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| Nevada                          | 87-0645394                           |
|---------------------------------|--------------------------------------|
| (State or other jurisdiction of | (I.R.S. Employer Identification No.) |
| incorporation or organization)  |                                 |

| Large accelerated filer                         | [   ] | Accelerated filer         | [   ] |
|-------------------------------------------------|----------------------|---------------------------|----------------------|
| Non-accelerated filer                           | [   ] | Smaller reporting company | [X]                  |
| (Don not check if a smaller reporting company.) |                 |                      |

| Class                          | Outstanding as of August 13 2010 |
|--------------------------------|----------------------------------|
| Common Stock, $0.001 par value | 2,633,750                        |

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|  Heading                               |                                                                                              |  Page     |
|---------------------------------------------|---------------------------------------------------------------------------------------------------|----------------|
|                                        |                                                                                              |           |
|                                        |  PART I --  FINANCIAL INFORMATION                                                       |           |
|                                        |                                                                                              |           |
|  Item 1.                | Financial Statements                                                                              |    3 |
|                                        |                                                                                              |           |
|  Item  2.     |  Management's Discussion and Analysis of Financial Condition and Results of Operations  |  11       |
|                                        |                                                                                              |           |
|  Item 3.                               |  Quantitative and Qualitative Disclosures About Market Risk                                  |  16       |
|                                        |                                                                                              |           |
|  Item 4(T).                            |  Controls and Procedures                                                                     |  16       |
|                                        |                                                                                              |           |
|                                        |  PART II -- OTHER INFORMATION                                                                |           |
|                                        |                                                                                              |           |
|  Item 1.                               |  Legal Proceedings                                                                           |  16       |
|                                        |                                                                                              |           |
|  Item 1A.                              |  Risk Factors                                                                                |  16       |
|                                        |                                                                                              |           |
|  Item 2.                               |  Unregistered Sales of Equity Securities and Use of Proceeds                                 |  16       |
|                                        |                                                                                              |           |
|  Item 3.                               |  Defaults Upon Senior Securities                                                             |  17       |
|                                        |                                                                                              |           |
|  Item 4.                               |  (Removed and Reserved)                                                                      |  17       |
|                                        |                                                                                              |           |
|  Item 5.                               |  Other Information                                                                           |  17       |
|                                        |                                                                                              |           |
|  Item 6.                               |  Exhibits                                                                                    |  17       |
|                                        |                                                                                              |           |
|                                        |  Signatures                                                                                  |  18       |
|                                        |                                                                                              |           |

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|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
|----------------------------------------------------------------------------|---------------------------------------------------------------------|-----------------------------------------------------------------------|-------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------|-----------------------------------------------------------------|------------------------------------------------------|
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      | June 30, 2010                                                                  |                                                            | Dec. 31, 2009                                        |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
| Assets                                                                     |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
| Current Assets                                                             |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
|                                                                       | Cash                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      | $           2,360       |                                                            |  $      257       |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
|                                                                       |                                                                | Total Current Assets                                                  |                                                                                      |                                                                           |               2,360 |                                                                           |           257 |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
|                                                                       |                                                                | Total Assets                                                          |                                                                                      |                                                                           | $2,360                                                                                    |                                                                           | $257                                                            |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
| Liabilities & Stockholders' Equity                                     |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |
| Current Liabilities                                                        |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
|                                                                       | Accounts Payable                                                    |                                                                  |                                                                                      |                                                                           |  $          26,112                 |                                                                           |  $   20,055                                 |
|                                                                       | Note Payable- Related Party                                         |                                                                  |                                                                                      |             21,272 |                                                                                      |       25,597                                     |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
|                                                                       |                                                                | Total Current Liabilities                                             |                                                                                      |             47,384 |                                                                                      |       45,652                                     |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
| Stockholders' Equity                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
|                                                                       | Common Stock                                                        |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |
|                                                                       |    25,000,000 shares authorized at $0.001 par value; |                                                                  |                                                                                      |                                                                           |
|                                                                       |    2,634,750 shares issued and outstanding           |                                                                  |               2,634 |                                                                           |        2,604                                           |
|                                                                       | Capital in excess of par value                                      |                                                                  |                                                                                      |            147,561      |                                                                                      |     140,091                                                |
|                                                                       | Accumulated deficit during development stage                        |           (195,219) |                                                                                      |    (188,090)                                                    |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
|                                                                       |                                                                | Total Stockholders' Equity                                            |                                                                                      |            (45,024)     |                                                                                      |      (45,395)                                         |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |  $           2,360 |                                                            |  $       257 |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
|                                                                       |                                                                |                                                                  |                                                                                      |                                                                           |                                                                                      |                                                                           |                                                            |                                                 |
| The accompanying notes are an integral part of these financial statements. |

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|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |                                                                                                                                                                |          |
|--------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------|---------------------------------------------------------------------------------|---------------------------------------------------------------------------------|----------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------|
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              | Three Months                                                                                      |                                                                                  | Six Months                                                                      |                                                                            | April 22, 1997 |
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              | June 30                                                                                           |                                                                                  | June 30                                                                         |                                                                            | to             |
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              | 2010                                                                                              | 2009                                                                                  |                                                                            | 2010                                                                            | 2009           |                                                                                                                                                                | June 30, 2010 |
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |                                                                                                                                                                |          |
| Sales                                                                                                        |   |                                                                                                    |                                                                                                    |                                                                                              | $2,978                                                                                            | $941                                                                                  |                                                                            | $3,942                                                                          | $1,364         |                                                                                                                                                                | $26,925       |
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |                                                                                                                                                                |          |
| Cost of Goods Sold                                                                                           |   |                                                                                                    |                                                                                                    |                 - |                 - |                                                                                  |              - |              - |           |                            - |
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |                                                                                                                                                                |          |
|               Gross Profit                  |   |                                                                                                    | $2,978                                                                                                  | $941                                                                                              |                                                                                              | $3,942                                                                                | $1,364                                                                          |                                                                            | $26,925        |
| Expenses                                                                                                     |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |                                                                                                                                                                |
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |                                                                                                                                                                |          |
|               Administrative                | 5,068  | 6,190                                                                                                   |                                                                                                    | 11,025                                                                                            | 6,991                                                                                             |                                                                                  | 193,288                                                                         |
|               Royalties                     |   |                                                                                                    | 34                                                                                                      | 13                                                                                                |                                                                                              | 46                                                                                    | 18                                                                              |                                                                            | 206            |
|               Depreciation and amortization |   |                  - |                  - |                                                                                              |              -                   |               - |                                                                            | 28,650                                                                          |
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              | 5,102                                                                                             | 6,203                                                                                 |                                                                            | 11,071                                                                          | 7,009          |                                                                                                                                                                | 222,144       |
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |                                                                                                                                                                |          |
| Net Loss                                                                                                     |   |                                                                                                    |                                                                                                    |                                                                                              | ($2,124)                                                                                          | ($5,262)                                                                              |                                                                            | ($7,129)                                                                        | ($5,645)       |                                                                                                                                                                | ($195,219)    |
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |                                                                                                                                                                |          |
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |                                                                                                                                                                |          |
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |                                                                                                                                                                |          |
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |                                                                                                                                                                |          |
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |                                                                                                                                                                |          |
| Net Loss Per Common Share                                                                                    |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |                                                                                                                                                                |          |
|               Basic and dilluted            |   |                                                                                                    | $    -                                                                              | $    -                                                                        |                                                                                              | $    -                                                            | $    -                                                      |                                                                            |           |
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |                                                                                                                                                                |          |
| Average Outstanding Shares                                                                                   |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |
|                                                                                                         |   |                                                                                                    |                                                                                                    |                                                                                              |                                                                                              |                                                                                  |                                                                            |                                                                            |           |                                                                                                                                                                |          |
|               Basic (stated in 1000's)      |   | 2,623                                                                                                   | 2,584                                                                                                   |                                                                                              | 2,623                                                                                             | 2,584                                                                                 |                                                                            |                                                                            |

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|                                                                       |   |          |   |   |          |   |   |           |   |
|----------------------------------------------------------------------------|--------|---------------|--------|--------|---------------|--------|--------|----------------|--------|
|                                                                       |   |          |   |   |          |   |   | April 22, 1997 |   |
|                                                                       |   |          |   |   |          |   |   | to             |   |
|                                                                       |   | June 30, 2010 |   |   | June 30, 2009 |   |   | Jun 30, 2010   |   |
| Cash Flows From                                                            |   |          |   |   |          |   |   |           |   |
| Operating Activities                                                       |   |          |   |   |          |   |   |           |   |
|                                                                       |   |          |   |   |          |   |   |           |   |
|  Net Loss                                                             |   | $             | (7,129 | )      |          | $      | (5,645 | )              |   | $ | (195,219 | ) |
|                                                                       |   |          |   |   |          |   |   |           |   |   |   |   |
| Adjustments to reconcile net loss to                                       |   |          |   |   |          |   |   |           |   |   |   |   |
| net cash provided by operating activities                                  |   |          |   |   |          |   |   |           |   |   |   |   |
|                                                                       |   |          |   |   |          |   |   |           |   |   |   |   |
| Issuance of common stock for expenses                                      |   |          | -      |   |          |   | -      |           |   |   | 8,700 |   |
| Depreciation and amortization                                              |   |          | -      |   |          |   | -      |           |   |   | 28,650 |   |
| Changes in accounts payable                                                |   |          | 6,057  |   |          |   | 1,628  |           |   |   | 22,891 |   |
| Contributions to capital- expenses                                         |   |          | -      |   |          |   | -      |           |   |   | 100 |   |
|                                                                       |   |          |   |   |          |   |   |           |   |   |   |   |
|                                                                       |   |          |   |   |          |   |   |           |   |   |   |   |
| Net Cash Flows Used in Operations                                          |   |          | (1,072 | )      |          |   | (4,017 | )              |   |   | (134,878 | ) |
|                                                                       |   |          |   |   |          |   |   |           |   |   |   |   |
| Cash Flows From Investing Activities                                       |   |          |   |   |          |   |   |           |   |   |   |   |
|                                                                       |   |          |   |   |          |   |   |           |   |   |   |   |
| Purchase of patent                                                         |   |          | -      |   |          |   | -      |           |   |   | (28,650 | ) |
| Purchase office equipment                                                  |   |          | -      |   |          |   | -      |           |   |   | (2,096 | ) |
|                                                                       |   |          |   |   |          |   |   |           |   |   |   |   |
| Cash Flows From Financing Activities                                       |   |          |   |   |          |   |   |           |   |   |   |   |
|                                                                       |   |          |   |   |          |   |   |           |   |   |   |   |
| Advances from related party                                                |   |          | (4,325 | )      |          |   | 4,056  |           |   |   | 21,272 |   |
| Proceeds from issuance of common stock net of costs                        |   |          | 7,500  |   |          |   | -      |           |   |   | 146,712 |   |
|                                                                       |   |          |   |   |          |   |   |           |   |   |   |   |
| Net Change in Cash                                                         |   |          | 2,103  |   |          |   | 39     |           |   |   | 2,360 |   |
| Cash at Beginning of Period                                                |   |          | 257    |   |          |   | 82     |           |   |   | - |   |
|                                                                       |   |          |   |   |          |   |   |           |   |   |   |   |
|  Cash at End of Period                                                |   | $             | 2,360  |   |          | $      | 121    |           |   | $ | 2,360 |   |
|                                                                       |   |          |   |   |          |   |   |           |   |   |   |   |
|                                                                       |   |          |   |   |          |   |   |           |   |   |   |   |
|                                                                       |   |          |   |   |          |   |   |           |   |   |   |   |
| NON CASH FLOWS FROM OPERATING AND INVESTING ACTIVITIES                     |   |          |   |   |          |   |   |           |   |   |   |   |
|                                                                       |   |          |   |   |          |   |   |           |   |   |   |   |
| Issuance of 922,900 common shares for a patent- 2000                       |   |          |   |   |          |   |   |           |   | $ | 11,963 |   |
| Contributions to capital- expenses- 2001                                   |   |          |   |   |          |   |   |           |   |   | 100 |   |
|                                                                       |   |          |   |   |          |   |   |           |   |   |   |   |
| The accompanying notes are an integral part of these financial statements. |   |

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|   | ● | the ability to maintain current business and, if feasible, expand the marketing of products; |
|--------|---------|----------------------------------------------------------------------------------------------|

|   | ● | the ability to attract and retain new individual and retail customers; |
|--------|---------|------------------------------------------------------------------------|

|   | ● | the sufficiency of existing capital resources and the ability to raise additional capital to fund cash requirements for future operations; |
|--------|---------|--------------------------------------------------------------------------------------------------------------------------------------------|

|   | ● | uncertainties involved in the rate of growth of business and acceptance of the Company’s product and; |
|--------|---------|-------------------------------------------------------------------------------------------------------------|

|   | ● | anticipated size or trends of the market segments in which we compete and the anticipated competition in those markets; |
|--------|---------|-------------------------------------------------------------------------------------------------------------------------|

|   | ● | future capital requirements and our ability to satisfy its needs; |
|--------|---------|-------------------------------------------------------------------|

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| Exhibit 31.1 | Certification of C.E.O. and Principal Accounting Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
|--------------|---------------------------------------------------------------------------------------------------------------------|

| Exhibit 32.1 | Certification of C.E.O. and Principal Accounting 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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|                  | LILM, INC.                                                                                                         |
|-----------------------|--------------------------------------------------------------------------------------------------------------------|
|                  |                                                                                                               |
| Date: August 16, 2010 | By:  /S/   George I. Norman, III                                                          |
|                  |               George I Norman, III           |
|                  |               President, C.E.O. and Director |
|                  |               (Principal Accounting Officer) |

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