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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>UNITED
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      D.C. 20549</strong></font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>FORM
      8-K</strong></font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 36pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Current
      Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
      1934</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Date
      of
      Report (Date of earliest event reported) September 15, 2006</font></div>
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      Inc.</u></strong></font></div>
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      name of Company as specified in its charter)</strong></font></div>
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            <td width="20%">&#160;</td>
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              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><strong><u><font size="2">75-2785941</font></u></strong></div>
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                Employer
                Identification)</font></strong></div>
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              <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><strong><font size="2">of
                Incorporation)</font></strong></div>
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            <td width="20%">&#160;</td>
            <td width="20%">&#160;</td>
            <td width="20%">&#160;</td>
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      So. Wymore Rd. Alomonte Springs, Suite 3000, Florida
      32714</u></strong></font></div>
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                communications pursuant to Rule 13e-4(c) under the Exchange Act (17
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      1.01 Entry into a Material Definitive Agreement. </strong></font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>In
      private placements to accredited investors, in January 2006 the Company sold
      discounted convertible promissory notes in the total face amount of $5,331,212
      for $4,685,000, and in February 2006, the Company sold discounted convertible
      promissory notes in total face amount of $2,987,072 for $2,625,000
      (collectively, the &#8220;Notes&#8221;). In May 2006, the investors and the Company entered
      into a Modification and Amendment Agreement pursuant to which the parties
      thereto restructured the terms of the January and February Subscription
      Agreements. </strong></font></div>
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    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>On
      or About September 15, 2006, certain investors (the &#8220;Investors&#8221;) filed an action
      against the Company entitled Alpha Capital Aktiengesellschaft, Bristol
      Investment Fund, Ltd., Whalehaven Capital Fund Limited, Ellis International,
      Ltd., Platinum Long Term Growth II, Inc., Chestnut Ridge Partners, LP, Grushko
      &amp; Mittman, P.C., CMS Capital, DKR Soundshore Oasis Holding Fund, Ltd., and
      Osher Capital, Inc. v. VoIP, Inc., in the Circuit Court of the Twelfth Judicial
      Circuit, Sarasota County, Florida (the &#8220;Action&#8221;) claiming a breach of contract
      related to the Notes. The Company filed an Answer to the Complaint denying
      all
      wrongdoing. In settlement of the Action, on or about September 15, 2006 the
      Company and the investors entered into a settlement agreement (the &#8220;Agreement&#8221;)
      pursuant to which: </strong></font></div>
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            <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>The
              amount due and owing under the Notes shall be reset to the principal
              amount due under the Notes in the amount of $8,318,284, together with
              interest due under the Notes in the amount of $207,957.09, and liquidated
              damages provided in the Notes in the amount of $374,322.77, for a total
              amount of $9,781,719</strong></font></div>
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            <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>The
              Investors agreed to surrender $4,940,000 of the Notes Claims, on a
              pro
              rata basis, to the Company in exchange for 19,000,000 shares of the
              Company&#8217;s common stock, par value $0.001 per share, through the issuance
              of freely trading securities issued pursuant to Section 3(a)(10) of
              the
              Act. </strong></font></div>
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            <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Alpha,
              Whalehaven, Ellis, and Bristol agree to surrender their Warrant Claims
              to
              the Company in exchange for 2,500,000 shares of the Company&#8217;s common
              stock, par value $0.001 per share, through the issuance of freely trading
              securities issued pursuant to Section 3(a)(10) of the
              Act.</strong></font></div>
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          <td>
            <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>The
              Investors agreed to retain the balance of their claims of their Notes
              Claims and the Company agreed to reset the conversion rate for the
              remaining balance under the Notes to $0.26 per share, which shall retain
              all rights </strong></font></div>
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        <tr valign="top" style="line-height: 1.25;">
          <td align="right" style="width: 36pt;"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Symbol, serif"><strong>&#183;&#160;&#160;</strong></font></td>
          <td>
            <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>The
              Company agreed to reduce the exercise price of the un-exercised warrants
              purchased by the Investors in connection with the Notes to
              $0.475.</strong></font></div>
          </td>
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        <tr valign="top" style="line-height: 1.25;">
          <td align="right" style="width: 36pt;"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Symbol, serif"><strong>&#183;&#160;&#160;</strong></font></td>
          <td>
            <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>The
              Company agreed to amend its Certificate of Incorporation and take all
              steps necessary, including obtaining shareholder approval, to authorize
              at
              least an additional 18,621,997 shares of common stock, as well as
              sufficient shares to cover the un-exercised warrants issued to the
              Investors under the Notes and hold such shares in reserve for the
              Investors&#8217; benefit in connection with the balance by the Investors herein
              on or before November 30, 2006. </strong></font></div>
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        <tr valign="top" style="line-height: 1.25;">
          <td align="right" style="width: 36pt;"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Symbol, serif"><strong>&#183;&#160;&#160;</strong></font></td>
          <td>
            <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>The
              Investors agreed that no Investor shall sell more than its pro-rata
              allocation of thirty percent (30%) of the daily trading volume in the
              Company&#8217;s common stock, provided however, any Investor may cumulate the
              daily trading volume in any given calendar week to compute their leak-out
              amount; provided further, that the aforementioned cumulative trading
              volume resets every Monday. This Investors&#8217; Leak-Out provision does not
              apply to any sale of the Company&#8217;s common stock at a price above $0.75 per
              share. </strong></font></div>
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    <div>&#160;</div>
    <table cellpadding="0" cellspacing="0" id="list" width="100%">

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            <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>With
              respect to the balance of the claims retained by The Investors under
              the
              Notes, The Investors retain all rights granted to them in Notes that
              were
              not specifically waived in The
              Agreement.</strong></font></div>
          </td>
        </tr>

    </table>
    <table cellpadding="0" cellspacing="0" id="list" width="100%">

        <tr valign="top" style="line-height: 1.25;">
          <td align="right" style="width: 36pt;"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Symbol, serif"><strong>&#183;
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            <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>The
              Company and the Investors agreed to execute a mutual release upon the
              Investors&#8217; receipt of the shares issued pursuant to Section
              3(a)(10)</strong></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
          </td>
        </tr>

    </table>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Item
      2.03
      Creation of a Direct Financial Obligation or an Obligation under an Off-Balance
      Sheet Arrangement of a Registrant.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">See
      Item
      1.01. </font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SIGNATURES</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pursuant
      to the requirement of the Securities Exchange Act of 1934, the Registrant has
      duly caused this report to be signed on its behalf by the undersigned hereunto
      duly authorized.</font></div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">
      <table align="center" bgcolor="#ffffff" border="0" cellpadding="0" cellspacing="0" width="100%">

          <tr valign="top" bgcolor="#ffffff">
            <td width="50%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;</font></td>
            <td width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;</font></td>
            <td width="49%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;</font></td>
          </tr>
          <tr valign="top" bgcolor="#ffffff">
            <td>&#160;</td>
            <td colspan="2">&#160;</td>
          </tr>
          <tr valign="top" bgcolor="#ffffff">
            <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;</font></td>
            <td colspan="2"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">VoIP,
              INC.</font></td>
          </tr>
          <tr valign="top" bgcolor="#ffffff">
            <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;<br>&#160;</font></td>
            <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;<br>&#160;</font></td>
            <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;<br>&#160;</font></td>
          </tr>
          <tr valign="top" bgcolor="#ffffff">
            <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">Date:&#160;September
              22, 2006</font></td>
            <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">By:&#160;&#160;</font></td>
            <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">/S/&#160;Anthony
              Cataldo</font></td>
          </tr>
          <tr valign="top" bgcolor="#ffffff">
            <td colspan="2"><font style="FONT-FAMILY: " size="1">&#160;</font></td>
            <td align="left">
              <hr style="COLOR: black" align="left" noshade size="2" width="55%"><font size="2">Anthony
              Cataldo</font></td>
          </tr>
          <tr valign="top" bgcolor="#ffffff">
            <td colspan="2"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">&#160;</font></td>
            <td><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: ">Chief
              Executive Officer </font></td>
          </tr>

      </table>
    </div>
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{"company-data": {"conformed-name": "VOIP INC", "cik": "0001100954", "assigned-sic": "3661", "irs-number": "752785941", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "000-28985", "film-number": "061104571"}, "business-address": {"street1": "151 SOUTH WYMORE ROAD", "street2": "SUITE 3000", "city": "ALTAMONTE SPRINGS", "state": "FL", "zip": "32714", "phone": "407-389-3232"}, "mail-address": {"street1": "151 SOUTH WYMORE ROAD", "street2": "SUITE 3000", "city": "ALTAMONTE SPRINGS", "state": "FL", "zip": "32714"}, "former-company": [{"former-conformed-name": "VOIP  INC", "date-changed": "20040415"}, {"former-conformed-name": "MILLENNIA TEA MASTERS INC", "date-changed": "19991213"}]}
UNITED
      STATES
SECURITIES
      AND EXCHANGE COMMISSION
Washington,
      D.C. 20549
FORM
      8-K
Current
      Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
      1934
Date
      of
      Report (Date of earliest event reported) September 15, 2006
VoIP,
      Inc.
(Exact
      name of Company as specified in its charter)
Texas
000-28985
75-2785941
(State
                or Other
                Jurisdiction
(Commission
                File
                Number)
(I.R.S.
                Employer
                Identification)
of
                Incorporation)
151
      So. Wymore Rd. Alomonte Springs, Suite 3000, Florida
      32714
(Address
      of principal executive offices) (Zip Code)
Registrant's
      telephone number, including area code:
(407)
      389-3232
N/A
(Former
      name or former address, if changed since last report)
o
Written
                communication pursuant to Rule 425 under the Securities Act (17 CFR
                230.425)
o
Soliciting
                material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
                240.14a-12)
o
Pre-commencement
                communications pursuant to Rule 14d-2(b) under the Exchange Act (17
                CFR
                240.14d-2(b))
o
Pre-commencement
                communications pursuant to Rule 13e-4(c) under the Exchange Act (17
                CFR
                40.13e-4(c))
Item
      1.01 Entry into a Material Definitive Agreement.
In
      private placements to accredited investors, in January 2006 the Company sold
      discounted convertible promissory notes in the total face amount of $5,331,212
      for $4,685,000, and in February 2006, the Company sold discounted convertible
      promissory notes in total face amount of $2,987,072 for $2,625,000
      (collectively, the "Notes"). In May 2006, the investors and the Company entered
      into a Modification and Amendment Agreement pursuant to which the parties
      thereto restructured the terms of the January and February Subscription
      Agreements.
On
      or About September 15, 2006, certain investors (the "Investors") filed an action
      against the Company entitled Alpha Capital Aktiengesellschaft, Bristol
      Investment Fund, Ltd., Whalehaven Capital Fund Limited, Ellis International,
      Ltd., Platinum Long Term Growth II, Inc., Chestnut Ridge Partners, LP, Grushko
      & Mittman, P.C., CMS Capital, DKR Soundshore Oasis Holding Fund, Ltd., and
      Osher Capital, Inc. v. VoIP, Inc., in the Circuit Court of the Twelfth Judicial
      Circuit, Sarasota County, Florida (the "Action") claiming a breach of contract
      related to the Notes. The Company filed an Answer to the Complaint denying
      all
      wrongdoing. In settlement of the Action, on or about September 15, 2006 the
      Company and the investors entered into a settlement agreement (the "Agreement")
      pursuant to which:
·
The
              amount due and owing under the Notes shall be reset to the principal
              amount due under the Notes in the amount of $8,318,284, together with
              interest due under the Notes in the amount of $207,957.09, and liquidated
              damages provided in the Notes in the amount of $374,322.77, for a total
              amount of $9,781,719
·
The
              Investors agreed to surrender $4,940,000 of the Notes Claims, on a
              pro
              rata basis, to the Company in exchange for 19,000,000 shares of the
              Company's common stock, par value $0.001 per share, through the issuance
              of freely trading securities issued pursuant to Section 3(a)(10) of
              the
              Act.
·
Alpha,
              Whalehaven, Ellis, and Bristol agree to surrender their Warrant Claims
              to
              the Company in exchange for 2,500,000 shares of the Company's common
              stock, par value $0.001 per share, through the issuance of freely trading
              securities issued pursuant to Section 3(a)(10) of the
              Act.
·
The
              Investors agreed to retain the balance of their claims of their Notes
              Claims and the Company agreed to reset the conversion rate for the
              remaining balance under the Notes to $0.26 per share, which shall retain
              all rights
·
The
              Company agreed to reduce the exercise price of the un-exercised warrants
              purchased by the Investors in connection with the Notes to
              $0.475.
·
The
              Company agreed to amend its Certificate of Incorporation and take all
              steps necessary, including obtaining shareholder approval, to authorize
              at
              least an additional 18,621,997 shares of common stock, as well as
              sufficient shares to cover the un-exercised warrants issued to the
              Investors under the Notes and hold such shares in reserve for the
              Investors' benefit in connection with the balance by the Investors herein
              on or before November 30, 2006.
·
The
              Investors agreed that no Investor shall sell more than its pro-rata
              allocation of thirty percent (30%) of the daily trading volume in the
              Company's common stock, provided however, any Investor may cumulate the
              daily trading volume in any given calendar week to compute their leak-out
              amount; provided further, that the aforementioned cumulative trading
              volume resets every Monday. This Investors' Leak-Out provision does not
              apply to any sale of the Company's common stock at a price above $0.75 per
              share.
·
With
              respect to the balance of the claims retained by The Investors under
              the
              Notes, The Investors retain all rights granted to them in Notes that
              were
              not specifically waived in The
              Agreement.
·
The
              Company and the Investors agreed to execute a mutual release upon the
              Investors' receipt of the shares issued pursuant to Section
              3(a)(10)
Item
      2.03
      Creation of a Direct Financial Obligation or an Obligation under an Off-Balance
      Sheet Arrangement of a Registrant.
See
      Item
      1.01.
SIGNATURES
Pursuant
      to the requirement of the Securities Exchange Act of 1934, the Registrant has
      duly caused this report to be signed on its behalf by the undersigned hereunto
      duly authorized.
VoIP,
              INC.
Date: September
              22, 2006
By:
/S/ Anthony
              Cataldo
Anthony
              Cataldo
Chief
              Executive Officer