10-Q/A

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

_________________

FORM 10-Q/A

Amendment No. 1  

_________________

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

For the quarterly period ended:  June 30, 2011

or

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

For the transition period from: _____________ to _____________

_________________

WORLDS INC.

(not affiliated with Worldcom, Inc.)

(Exact name of registrant as specified in its charter)

_________________

Delaware	0-24115	22-1848316
(State or Other Jurisdiction	(Commission	(I.R.S. Employer
of Incorporation or Organization)	File Number)	Identification No.)

11 Royal Road
Brookline, MA 02445
(Address of Principal Executive Offices)

(617) 725-8900
(Registrant’s telephone number, including area code)

N/A
(Former name or former address and former fiscal year, if changed since last report)

_________________

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     Yes  o     No  þ

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

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

Large accelerated filer  o Accelerated filer  o Non-accelerated filer  o Smaller reporting company  x

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

As of August 12, 2011, the registrant had 71,361,909  shares shares of common stock, par value $0.001 per share outstanding. 

EXPLANATORY NOTE

This Amendment No. 1 to the Quarterly Report on Form 10-Q/A (the “Amendment”) amends the Quarterly Report on Form 10-Q of Worlds Inc. (the “Company”) for the quarter ended June 30, 2011 (the “Original Filing”), that was originally filed with the U.S. Securities and Exchange Commission on August 22, 2011. The Amendment is being filed to submit Notes. The Amendment revises the financial notes of the Original Filing (XBRL interactive data) is included as an exhibit to the Amendment.

Except as described above, the Amendment does not modify or update the disclosures presented in, or exhibits to, the Original Filing in any way. Those sections of the Original Filing that are unaffected by the Amendment are not included herein. The Amendment continues to speak as of the date of the Original Filing. Furthermore, the Amendment does not reflect events occurring after the filing of the Original Filing. Accordingly, the Amendment should be read in conjunction with the Original Filing, as well as the Company’s other filings made with the SEC pursuant to Section 13(a) or 15(d) of the Exchange Act subsequent to the filing of the Original Filing.

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.

Date: August 22, 2011

WORLDS INC.

By: /s/ Thomas Kidrin
Thomas Kidrin
President and CEO


By: /s/ Christopher Ryan
Christopher Ryan
Chief Financial Officer

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Balance Sheets (Parenthetical) (USD $)	Dec. 31, 2010	Jun. 30, 2011 Unaudited	Dec. 31, 2010 Audited
Common Stock, par value	$ 0.001	$ 0.001	$ 0.001
Common Stock, shares authorized	100,000,000	100,000,000	100,000,000
Common Stock, shares issued	62,781,122	71,361,909	62,781,122
Common Stock, shares outstanding	62,781,122	71,361,909	62,781,122

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Statements of Operations (Unaudited) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010
Revenues
Revenue	$ 0	$ 38	$ 199	$ 75,574
Total Revenue	0	38	199	75,574
Cost of Revenue	4,650	3,331	16,959	8,112
Gross Profit/(Loss)	(4,650)	(3,293)	(16,760)	67,462
Common Stock issued for services rendered	210,000	0	683,430	0
Selling, General & Admin.	112,172	122,271	225,425	206,675
Salaries	61,004	0	134,209	0
Operating loss	(387,826)	(125,564)	(1,059,825)	(139,213)
Other Income Expense
Interest Expense	0	0	0	0
Net (Loss)	$ (387,826)	$ (125,564)	$ (1,059,825)	$ (139,213)
Weighted Average Loss per share	$ (0.01)	$ 0.00	$ (0.02)	$ 0.00
Weighted Average Common Shares Outstanding	69,987,733	56,370,906	67,503,361	55,024,810

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Document and Entity Information	6 Months Ended
	Jun. 30, 2011	Aug. 12, 2011
Document And Entity Information
Entity Registrant Name	Worlds.com, Inc.
Entity Central Index Key	0000001961
Document Type	10-Q
Document Period End Date	Jun. 30, 2011
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		71,361,909
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2011

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NOTE 7 - STOCK OPTIONS

6 Months Ended

Jun. 30, 2011

Notes to Financial Statements

NOTE 7 - STOCK OPTIONS

NOTE 7 – STOCK OPTIONS

During 2010 the Company issued stock options to various parties.  The stock options allow the parties to purchase shares of the Company’s common stock at various prices per share per each individual option agreement.  The options allow the various parties to purchase one share of its stock for each option.  The options expire at various times through October 28, 2013 per each individual option agreement. The Company did not grant any registration rights with respect to any shares of common stock issuable upon exercise of the options. There were no forfeited options during 2010. During the year ended December 31, 2010, the Company recorded an expense of $42,543, equal to the estimated fair value of the options at the date of grants.  The fair market value was calculated using the Black-Scholes options pricing model, assuming approximately 5.0% risk-free interest, 0% dividend yield, 60% volatility, and expected lives ranging from one to three years.

During 2010 we also issued 500,000 stock options exercisable at $0.05 per share to one person, who is not an officer or a director. No stock options have been issued in the six months ended June 30, 2011.

During the three months ended June 30, 2011, 928,529 stock options were exercised and 920,160 warrants were exercised. There are no outstanding warrants as of June 30, 2011.

Stock Options

Stock options outstanding and exercisable on June 30, 2011 are as follows:

Exercise Price per Share	Shares Under Option		Remaining Life in Years
Outstanding
$0.35		212,500		2.50
$0.30		60,000		1.25
$0.20		300,000		1.50
$0.20		300,000		2.50
$0.11		15,000		3.80
$0.11		15,000		1.24
$0.11		300,000		1.79
$0.05		15,450,000		1.20
$0.05		100,000		2.35
Exercisable
$0.35		212,500		2.50
$0.30		60,000		1.25
$0.20		300,000		1.50
$0.20		300,000		2.50
$0.11		15,000		3.80
$0.11		15,000		1.24
$0.11		300,000		1.79
$0.05		15,450,000		1.20
$0.05		100,000		2.35

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NOTE 3 - PRIVATE PLACEMENTS OF EQUITY

6 Months Ended

Jun. 30, 2011

Notes to Financial Statements

NOTE 3 - PRIVATE PLACEMENTS OF EQUITY

NOTE 3 - PRIVATE PLACEMENTS OF EQUITY

During 2010, the Company completed a private placement of 1,454,590 shares of its common stock at a price per share of $0.10 for aggregate proceeds of $145,459.  The five “accredited” investors also received an aggregate of 975,338 warrants as part of the equity investment exercisable at $0.15 per share. The Company also converted the $175,000 in notes payable from the 2009 financing into 1,750,000 shares of its common stock. Also in 2010, the Company completed a private placement of 3,333,331 shares of its common stock at a price per share of $0.12 for aggregate proceeds of $400,000.

During 2010, the Company issued an aggregate of 5,912,774 shares of common stock as payment for services rendered. During the six months ended June 30, 2011 the Company issued an aggregate of 3,173,382 shares of common stock as payment for services rendered.

During the six months ended June 30, 2011, the Company raised $118,446 with the exercise of warrants covering 1,160,804 shares of its common stock at a price per share ranging from $0.01 to $0.15 per share. 

During the six months ended June 30, 2011, the Company raised $58,000 with the exercise of options covering 928,529 shares of its common stock at a price ranging from $0.05 to $0.30 per share. 128,529 of those shares were exercised on a cashless basis by the surrender to the Company of an aggregate of 131,747 options with a value of $38,558 being equal to the difference in price between the exercise price and the market price on the date of exercise.

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NOTE 8 - INCOME TAXES

6 Months Ended

Jun. 30, 2011

Notes to Financial Statements

NOTE 8 - INCOME TAXES

NOTE 8 - INCOME TAXES

At June 30, 2011, the Company had federal and state net operating loss carry forwards of approximately $40,000,000 that expire in various years through the year 2024.

Due to operating losses, there is no provision for current federal or state income taxes for the six months ended June 30, 2011 and 2010.

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amount used for federal and state income tax purposes.

The Company’s deferred tax asset at June 30, 2011 consists of net operating loss carry forwards calculated using federal and state effective tax rates equating to approximately $16,000,000 less a valuation allowance in the amount of approximately $16,000,000. Because of the Company’s lack of earnings history, the deferred tax asset has been fully offset by a valuation allowance.

The Company’s total deferred tax asset as of June 30, 2011 is as follows:

Net operating loss carry forwards	$	16,000,000
Valuation allowance		(16,000,000)
Net deferred tax asset	$	—

The reconciliation of income taxes computed at the federal and state statutory income tax rate to total income taxes for the six months ended June 30, 2011 is as follows:

Income tax computed at the federal statutory rate	34%
Income tax computed at the state statutory rate	5%
Valuation allowance	(39%)
Total deferred tax asset	0%

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NOTE 1 - DECSRIPTION OF BUSINESS & SUMMARY OF ACCTING POLICIES

6 Months Ended

Jun. 30, 2011

Notes to Financial Statements

NOTE 1 - DECSRIPTION OF BUSINESS & SUMMARY OF ACCTING POLICIES

NOTE 1 – DESCRIPTION OF BUSINESS AND SUMMARY OF ACCOUNTING POLICIES

Description of Business

On May 16, 2011, the Company transferred, through a spin-off to its then wholly owned subsidiary, Worlds Online Inc., the majority of its operations and related operational assets. The Company retained its patent portfolio which it intends to continue to increase and to more aggressively enforce against infringers. The Company also entered into a License Agreement with Worlds Online Inc. to sublicense patented technologies.

Basis of Presentation

The accompanying financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("US GAAP"), which contemplates continuation of the Company as a going concern. The Company has always been considered a developmental stage business, has incurred significant losses since its inception and has had minimal revenues from operations.  The Company will require substantial additional funds for development and enforcement of its patent portfolio. There can be no assurance that the Company will be able to obtain the substantial additional capital resources to pursue its business plan or that any assumptions relating to its business plan will prove to be accurate. The Company has not been able to generate sufficient revenue or obtain sufficient financing which has had a material adverse effect on the Company, including requiring the Company to reduce operations. These factors raise substantial doubt about the Company's ability to continue as a going concern.  For the past year the Company has been operating at a significantly reduced capacity, with only one full time employee, performing primarily consulting services and licensing software and using consultants to perform any additional work that may be required.

Use of Estimates

The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from these estimates.

Cash and Cash Equivalents

Cash and cash equivalents are comprised of highly liquid money market instruments, which have original maturities of three months or less at the time of purchase.

Due from Related Party

Due from related party is comprised of cash payments made by Worlds Inc. on behalf of Worlds Online Inc.

Revenue Recognition

Effective for the second quarter of 2011, the Company spun off its online businesses to Worlds Online Inc. The Company’s sources of revenue after the spin off will be from sublicensing the patented technology and any revenue that may be generated from enforcing those patents in the market. The Company had the following sources of revenue: (1) consulting/licensing revenue from the performance of development work performed on behalf of the Company, licensing revenue or from the sale of certain software to third parties; and (2) VIP subscriptions to our Worlds Ultimate 3-D Chat service.   The Company recognizes revenue when all of the following criteria are met: evidence of an arrangement exists such as a signed contract, delivery has occurred, the price is fixed or determinable, and collectibility is reasonable assured.  This will usually be in the form of a receipt of a customer’s acceptance indicating the product has been completed to their satisfaction except for development work and service revenue which is recognized when the services have been performed.  Deferred revenue represents cash payments received in advance to be recorded as revenue when earned.  The corresponding cost associated with those contracts is also deferred as deferred costs until the revenue is ultimately recognized.

Research and Development Costs

Research and development costs are charged to operations as incurred.

Property and Equipment

Property and equipment are stated at cost.   Depreciation is provided on a straight line basis over the estimated useful lives of the assets ranging from three to five years.  When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are included in income.  Maintenance and repairs are charged to expense in the period incurred.

Impairment of Long Lived Assets

The Company evaluates the recoverability of its fixed assets and other assets in accordance with section 360-10-15 of the FASB Accounting Standards Codification for disclosures about Impairment or Disposal of Long-Lived Assets. Disclosure requires recognition of impairment of long-lived assets in the event the net book value of such assets exceeds its expected cash flows. If so, it is considered to be impaired and is written down to fair value, which is determined based on either discounted future cash flows or appraised values. The Company adopted the statement on inception. No impairments of these types of assets were recognized during the six months ended June 30, 2011 and 2010.

Stock-Based Compensation

The Company accounts for stock-based compensation using the fair value method following the guidance set forth in section 718-10 of the FASB Accounting Standards Codification for disclosure about Stock-Based Compensation. This section requires a public entity to measure the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award (with limited exceptions). That cost will be recognized over the period during which an employee is required to provide service in exchange for the award- the requisite service period (usually the vesting period). No compensation cost is recognized for equity instruments for which employees do not render the requisite service.

Income Taxes

The Company accounts for income taxes under Section 740-10-30 of the FASB Accounting Standards Codification. Deferred income tax assets and liabilities are determined based upon differences between the financial reporting and tax basis of assets and liabilities and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent management concludes it is more likely than not that the assets will not be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated statements of operations in the period that includes the enactment date.

Notes Payable

The Company has $773,279 in short term notes outstanding at June 30, 2011.

Deferred Revenue

As part of a debt refinancing in 2000, $631,950 of debt was renegotiated to deferred revenue representing future services to be provided by the Company. $355,000 has been amortized into income since then. The balance was transferred over to Worlds Online Inc. and no longer appears on the Company’s balance sheet.

Call Option Agreements

The Company has entered into call option agreements with 13 of its major shareholders. The call options give the Company the right to purchase up to 4,150,000 shares of stock back at prices ranging from $0.15 per share up to $0.40 per share. The Company issued an aggregate of 680,000 shares of stock to these shareholders as an inducement to enter into these call option agreements. The call option agreements have expiration dates of 1 and 2 years.

Comprehensive Income (Loss)

The Company reports comprehensive income and its components following guidance set forth by section 220-10 of the FASB Accounting Standards Codification which establishes standards for the reporting and display of comprehensive income and its components in the consolidated financial statements. There were no items of comprehensive income (loss) applicable to the Company during the period covered in the consolidated financial statements.

Loss Per Share

Net loss per common share is computed pursuant to section 260-10-45 of the FASB Accounting Standards Codification. Basic net loss per share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share is computed by dividing net loss by the weighted average number of shares of common stock and potentially outstanding shares of common stock during each period. There were no potentially dilutive shares outstanding as of June 30, 2011 and 2010.

Stockholders Equity

3,173,382 shares of common stock were issued for services rendered during the six months ended June 30, 2011.

Commitments and Contingencies

During 2000 the Company was involved in a lawsuit relating to unpaid consulting services. In April, 2001 a judgment against the Company was rendered for approximately $205,000. As of June 30, 2011 and December 31, 2010 the Company recorded a reserve of $205,000 for this lawsuit, which is included in accrued expenses in the accompanying balance sheets.

Risk and Uncertainties

The Company is subject to risks common to companies in the service and technology industries, including, but not limited to, litigation, development of new technological innovations and dependence on key personnel.

Recent Accounting Pronouncements

The Company has reviewed all recently issued, but not yet effective, accounting pronouncements and do not believe the future adoption of any such pronouncements may be expected to cause a material impact on its financial condition or the results of its operations.

FASB Accounting Standards Codification

(Accounting Standards Update (“ASU”) 2009-01)

In June 2009, FASB approved the FASB Accounting Standards Codification (“the Codification”) as the single source of authoritative nongovernmental US GAAP. All existing accounting standard documents, such as FASB, American Institute of Certified Public Accountants, Emerging Issues Task Force and other related literature, excluding guidance from the Securities and Exchange Commission (“SEC”), have been superseded by the Codification. All other non-grandfathered, non-SEC accounting literature not included in the Codification has become nonauthoritative. The Codification did not change US GAAP, but instead introduced a new structure that combines all authoritative standards into a comprehensive, topically organized online database. The Codification is effective for interim or annual periods ending after September 15, 2009, and impacts the Company’s consolidated financial statements as all future references to authoritative accounting literature will be referenced in accordance with the Codification. There have been no changes to the content of the Company’s financial statements or disclosures as a result of implementing the Codification during the fiscal year ended December 31, 2010 or the six months ended June 30, 2011.

As a result of the Company’s implementation of the Codification during the fiscal year ended December 31, 2009, previous references to new accounting standards and literature are no longer applicable. In the current annual consolidated financial statements, the Company will provide reference to both new and old guidance to assist in understanding the impacts of recently adopted accounting literature, particularly for guidance adopted since the beginning of the current fiscal year but prior to the Codification.

Subsequent Events

(Included in Accounting Standards Codification (“ASC”) 855 “Subsequent Events”, previously SFAS No. 165 “Subsequent Events”)

SFAS No. 165 established general standards of accounting for and disclosure of events that occur after the balance sheet date, but before the consolidated financial statements are issued or available to be issued (“subsequent events”). An entity is required to disclose the date through which subsequent events have been evaluated and the basis for that date. For public entities, this is the date the consolidated financial statements are issued. SFAS No. 165 does not apply to subsequent events or transactions that are within the scope of other GAAP and did not result in significant changes in the subsequent events reported by the Company. SFAS No. 165 became effective for interim or annual periods ending after June 15, 2009 and did not impact the Company’s consolidated financial statements. The Company evaluated for subsequent events through the issuance date of the Company’s consolidated financial statements. No recognized or non-recognized subsequent events were noted.

Determination of the Useful Life of Intangible Assets

(Included in ASC 350 “Intangibles — Goodwill and Other”, previously FSP SFAS No. 142-3 “Determination of the Useful Lives of Intangible Assets”)

FSP SFAS No. 142-3 amended the factors that should be considered in developing renewal or extension assumptions used to determine the useful life of a recognized intangible asset under previously issued goodwill and intangible assets topics. This change was intended to improve the consistency between the useful life of a recognized intangible asset and the period of expected cash flows used to measure the fair value of the asset under topics related to business combinations and other GAAP. The requirement for determining useful lives must be applied prospectively to intangible assets acquired after the effective date and the disclosure requirements must be applied prospectively to all intangible assets recognized as of, and subsequent to, the effective date. FSP SFAS No. 142-3 became effective for consolidated financial statements issued for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years. The adoption of FSP SFAS No. 142-3 did not impact the Company’s consolidated financial statements.

Non-controlling Interests

(Included in ASC 810 “Consolidation”, previously SFAS No. 160 “Noncontrolling Interests in Consolidated Financial Statements an amendment of ARB No. 51”)

SFAS No. 160 changed the accounting and reporting for minority interests such that they will be recharacterized as noncontrolling interests and classified as a component of equity. SFAS No. 160 became effective for fiscal years beginning after December 15, 2008 with early application prohibited. The Company implemented SFAS No. 160 at the start of fiscal 2009 and no longer records an intangible asset when the purchase price of a non-controlling interest exceeds the book value at the time of buyout. The adoption of SFAS No. 160 did not have any other material impact on the Company’s financial statements.

Consolidation of Variable Interest Entities — Amended

(To be included in ASC 810 “Consolidation”, SFAS No. 167 “Amendments to FASB Interpretation No. 46(R)”)

SFAS No. 167 amends FASB Interpretation No. 46(R) “Consolidation of Variable Interest Entities regarding certain guidance for determining whether an entity is a variable interest entity and modifies the methods allowed for determining the primary beneficiary of a variable interest entity. The amendments include: (1) the elimination of the exemption for qualifying special purpose entities, (2) a new approach for determining who should consolidate a variable-interest entity, and (3) changes to when it is necessary to reassess who should consolidate a variable-interest entity. SFAS No. 167 is effective for the first annual reporting period beginning after November 15, 2009, with earlier adoption prohibited. The adoption of SFAS No. 167 in 2010 did not have a material impact on the Company’s financial statements.

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NOTE 4 - DEFERRED REVENUE

6 Months Ended

Jun. 30, 2011

Notes to Financial Statements

NOTE 4 - DEFERRED REVENUE

NOTE 4 – DEFERRED REVENUE

Deferred revenue represents advance payments for the license, the design and development of the software, content and related technology for the creation of an interactive, 3D entertainment portal on the internet.  As part of a debt refinancing in 2000, $631,950 of debt was renegotiated to deferred revenue representing future services to be provided by the Company.  During 2010, $265,000 worth of services was provided leaving a balance of $276,950 at December 31, 2010. As part of the spin off, the deferred revenue agreement was transferred to Worlds Online Inc. As of June 30, 2011 the balance is $0.

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NOTE 5 - NOTES PAYABLE

6 Months Ended

Jun. 30, 2011

Notes to Financial Statements

NOTE 5 - NOTES PAYABLE

NOTE 5 - NOTES PAYABLE

Short term notes payable at June 30, 2011 consist of the following:
Unsecured note payable to a shareholder bearing 8% interest.
Entire balance of principal and unpaid interest due on demand	$	124,230
Unsecured note payable to a shareholder bearing  10% interest
Entire balance of principal and unpaid interest due on demand	$	649,049
Total current	$	773,279
2011	$	773,279
2012	$	-0-
2013	$	-0-
2014	$	-0-
2015	$	-0-
	$	773,279

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NOTE 6 - PROPERTY AND EQUIPMENT

6 Months Ended

Jun. 30, 2011

Notes to Financial Statements

NOTE 6 - PROPERTY AND EQUIPMENT

NOTE 6- PROPERTY AND EQUIPMENT

The detail composition of property and equipment at June 30, 2011 and December 31, 2010 is as follows: 

		30-Jun		31-Dec
		2011		2010
Computer equipment	$	10,891	$	10,891
Less: accumulated depreciation		10,891		10,132
	$	0	$	759

Depreciation expense recorded for the three months ended June 30, 2011 and 2010 was $0 and $781, respectively.

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Statements of Cash Flows (Unaudited) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2011	Jun. 30, 2010	Jun. 30, 2011	Jun. 30, 2010
Cash flows from operating activities:
Net (loss)	$ (387,826)	$ (125,564)	$ (1,059,825)	$ (139,213)
Adjustments to reconcile net loss to net cash used in operating activities
Depreciation	759	1,562	759	1,562
Common stock issued for services rendered			683,430	10,900
Bank Overdraft	0	(1,175)	0	(1,175)
Accounts payable and accrued expenses	(4,972)	88,847	(4,972)	88,847
Contingent Deposit	0	417,500	0	417,500
Deferred revenue	0	(75,000)	0	(75,000)
Net cash used in operating activities:	(380,608)	303,421	(380,608)	303,421
Proceeds from exercise of warrants	118,446	145,459	118,446	145,459
Proceeds from exercise of options	58,000	0	58,000	0
Due from related party	(23,339)	0	(23,339)	0
Repayment of officer loan payable	(2,400)	(4,000)	(2,400)	(4,000)
Net cash provided by financing activities	150,707	141,459	150,707	141,459
Net increase/(decrease) in cash	(229,901)	444,880	(229,901)	444,880
Cash beginning of period	400,848	0	400,848
Cash end of period	170,947	444,880	170,947	444,880
Common stock issued for payable	72,375	0	72,375	0
Deferred revenue			276,950	0
Interest	0	0	0	0
Income taxes	$ 0	$ 0	$ 0	$ 0

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NOTE 2 - GOING CONCERN

6 Months Ended

Jun. 30, 2011

Notes to Financial Statements

NOTE 2 - GOING CONCERN

NOTE 2 - GOING CONCERN

From mid-2001 through most of 2007, the Company had to significantly curtail and at times almost cease operations due to lack of resources. The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. Since its inception, the Company has had periods where it had only minimal revenues from operations. There can be no assurance that the Company will be able to obtain the additional capital resources to fully implement its business plan or that any assumptions relating to its business plan will prove to be accurate. The Company is pursuing sources of additional financing and there can be no assurance that any such financing will be available to the Company on commercially reasonable terms, or at all. Any inability to obtain additional financing will likely have a material adverse effect on the Company, including possibly requiring the Company to reduce and/or cease operations.

These factors raise substantial doubt about the ability of the Company to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

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Balance Sheets (USD $)	Dec. 31, 2010	Jun. 30, 2011 Unaudited	Dec. 31, 2010 Audited
Current Assets
Cash and cash equivalents	$ 400,848	$ 170,946	$ 400,848
Due from related party	0	23,339	0
Total Current Assets	400,848	194,285	400,848
Property and equipment, net of accumulated depreciation	759	0	759
Total Assets	401,607	194,285	401,607
Current Liabilities
Accounts payable	782,809	777,809	782,809
Accrued expenses	1,818,751	1,791,904	1,818,751
Loan payable officer	2,400	0	2,400
Deferred revenue	276,950	0	276,950
Notes payable	773,279	773,279	773,279
Total Current Liabilities	3,654,189	3,342,992	3,654,189
Common stock (Par value $0.001 authorized 100,000,000 shares, issued and outstanding 71,361,909 and 62,781,122 at June 30, 2011 and December 31, 2010, respectively)	62,780	71,360	62,780
Common stock subscribed but not yet issued (325,000 and 3,358,331 at June 30, 2011 and December 31, 2010, respectively)	3,358	325	3,358
Additional Paid in Capital	23,453,111	24,611,264	23,453,111
Accumulated Deficit	(26,771,831)	(27,831,656)	(26,771,831)
Total stockholders deficit	(3,252,582)	(3,148,707)	(3,252,582)
Total Liabilities and stockholders deficit	$ 401,607	$ 194,285	$ 401,607