form10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

T QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE

ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 2008.

£ TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT

OF 1934

FOR THE TRANSITION FROM _______ TO ________.

COMMISSION FILE NUMBER 0-28353

INTEGRAL TECHNOLOGIES, INC.

(Exact Name of Registrant as Specified in its Charter)

Nevada	98-0163519
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

805 W. Orchard Drive, Suite 7, Bellingham, Washington 98225

(Address of principal executive offices) (Zip Code)

Issuer's telephone number: (360) 752-1982

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 /X/ No / /

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

Large accelerated filer £	Accelerated filer £

Non-accelerated filer £	Smaller reporting company T

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

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS

DURING THE PRECEDING FIVE YEARS

Indicate by check mark whether the registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court. Yes £ No £

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: As of February 2, 2009, there were 45,754,969 outstanding shares of the Registrant's Common Stock, $0.001 par value.

INTEGRAL TECHNNOLOGIES, INC.

DECEMBER 31, 2008 QUARTERLY REPORT ON FORM 10-Q

TABLE OF CONTENTS

		Page
PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

	INTEGRAL TECHNOLOGIES, INC.
	(A Development Stage Company)
	Consolidated Financial Statements
	December 31, 2008
	(U.S. Dollars)
	(Unaudited)

	Consolidated Balance Sheets	F-1

	Consolidated Statement of Operations	F-2

	Consolidated Statement of Stockholders’ Equity	F-3

	Consolidated Statement of Cash Flows	F-4

	Notes to Consolidated Financial Statements	F-5

Item 2. Management’s Discussion and Analysis and Results of Operations		1
Item 3. Quantitative and Qualitative Disclosure About Market Risk		3
Item 4T. Controls and Procedures		3

PART II - OTHER INFORMATION

Item 1. Legal Proceedings		4
Item 1A. Risk Factors		4
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		4
Item 3. Defaults Upon Senior Securities		4
Item 4. Submission of Matters to a Vote of Security Holders		4
Item 5. Other Information		4
Item 6. Exhibits		5
SIGNATURES		5

Table of Contents

PART I

FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

INTEGRAL TECHNOLOGIES, INC.

(A Development Stage Company)

Consolidated Balance Sheet

(Unaudited)

(US Dollars)

	December 31,			June 30,
	2008			2008

Assets

Current
Cash	$	1,209,856		$	1,104,104
Prepaid expenses		19,357			30,575

Total Assets	$	1,229,213		$	1,134,679

Liabilities

Current
Accounts payable and accruals	$	668,761		$	707,848

Total Current Liabilities		668,761			707,848

Stockholders’ Equity

Preferred Stock and Paid-in Capital in Excess of $0.001 Par Value
20,000,000 Shares authorized
308,538 (June 30, 2008 - 308,538) issued and outstanding		308,538			308,538
Common Stock and Paid-in Capital in Excess of $0.001 Par Value
50,000,000 Shares authorized
45,754,969 (June 30, 2008 - 45,704,969) issued and outstanding		29,299,846			29,219,711
Promissory Notes Receivable		(29,737	)		(29,737	)
Subscriptions Received		1,125,200			276,500
Other Comprehensive Income		46,267			46,267
Deficit Accumulated During the Development Stage		(30,189,662	)		(29,394,448	)

Total Stockholders’ Equity		560,452			426,831

Total Liabilities and Stockholders’ Equity	$	1,229,213		$	1,134,679

F-1

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INTEGRAL TECHNOLOGIES, INC.

(A Development Stage Company)

Consolidated Statement of Operations

(Unaudited)

(US Dollars)

													Period from
													February 12,
													1996
	Three Months Ended						Six Months Ended						(Inception) to
	December 31,						December 31,						December 31,
	2008			2007			2008			2007			2008

Revenue	$	0		$	0		$	0		$	0		$	249,308
Cost of Sales		0			0			0			0			216,016
Gross Profit		0			0			0			0			33,292
Other Income		2,191			18,063			6,053			41,561			863,149
Total Income		2,191			18,063			6,053			41,561			896,441
Expenses
Legal and accounting		93,710			92,423			141,723			156,553			4,281,518
Salaries and benefits		146,000			147,261			304,558			288,261			9,406,650
Consulting		58,512			67,500			131,082			136,639			6,395,484
General and administrative		15,325			30,252			34,623			51,485			1,147,263
Travel and entertainment		16,194			26,197			31,457			47,017			1,334,803
Bank charges and interest, net		92			156			2,436			257			204,634
Rent		10,261			12,186			22,443			22,575			466,943
Telephone		8,057			7,485			13,320			15,747			447,622
Advertising		0			0			1,591			0			332,861
Research and development		53,620			90,820			110,314			131,943			1,351,217
Settlement of lawsuit		0			0			0			0			45,250
Remuneration pursuant to proprietary, non-competition agreement		0			0			0			0			711,000
Financing fees		0			0			0			0			129,043
Write-off of investments		0			0			0			0			1,250,000
Interest on beneficial conversion feature		0			0			0			0			566,455
Write-down of license and operating assets		0			0			0			0			1,855,619
Bad debts		0			(6,009	)		0			(6,009	)		46,604
Amortization		0			0			0			0			324,386
Total Expenses		401,771			468,271			793,547			844,468			30,297,352
Net Loss for Period	$	(399,580	)	$	(450,208	)	$	(787,494	)	$	(802,907	)	$	(29,400,911	)

Loss Per Share	$	(0.01	)	$	(0.01	)	$	(0.02	)	$	(0.02	)

Weighted Average Number of Common Shares Outstanding		45,754,969			45,519,969			45,734,860			45,518,914

F-2

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INTEGRAL TECHNOLOGIES, INC.

(A Development Stage Company)

Consolidated Statements of Stockholders' Equity (Deficit)

(US Dollars)

	Shares of Common Stock Issued		Common Stock and Paid-in Capital in Excess of Par		Shares of Preferred Stock Issued		Preferred Stock and Paid-in Capital in Excess of Par		Promissory Notes Receivable			Share Subscriptions			Other Comprehensive Income		Deficit Accumulated During the Development Stage			Total Stockholders' Equity (Deficit)

Balance, June 30, 2007		45,514,969	$	28,762,772		308,538	$	308,538	$	(29,737	)	$	0		$	46,267	$	(27,440,805	)	$	1,647,035
Shares Issued for
Exercise of warrants		190,000		208,995		0		0		0			0			0		0			208,995
Subscription received		0		0		0		0		0			276,500			0		0			276,500
Dividends on preferred shares		0		0		0		0		0			0			0		(15,427	)		(15,427	)
Stock option compensation		0		247,944		0		0		0			0			0		0			247,944
Net loss for year		0		0		0		0		0			0			0		(1,938,216	)		(1,938,216	)

Balance, June 30, 2008		45,704,969		29,219,711		308,538		308,538		(29,737	)		276,500			46,267		(29,394,448	)		426,831
Shares Issued for
Past services (note 2(a))		50,000		46,500		0		0		0			(46,500	)		0		0			0
Subscription received		0		0		0		0		0			895,200			0		0			895,200
Dividends on preferred shares		0		0		0		0		0			0			0		(7,720	)		(7,720	)
Stock option compensation		0		33,635		0		0		0			0			0		0			33,635
Net loss for period		0		0		0		0		0			0			0		(787,494	)		(787,494	)

Balance, December 31, 2008		45,754,969	$	29,299,846		308,538	$	308,538	$	(29,737	)	$	1,125,200		$	46,267	$	(30,189,662	)	$	560,452

F-3

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INTEGRAL TECHNOLOGIES, INC.

(A Development Stage Company)

Consolidated Statement of Cash Flows

(Unaudited)

(US Dollars)

								Period from
								February 12,
								1996
	Six Months Ended							(Inception) to
	December 31,							December 31,
	2008			2007				2008
Operating Activities
Net loss	$	(787,494	)	$	(802,907	)		$	(29,400,911	)
Items not involving cash
Write-down of investment		0			0				1,250,000
Proprietary, non-competition agreement		0			0				711,000
Amortization		0			0				349,941
Other income		0			0				(658,305	)
Consulting services and financing fees		0			0				1,523,783
Stock option compensation		33,635			0				5,747,929
Interest on beneficial conversion feature		0			0				566,456
Settlement of lawsuit		0			0				60,250
Write-down of license and operating assets		0			0				1,853,542
Bad debts		0			0				77,712
Changes in Non-Cash Working Capital
Due from affiliated company		0			0				(116,000	)
Notes and account receivable		0			0				(109,213	)
Inventory		0			0				(46,842	)
Prepaid expenses		11,218			4,801				(19,357	)
Other		0			0				(2,609	)
Accounts payable and accruals		(46,807	)		57,672				934,041
Cash Used in Operating Activities		(789,448	)		(740,434	)			(17,278,583	)
Investing Activities
Purchase of property, equipment and intangible assets		0			0				(200,935	)
Assets acquired and liabilities assumed on purchase of subsidiary		0			0				(129,474	)
Investment purchase		0			0				(2,000,000	)
License agreement		0			0				(124,835	)
Cash Used in Investing Activities		0			0				(2,455,244	)
Financing Activities
Redemption of preferred shares		0			0				(50,000	)
Repayment of loan		0			0				(11,000	)
Repayments to stockholders		0			0				(91,283	)
Proceeds from Issuance of common stock		0			208,995				18,200,470
Advances from stockholders		0			0				1,078,284
Share issue cost		0			0				(227,420	)
Subscriptions received		895,200			0				1,398,365
Proceeds from convertible debentures		0			0				600,000
Cash Provided by Financing Activities		895,200			208,995				20,897,416
Effect of Foreign Currency Translation on Cash		0			0				46,267
Inflow (Outflow) of Cash		105,752			(531,439	)			1,209,856
Cash, Beginning of Period		1,104,104			2,240,356				0
Cash, End of Period	$	1,209,856		$	1,708,917		$283,720		1,209,856

F-4

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INTEGRAL TECHNOLOGIES, INC.

(A Development Stage Company)

Notes to Consolidated Financial Statements

Six Months Ended December 31, 2008

(Unaudited)

(US Dollars)

1.	BASIS OF PRESENTATION

These unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States for interim financial information. These financial statements are condensed and do not include all disclosures required for annual financial statements. The organization and business of the Company, accounting policies followed by the Company and other information are contained in the notes to the Company’s audited consolidated financial statements filed as part of the Company’s June 30, 2008 Form 10-KSB.

In the opinion of the Company’s management, these consolidated financial statements reflect all adjustments necessary to present fairly the Company’s consolidated financial position at December 31, 2008 and June 30, 2008 and the consolidated results of operations and cash flows for the three and six months ended December 31, 2008 and 2007. The results of operations for the three and six months ended December 31, 2008 and 2007 are not necessarily indicative of the results to be expected for the entire fiscal year.

2.	STOCKHOLDERS’ EQUITY

(a)

Common stock

During the period ended December 31, 2008, the Company issued 50,000 shares as consideration for consulting services. These shares were recorded as subscriptions received during the year ended June 30, 2008 at a value of $46,500 representing the market value of the shares at the date when the shares were to be issued.

(b)

Stock based compensation

During the period ended December 31, 2008, the Company extended the expiry date of 955,000 options. These options have been re-measured resulting in $33,635 additional compensation expense recognized in the period, $15,531 is included as salaries and benefits and $18,104 is included as consulting fees.

The fair value of each is calculated using the following weighted average assumptions:


Expected life (years)	1
Interest rate	3.87	%
Volatility	84.24	%
Dividend yield	0.00	%
Forfeiture rate	0.00	%

F-5

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INTEGRAL TECHNOLOGIES, INC.

(A Development Stage Company)

Notes to Consolidated Financial Statements

Six Months Ended December 31, 2008

(Unaudited)

(US Dollars)

2.	STOCKHOLDERS’ EQUITY (Continued)

(c)

Subscriptions received

During the six-month period ended December 31, 2008, a total of $895,000 was received for subscriptions of 3,580,000 units at $0.25 per unit, with each unit comprised of one share of common stock and one warrant at $0.001 per share. Each warrant entitles the holder to purchase one share of common stock on or before two years after the closing date at an exercise price of $0.50 per share. To date, these shares have not been issued.

During the six-month period ended December 31, 2008, the price of the subscription agreements for funds received during the year ended June 30, 2008 were reduced from $0.69 per share to $0.25 per share. The revised terms of the $230,000 received during the year ended June 30, 2008 are for subscriptions of 920,000 units, each unit consisting of one share of common stock at $0.25 per share and one warrant at $0.001 per share. Each warrant entitles the holder to purchase one share of common stock on or before two years after the closing date at an exercise price of $0.50 per share. To date, these shares have not been issued.

F-6

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS AND PLAN OF OPERATIONS

Statements contained herein that are not historical facts are forward-looking statements. Although we believe that the expectations reflected in such forward-looking statements are reasonable, the forward-looking statements are subject to risks and uncertainties that could cause actual results to differ from those projected. We caution investors that any forward-looking statements made by us are not guarantees of future performance and that actual results may differ materially from those in the forward-looking statements. Such risks and uncertainties include, without limitation: well-established competitors who have substantially greater financial resources and longer operating histories, regulatory delays or denials, ability to compete as a start-up company in a highly competitive market, and access to sources of capital.

The following discussion and analysis should be read in conjunction with our financial statements and notes thereto included elsewhere in this Form 10-Q. Except for the historical information contained herein, the discussion in this Form 10-Q contains certain forward-looking statements that involve risks and uncertainties, such as statements of our plans, objectives, expectations and intentions. The cautionary statements made in this Form 10-Q should be read as being applicable to all related forward-looking statements wherever they appear in this Form 10-Q. Our actual results could differ materially from those discussed here.

To date we have recorded nominal revenues. We are still considered a development stage company for accounting purposes. From inception on February 12, 1996 through December 31, 2008, we have accrued an accumulated deficit of approximately $30.1 million.

At December 31, 2008, all of our assets were current assets of $1,229,213, consisting of cash of $1,209,856 and prepaid expenses of $19,357. All of our property and equipment has been fully depreciated.

At December 31, 2008, all of our liabilities were current liabilities of $668,761, consisting of accounts payable and accruals. Of this amount, payables for legal fees (including associated filing fees) related to patent filings accounted for approximately $535,000 of the total.

At December 31, 2008, total stockholder’s equity was $560,452.

For the Three Months Ended December 31, 2008 compared to the Three Months Ended December 31, 2007

Our net loss for the quarter ended December 31, 2008, was $399,580, compared to a net loss of $450,208 for the corresponding period of the prior fiscal year, a decrease of $50,628 which was primarily a result of a reduction in general and administrative expenses of $14,927, travel and entertainment expenses of $10,003 and a reduction of research and development costs of $37,200.

Total expenses for the quarter ended December 31, 2008, was $401,771 compared to total expenses of $468,271 for the corresponding period of the prior fiscal year a reduction of $66,500 which was primarily a result of a reduction in general and administrative expenses of $14,927, travel and entertainment expenses of $10,003 and a reduction of research and development costs of $37,200.

Total income for the quarter ended December 31, 2008, was comprised of “other income” of $2,191 compared to “other income” of $18,063 for the corresponding period of the prior fiscal year, a decrease of $15,872. The category of “other income” consists of interest income and nominal license fees.

Consulting expenses during the quarter ended December 31, 2008, were $58,512 which included non-cash, stock based compensation charges (for the extension of the expiry date of options) of $5,159. In the corresponding period of the prior fiscal year, consulting expenses were $67,500, which included non-cash, stock based compensation charges of $nil.

Salaries and benefits expenses during the quarter ended December 31, 2008, were $146,000 which included non-cash, stock based compensation charges (for the extension of the expiry date of options) of $nil. In the corresponding period of the prior fiscal year, salaries and benefits expenses were $147,261, which included non-cash, stock based compensation charges of $nil.

Research and development costs of $53,620 during the quarter ended December 31, 2008, are attributable to refining the manufacturing process of our ElectriPlast™ material. In the corresponding period of the prior fiscal year, the amount expensed under this category was $90,820.

For the Six Months Ended December 31, 2008 compared to the Six Months Ended December 31, 2007

Our net loss for the six months ended December 31, 2008, was $787,494, compared to a net loss of $802,907 for the corresponding period of the prior fiscal year, a modest decrease of $15,413.

Total expenses for the six months ended December 31, 2008, was $793,547 compared to total expenses of $844,468 for the corresponding period of the prior fiscal year a reduction of $50,921 which was primarily a result of a reduction in general and administrative expenses of $16,862, travel and entertainment expenses of $15,560 and a reduction of research and development costs of $21,627.

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Total income for the six months ended December 31, 2008, was comprised of “other income” of $6,053 compared to “other income” of $41,561 for the corresponding period of the prior fiscal year, a decrease of $35,508. The category of “other income” consists of interest income and nominal license fees.

Consulting expenses during the six months ended December 31, 2008, were $131,082 which included non-cash, stock based compensation charges (for the extension of the expiry date of options) of $18,104. In the corresponding period of the prior fiscal year, consulting expenses were $136,082, which included non-cash, stock based compensation charges of $nil.

Salaries and benefits expenses during the six months ended December 31, 2008, were $304,558 which included non-cash, stock based compensation charges (for the extension of the expiry date of options) of $15,531. In the corresponding period of the prior fiscal year, salaries and benefits expenses were $288,261, which included non-cash, stock based compensation charges of $nil.

Research and development costs of $110,314 during the six months ended December 31, 2008, are attributable to refining the manufacturing process of our ElectriPlast™ material. In the corresponding period of the prior fiscal year, the amount expensed under this category was $131,941.

For the six months ended December 31, 2008, our cash used in operating activities was $789,448 compared to $740,434 used in the corresponding period of the prior fiscal year an increase of $49,014.

For the six months ended December 31, 2008, our cash provided by financing activities was $895,200 compared to $208,995 provided in the corresponding period of the prior fiscal year. The difference of $686,205 was due to subscriptions received during the six months ended December 31, 2008, for the private placement of equity securities in the amount of $895,200.

We anticipate spending up to approximately $250,000 over the next twelve months on ongoing research and development (primarily salaries and consulting fees) of the different applications and uses of our technologies.

During the next twelve months, we do not anticipate increasing our staff.

As of December 31, 2008, we had $1,209,856 in cash on hand. Accordingly, management believes that there is adequate cash on hand to fund operations over the next 4 months and additional equity funding will be required thereafter.

We are not in the manufacturing business and do not expect to make any capital purchases of a manufacturing plant or significant equipment in the next twelve months.

Presently, we are focusing the majority of our resources on the researching, developing and commercializing of our ElectriPlast™ technologies. Our business strategy focuses on leveraging our intellectual property rights and our strengths in product design and material innovation. We are focusing our marketing efforts on securing licensing agreements for applications of our ElectriPlast™ technologies with manufacturers of products which would benefit from the incorporation of any of the ElectriPlast™ applications.

ElectriPlast™ is an innovative, electrically-conductive resin-based material. The ElectriPlast™ polymer is a compounded formulation of resin-based materials, which are conductively loaded, or doped, with a proprietary-controlled, balanced concentration of micron conductive materials, then pelletized. The conductive loading or doping within this pellet is then homogenized using conventional molding techniques and conventional molding equipment. The end result is a product that can be molded into any of the infinite shapes and sizes associated with plastics and rubbers, and is non-corrosive, but which is as electrically conductive as if it were metal.

Various examples of applications for ElectriPlast™ are shielding, lighting circuitry, switch actuators, resistors, medical devices, thermal management and cable connector bodies, to name just a few. We have been working to introduce these new applications and the ElectriPlast™ technology to the marketplace.

Patents/Trademarks on Technologies

Our intellectual property portfolio consists of over eleven years of accumulated research and design knowledge and trade secrets. We have sought U.S. patent protection for many of our ideas related to our ElectriPlast™ technologies. Currently, we have filed 128 U.S. patent applications, 41 of which have been issued and 87 of which have been filed and are pending approval and 29 have been rejected. No assurances can be given that all patent applications will be approved; however, to the extent that patents are not granted, we will continue to attempt to commercialize these technologies without the protection of patents. As patents are issued, we will have the exclusive right to use in the U.S. the design(s) described in each issued patent for the 18-year life of the patent.

Certain patent office applications have been rejected by the patent office due to more stringent requirements implemented by the patent office over 18 months ago. The Company has elected not to appeal those patent application rejected as the contents of those rejected applications have been incorporated into subsequent applications.

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Recent developments in the law increase the challenge of obtaining US patent protection. In particular, the Supreme Court’s decision in KSR v. Teleflex (2007) makes it easier for the USPTO to sustain obviousness rejections. As a result, the USPTO is now more likely to reject applications by combining elements from the prior art – even where no motivation to combine can be shown in the art references. This new approach affects all applicants, including Integral Technologies, Inc., and has reduced the rate of patent issues. Nevertheless, Integral Technology, Inc., continues to pursue intellectual property protection through its patent and trademark portfolio while constantly evaluating its filings to judiciously apply resources to the most critical technologies.

We have also filed trademark applications with the U.S. Trademark Office for “ElectriPlast™” and related names such as “ElectriPonix™” and “ElectriOnix™.

Summary descriptions of our manufacturing agreement with Jasper Rubber Products, Inc. and our various patent license agreements are included in our annual report on Form 10-KSB for the year ended June 30, 2008.

We have also filed trademark applications with the U.S. Trademark Office for “ElectriPlast™” and related names such as “ElectriPonix™” and “ElectriOnix™.

We are not in the manufacturing business. Our manufacturing agreement with Jasper Rubber Products, Inc. provides for Jasper to manufacture ElectriPlast™ for us.

After twenty-three months of refining the manufacturing and molding process of ElectriPlast™, the Jasper facility is now capable of producing over 50,000 pounds of ElectriPlast™ pellets per month. We have entered into patent license agreements with several companies, as summarized below, and we are in the process of producing prototypes of requested applications of ElectriPlast™ for these companies as well as other prospective customers.

In addition to its manufacturing capabilities, Jasper has a distribution network throughout the US and Canada, allowing for ElectriPlast™ to be introduced to prospective customers and delivered to customers.

We anticipate that our technologies will not be sold directly to the general public, but rather to businesses and manufacturers who will incorporate our technologies as components in the design of their products.

During the six months ended December 31, 2008, the Company extended the expiration date of 955,000 options.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

N/A.

ITEM 4T. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Our management is responsible for establishing and maintaining a system of disclosure controls and procedures (as defined in Rule 13a-15(e)) under the Exchange Act) that is designed to ensure that information required to be disclosed by the Company in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time specified in the 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 an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer's management, including its principal executive officer or officers and principal financial officer or officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.

Pursuant to Rule 13a-15(b) under the Exchange Act the Company carried out an evaluation with the participation of the Company’s management, including William S. Robinson, our Chief Executive Officer (“CEO”) and William A. Ince, our Company’s Chief Financial Officer (“CFO”), of the effectiveness of the Company’s disclosure controls and procedures (as defined under Rule 13a-15(e) under the Exchange Act) as of the period ended December 31, 2008. Based upon that evaluation, the Company’s CEO and CFO concluded that the Company’s disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including the Company’s CEO and CFO, as appropriate, to allow timely decisions regarding required disclosure.

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Changes in internal controls

Our management, with the participation our Chief Executive Officer and Chief Financial Officer, performed an evaluation as to whether any change in our internal controls over financial reporting occurred during the Quarter ended December 31, 2008. Based on that evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that no change occurred in the Company's internal controls over financial reporting during the 2008 Quarter ended December 31, 2008 that has materially affected, or is reasonably likely to materially affect, the Company's internal controls over financial reporting.

. PART II

OTHER INFORMATION COMPANY CONFIRM OR UPDATE AS NEEDED

ITEM 1 - LEGAL PROCEEDINGS

We are not a party to any pending legal proceeding, nor is our property the subject of a pending legal proceeding, that is not in the ordinary course of business or otherwise material to the financial condition of our business. None of our directors, officers or affiliates is involved in a proceeding adverse to our business or has a material interest adverse to our business.

ITEM 1A. RISK FACTORS

There have been no material changes from the Risk Factors described in our Annual Report on Form 10-KSB for the fiscal year ended June 30, 2008.

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

As previously reported in the Company’s Form 10-KSB for the fiscal year ended June 30, 2008, during the year ended June 30, 2008, the Company received subscriptions for an aggregate of 333,333 units, at a price of $0.69 per unit, for aggregate proceeds of $230,000. Each unit consisted of one share of common stock and a warrant to purchase one share of common stock at an exercise price of $0.75 per share for a term of 2 years. On December 15, 2008, the terms of the subscription were amended such that the per unit purchase price was reduced to $0.25 and the exercise price of the warrants was reduced to $0.50 per share. To date, the shares and warrants have yet to be issued, however, the amendment to the subscription terms will result in the issuance of an additional 586,667 shares of the Company’s common stock.

As previously reported in the Company’s Form 10-Q for the quarter ended September 30, 2008, during the first quarter, the Company received subscriptions for an aggregate of 92,500 units, at a price of $0.40 per unit, for aggregate proceeds of $37,000. Each unit consisted of one share of common stock and a warrant to purchase one share of common stock at an exercise price of $0.60 per share for a term of 2 years. On December 15, 2008, the terms of the subscription were amended such that the per unit purchase price was reduced to $0.25 and the exercise price of the warrants was reduced to $0.50 per share. To date, the shares and warrants have yet to be issued, however, the amendment to the subscription terms will result in the issuance of an additional 55,500 shares of the Company’s common stock.

During the quarter ended December 31, 2008, the Company received subscriptions for an aggregate of 3,432,000 units, at a price of $0.25 per unit, for aggregate proceeds of $858,000. Each unit consisted of one share of common stock and a warrant to purchase one share of common stock at an exercise price of $0.50 per share for a term of 2 years. To date, the shares and warrants have yet to be issued.

ITEM 3 - DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4 - SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS

None.

ITEM 5 - OTHER INFORMATION

None.

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ITEM 6. Exhibits

31.1	Certification by Chief Executive Officer, required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act

31.2	Certification by Chief Financial Officer, required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act

32.1	Certification by Chief Executive Officer, required by Rule 13a-14(b) or Rule 15d-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code

32.2	Certification by Chief Financial Officer, required by Rule 13a-14(b) or Rule 15d-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code

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: February 17, 2009

	Integral Technologies, Inc.

	By:	/s/ William S. Robinson
		William S. Robinson, Chief Executive Officer
		and Principal Executive Officer

	By:	/s/ William A. Ince
		William A. Ince, Chief Financial Officer and
		Principal Accounting Officer

Date: February 17, 2009

EXHIBIT INDEX

31.1	Certification by Chief Executive Officer, required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act

31.2	Certification by Chief Financial Officer, required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act

32.1	Certification by Chief Executive Officer, required by Rule 13a-14(b) or Rule 15d-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code

32.2	Certification by Chief Financial Officer, required by Rule 13a-14(b) or Rule 15d-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code