UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington
D.C. 20549




FORM
10-Q


(Mark
One)




x
            QUARTERLY
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934





For the quarterly period ended
September 30, 2009





 ̈
            TRANSITION
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934





For the transition period from
_________________ to _________________




Commission
File No.: 333-137210




ZEVOTEK,
INC.


(Exact
name of registrant as specified in its charter)





Delaware
              
              05-0630427(State or other jurisdiction of
                incorporation or organization)
              
              (I.R.S. Employer
                Identification No.)





134
Cedar Street


Nutley,
NJ 07110


(Address of principal
executive offices)





Issuer’s
telephone number:  (973) 667-4026


___________________


Check
whether the registrant filed all documents and reports required to be filed by
Section 12, 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 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  ̈  No  ̈





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.





Large accelerated filter  ̈
                    
                    
                    Accelerated filter  ̈Non-accelerated filter  ̈
                    (Do not check if a smaller reporting company)
                    
                    Smaller reporting company
      x





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




APPLICABLE
ONLY TO CORPORATE ISSUERS


As of
November 11, 2009, 1,173,461,407 shares of our common stock were
outstanding.




Transitional
Small Business Disclosure Format:    Yes   ̈
No  x







__________________


Quarterly
Report on Form 10-Q for the


Quarterly
Period Ended September, 2009





Table of
Contents





PagePART
      I. FINANCIAL INFORMATIONItem
      1. Financial StatementsCondensed
      Consolidated Balance Sheets as of September 30, 2009 (unaudited) and June
      30, 2009
                            2Condensed
      Consolidated Statements of Operations for the Three Months Ended
      September 30, 2009 and 2008 (unaudited):
                            3Condensed
      Consolidated Statement of Changes in Deficiency in Stockholders’ Equity
      for Period June 30, 2008 to September 30, 2009
(unaudited):
                            4Condensed
      Consolidated Statements of Cash Flows for the Three Months Ended September
      30, 2009  and 2008 (unaudited):
                            5Notes
      to Unaudited Condensed Consolidated Financial Statements September 30,
      2009:
                            6Item
      2. Management’s Discussion and Analysis of Financial Condition and Results
      of Operations
                            18Item
      3. Quantitative and Qualitative Disclosures About Market
    Risk
                            23Item
      4  Controls and Procedures
                            23PART
      II. OTHER INFORMATIONItem
      1. Legal Proceedings
                            24Item
      1A Risk Factor
                            24Item
      2. Unregistered Sales of Equity Securities and Use of
    Proceeds
                            24Item
      3. Defaults upon Senior Securities
                            24Item
      4. Submission of matters to a vote of security holders
                            24Item
      5. Other information
                            24Item
      6. Exhibits
                            25CERTIFICATION
      PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002CERTIFICATION
      PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002CERTIFICATION
      PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002CERTIFICATION
      PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002




1





PART
      1:
              FINANCIAL
      INFORMATION





ITEM
1 – FINANCIAL STATEMENTS


ZEVOTEK,
INC.


CONDENSED
CONSOLIDATED BALANCE SHEETS





September
      30,
                    
                    
                    June
      30,2009
                    
                    
                    2009(unaudited)ASSETSCurrent
      assets:Cash
                    
                    $
                    66
                    
                    
                    $
                    -Prepayment
                    
                    
                    -
                    
                    
                    
                    17,000Total
      current assets
                    
                    
                    66
                    
                    
                    
                    17,000Other
      assets:Licensing
      agreement
                    
                    
                    40,000
                    
                    
                    
                    40,000Total
      assets
                    
                    $
                    40,066
                    
                    
                    $
                    57,000LIABILITIES
      AND DEFICIENCY IN STOCKHOLDERS' EQUITYCurrent
      liabilities:Accounts
      payable and accrued expenses
                    
                    $
                    1,249,457
                    
                    
                    $
                    1,232,271Advances
      payable
                    
                    
                    62,827
                    
                    
                    
                    44,000Convertible
      notes payable and demand notes (net of debt discount of $119,484 and
      $166,595 as of September 30, 2009 and June 30, 2009,
      respectively)
                    
                    
                    142,010
                    
                    
                    
                    134,139Customer
      deposits
                    
                    
                    24,351
                    
                    
                    
                    24,351Total
      current liabilities
                    
                    
                    1,478,645
                    
                    
                    
                    1,434,761Long
      term portion of convertible notes payable (net of debt discount of
      $179,612 and $167,232 as of September 30, 2009 and June 30, 2009,
      respectively)
                    
                    
                    71,284
                    
                    
                    
                    39,664Deficiency
      in stockholders' equity:Series
      A Preferred stock, $0.00001 par value; 10,000,000 shares authorized;
      50,000 shares issued and outstanding as of September 30, 2009 and June 30,
      2009.
                    
                    
                    1
                    
                    
                    
                    1Series
      B Preferred stock, $0.00001 par value; 1,000,000 shares authorized;
      1,000,000 shares issued and outstanding as of September 30, 2009 and June
      30, 2009
                    
                    
                    10
                    
                    
                    
                    10Common
      stock, $0.00001 par value, 1,000,000,000 shares authorized; 670,885,307
      and 176,092,373 shares issued and outstanding as of September 30, 2009 and
      June 30, 2009, respectively
                    
                    
                    6,709
                    
                    
                    
                    1,761Common
      stock to be issued
                    
                    
                    -
                    
                    
                    
                    30Treasury
      stock, 40,000 shares as of September 30, 2009 and June 30,
      2009
                    
                    
                    -
                    
                    
                    
                    -Additional
      paid in capital
                    
                    
                    2,923,701
                    
                    
                    
                    2,726,796Accumulated
      deficit
                    
                    
                    (4,440,284
                    )
                    
                    
                    (4,146,023
                    )Total
      deficiency in stockholders' equity
                    
                    
                    (1,509,863
                    )
                    
                    
                    (1,417,425
                    )Total
      liabilities and deficiency in stockholders' equity
                    
                    $
                    40,066
                    
                    
                    $
                    57,000





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


2




ZEVOTEK,
INC


CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS


(UNAUDITED)





Three Months Ended September 30,2009
                      
                      
                      2008REVENUES:Sales
                      
                      $
                      -
                      
                      
                      $
                      -Cost
      of sales
                      
                      
                      -
                      
                      
                      
                      -Gross
      profit
                      
                      
                      -
                      
                      
                      
                      -OPERATING
      EXPENSES:Selling,
      general and administrative
                      
                      
                      201,785
                      
                      
                      
                      160,902Loss
      from operations
                      
                      
                      (201,785
                      )
                      
                      
                      (160,902
                      )OTHER
      (EXPENSE):Interest,
      net
                      
                      
                      (13,745
                      )
                      
                      
                      (11,390
                      )Amortization
                      
                      
                      (78,731
                      )
                      
                      ________(37,910
                      )(92,476
                      )
                      
                      
                      (49,300
                      )Net
      loss before provision for income taxes
                      
                      
                      (294,261
                      )
                      
                      
                      (210,202
                      )Income
      taxes
                      
                      
                      -
                      
                      
                      
                      -NET
      LOSS
                      
                      $
                      (294,261
                      )
                      
                      $
                      (210,202
                      )Net
      loss per common share, basic and fully diluted
                      
                      $
                      (0.00
                      )
                      
                      $
                      (0.02
                      )Weighted
      average number of common shares outstanding, basic and fully
      diluted
                      
                      
                      330,180,884
                      
                      
                      
                      9,567,700





The
accompanying notes are an integral part of these unaudited condensed
consolidated financial statements.


3





ZEVOTEK,
INC.


CONSOLIDATED
STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)


For
the Period from June 30, 2008 to September 30, 2009


(UNAUDITED)





Preferred stock
                  
                  
                  
                  
                  
                  
                  
                  
                  Common
                  
                  
                  
                  
                  
                  
                  
                  
                  AdditionalSeries A
                  
                  
                  Series B
                  
                  
                  Common stock
                  
                  
                  Stock To
                  
                  
                  Treasury stock
                  
                  
                  Paid in
                  
                  
                  AccumulatedShares
                  
                  
                  Amount
                  
                  
                  Shares
                  
                  
                  Amount
                  
                  
                  Shares
                  
                  
                  Amount
                  
                  
                  Be
                    Issued
                  
                  
                  Shares
                  
                  
                  Amount
                  
                  
                  Capital
                  
                  
                  Deficit
                  
                  
                  TotalBalance,
      June 30, 2008
                  
                  
                  50,000
                  
                  
                  $
                  1
                  
                  
                  
                  1,000,000
                  
                  
                  $
                  10
                  
                  
                  
                  3,784,920
                  
                  
                  $
                  38
                  
                  
                  $
                  -
                  
                  
                  
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  2,013,381
                  
                  
                  $
                  (3,324,225
                  )
                  
                  $
                  (1,310,795
                  )Common
      stock issued for services rendered
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  23,057,514
                  
                  
                  
                  231
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  188,992
                  
                  
                  
                  -
                  
                  
                  
                  189,223Common
      stock issued for previously incurred debt
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  1,553,939
                  
                  
                  
                  15
                  
                  
                  
                  
                  
                  
                  
                  -
                  
                  
                  
                  
                  
                  
                  
                  6,135
                  
                  
                  
                  -
                  
                  
                  
                  6,150Common
      stock issued for licensing agreement
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  50,000,000
                  
                  
                  
                  500
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  39,500
                  
                  
                  
                  -
                  
                  
                  
                  40,000Conversion
      of debt and accrued interest for common stock
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  97,696,000
                  
                  
                  
                  977
                  
                  
                  
                  30
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  20,939
                  
                  
                  
                  -
                  
                  
                  
                  21,946Common
      stock issued and held in treasury
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  40,000
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -Fair
      value of Beneficial conversion feature
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  457,849
                  
                  
                  
                  -
                  
                  
                  
                  457,849Net
      loss
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (821,798
                  )
                  
                  
                  (821,798
                  )BALANCE,
      June 30, 2009
                  
                  
                  50,000
                  
                  
                  $
                  1
                  
                  
                  
                  1,000,000
                  
                  
                  $
                  10
                  
                  
                  
                  176,092,373
                  
                  
                  $
                  1,761
                  
                  
                  $
                  30
                  
                  
                  
                  40,000
                  
                  
                  $
                  -
                  
                  
                  $
                  2,726,796
                  
                  
                  $
                  (4,146,023
                  )
                  
                  $
                  (1,417,425
                  )Common
      stock issued for services rendered
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  74,493,434
                  
                  
                  
                  745
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  115,348
                  
                  
                  
                  -
                  
                  
                  
                  116,093Conversion
      of debt and accrued interest for common stock
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  420,299,500
                  
                  
                  
                  4,203
                  
                  
                  
                  (30
                  )
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  37,557
                  
                  
                  
                  -
                  
                  
                  
                  41,730Fair
      value of Beneficial conversion feature
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  44,000
                  
                  
                  
                  -
                  
                  
                  
                  44,000Net
      loss
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (294,261
                  )
                  
                  
                  (294,261
                  )BALANCE,
      September 30, 2009
                  
                  
                  50,000
                  
                  
                  $
                  1
                  
                  
                  
                  1,000,000
                  
                  
                  $
                  10
                  
                  
                  
                  670,885,307
                  
                  
                  $
                  6,709
                  
                  
                  $
                  -
                  
                  
                  
                  40,000
                  
                  
                  $
                  -
                  
                  
                  $
                  2,923,701
                  
                  
                  $
                  (4,440,284
                  )
                  
                  $
                  (1,509,863
                  )





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


4





ZEVOTEK,
INC.


CONSOLIDATED
STATEMENTS OF CASH FLOWS


Three
Months Ended September 30, 2009 and 2008


(UNAUDITED)





2009
                      
                      
                      2008CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      loss
                      
                      $
                      (294,261
                      )
                      
                      $
                      (210,202
                      )Adjustments
      to reconcile net loss to net cash used in operating
      activities:Common
      stock issued for services rendered
                      
                      
                      116,093
                      
                      
                      
                      80,000Amortization
      of beneficial conversion feature
                      
                      
                      78,731
                      
                      
                      
                      37,910(Increase)
      decrease in:Prepayments
                      
                      
                      17,000
                      
                      
                      
                      -Other
      assets
                      
                      
                      -(Decrease)
      increase in:Accounts
      payable and accrued expenses
                      
                      
                      19,676
                      
                      
                      
                      21,245Net
      cash used in operating activities:
                      
                      
                      (62,761
                      )
                      
                      
                      (71,047
                      )CASH
      FLOWS FROM INVESTING ACTIVITIES:
                      
                      
                      -
                      
                      
                      
                      -CASH
      FLOWS FROM FINANCING ACTIVITIES:Proceeds
      from advances payable
                      
                      
                      62,827
                      
                      
                      
                      -Proceeds
      from loans
                      
                      
                      -
                      
                      
                      
                      65,000Net
      cash provided by financing activities
                      
                      
                      62,827
                      
                      
                      
                      65,000Net
      increase (decrease) in cash and cash equivalents
                      
                      
                      66
                      
                      
                      
                      (6,047
                      )Cash
      and cash equivalents, beginning of year
                      
                      
                      -
                      
                      
                      6,755Cash
      and cash equivalents, end of year
                      
                      $
                      66
                      
                      
                      $
                      708SUPPLEMENTAL
      DISCLOSURE OF CASH FLOW:Interest
      paid
                      
                      $
                      -
                      
                      
                      $
                      -Taxes
      paid
                      
                      $
                      -
                      
                      
                      $
                      -Common
      stock issued for services rendered
                      
                      $
                      116,093
                      
                      
                      $
                      80,000Exchange
      of convertible debenture for advances payable
                      
                      $
                      44,000
                      
                      
                      $
                      -Debt
      and accrued interest converted for shares of common stock
                      
                      $
                      41,730
                      
                      
                      $
                      10,324





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


5


ZEVOTEK,
INC.


NOTES
TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


SEPTEMBER
30, 2009





NOTE
A - SUMMARY OF ACCOUNTING POLICIES





A summary
of the significant accounting policies applied in the preparation of the
accompanying unaudited condensed consolidated financial statements
follows.




Business and Basis of
Presentation




ZEVOTEK,
INC. (“Company” or “Registrant”) was organized on December 19, 2005 under the
state laws of Delaware with an original name of “The Diet Coffee Company.” On
March 1, 2006, the Company changed its name Diet Coffee Inc, and on June 25,
2008 to the current existing name.




The
Company’s wholly-owned subsidiary is Ionic Bulb.com, Inc (Ionic Bulb) which was
formerly named Zevotek, Inc. Through its subsidiary, it markets and sells a
range of home care and household products. In May 2007, the Company entered into
a license agreement to sell an energy saving compact fluorescent light bulb
named the Ionic Bulb. The Company plans to market the Ionic Bulb through TV
infomercials, catalogs, magazines and major U.S. retail and specialty stores and
our websites www.ionic-bulb.com and www.zevo-tek.com.




General




The
accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with accounting principles generally accepted in the
United States of America.




In the
opinion of management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been included. The
consolidated financial statements include the accounts of the Registrant and its
wholly-owned subsidiary, Ionic Bulb.com, Inc. The Registrant formed its Ionic
Bulb.com, Inc. subsidiary on August 21, 2007 and started its operations during
the fiscal year ending June 30, 2008. All significant inter-company transactions
and balances have been eliminated in consolidation.




The
company has adopted the fiscal year end of June 30.




Reverse Stock
Split




Effective
June 26, 2008, the Company authorized for its common stock a 50:1 reverse stock
split Also, par value for the Preferred Stock and Common stock was changed to
$.00001 per share All preferred and common stock and related information have
been retroactively restated.




Revenue
Recognition




The
Company recognizes revenue from product sales  based on four basic
criteria must be met before revenue can be recognized: (1) persuasive evidence
of an arrangement exists; (2) delivery has occurred; (3) the selling price is
fixed and determinable; and (4) collectibility is reasonably assured.
Determination of criteria (3) and (4) are based on management's judgment
regarding the fixed nature of the selling prices of the products delivered and
the collectibility of those amounts. Provisions for discounts and rebates to
customers, estimated returns and allowances, and other adjustments are provided
for in the same period the related sales are recorded. The Company defers any
revenue for which the product was not delivered or is subject to refund until
such time that the Company and the customer jointly determine that the product
has been delivered or no refund will be required.




Consideration Paid to
Customers




The
Company offers our customers certain incentives in the form of cooperative
advertising arrangements, product markdown allowances, trade discounts, cash
discounts, and slotting fees. Markdown allowances, trade discounts, cooperative
advertising program participation and cash discounts are all recorded as
reductions of net sales. No customer incentives are included in sales for the
three months ended September 30, 2009 and 2008.


6





Use of
Estimates




The
preparation of the financial statement in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect certain reported amounts and disclosures. Accordingly, actual results
could differ from those estimates.




Foreign Currency
Translation




The
Company translates the foreign currency assets and liabilities at current
exchange rates, and related revenue and expenses are translated at average
exchange rates in effect during the period. Resulting translation adjustments
are recorded as a separate component in stockholders' equity. Foreign currency
translation gains and losses are included in the statement of
operations.




Cash and Cash
Equivalents




For the
purpose of the accompanying financial statements, all highly liquid investments
with a maturity of three months or less are considered to be cash
equivalents.




Inventories / Cost of Goods
Sold




The
Company has adopted a policy to record inventory at the lower of cost or market
determined by the first-in-first-out method. The elements of cost that comprise
inventory and cost good sold are FOB shipping point costs, freight and
destination charges, customs and importation fees and taxes, customer broker
fees (if any) and other related costs. Warehousing costs are charged to cost of
goods in the period the costs are incurred. The Company provides inventory
allowances based on estimates of obsolete inventories.




Inventories
consist of finished products available for sale to distributors and customers.
At September 30, 2009 and June 30, 2009 Finished Goods inventory was
$0.




Allowance for doubtful
accounts




The
Company maintains an allowance for doubtful accounts to reduce amounts to their
estimated realizable value, including reserves for customer and other receivable
allowances and incentives. In estimating the provision for doubtful accounts,
the company considers a number of factors including age of the accounts
receivable, trends and ratios involving the age of the accounts receivable and
the customer mix of each aging categories. As of September 30, 2009 and June 30,
2009 the allowance for doubtful accounts was $0.




Property and
Equipment




Property
and equipment are stated at cost. When retired or otherwise disposed, the
related carrying value and accumulated depreciation are removed from the
respective accounts and the net difference less any amount realized from
disposition, is reflected in earnings. For financial statement purposes,
property and equipment would be recorded at cost and depreciated using the
straight-line method over their estimated useful lives.




Impairment of Long-Lived
Assets




Long-lived
assets and certain identifiable intangibles held and used by the Company are
reviewed for impairment whenever events or changes in circumstances indicate
that the carrying amount of an asset may not be recoverable. Events relating to
recoverability may include significant unfavorable changes in business
conditions, recurring losses, or a forecasted inability to achieve break-even
operating results over an extended period. The Company evaluates the
recoverability of long-lived assets based upon forecasted discounted cash flows.
Should impairment in value be indicated, the carrying value of intangible assets
will be adjusted, based on estimates of future discounted cash flows resulting
from the use and ultimate disposition of the asset. Assets to be disposed of are
reported at the lower of the carrying amount or the fair value less disposal
costs.


7


Advertising




The
Company charges the costs of advertising to expenses as incurred. The Company
charged $0 to operations for the three months ended September 30, 2009 and 2008,
respectively.





Research and
Development




All
research and development costs must be charged to expense as incurred.
Accordingly, internal research and development costs are expensed as incurred.
Third-party research and development costs are expensed when the contracted work
has been performed or as milestone results have been achieved. Company-sponsored
research and development costs related to both present and future products are
expensed in the period incurred. The Company had no expenditures on research and
product development for three months ended September 30, 2009 and 2008,
respectively.




Stock Based
Compensation




The
Company made no employee stock-based compensation grants before June 30, 2007,
during the years ended June 30, 2009 and 2008 and during the three months ended
September 30, 2009; therefore has no unrecognized stock compensation related
liabilities or expense unvested or vested.





Loss per
Share




Basic and
diluted earnings (loss) per share amounts are computed based on net income
(loss) divided by the weighted average number of common shares outstanding.Potentially dilutive
shares of common stock realizable from the conversion of our convertible
debentures of 5,022,012,998 and 347,494,370, respectively at September 30, 2009
and 2008, are excluded from the computation of diluted net loss per share as
their inclusion would be anti-dilutive.





Concentration of Credit
Risk




Financial
instruments and related items, which potentially subject the Company to
concentrations of credit risk, consist primarily of cash, cash equivalents and
trade receivables. The Company places its cash and temporary cash investments
with high credit quality institutions. At times, such investments may be in
excess of the FDIC insurance limit.




Liquidity





As shown
in the accompanying unaudited condensed consolidated financial statements, the
Company’s current liabilities exceed its current assets by $1,478,579 as of
September 30, 2009. The Company has incurred a net loss of $294,261 and used
$62,761 in cash flows for operations during the three months ended September 30,
2009.





Reclassifications




Certain
reclassifications have been made in prior year's financial statements to conform
to classifications used in the current year.


8





Recent accounting
pronouncements





New Accounting Requirements
and Disclosures





Accounting Standards Codification
and GAAP Hierarchy —Effective for interim and annual periods
ending after September 15, 2009, the Accounting Standards Codification and
related disclosure requirements issued by the FASB became the single official
source of authoritative, nongovernmental GAAP. The ASC simplifies GAAP, without
change, by consolidating the numerous, predecessor accounting standards and
requirements into logically organized topics. All other literature not included
in the ASC is non-authoritative. We adopted the ASC as of September 30, 2009,
which did not have any impact on our results of operations, financial condition
or cash flows as it does not represent new accounting literature or
requirements.  All references to pre-codified U.S. GAAP have been
removed from this Form 10Q.





Determining Fair Value in Inactive
Markets — Effective for interim and annual periods beginning
after June 15, 2009, GAAP established new accounting standards for determining
fair value when the volume and level of activity for the asset or liability have
significantly decreased and the identifying transactions are not orderly. The
new standards apply to all fair value measurements when appropriate. Among other
things, the new standards:





•
            affirm
      that the objective of fair value, when the market for an asset is not
      active, is the price that would be received in a sale of the asset in an
      orderly transaction;





•
            clarify
      certain factors and provide additional factors for determining whether
      there has been a significant decrease in market activity for an asset when
      the market for that asset is not
active;





•
            provide
      that a transaction for an asset or liability may not be presumed to be
      distressed (not orderly) simply because there has been a significant
      decrease in the volume and level of activity for the asset or liability,
      rather, a company must determine whether a transaction is not orderly
      based on the weight of the evidence, and provide a non-exclusive list of
      the evidence that may indicate that a transaction is not orderly;
      and





•
            require
      disclosure in interim and annual periods of the inputs and valuation
      techniques used to measure fair value and any change in valuation
      technique (and the related inputs) resulting from the application of the
      standard, including quantification of its effects, if
      practicable.





These new
accounting standards must be applied prospectively and retrospective application
is not permitted. See Note K for disclosure of our fair value
measurements.




Financial
Instruments — Effective for interim and annual periods ending
after June 15, 2009, GAAP established new disclosure requirements for the
fair value of financial instruments in both interim and annual financial
statements. Previously, the disclosure was only required annually. We adopted
the new requirements as of September 30, 2009, which resulted in no change to
our accounting policies, and had no effect on our results of operations, cash
flows or financial position, but did result in the addition of interim
disclosure of the fair values of our financial instruments. See Note 4 for
disclosure of the fair value of our debt.





Subsequent
Events — Effective for interim and annual periods ending after
June 15, 2009, GAAP established general standards of accounting for and
disclosure of events that occur after the balance sheet date but before
financial statements are issued or are available to be issued. The new
requirements do not change the accounting for subsequent events; however, they
do require disclosure, on a prospective basis, of the date an entity has
evaluated subsequent events. We adopted these new requirements as of September
30, 2009, which had no impact on our results of operations, financial condition
or cash flows.





Consolidation— Effective
for interim and annual periods beginning after November 15, 2009, with
earlier application prohibited, GAAP amends the current accounting standards for
determining which enterprise has a controlling financial interest in a VIE and
amends guidance for determining whether an entity is a VIE. The new standards
will also add reconsideration events for determining whether an entity is a VIE
and will require ongoing reassessment of which entity is determined to be the
VIE’s primary beneficiary as well as enhanced disclosures about the enterprise’s
involvement with a VIE. We are currently assessing the future impact these new
standards will have on our results of operations, financial position or cash
flows.




Transfers and Servicing --
Effective for interim and annual periods beginning after November 15, 2009,
GAAP eliminates the concept of a qualifying special purpose entity, changes the
requirements for derecognizing financial assets and requires additional
disclosures. We are currently assessing the future impact these new standards
will have on our results of operations, financial position or cash
flows.


9





NOTE
B - GOING CONCERN MATTERS




The
accompanying unaudited condensed consolidated statements have been prepared on a
going concern basis, which contemplates the realization of assets and the
satisfaction of liabilities in the normal course of business. As shown in the
accompanying unaudited condensed consolidated financial statements, for the
three months ended September 30, 2009, the Company incurred a net loss of
$294,621. At September 30, 2009, the Company had a working capital deficit of
$1,478,579 and accumulated losses of $4,440,284. These factors among others may
indicate that the Company will be unable to continue as a going concern for a
reasonable period of time.




The
Company is actively pursuing additional equity financing through discussions
with private investors. There can be no assurance the Company will be successful
in its effort to secure additional equity financing. If operations and cash
flows improve through these efforts, management believes that the Company can
continue to operate. However, no assurance can be given that management's
actions will result in profitable operations or the resolution of its liquidity
problems.




The
Company's existence is dependent upon management's ability to develop profitable
operations and resolve its liquidity problems. Management anticipates the
Company will attain profitable status and improve its liquidity through the
continued developing, marketing and selling of its services and additional
equity investment in the Company. The accompanying unaudited condensed
consolidated financial statements do not include any adjustments that might
result should the Company be unable to continue as a going concern.





NOTE
C – LICENSING AGREEMENT AND DISTRIBUTION AGREEMENT





On
February 24, 2009, the Company entered into an Exclusive License and Sales
Agreement whereby the Company has worldwide exclusive rights to manufacture,
market use, sell, distribute and advertise certain licensed
products.  The license is on a year to year basis with automatic
renewal subject to the Company re-acquire listing on the OTC BB exchange by
February 14, 2010 and files all quarterly and annual reports by due dates,
inclusive of allowable extensions.





In
exchange for the exclusive license, the Company issued 50,000,000 shares of its
common stock.  The license was valued at the market price of the
underlying security.





In
addition, the Agreement also provides for the retention of Ryu as a
non-exclusive independent contractor sales representative to obtain purchase
orders for the Licensed Products on our behalf  In consideration for
his consulting services, we agreed to issue Ryu 750,000 shares of Common Stock
for each $100,000 in gross sales of the Licensed Product by Ryu (or any Sales
Associate hired by him) on or before February 28, 2010 up to a maximum of
75,000,000 shares of Common Stock (collectively, the “Incentive
Shares”).  The Incentive Shares shall not vest unless Ryu (or
any Sales Associate hired by him) shall have collectively procured gross sales
of $5,000,000 for the Licensed Products on or before February 28, 2010 (the
“Target”).  If
Ryu fails to achieve the Target, such Incentive Shares shall be null and void
and of no further force and effect.  In addition to the Incentive
Shares, we also agreed to pay Ryu a commission at the rate 50% of all Net
Profits (as defined on the Agreement) recognized by us on sales of the Licensed
Products made by Ryu (or Sales Associates hired by Ryu) on our behalf during the
period of this Agreement.





On April
29, 2009 the Company entered into a Distribution Agreement with a German
distributor pursuant to which the Company granted such distributor the exclusive
right (subject to minimum sales in the first year) to advertise, market and sell
our ionic bulb product in Germany, Austria, Switzerland, Liechtenstein, Czech
Republic, Slovakia, Hungary, Romania and Poland (the
“Territory”).  Upon satisfactory sales of an initial order (in
dealer’s reasonable discretion) of 5,000 units of the Company’s ionic bulb
product, the distributor agreed to purchase 5,000 units of the Company’s ionic
bulb product per month during the first year of the contact to maintain
exclusive status in the Territory.  The Company also granted
distributor a license to use certain marketing material to advertise and sell
the ionic bulb product.  Such distributor also agreed to maintain
general and product liability insurance in an amount of at least $1,000,000 and
agreed to name us as an additional insured under such policy.  The
term of the agreement is for one year and will be automatically renewed for
successive 1 year periods if the minimum quantities (5,000/month and
60,000/year) are met.


10





NOTE
E- ACCOUNTS PAYABLE AND ACCRUED EXPENSES




Accounts
payable and accrued liabilities are as follows:




September 30,
                        2009
                      
                      June 30,
                        2009(unaudited)Accounts
      payable
                      $
                      171,109
                      
                      $
                      195,181Accrued
      professional fees
                      
                      100,000
                      
                      
                      100,000Accrued
      payroll and payroll taxes
                      
                      809,860
                      
                      
                      799,280Accrued
      interest
                      
                      54,749
                      
                      
                      43,494Other
      accrued liabilities
                      
                      113,739
                      
                      
                      94,316Total
                      $
                      1,249,457
                      
                      $
                      1,232,271





NOTE
F - CONVERTIBLE NOTES PAYABLE AND DEMAND NOTES




September
                          30,
                          2009
                        
                        
                        June 30,
                          2009(unaudited)Notes
      Payable to Interstellar Holdings, LLC.Convertible
      term note (a)
                        
                        $
                        48,773
                        
                        
                        $
                        87,013Convertible
      term note ( b )
                        
                        
                        154,789
                        
                        
                        
                        155,789Convertible
      term note (c)
                        
                        
                        50,000
                        
                        
                        
                        50,000Convertible
      term note (d)
                        
                        
                        92,924
                        
                        
                        
                        92,924Convertible
      term note (e)
                        
                        
                        113,972
                        
                        
                        
                        113,972Convertible
      term note (f)
                        
                        
                        7,932
                        
                        
                        
                        7,932Convertible
      term note (g)
                        
                        
                        44,000
                        
                        
                        
                        -Subtotal
                        
                        
                        512,390
                        
                        
                        
                        507,630Less:
      discount on debt
                        
                        
                        ( 299,096
                        )
                        
                        
                        ( 333,827
                        )213,294
                        
                        
                        
                        173,803Less:
      current portion
                        
                        
                        (142,010
                        )
                        
                        
                        (134,139
                        )Long
      term debt
                        
                        $
                        71,284
                        
                        
                        $
                        39,664





a)
            On May 14, 2008, the Company
      entered into a convertible term note bearing interest at 10% per annum
      with a maturity date of May 14, 2010.   At any time at the
      option of the note holder, principal and interest payments may be paid in
      common stock at a conversion price of $0.0001 per share (see
      below).


b)
            On May 27, 2008, the Company
      entered into a convertible term note bearing interest at 10% per annum
      with a maturity date of May 27, 2010.   At any time at the
      option of the note holder, principal and interest payments may be paid in
      common stock at a conversion price of $0.0001 per share (see
      below).


c)
            On January 1, 2008, Company
      entered into a convertible term note for the principal amount of $50,000
      bearing interest at 7% per annum with a maturity date of June 30,
      2008.  This note is convertible into common stock at 90% of the
      common stock closing price at June 30, 2008, or approximately 370,000
      shares of common stock.  The Company is in default of payment of
      principal and interest on the note and the Company is in discussions with
      the note holder about amending the conversion terms to cure the
      default.


d)
            On January 8, 2009, the Company
      entered into a convertible term note bearing interest at 10% per annum
      with a maturity date of January 8, 2011.   At any time at
      the option of the note holder, principal and interest payments may be paid
      in common stock at a conversion price of $0.0001 per share (see
      below).


e)
                On
      March 9, 2009, the Company entered into a convertible term note bearing
      interest at 10% per annum with a maturity date of March 9,
      2011.   At any time at the option of the note holder,
      principal and interest payments may be paid in common stock at a
      conversion price of $0.0001 per share (see below).f)
                Of
      the convertible term notes entered into on May 14, 2008, certain notes
      having a principal amount of $7,932 and $7,932 as of September 30, 2009
      and June 30, 2009, respectively, were not amended with respect to their
      conversion price and, at any time at the option of the note holder,
      principal and interest payments may be paid in common stock at a
      conversion price of $0.001 per share (see below).g)
                On
      July 28, 2009, the Company entered into a convertible term note bearing
      interest at 10% per annum with a maturity date of July 28,
      2011.   At any time at the option of the note holder,
      principal and interest payments may be paid in common stock at a
      conversion price of $0.0001 per share (see
below).


11


In
accordance with Emerging Issues Task Force Issue 98-5, Accounting for
Convertible Securities with a Beneficial Conversion Features or Contingently
Adjustable Conversion Ratios ("EITF 98-5"), the Company recognized an imbedded
beneficial conversion feature present in the notes. The Company allocated a
portion of the proceeds equal to the intrinsic value of that feature to
additional paid in capital. The Company recognized and measured an aggregate of
$314,049 of the proceeds, which was equal to the intrinsic value of the imbedded
beneficial conversion feature at the time, to additional paid in capital and a
discount against the Notes issued during the year ended June 30, 2008. The debt
discount attributed to the beneficial conversion feature was originally
amortized over the Notes maturity period (two years) as interest expense,
adjusted for conversion of debt to common stock. In January 2009 through March
2009, the Company restructured certain Notes to a conversion rate of $0.0001 per
share with a two year term and accordingly fully amortized the remaining debt
discount of $206,160. In accordance with Emerging Issues Task Force Issue 98-5,
Accounting for Convertible Securities with a Beneficial Conversion Features or
Contingently Adjustable Conversion Ratios ("EITF 98-5"), the Company recognized
an imbedded beneficial conversion feature present in the notes. The Company
recognized and measured an aggregate of $457,849 of the proceeds, which is equal
to the intrinsic value of the imbedded amended beneficial conversion feature, to
additional paid in capital and a discount against the Notes issued during the
year ended June 30, 2009. The remaining debt discount attributed to the original
beneficial conversion feature was expensed at the time the Notes were amended
and the $457,849 assigned to the amended beneficial conversion feature is being
amortized over the Notes maturity period.





On July
28, 2009, the Company issued a $44,000 convertible note having the same terms as
the amended outstanding convertible notes.  The Company recognized and
measured an aggregate of $44,000 of the proceeds, which is equal to the
intrinsic value of the imbedded amended beneficial conversion feature, to
additional paid in capital and a discount against the note issued, with the
discount being amortized over the note’s two-year term.  During the
three months ended September 30, 2009 and 2008, amortization related to the
beneficial conversion feature on the convertible notes was $78,731 and $37,910,
respectively.





NOTE
G – STOCKHOLDERS’ EQUITY





Preferred
Stock




The
Company has authorized 10,000,000 shares of Preferred Stock of which 50,000
shares have been designated as Series A Preferred stock, par value $0.00001, and
1,000,000 shares have been designated as Series B Preferred Stock, par
value $0.00001 within the limitations and restrictions stated in the Certificate
of Incorporation of the Company.





The
Company issued of 50,000 shares of Series A - Preferred stock; non convertible.
Each share of the Series A- Preferred stock is entitled to 10,000 votes on all
matters submitted to the stockholders of the Company. The holders of the Series
A-Preferred stock are not granted any preference upon the liquidation,
dissolution or winding up of the business of the Company.





The
Company designated and issued 1,000,000 shares of Series B Preferred
Stock.  On May 14, 2008 the Company and an unrelated third party
entered into an exchange agreement under which the third party note holder
exchanged a $21,026 promissory note for 1,000,000 shares of Series B Preferred
Stock.   Each share of Series B Preferred Stock is entitled to
5,000 votes on all matters submitted to the stockholders of the
Company.





Common
stock





On
October 14, 2009, the Company filed an amendment to its certificate of
incorporation with the Delaware Secretary of State to: increase the
Corporation’s authorized common stock from 1,000,000,000 shares to 5,000,000,000
shares. This amendment was unanimously approved by the Company’s board of
directors and by a majority of Company stockholders by written
consent.





The
Company effectuated a 1 for 50 reverse stock split on June 26, 2008. All common
stock and related information has been retroactively restated. In addition,
contemporaneously with the stock split the Company changed the par value of its
Common Stock to $0.00001.





At
September 30, 2009 and June 30, 2009, common shares issued and outstanding were
670,885,307 and 176,092,373, respectively.


12





On
September 11, 2007, the Company adopted its 2007 Stock Incentive Plan (the “2007
Plan”). The Company is permitted to issue up to 21,450,000 shares of common
stock under the Plan in the form of stock options, restricted stock awards, and
stock awards to employees, non-employee directors, and outside
consultants.  As of September 30, 2009, 14,429,000 shares have been
issued under this 2007 Plan.





On
December 13, 2007, the Company adopted its 2007 Stock Incentive Plan No. 2. (the
“2007 Plan #2”). The Company is permitted to issue up to 17,994,000 shares of
common stock under the Plan in the form of stock options, restricted stock
awards, and stock awards to employees, non-employee directors, and outside
consultants.  As of September 30, 2009, 359,880 shares have been
issued under this 2007 Plan #2.





On
February 21, 2008 the Company adopted its 2008 Stock Incentive Plan. The Company
is permitted to issue up to 33,000,000 shares of common stock under the Plan in
the form of stock options, restricted stock awards, and stock awards to
employees, non-employee directors, and outside consultants. As of September 30,
2009, 21,340,685 shares have been issued under this Plan.





On
February 21, 2008 the Company adopted its 2008 California Stock Incentive Plan.
The Company is permitted to issue up to 33,000,000 shares of common stock under
the Plan in the form of stock options, restricted stock awards, and stock awards
to employees, non-employee directors, and outside consultants.  As of
September 30, 2009, 32,925,190 shares have been issued under this
Plan.





On
September 15, 2009 the Company adopted its 2009 Stock Incentive Plan. The
Company is permitted to issue up to 136,715,000 shares of common stock under the
Plan in the form of stock options, restricted stock awards, and stock awards to
employees, non-employee directors, and outside consultants.  As of
September 30, 2009, no shares have been issued under this Plan.





On
September 15, 2009 the Company adopted its 2009 California Stock Incentive Plan.
The Company is permitted to issue up to 136,715,000 shares of common stock under
the Plan in the form of stock options, restricted stock awards, and stock awards
to employees, non-employee directors, and outside consultants.  As of
September 30, 2009, 25,000,0000 shares have been issued under this
Plan.





During
the three months ending September 30, 2009, the Company issued 74,493,434 shares
of common stock, valued at $116,093 for services and expenses.





During
the three months ended September 30, 2009, the Company converted debt and
accrued interest of $41,730 into 417,299,500 shares of common stock, excluding
3,000,000 shares the Company was committed to issue as of June 30,
3009.





Treasury
Stock





As of
September 30, 2009 and June 30, 2009, the Company had 40,000 shares of common
stock held in treasury that are carried at $0 based on a $0.00001 par
value.





NOTE
H - INCOME TAXES




The
Company recognizes deferred tax liabilities and assets for the expected future
tax consequences of events that have been included in the financial statement or
tax returns.




Under
this method, deferred tax liabilities and assets are determined based on the
difference between financial statements and tax basis of assets and liabilities
using enacted tax rates in effect for the year in which the differences are
expected to reverse. Temporary differences between taxable income reported for
financial reporting purposes and income tax purposes are insignificant. A
management estimate that at September 30, 2009, the Company has available for
federal income tax purposes a net operating loss carry forward of approximately
$2.5 million expiring by the year 2028, that may be used to offset future
taxable income. Due to significant changes in the Company's ownership, the
future use of its existing net operating losses may be limited.




The
Company has provided a valuation reserve against the full amount of the net
operating loss benefit, since in the opinion of management based upon the
earnings history of the Company; it is more likely than not that the benefits
will not be realized. Components of deferred tax assets as of September 30, 2009
are as follows:


13




Net
      operating loss carry forward
                    
                    $
                    1,800,000Valuation
      allowance
                    
                    
                    (1,800,000
                    )Net
                    
                    $
                    0




The
Company has not filed their federal or state income tax returns for fiscal years
ended June 30, 2006, 2007, 2008 and 2009.





NOTE
I - STOCK OPTIONS AND WARRANTS





During
the three months ended September 30, 2009, the Company did not issue any stock
warrants.  As of September 30, 2009, no warrants are
outstanding.





On
December 13, 2007, the Company agreed to grant Mr. Engel options to purchase
72,000 shares of common stock, which options would vest at a rate of 2,000
shares per month. These options have not yet been deemed granted.




NOTE
J - COMMITMENTS AND CONTINGENCIES





Employment
Agreement




On
December 13, 2007, the Company entered into an employment agreement with Adam
Engel pursuant to which the Company employs Mr. Engel as President, Chief
Executive Officer, Chief Financial Officer, Treasurer and Secretary. The
agreement is for an initial term of three years and provides for an annual base
salary during the term of the agreement of $120,000, payable either in cash or
stock. The Company also agreed to grant Mr. Engel options to purchase 72,000
shares of Company common stock with an exercise price of $0.25 per share (which
price shall not be less than 85% of the “fair market value” of the Company’s
common stock on the date of grant), which options would vest at a rate of 2,000
shares per month. These options have not yet been granted. In addition to salary
and benefit provisions, the agreements include defined commitments should we
terminate his employment without cause and 24 month non-compete/non solicitation
terms.  As of September 30, 2009, the Company owes $163,293 in unpaid
salary.





U.S. Federal Trade
Commission Settlement




On March
26, 2007, the Company received a letter from the U.S. Federal Trade Commission
(“FTC”) whereby the Company was informed that the FTC was conducting an
investigation into advertising claims made for the Company’s weight loss product
known as “Slim Coffee.”  The purpose of the investigation was to determine
whether the Company, in connection with its sales of Slim Coffee, engaged in
unfair or deceptive acts or practices and false advertising. The FTC threatened
to file a complaint in the United States District Court, Southern District of
New York, alleging false advertising, unless the Company and the FTC could reach
a satisfactory resolution to the matter.  A negotiated settlement has been
reached with the FTC under which the Company, its officers and directors did not
admit any wrongdoing.  On January 10, 2008, pursuant to a stipulated final
judgment and order, the United States District Court, Southern District of New
York, entered a final judgment and order against the Company in the amount of
$923,910.  The full amount of the judgment, and payment of any portion of
it is suspended and cannot be reinstated so long as (a) the Company abides by
the reporting and monitoring requirements of the judgment, (b) does not make
false advertising claims in connection with any of its products in the future,
and (c) its past financial disclosures to the FTC were materially
accurate. Company to comply with terms of the stipulation and do not
anticipate incurring a liability for the judgment, however there can be no
assurance of compliance.  Should Company fail to comply with the FTC’s
final judgment, this could have a material adverse on Companies business,
financial condition and results of operations.





Royalty commitment and
Agreement Termination




On May
18, 2007, the Company entered into a Consulting, License and Supply Agreement
with Jason Ryu, pursuant to which the Company licensed the right to market and
sell a fluorescent light bulb that contains an air purifying microchip ion
emitter from Mr. Ryu. In exchange for this license the Company agreed to pay Mr.
Ryu a royalty of $0.20 per unit for the first 1.5 million units sold by the
Company and the lesser of $0.15 per unit or 5% of manufacturing costs for all
additional units. The initial term of this agreement was for two years and was
to be automatically be renewed for subsequent two year periods if at least 5
million units are old by the Company during each period. Within ninety days from
the date of this Agreement, the Company was required to place an order not less
than 100,000 units and at least 600,000 units each quarter
thereafter.  Mr. Ryu sent notice to the Company that license agreement
shall continue on a non-exclusive basis.


14


On
February 24, 2009, the Company entered into an Exclusive License and Sales
Agreement whereby the Company has worldwide exclusive rights to manufacture,
market use, sell, distribute and advertise certain licensed
products.  The license is on a year to year basis with automatic
renewal subject to the Company re-acquire listing on the OTC BB exchange by
February 14, 2010 and files all quarterly and annual reports by due dates,
inclusive of allowable extensions.  In exchange for the exclusive
license, the Company issued 50,000,000 shares of its common stock.





In
addition, the Agreement also provides for the retention of Ryu as a
non-exclusive independent contractor sales representative to obtain purchase
orders for the Licensed Products on companies behalf  In consideration
for his consulting services, Company agreed to issue Ryu 750,000 shares of
Common Stock for each $100,000 in gross sales of the Licensed Product by Ryu (or
any Sales Associate hired by him) on or before February 28, 2010 up to a maximum
of 75,000,000 shares of Common Stock (collectively, the “Incentive
Shares”).  The Incentive Shares shall not vest unless Ryu (or
any Sales Associate hired by him) shall have collectively procured gross sales
of $5,000,000 for the Licensed Products on or before February 28, 2010 (the
“Target”).  If
Ryu fails to achieve the Target, such Incentive Shares shall be null and void
and of no further force and effect.  In addition to the Incentive
Shares, Company also agreed to pay Ryu a commission at the rate 50% of all Net
Profits (as defined on the Agreement) recognized by Company on sales of the
Licensed Products made by Ryu (or Sales Associates hired by Ryu) on Companies
behalf during the period of this Agreement.




Distribution
Agreement





On April
29, 2009 the Company entered into a Distribution Agreement with a German
distributor pursuant to which the Company granted such distributor the exclusive
right (subject to minimum sales in the first year) to advertise, market and sell
our ionic bulb product in Germany, Austria, Switzerland, Liechtenstein, Czech
Republic, Slovakia, Hungary, Romania and Poland (the
“Territory”).  Upon satisfactory sales of an initial order (in
dealer’s reasonable discretion) of 5,000 units of the Company’s ionic bulb
product, the distributor agreed to purchase 5,000 units of the Company’s ionic
bulb product per month during the first year of the contact to maintain
exclusive status in the Territory.  The Company also granted
distributor a license to use certain marketing material to advertise and sell
the ionic bulb product.  Such distributor also agreed to maintain
general and product liability insurance in an amount of at least $1,000,000 and
agreed to name us as an additional insured under such policy.  The
term of the agreement is for one year and will be automatically renewed for
successive 1 year periods if the minimum quantities (5,000/month and
60,000/year) are met.





Payroll
Taxes




At
September 30, 2009, the Company is delinquent with filing and remitting payroll
taxes of approximately $83,000 including estimated penalties and interest
related to payroll taxes withheld since April 2007. The Company has recorded the
delinquent payroll taxes, which are included in accrued expenses on the balance
sheet. Although the Company has not entered into any formal repayment agreements
with the respective tax authorities, management plans to make payment as funds
become available. Penalties and interest amounts are subject to increase based
on a number of factors that can cause the estimated liability to increase
further. Interest and penalties were accrued in an amount estimated to cover the
ultimate liability.


15


Sales
Taxes




At June
30, 2009, the Company is delinquent with remitting sales taxes of approximately
$16,000, including related estimated penalties and interest related to sales
taxes withheld since 2006 in the state of New York. The Company has recorded the
delinquent sales taxes, which are included in accrued expenses on the balance
sheet. Although the Company has not entered into any formal repayment agreements
with the respective tax authorities, management plans to make payment as funds
become available. Penalties and interest amounts are subject to increase based
on a number of factors that can cause the estimated liability to increase
further. Interest and penalties were accrued in an amount estimated to cover the
ultimate liability.





NOTE
K - FAIR VALUE MEASUREMENT





Fair Value Measurements under
GAAP clarifies the principle that fair value should be based on the assumptions
market participants would use when pricing an asset or liability and establishes
a fair value hierarchy that prioritizes the information used to develop those
assumptions. Under the standard, fair value measurements are separately
disclosed by level within the fair value hierarchy.  It only applies
to accounting pronouncements that already require or permit fair value measures,
except for standards that relate to share-based payments





Level 1 -
Quoted prices in active markets for identical assets or
liabilities.





Level 2 -
Observable inputs other than Level 1 prices such as quoted prices for similar
assets or liabilities; quoted prices in markets with insufficient volume or
infrequent transactions (less active markets); or model-derived valuations in
which all significant inputs are observable or can be derived principally from
or corroborated by observable market data for substantially the full term of the
assets or liabilities.





Level 3 -
Unobservable inputs to the valuation methodology that are significant to the
measurement of fair value of assets or liabilities.





To the
extent that valuation is based on models or inputs that are less observable or
unobservable in the market, the determination of fair value requires more
judgment.  In certain cases, the inputs used to measure fair value may fall
into different levels of the fair value hierarchy.  In such cases, for
disclosure purposes, the level in the fair value hierarchy within which the fair
value measurement is disclosed and is determined based on the lowest level input
that is significant to the fair value measurement.





The
carrying value of the Company’s cash and cash equivalents, accounts receivable,
prepayments, accounts payable, short-term borrowings (including convertible
notes payable), and other current assets and liabilities approximate fair value
because of their short-term maturity.  All other significant financial
assets, financial liabilities and equity instruments of the Company are either
recognized or disclosed in the consolidated financial statements together with
other information relevant for making a reasonable assessment of future cash
flows, interest rate risk and credit risk. Where practicable the fair values of
financial assets and financial liabilities have been determined and disclosed;
otherwise only available information pertinent to fair value has been
disclosed.





The
following table sets forth the Company’s short investments as of September 30,
2009, which are measured at fair value on a recurring basis by level within the
fair value hierarchy.  THe table is classified based on the lowest
level of input that is significant to the fair value measurement:





Quoted
                  Prices in
                  Active
                  Markets for
                  Identical
                  Instruments
                  Level 1
                
                
                Significant
                  Other
                  Observable
                  Inputs
                  Level 2
                
                
                Significant
                  Unobservable
                  Inputs
                  Level 3
                
                
                Assets at
                  Fair ValueAssets:License
      agreement
                
                $
                -
                
                
                $
                -
                
                
                $
                40,000
                
                
                $
                40,000Liabilities:Advances
      payable
                
                $
                -
                
                
                $
                (62,827)
                
                
                $
                -
                
                
                $
                (62,827
                )Convertible
      notes payable
                
                $
                -
                
                
                $
                (213,294)
                
                
                $
                -
                
                
                $
                (213,294
                )


16


NOTE
L – SUBSEQUENT EVENTS





The
Company has evaluated subsequent event through the date of this filing (November
16, 2009).





Since
September 30, 2009, the Company issued an aggregate of 15,000,000 shares of
common stock to consultants for services rendered and 7,000,000 shares to the
Company’s Chief Executive Officer.





Since
September 30, 2009, the Company issued an aggregate of 480,576,100 shares of
common stock upon conversion of convertible promissory notes.





In
September 2009, the Company and Star Funding agreed to terminate their Supply
Agreement and Factoring Agreement, effective at the end of the initial term on
October 23, 2009.  The parties agreed to exchange mutual releases in
connection with the termination.





On
October 14, 2009, the Company filed an amendment to its certificate of
incorporation with the Delaware Secretary of State to: increase the Company’s
authorized common stock from 1,000,000,000 shares to 5,000,000,000 shares. This
amendment was unanimously approved by the Company’s board of directors and by a
majority of its stockholders by written consent.


17


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





The
following discussion and analysis should be read in conjunction with our
unaudited consolidated financial statements and related notes included in this
report.  This report contains “forward-looking statements” within the
meaning of the Private Securities Litigation Reform Act of 1995.  The
statements contained in this report that are not historic in nature,
particularly those that utilize terminology such as “may,” “will,” “should,”
“expects,” “anticipates,” “estimates,” “believes,” or “plans” or comparable
terminology are forward-looking statements based on current expectations and
assumptions.  Various risks and uncertainties could cause actual
results to differ materially from those expressed in forward-looking
statements.





The
forward-looking events discussed in this annual report, the documents to which
we refer you and other statements made from time to time by us or our
representatives, may not occur, and actual events and results may differ
materially and are subject to risks, uncertainties and assumptions about
us.  For these statements, we claim the protection of the “bespeaks
caution” doctrine.  All forward-looking statements in this document
are based on information currently available to us as of the date of this
report, and we assume no obligation to update any forward-looking
statements.  Forward-looking statements involve known and unknown
risks, uncertainties and other factors that may cause the actual results to
differ materially from any future results, performance or achievements expressed
or implied by such forward-looking statements.





General





The following discussion and analysis
is provided to increase the understanding of, and should be read in conjunction
with, our unaudited financial statements and related notes included elsewhere in
this Report.  Historical results and percentage relationships among
any amounts in these financial statements are not necessarily indicative of
trends in operating results for any future period. This report contains “forward
looking statements” within the meaning of the Private Securities Litigation
Reform Act of 1995.  The statements, which are not historical facts
contained in this Report, including this Management’s discussion and analysis of
financial condition and results of operation, and notes to our unaudited
financial statements, particularly those that utilize terminology such as “may”
“will,” “should,” “expects,” “anticipates,” “estimates,” “believes,” or “plans”
or comparable terminology are forward-looking statements. Such statements are
based on currently available operating, financial and competitive information,
and are subject to various risks and uncertainties. Future events and our actual
results may differ materially from the results reflected in these
forward-looking statements. Factors that might cause such a difference include,
but are not limited to, dependence on existing and future key strategic and
strategic end-user customers, limited ability to establish new strategic
relationships, ability to sustain and manage growth, variability of operating
results, our expansion and development of new service lines, marketing and other
business development initiatives, the commencement of new engagements,
competition in the industry, general economic conditions, dependence on key
personnel, the ability to attract, hire and retain personnel who possess the
technical skills and experience necessary to meet the service requirements of
our clients, the potential liability with respect to actions taken by our
existing and past employees, risks associated with international sales, and
other risks described herein and in our other filings with the Securities and
Exchange Commission.





The safe harbor for forward-looking
statements provided by Section 21E of the Securities Exchange Act of 1934
excludes issuers of “penny stock” (as defined under Rule 3a51-1 of the
Securities Exchange Act of 1934). Our common stock currently falls within that
definition





All
forward-looking statements in this document are based on information currently
available to us as of the date of this report, and we assume no obligation to
update any forward-looking statements.  Forward-looking statements
involve known and unknown risks, uncertainties and other factors that may cause
the actual results to differ materially from any future results, performance or
achievements expressed or implied by such forward looking
statements.





The
following discussion of our financial condition and results of operations should
be read in conjunction with our unaudited financial statements and related notes
appearing elsewhere in this report.


18


Company
History





We were
incorporated in the State of Delaware on December 19, 2005 and amended our
Certificate of Incorporation on March 1, 2006. On March 1, 2006, we changed our
name from The Diet Coffee Company, Inc. to Diet Coffee, Inc. and on June 26,
2008, we changed our name to Zevotek, Inc.   Our principal
executive offices are located at 134 Cedar Street, Nutley, NJ 07110. Our
telephone number is (973) 667-4026.




We are
engaged in the direct marketing and distribution of consumer
products.  Our first offering was the Slim Coffee product line, which
featured coffee beverages. We no longer sell or market Slim Coffee products and
do not anticipate selling Slim Coffee products in the fiscal year ended June 30,
2008.  In May 2007, we entered into a license agreement to sell
anenergy
saving compact fluorescent light bulb named the Ionic Bulb, which agreement was
replaced by an Exclusive License and Sales Agreement dated February 24, 2009
under which we currently retain the exclusive worldwide rights to manufacture,
market, use, sell, distribute and advertise the Ionic Bulb.  We plan
to market the Ionic Bulb through TV infomercials, catalogs, magazines and major
U.S. retail and specialty stores and our websites www.zevo-tek.com
and  www.ionicbulb.com.





Recent
Developments





In April
2009, we signed a Distribution Agreement with a German distributor pursuant to
which we granted such distributor the exclusive right (subject to minimum sales
in the first year) to advertise, market and sell our ionic bulb product in
Germany, Austria, Switzerland, Liechtenstein, Czech Republic, Slovakia, Hungary,
Romania and Poland.





On August
25, 2009 we announced that we had completed an extensive search in order to
increase sales and presence in the retail markets and is close to completing a
sales partnership with ELS Group LLC of Danbury, CT.  Since that
announcement, we have terminated negotiations with ELS Group due to
disagreements which arose during negotiations of the definitive
agreement.  We are continuing our efforts to determine the most
efficient and effective way to increase sales in our target
markets.





In
September 2009, we signed a media buying agreement with a Diray TV, a media
buying agency, for buying TV airtime to advertise our ionic bulb
product.





In
October 2009, we signed a sales processing and warehousing agreement with
Imagine Fulfillment Services to handle billing and shipping for orders of our
ionic bulb product.





On
October 30, 2009, we issued a press release announcing that an infomercial
featuring our ionic bulb would start airing in Europe in the first week of
November 2009.  Due to the backlog with our media partner the airing
has been delayed.  We currently expect the infomercial to air in
December 2009.




Comparison
of Three Months Ended September 30, 2009 To September 30, 2008




Results
of Operations




Revenue




Our sales
were $0 for the three months ended September 30, 2009 and
2008.  We recently signed a distribution agreement with a European
distributor and have also produced a new infomercial for our ionic bulb product
and expect our sales to increase in fiscal 2010 as a result.





Cost
of Sales





Our cost
of sales were $0 for the three months ended September 30, 2009 and
2008.  This is attributable to the fact that we had no sales of
products in the three months ended September 30, 2009 and 2008.





Gross
Profit




Our gross
profit was $0 for the three months ended September 30, 2009 and 2008. This is
attributable to the fact that we had no sales of products in the three months
ended September 30, 2009 and 2008.


19





Operating
expenses





Operating
expenses increased to $210,785 in the three months ended September 30, 2009, or
approximately 25.4%, from $160,902 for the comparable period in 2008. This
increase in primarily attributable to increased payments to consultants in the
three months ended September 30, 2009 as compared the same period in
2008.





Net
Income and Loss




Our net
loss was $294,261 for the three months ended September 30, 2009 and
$210,202  for the three months ended September 30, 2008. We recently
began operating our business, including efforts to market and sell our products,
and revenues generated were not sufficient to cover our operating costs. We are
continuing our efforts to market and sell our products in order to generate a
higher sales volume and unless and until such time as we generate substantially
higher sales volume, we will continue realize net losses.





Our
net loss per common share was ($0.00) (basic and diluted) for three months
ended September 30, 2009 as compared to our ($0.02) (basic and diluted) for the
three months ended September 30, 2008.




The weighted average number of
outstanding shares was 330,180,884 (basic and diluted) for three months
ended September 30, 2009 as compared to 9,567,700 (basic and diluted) for the
three months ended September 30, 2008.





Liquidity
and Capital Resources




Overview




As of
September 30, 2009, we had a working capital deficit of
$1,478,579.  As of June 30, 2009, we had a working capital deficit of
$1,417,761. Our cash position at September 30, 2009 was $66 as compared to $0 at
June 30, 2009.





For three
months ended September 30, 2009, net cash used in operating activities was
$62,761 consisting primarily of a net loss of $294,261, adjusted primarily for
common stock issued for services of $116,093 and an amortization of beneficial
conversion feature related to our convertible promissory notes of
$78,731.





Cash
provided by financing activities totaled $62,827 from advances
payable.





We expect
capital expenditures to be nominal for the year ending June 30, 2010. These
anticipated expenditures are for continued investments in property and equipment
used in our business and software for our accounting and information
systems.




Financing




As of
September 30, 2009, we have raised an aggregate of $1,319,801 in financing
through the issuance debt and equity securities





Star
Funding Financing Facility—To be terminated at the end of the Initial Term on
October 23, 2009





On
October 23, 2007, Ionicbulb.com, Inc. (f/k/a Zevotek, Inc.), our wholly owned
subsidiary, entered into a Supply Agreement with Star Funding, Inc. pursuant to
which Star Funding will provide, on a discretionary basis, purchase order
financing up to $2.5 million to facilitate Ionbulb.com Inc’s sale of its Ionic
Bulb product. This purchase order financing may be made via direct payment to
Ionbulb.com Inc’s suppliers, issue or cause the issuance of letters of credit,
and/or advances to Ionicbulb.com. Ionicbulb.com will be required to pay Star
Funding an amount equal to 2.5% of all “Expenses” (as defined) associated with
the purchase of any Goods under the Agreement, including letter of credit fees,
if any, which will equal 0.25% of the face amount of any letter of credit. As
collateral security for all of Ionicbulb.com Inc.’s obligations under the Supply
Agreement, Ionicbulb.com granted Star Funding a security interest in all of
Ionicbulb.com’s personal property and fixtures. The Supply Agreement is for an
initial term of two years, and will be automatically extended for additional 1
year terms unless terminated by either party with 60 days’ prior written notice
before the end of the initial or any renewal period.


20


On
October 23, 2007, Ionicbulb.com also entered into a Factoring Agreement with
Star Funding pursuant to which Star Funding has agreed to purchase certain
accounts receivables of Ionicbulb.com under the Supply Agreement. Ionicbulb.com
has agreed to pay Star Funding a factoring commission of 1.5% of the gross
amount of each receivable under the Factoring Agreement provided, however, that
Ionicbulb.com has agreed that Star Funding will receive $15,000 in fees under
the Supply Agreement and the Factoring Agreement in the first 12 months and
Ionicbulb.com has agreed to pay Star Funding the shortfall by which all fees and
commissions are less than $15,000. As collateral security for all of
Ioncibulb.com’s obligations under the Supply Agreement, Ioncibulb.com granted
Star Funding a security interest in all of Ionicbulb.com’s personal property and
fixtures. The Supply Agreement is for an initial term of two years, and will be
automatically extended for additional 1 year terms unless terminated by
Ionicbulb.com upon 60 days’ prior written notice before the end of the initial
or any renewal period, or by Star Funding upon 30 days prior written
notice.





To
further secure Ionicbulb.com’s obligations under the Supply Agreement and the
Factoring Agreement (as discussed below), we have executed (i) a guarantee and
(ii) an assignment of that certain License and Supply Agreement under which is
obtained its distribution rights for the Ionic Bulb. In addition, Adam Engel,
President of Zevotek and Ionicbulb.com, executed an Anti Fraud and Performance
Agreement under which Mr. Engel guaranteed Ionicbulb.com’s representations and
warranties under the Supply and Factoring Agreements. Mr. Engel explicitly
agrees that if any receivable purchased by Star Funding is not paid when due
(subject to certain exceptions), such non-payment shall be presumed to be the
result of a breach of Ionicbulb.com’s representations and warranties under the
Supply Agreement and/or the Factoring Agreement at which time Star Funding may
be able to execute on the (i) collateral pledged under the Supply and Factoring
Agreements and (ii) license for distribution of the Ionic bulb
product.





In
September 2009, Zevotek and Star Funding agreed to terminate these agreements,
effective at the end of the initial term on October 23, 2009.  The
parties agreed to exchange mutual releases in connection with the
termination.





Financing
Needs




Since our
inception on December 19, 2005 to September 30, 2009, we have generated revenues
of $1,205,342 and have incurred a net loss of $4,440,284. It is hoped that we
will begin to achieve sustainable revenues within the next 12 months, of which
there can be no guarantee.  Our ability to achieve profitability is
dependent on several factors, including but not limited to, our ability to:
generate liquidity from operations and satisfy our ongoing operating costs on a
timely basis. We still need additional investments in order to continue
operations to cash flow break even. Additional investments are being sought, but
we cannot guarantee that we will be able to obtain such investments. Financing
transactions may include the issuance of equity or debt securities, obtaining
credit facilities, or other financing mechanisms. However, the trading price of
our common stock and conditions in the U.S. stock and debt markets make it more
difficult to obtain financing through the issuance of equity or debt securities.
Even if we are able to raise the funds required, it is possible that we could
incur unexpected costs and expenses, fail to collect significant amounts owed to
us, or experience unexpected cash requirements that would force us to seek
alternative financing. Further, if we issue additional equity or debt
securities, stockholders may experience additional dilution or the new equity
securities may have rights, preferences or privileges senior to those of
existing holders of our common stock. If additional financing is not available
or is not available on acceptable terms, we will have to curtail our operations
again, attempt to further restructure financial obligations and/or seek a
strategic merger, acquisition or a sale of assets.





The
independent auditor's report on our June 30, 2009 financial statements included
in our Annual Report on Form 10-K stated that our recurring losses raise
substantial doubts about our ability to continue as a going
concern.





The
effect of inflation on our revenue and operating results was not significant.
Our operations are located in North America and there are no seasonal aspects
that would have a material effect on our financial condition or results of
operations.


21


We do not
maintain off-balance sheet arrangements nor do we participate in non-exchange
traded contracts requiring fair value accounting treatment.





CRITICAL
ACCOUNTING POLICIES AND USE OF ESTIMATES





Financial
Reporting Release No. 60, recently released by the Securities and Exchange
Commission, requires all companies to include a discussion of critical
accounting policies or methods used in the preparation of financial statements.
The notes to the consolidated financial statements include a summary of
significant accounting policies and methods used in the preparation of our
Consolidated Financial Statements. In addition, Financial Reporting Release No.
61 was recently released by the SEC requires all companies to include a
discussion which addresses, among other things, liquidity, off-balance sheet
arrangements, contractual obligations and commercial commitments. The following
is a brief discussion of the more significant accounting policies and methods
used by us.





The
discussion and analysis of our financial condition and results of operations are
based upon our consolidated financial statements, which have been prepared in
accordance with accounting principles generally accepted in the United States.
The preparation of financial statements in accordance with generally accepted
accounting principles in the United States requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities,
including the recoverability of tangible and intangible assets, disclosure of
contingent assets and liabilities as of the date of the financial statements and
the reported amounts of revenues and expenses during the reported
period.





On an
on-going basis, we evaluate our estimates. The most significant estimates relate
to our recognition of revenue, the allowance for doubtful accounts receivable
and inventory valuation reserves.





We
believe the following critical accounting policies affect our more significant
judgments and estimates used in the preparation of our consolidated financial
statements:





Reverse
Stock Split





Effective
June 26, 2008, the Company authorized for its common stock  a 50:1
reverse stock split  Also, par value for the Preferred Stock and
Common stock was changed to $.00001 per share   All preferred and
common stock and related information have been retroactively
restated.





Revenue
Recognition





The
Company recognizes revenue from product sales in accordance with Staff
Accounting Bulletin No. 104, Revenue Recognition ("SAB104"), which superseded
Staff Accounting Bulletin No. 101, Revenue Recognition in Financial Statements
("SAB101"). SAB 104 requires that four basic criteria must be met before revenue
can be recognized: (1) persuasive evidence of an arrangement exists; (2)
delivery has occurred; (3) the selling price is fixed and determinable; and (4)
collectibility is reasonably assured. Determination of criteria (3) and (4) are
based on management's judgment regarding the fixed nature of the selling prices
of the products delivered and the collectibility of those amounts. Provisions
for discounts and rebates to customers, estimated returns and allowances, and
other adjustments are provided for in the same period the related sales are
recorded. The Company defers any revenue for which the product was not delivered
or is subject to refund until such time that the Company and the customer
jointly determine that the product has been delivered or no refund will be
required.





Valuation
of Accounts Receivable





Our
allowance for doubtful accounts reflects our best estimate of probable losses,
determined principally on the basis of historical experience and specific
allowances for known troubled accounts.


22


Inventories
/ Cost of Goods Sold





The
Company has adopted a policy to record inventory at the lower of cost or market
determined by the first-in-first-out method. The elements of cost that comprise
inventory and cost good sold are FOB shipping point costs, freight and
destination charges, customs and importation fees and taxes, customer broker
fees (if any) and other related costs. Warehousing costs are charged to cost of
goods in the period the costs are incurred. The Company provides inventory
allowances based on estimates of obsolete inventories.





Allowance
for doubtful accounts





The
Company maintains an allowance for doubtful accounts to reduce amounts to their
estimated realizable value, including reserves for customer and other receivable
allowances and incentives. In estimating the provision for doubtful accounts,
the company considers a number of factors including age of the accounts
receivable, trends and ratios involving the age of the accounts receivable and
the customer mix of each aging categories.





Advertising





The
Company follows SOP 93-7 whereby charging the costs of advertising to expenses
as incurred.





Off Balance Sheet
Arrangements





None.





ITEM
3 – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK





As a “smaller reporting company” as
defined by Item 10 of Regulation S-K, we are not required to provide the
information required by this item.





ITEM
4 – CONTROLS AND PROCEDURES





Evaluation of Disclosure
Controls and Procedures





Disclosure
controls and procedures are controls and other procedures that are designed to
ensure that information required to be disclosed by us in the reports that we
file or submit under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”) is recorded, processed, summarized and reported, within the time
periods specified in the Securities and Exchange Commission's rules and forms.
Disclosure controls and procedures include, without limitation, controls and
procedures designed to ensure that information required to be disclosed by us in
the reports that we file under the Exchange Act is accumulated and communicated
to our management, including our principal executive and financial officers, as
appropriate to allow timely decisions regarding required
disclosure.




The
Company’s management, under the supervision and with the participation of our
Chief Executive Officer and Chief Financial Officer, carried out an evaluation
of the effectiveness of the design and operation of the Company's disclosure
controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) of the
Exchange Act) as of September 30, 2009.  Based upon that evaluation
and the identification of the material weakness in the Company’s internal
control over financial reporting as previously disclosed in our quarterly report
for the period ended September 30, 2009, the Chief Executive Officer and Chief
Financial Officer concluded that the Company’s disclosure controls and
procedures were ineffective as of the end of the period covered by this
report.





Changes
in Internal Control over Financial Reporting





There
were no changes in our internal control over financial reporting identified in
connection with the evaluation required by paragraph (d) of Rule 13a-15 or
15d-15 under the Exchange Act that occurred during the quarter ended September
30, 2009 that have materially affected, or is reasonably likely to materially
affect, our internal control over financial reporting.


23


PART
II:  OTHER INFORMATION




ITEM
1 – LEGAL PROCEEDINGS





On March
26, 2007, Zevotek, Inc. f/k/a Diet Coffee, Inc. (the “Company”) received a
letter from the U.S. Federal Trade Commission (“FTC”) whereby the Company was
informed that the FTC is conducting an investigation into advertising claims
made for the Company’s weight loss product known as “Slim Coffee”. The purpose
of the investigation was to determine whether the Company, in connection with
its sales of Slim Coffee, engaged in unfair or deceptive acts or practices and
false advertising. The FTC threatened to file a complaint in the United States
District Court, Southern District of New York, alleging False Advertising,
unless the Company and the FTC could reach a satisfactory resolution to the
matter. A negotiated settlement has been reached with the FTC under which the
Company, its officers and directors did not admit any wrongdoing. On October 5,
2007, the Company executed a stipulation to a final order and judgment in the
amount of $923,910. The full amount of the judgment, and payment of any portion
of it is suspended and cannot be reinstated so long as the Company abides by the
reporting and monitoring requirements of the judgment; does not make false
advertising claims in connection with any of its products in the future; and its
past financial disclosures to the FTC were materially accurate. The Company
expects stipulation will be executed by the FTC and filed with the United States
District Court, Southern District of New York. The Company expects to comply
with terms of the stipulation and does not anticipate incurring a liability for
the judgment.




ITEM
1A – RISK FACTORS





As a
“small reporting company” as defined by Item 10 of Regulation S-K, we are not
required to provide information required by this item.





ITEM
2 – UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS





During
the quarter ended September 30, 2009, we issued an aggregate of 417,299,500
shares of common stock upon conversions of 10% convertible promissory notes. The
aggregate principal and interest amount of these notes that were converted was
$41,729.95. The issuances were exempt pursuant to Section 3(a)(9) of the
Securities Act as well as Section 4(2) of the Securities Act.





ITEM
3 – DEFAULT UPON SENIOR SECURITIES





None.





ITEM
4 – SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS





None.





ITEM
5 – OTHER INFORMATION





1.           On
October 14, 2009, we filed an amendment to our certificate of incorporation with
the Delaware Secretary of State to: increase our authorized common stock from
1,000,000,000 shares to 5,000,000,000 shares. This amendment was unanimously
approved by our board of directors and by a majority of our stockholders by
written consent.  Please see our Current Report on Form 8-K dated
October 14, 2009 and filed with the SEC on October 19, 2009.





2.           On
October 16, 2009, Indira Tovar was duly appointed as one of our directors to
fill a vacancy on our Board of Directors.  Ms. Tovar was appointed by
unanimous consent of our current directors and a majority of votes of our
stockholders by written consent.  After Ms. Tovar’s appointment, there
remains one vacancy on our Board of Directors.  Please see our Current
Report on Form 8-K dated October 16, 2009 and filed with the SEC on October 23,
2009.





3.           In
November 2009, Jeff Carlson was appointed as President of our subsidiary,
Ionicbulb.com, Inc.


24


ITEM
6 - EXHIBITS





Item
                    No.
                  
                  Description31.1
                  
                  Certification
      of Adam J. Engel, Chief Executive Officer and Chief Financial Officer of
      Zevotek, Inc. pursuant to Rule 13a-14(a)32.1
                  
                  Certification
      of Adam J. Engel, Chief Executive Officer and Chief Financial Officer of
      Zevotek, Inc. pursuant to 18 U.S.C. § 1350 adopted pursuant to Section 906
      of the Sarbanes Oxley Act of
2002





SIGNATURES





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





ZEVOTEK,
      INC.November
      16, 2009
              /s/ Adam J.
      EngelAdam
      J. EngelPresident,
      Chief Executive Officer and Chief Financial Officer(Principal
      Executive and Financial and Accounting
Officer)


25