      liabilities
                
                
                -
                
                
                
                133,212
                
                
                
                -
                
                
                
                133,212Total
      Liabilities
                
                $
                -
                
                
                $
                290,863
                
                
                $
                -
                
                
                $
                290,863
  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 Notes 7 and 8 for more discussion on
derivatives. The Company did not hold financial assets and liabilities, which
were recorded at fair value in the Level 3 category as of September 30,
2009 and December 31, 2008.
 
 Note
14      Subsequent
Event
 
 On
September 29, 2009 the Company filed an Information Statement on Schedule 14C,
which will be effective on November 10, 2009 for the following:
 
 1. Grant of
discretionary authority for the Board of Directors to effect the buyback by the
Company of the Class A Common Stock.
 2. Election
of Jerome Mahoney and Frank Esser to the Board of Directors.
 3. Change
the name of the corporation to B Green Innovations, Inc. by filing an amendment
to the Certificate of Incorporation, change trading symbol.
 4. Approval
of the iVoice Technology, Inc. 2005 Stock Incentive Plan and change the name to
the B Green Innovations, Inc. 2005 Stock Incentive Plan (the “2005
Plan”).
 5. Approval
of the iVoice Technology, Inc. 2005 Directors’ and Officers’ Stock Incentive
Plan and change the name to the B Green Innovations, Inc. 2005 Directors’ and
Officers’ Stock Incentive Plan (the “2005 Directors’ and Officers’
Plan”).
 6. Ratify
the Board of Directors’ selection of Bagell Josephs Levine & Company, LLC to
audit our financial
statements for the fiscal year ending December 31,
2009.
 
 17
 Table of Contents
 
 Item2.       Management’s
Discussion And Analysis Of Financial Condition And Results Of
Operations
  Forward Looking
Statements
 
 A number
of the statements made by the Company in this report may be regarded as
“forward-looking statements” within the meaning of the Private Securities
Litigation Reform Act of 1995.
 
 Forward-looking
statements include, among others, statements concerning the Company’s outlook,
pricing trends and forces within the industry, the completion dates of capital
projects, expected sales growth, cost reduction strategies and their results,
long-term goals of the Company and other statements of expectations, beliefs,
future plans and strategies, anticipated events or trends and similar
expressions concerning matters that are not historical facts.
 
 All
predictions as to future results contain a measure of uncertainty and
accordingly, actual results could differ materially.  Among the
factors that could cause a difference are:  changes in the general
economy; changes in demand for the Company’s products or in the cost and
availability of its raw materials; the actions of its competitors; the success
of our customers; technological change; changes in employee relations;
government regulations; litigation, including its inherent uncertainty;
difficulties in plant operations and materials; transportation, environmental
matters; and other unforeseen circumstances.  For a discussion of
material risks and uncertainties that the Company faces.  See the
discussion in the Form 10−K for the fiscal year ended December 31, 2008 entitled
“Risk Factors”.
 
 Results of
Operations
  Total
revenues increased $18,935 (193.5%) and $38,805 (110.4%) for the three and nine
months ended September 30, 2009 to $28,721 and $73,969, respectively, as
compared to $9,786 and $35,164 for the same periods in the prior year.
Maintenance services on IVR products declined  70.3% and 39.3% for the
three and nine months ended September 30, 2009, respectively, as compared to the
same periods in the prior year as a result of lower maintenance services, which
has been a result of the reduction installations. The decreases in maintenance
revenues were offset by new sales of our “green” products from B Green
Innovations. There were no sales of “green” products in the prior year. The
Company continues its efforts to market and sell its products through a
distribution network. B Green has entered into distribution agreements with
reputable distributors that have proven themselves within their territories and
industry segments.
 Gross
profit increased $5,001 (51.1%) to $14,787 for the three months ended September
30, 2009 as compared to the same period in the prior year as a result of the
increased volume for “Green” products. Maintenance services on IVR products
yield a very high gross profit as a result of the limited costs needed to
support these products as compared to the manufactured “Green” products. 
Gross profit for the nine months ended increased $4,332 (12.3%) to $39,496 as
compared to the same period last year. Gross profit increased as a result of
lower maintenance revenues offset by higher gross profits on the “green”
products. B Green’s gross profit on product sales was offset by purchases
certain packaging materials that were charged directly to cost of
sales.
  Total
operating expenses decreased $24,008 (15.7%) to $129,060 for the three months
ended September 30, 2009 as compared to the three months ended September 30,
2008, primarily as a result of lower investor relations expenses partially
offset by an increase in expenses associated with the operations of B Green
Innovations, Inc.  For the nine months ended September 30, 2009 total
operating expenses decreased $19,998 (4.6%), lower investor relations expenses
partially offset by an increase in expenses associated with the operations of B
Green Innovations, Inc.
  Total
other expense was $275,341 for the three months ended September 30, 2009 as
compared to an expense of $39,782 for the three months ended September 30, 2008,
an increase of $235,559. This increase in other expense is primarily attributed
to the loss on valuation of derivative. Total other expense was $916,416 for the
nine months ended September 30, 2009 as compared to income of $238,449 for the
nine months ended September 30, 2008, a decrease of $1,154,865. For the nine
months ended September 30, 2008 the Company reported a gain on the valuation of
derivative of $1,094,066, which was partially offset by amortization of debt
discount of $624,051 as compared to a loss on valuation of derivative of
$852,204 and amortization of debt discount of $40,741 for the nine months ended
September 30, 2009.
 Net loss
for the quarter ended September 30, 2009 was $389,614 as compared to a loss of
$183,064 for the quarter ended September 30, 2008.  Net loss for the nine
months ended September 30, 2009 was $1,296,296 as compared to a loss of $145,761
for the nine months ended September 30, 2008. The changes were the result of the
factors discussed above.
  As of
September 30, 2009, iVoice Technology had one full-time and two part-time
employees.
  18
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  Liquidity and Capital
Resources
  To date,
iVoice Technology has incurred substantial losses, and will require financing
for working capital to meet its operating obligations.  We anticipate
that we will require financing on an ongoing basis for the foreseeable
future.
  On March
30, 2007, iVoice Technology, Inc. issued a Secured Convertible Debenture (the
"Debenture") to YA Global Investments (f/k/a/ Cornell Capital Partners) for the
sum of $700,000 in exchange for the previously issued note payable for the same
amount (see Note 8 to the Financial Statements). On March 14, 2008, the Company
and YA Global Investments agreed that the Company would redeem all amounts
outstanding under the Debenture, except for the $186,557 of the outstanding
interest remaining on the original notes payable that were originally exchanged
for the Debenture. The amount redeemed was $691,021, consisting of the remaining
balance of the Debenture of $572,815, accrued interest of $32,284, and a
redemption premium of $85,922. The Debenture was amended to change the amount to
$186,557 with a due date of March 14, 2009. The Debenture shall accrue interest
at the rate of 15% per annum, and shall be convertible at a conversion price
equal to 70% of the lowest closing bid price of the Company’s common stock
during the 30 trading days immediately proceeding the conversion date. No
conversions can be made prior to November 1, 2008.
  On
November 21, 2008, the Company entered into an Amendment Agreement (the
"Agreement") between the Company and YA Global Investments LP, f/k/a Cornell
Capital Partners, LP. ("YA Global") which paid off in full the Secured
Convertible Debenture dated March 30, 2007 (the "Debenture"). Under the terms of
the Agreement, the Company paid the sum of One Hundred and Thirty-five Thousand
Dollars ($135,000) in full payment of the Debenture with a remaining principal
balance of $186,567, with accrued interest of $17,788. The security interest
that YA Global held in the assets of the Company was terminated.
  On August
5, 2005, iVoice Technology assumed an aggregate of $190,000 in liabilities from
iVoice and iVoice assigned to iVoice Technology assets having an aggregate book
value of $10,000. iVoice Technology believes that the fair value of these assets
may be greater than the book value, although it has not undertaken an appraisal.
The assumed obligations are described below.
  iVoice
Technology assumed from iVoice outstanding indebtedness in the amount of
$190,000 payable to Jerry Mahoney.  This amount is related to funds
that had been loaned to iVoice in July 2000 that were used to develop the IVR
software business.  The amount of $190,000 includes approximately
$32,110 for interest on the original loan from Jerry Mahoney to
iVoice.  Pursuant to the terms of the promissory note representing
such obligation, iVoice Technology, for value received, will pay to Mr. Mahoney
the principal sum of $190,000 that will bear interest at the prime rate plus 2%
per annum on the unpaid balance until paid or until default. Interest payments
will be due annually. All accrued interest becomes due on the date of any
payment of the promissory note. At the time of default (if any) the interest
rate shall increase to 20% until the principal balance has been 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, par value $0.01, for each dollar owed, (ii) the number of
shares of Class A Common Stock of iVoice Technology 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 the Company maintains control over the issuance of shares and
may decline the request for conversion of the repayment into shares of the
Company.
  On
September 22, 2005, iVoice Technology entered into a Standby Equity Distribution
Agreement with YA Global Investments (f/k/a/ Cornell Capital Partners), pursuant
to which iVoice Technology may, from time to time, issue and sell to YA Global
Investments (f/k/a/ Cornell Capital Partners) our Class A Common Stock for a
total purchase price of up to $10 million. As of September 30, 2008, the Company
has sold in the aggregate 190,365,518 shares of Class A Common Stock to YA
Global for net proceeds of $324,520, which are net of fees and discounts of
$59,377, which was used to fund the operations of the Company. The Standby
Equity Distribution Agreement expired on February 5, 2008.
  On March
12, 2008, the Company sold 1,444.44 shares of Series A 10% Preferred Stock to
iVoice, Inc. for net proceeds of $1,300,000. These funds were used to repay the
Convertible Debenture and to fund operations and the new venture in B Green
Technologies discussed above.
  If the
Company cannot find sources of additional financing to fund its working capital
needs, the Company will be unable to obtain sufficient capital resources to
operate our business. We cannot assure you that we will be able to access any
financing in sufficient amounts or at all when needed. Our inability to obtain
sufficient working capital funding will have an immediate material adverse
effect upon our financial condition and our business.
 
 The
Company currently has no other significant sources of working capital or cash
commitments. However, no assurance can be given that iVoice Technology will
raise sufficient funds from such financing arrangements, or that iVoice
Technology will ever produce sufficient revenues to sustain its operations, or
that a market will develop for its common stock for which a significant amount
of iVoice Technology’s financing is dependent upon.
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  For the
nine months ended September 30, 2009, the Company had a net decrease in cash of
$207,041.  The Company’s principal sources and uses of funds were as
follows:
  Cash used by operating
activities.   The Company used $207,041 in cash for
operating activities for the nine months ended September 30, 2009 as compared to
$284,348 in the prior year. The decrease in cash used for operating activities
is primarily attributed to the payment of accrued interest and the redemption
fees associated with the paydown of the convertible debenture for the nine
months ended September 30, 2008, which did not occur in 2009.
  Net Cash used by investing
activities. Net cash used in investing activities is attributed to
increases in notes payable and other assets for the nine months ended September
30, 2008. There was no change in cash from investing activities for the nine
months ended September 30, 2009.
  Net Cash provided by financing
activities. There were no proceeds from financing activities for the nine
months ended September 30, 2009.  The Company generated $816,368 from
financing activities for the nine months ended September 30, 2008 primarily as a
result of net proceeds from the sales of Series A Preferred Stock, partially
offset by the payment of the convertible debenture in the amount of
$572,815.
 
 There was
no significant impact on the Company’s operations as a result of inflation for
the nine months ended September 30, 2009.
  Critical Accounting
Policies
 
 The
discussion and analysis of our financial condition and results of operations are
based on our financial statements, which have been prepared in accordance with
accounting principles generally accepted in the United States of America (GAAP).
The preparation of these financial statements requires us to make estimates and
judgments that affect the reported amounts of assets, liabilities, revenues and
expenses, and related disclosure of contingent assets and liabilities. On an
on-going basis, we evaluate these estimates, including those related to bad
debts, inventory obsolescence, intangible assets, payroll tax obligations, and
litigation. We base our estimates on historical experience and on various other
assumptions that are believed to be reasonable under the circumstances, the
results of which form the basis for making judgments about the carrying values
of certain assets and liabilities. Actual results may differ from these
estimates under different assumptions or conditions.
  We have
identified below the accounting policies, revenue recognition and software
costs, related to what we believe are most critical to our business operations
and are discussed throughout Management’s Discussion and Analysis of Financial
Condition or Plan of Operation where such policies affect our reported and
expected financial results.
  Revenue
Recognition
  With
respect to the sale of software license fees, the Company recognizes revenue in
accordance with FASB ASC 985-605, Software Revenue Recognition, and generally
recognizes revenue when all of the following criteria are met: (1) persuasive
evidence of an arrangement exists generally evidenced by a signed, written
purchase order from the customer, (2) delivery of the software product on
Compact Disk (CD) or other means to the customer has occurred, (3) the perpetual
license fee is fixed or determinable and (4) collectability, which is assessed
on a customer-by-customer basis, is probable.
  With
respect to customer support services, upon the completion of one year from the
date of sale, the Company offers customers an optional annual software
maintenance and support agreement for subsequent one-year periods. Sales of
purchased maintenance and support agreements are recorded as deferred revenues
and recognized over the respective terms of the agreements.
  The
Company derives its revenues from the licensing of its software product and
optional customer support (maintenance) services. Presently, 100% of the
revenues reported by the Company are derived from the licensing of the Company’s
IVR software. No revenues have been derived from the sale of optional customer
support services. The Company’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. The Company’s software application is
fully functional upon delivery and implementation and does not require any
significant modification or alteration. The Company also offers customers an
optional annual software maintenance and support agreement for the subsequent
one-year periods. Such maintenance and support services are free for the first
year the product is licensed. The software maintenance and support agreement
provides free software updates, if any, and technical support the customer may
need in deploying or changing the configuration of the software. Generally, the
Company does not license its software in multiple element arrangements whereby
the customer purchases a combination of software and maintenance. In a typical
arrangement, software maintenance services are sold separately from the software
product; are not considered essential to the functionality of the software and
are purchased at the customer’s option upon the completion of the first year
licensed.
  The
Company does not offer any special payment terms or significant discount
pricing. Normal and customary payment terms require payment for the software
license fees when the product is shipped. Payment for software maintenance is
due prior to the commencement of the maintenance period. It is also the
Company’s policy not to provide direct customers (as opposed to resellers and
dealers) the right to refund any portion of its license fees. The Company
accepts Visa and MasterCard as well as company checks.
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  Customers
may license the Company’s products through our telesales organization and
through promotions or reseller agreements with independent third
parties.  iVoice Technology only permits returns from authorized
dealers and resellers of unused inventory, subject to the consent of the Company
and a twenty-five percent restocking fee.  End users who purchaser
products directly from iVoice Technology may not return such products to iVoice
Technology under any circumstances.  Accordingly, the Company records
a provision for product returns and allowances against product revenue in the
same period the revenue is recorded. The estimates are based on historical sales
returns and other known data as well as market and economic
conditions.
  Our
current products are not sold through retail distribution channels. Current
reseller agreements provide for a limited contractual right of return and do not
provide for future price concessions, minimum inventory commitments nor is
payment contingent upon the reseller’s future sales or our products. Revenues
generated from products licensed through marketing channels where the right of
return exists, explicitly or implicitly, is reduced by reserves for estimated
product returns. Such reserves are estimates based on returns history and
current economic and market trends.
  Due to
the nature of the business and one-time contracts, it is unlikely that one
customer will impact revenues in future periods. All revenues for 2009 related
to the Company’s IVR operations were derived from annual maintenance and support
agreements.
  For B
Green Innovations, Inc. revenues 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.
 
 Software
Costs
  Software
license costs are recorded at cost, which approximates fair market value as of
the date of purchase. These costs represent the purchase of various exploitation
rights to certain software, pre-developed codes and systems developed by a
non-related third party. These costs are capitalized pursuant to FASB ASC
985-20, “Accounting for the Costs of Computer Software to be Sold, Leased or
Otherwise Marketed”. The carrying value of software license costs are regularly
reviewed by the Company and a loss would be recognized if the value of the
estimated undiscounted cash flow benefit related to the asset falls below the
unamortized cost. The Company develops software for licensing to its customers
and capitalizes software development costs when technological feasibility has
been established. Software development costs not qualifying for capitalization
are expensed and classified as research and development expenses in the
statements of operations. Research and development expenses and the
capitalization rate will fluctuate from period to period depending upon the
number and status of software development projects that are in process and the
related number of people assigned to those projects.
  Purchased
software and capitalized software development costs are amortized using the
greater of the revenue method or the straight-line method with useful lives
ranging from three to five years. Amortization expense is classified in costs of
revenue on the statements of operations. Our products operate on or with other
third party software and operating systems. When determining the useful life of
a product we consider factors such as the current state of the technology,
operating systems on which our products run, competitive products and the
potential use of our products by the end user. Technological advances in
software operating systems and other software technologies on which our products
rely may shorten the expected life cycle of our products. We make an assessment
of the useful lives of our products at each balance sheet date. If that
assessment determines that a shortened product life has occurred, we amortize
the remaining unamortized balances over the new estimated useful life of the
product and provide disclosure regarding a change in estimate in the notes to
the financial statements pursuant to Accounting Principles Board Opinion No. 20
“Accounting Changes.”
  The
Company evaluates the estimated net realizable value of each software product at
each balance sheet date. The estimate is based on historical and forecasted net
revenue for each product. Net revenue is the product revenue reduced by the
estimated costs of revenue and, if in development, the estimated cost to
complete the development of the product. When the net book value exceeds the
estimate of net realizable value, the Company records a write-down to net
realizable value on each product affected. Management’s ability to achieve its
revenue forecast is subject to judgment, competitive pressures, market and
economic conditions and management’s ability to successfully license its
products to its customers. A change in one or more of these factors may
influence management’s estimates. Accordingly, currently estimated net
realizable values are subject to being reduced resulting in corresponding
charges for impairment in the future
  Derivative
Liabilities
  The
Company accounts for its embedded conversion features in its convertible
debentures in accordance with FASB ASC 815-10, "Accounting for Derivative
Instruments and Hedging Activities", which requires a periodic valuation of
their fair value and a corresponding recognition of liabilities associated with
such derivatives, and FASB ASC 815-40, “Accounting for Derivative Financial
Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock. The
recognition of derivative liabilities related to the issuance of convertible
debt is applied first to the proceeds of such issuance as a debt discount, at
the date of issuance, and the excess of derivative liabilities over the proceeds
is recognized as “Loss on Valuation of Derivative” in other expense in the
accompanying financial statements. Any subsequent increase or decrease in the
fair value of the derivative liabilities is recognized as other expense or other
income, respectively. The financial statements for the period include the
recognition of the derivative liability on the underlying securities issuable
upon conversion of the Convertible Debentures with YA Global Investments
(f/k/a/Cornell Capital Partners)
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 Item4T.     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
  Item5.       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.
 
 Item6.       Exhibits
  3.1
                Amendment to the Certificate of Incorporation dated July
      27, 2009 and filed as an Exhibit 3.1 on a Current Report on Form 8-K dated
      July 27, 2009 and incorporated by reference herein.31.1
                Certification by Chief Executive Officer and Chief
      Financial Officer pursuant to Rule 15d-14 under the Securities Exchange
      Act.32.1
                Certification by Chief Executive Officer and Chief
      Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant
      to Section 906 of the Sarbanes-Oxley Act of
  2002.
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 SIGNATURES
 
 In
accordance with the requirements of the Exchange Act, the Registrant caused this
report on Form 10-Q to
be signed on its behalf by the undersigned, thereunto duly
authorized.
  iVOICE
      TECHNOLOGY, INC.Date:
      November 6, 2009
                By:
                /s/ Jerome
      MahoneyJerome
      MahoneyPresident,
      Chief Executive Officer and
                  Chief
      Financial Officer
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 INDEXOF EXHIBITS
  3.1
                Amendment to the Certificate of Incorporation dated July
      27, 2009 and filed as an Exhibit 3.1 on a Current Report on Form 8-K dated
      July 27, 2009 and incorporated by reference herein.31.1
                Certification by Chief Executive Officer and Chief
      Financial Officer pursuant to Rule 15d-14 under the Securities Exchange
      Act.32.1
                Certification by Chief Executive Officer and Chief
      Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant
      to Section 906 of the Sarbanes-Oxley Act of
  2002.
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