##### Table of Contents



UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, D.C.
    20549
  Form 10-Q
  þ

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)  OF THE
    SECURITIES EXCHANGE ACT OF 1934For the quarterly period ended
    June 30, 2007ORo

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the transition period
    from          to   Commission File
    No. 000-17436
  CKX, INC.
 (Exact name of Registrant as
    specified in its charter)
   Delaware

27-0118168(State or other jurisdiction
    of
    incorporation or organization)

(I.R.S. Employer
    Identification Number)   650 Madison Avenue
 New York, New York 10022
 (Address of Principal Executive
    Offices and Zip Code)
  Registrants Telephone Number, Including Area Code:
 (212) 838-3100
   þ o
  Rule 12b-2
  o þ o
  Rule 12b-2 o þ




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##### 



TABLE OF
    CONTENTS
  
  Part I.


FINANCIAL INFORMATIONItem 1


Financial StatementsCondensed
    Consolidated Balance Sheets (Unaudited) at June 30, 2007
    and December 31, 2006


2Condensed
    Consolidated Statements of Operations (Unaudited) for the three
    months ended June 30, 2007 and 2006 (as restated)


3Condensed
    Consolidated Statements of Operations (Unaudited) for the six
    months ended June 30, 2007 and 2006 (as restated)


4Condensed
    Consolidated Statements of Cash Flows (Unaudited) for the six
    months ended June 30, 2007 and 2006 (as restated)


5Notes to Condensed
    Consolidated Financial Statements (Unaudited)


7Item 2


Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations


24Item 3


Quantitative and
    Qualitative Disclosures About Market Risk


46Item 4


Controls and
    Procedures


47Part II


OTHER
    INFORMATIONItem 1


Legal
    Proceedings


47Item 4


Submission of
    Matters to a Vote of Security Holders


48Item 6


Exhibits


49EX-2.3: AMENDMENT TO THE MANAGEMENT COOPERATION AGREEMENTEX-10.1: LICENSE AGREEMENT-ELVIS PRESLEY ENTERPRISES, INC.EX-10.2: LICENSE AGREEMENT-MUHAMMAD ALI ENTERPRISES LLCEX-31.1: CERTIFICATIONEX-31.2: CERTIFICATIONEX-32.1: CERTIFICATIONEX-32.2: CERTIFICATION   1




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##### Table of Contents



CKX,
    INC.
  CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
  June 30,


December 31,2007


2006(In thousands, except share and per share information)ASSETSCurrent assets:Cash and cash equivalents

$
140,438


$
36,610Restricted cash


1,131



Marketable securities


30,410



Receivables, net of allowance for
    doubtful accounts of $234 at June 30, 2007 and $457 at
    December 31, 2006


49,250



23,364Inventories, net of allowance for
    obsolescence of $773 at June 30, 2007 and $636 at
    December 31, 2006


2,210



2,192Prepaid expenses and other current
    assets


26,896



2,758Prepaid income taxes






7,014Deferred tax assets


1,072



760Total current assets


251,407



72,698Property and equipment 
    net


43,126



35,329Receivables


823



1,274Deferred production costs


3,292



Investment in Park Central
    Properties


86,382



Other assets


20,623



20,394Goodwill


149,220



143,946Other intangible assets 
    net


191,450



199,805Deferred tax assets


1,068



1,199TOTAL ASSETS

$
747,391


$
474,645LIABILITIES AND
    STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable

$
9,808


$
9,612Accrued expenses


28,412



16,831Current portion of long-term debt


652



631Notes payable


31,443



Income taxes payable


8,672



Other current liabilities


372



497Deferred revenue


13,454



12,492Total current liabilities


92,813



40,063Long-term liabilities:Long-term debt


102,564



3,070Deferred revenue


2,376



2,566Other long-term liabilities


4,474



4,359Deferred tax liabilities


28,487



26,623Total liabilities


230,714



76,681Minority interest


162,288



3,953Redeemable restricted common
    stock  1,672,170 shares outstanding at
    June 30, 2007 and December 31, 2006


23,002



23,002Commitments and contingenciesStockholders equity:Preferred stock, $.01 par
    value, authorized 75,000,000 shares:Series B  1,491,817
    outstanding


22,825



22,825Series C 
    1 share outstanding






Common stock, $0.01 par value:
    authorized 200,000,000 shares, 95,244,648 and
    94,237,075 shares issued and outstanding at June 30,
    2007 and December 31, 2006, respectively


952



942Additional
    paid-in-capital


374,078



373,115Accumulated deficit


(82,126
)


(36,562
)Accumulated other comprehensive
    income


15,658



10,689Total stockholders equity


331,387



371,009TOTAL LIABILITIES AND
    STOCKHOLDERS EQUITY

$
747,391


$
474,645    2




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##### Table of Contents



CKX,
    INC.
  CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
    (UNAUDITED)
  Three MonthsThree Months


EndedEnded


June 30, 2006June 30, 2007


(as Restated)(1)(In thousands, except share andper share information)Revenue

$
72,331


$
60,210Operating expenses:Cost of sales


24,915



20,483Selling, general and
    administrative expenses


21,273



16,182Corporate expenses


3,991



3,359Depreciation and amortization


5,526



5,117Merger and distribution-related
    costs


2,761



Acquisition-related costs






646Other costs


295



124Total operating expenses


58,761



45,911Operating income


13,570



14,299Interest income


679



248Interest expense


(1,160
)


(234
)Other expense


(388
)


(881
)Income before income taxes, equity
    in earnings of affiliates and minority interest


12,701



13,432Income tax expense


9,105



5,954Income before equity in earnings
    of affiliates and minority interest


3,596



7,478Equity in earnings (loss) of
    affiliates


(2,236
)


530Minority interest


1,531



(500
)Net income


2,891



7,508Dividends on preferred stock


(456
)


(456
)Net income available to common
    shareholders

$
2,435


$
7,052Income per share:Basic income per share

$
0.03


$
0.08Diluted income per share

$
0.03


$
0.07Average number of common shares
    outstanding:Basic


96,857,748



92,225,921Diluted


96,949,853



96,225,503     (1)
    
    See Note 1 to the Unaudited Condensed Consolidated
    Financial Statements   3




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##### Table of Contents



CKX,
    INC.
  CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
    (UNAUDITED)
  Six MonthsSix Months


EndedEnded


June 30, 2006June 30, 2007


(as Restated)(1)(In thousands, except share andper share information)Revenue

$
121,929


$
101,319Operating expenses:Cost of sales


36,469



33,737Selling, general and
    administrative expenses


40,585



29,418Corporate expenses


8,961



7,422Depreciation and amortization


11,098



9,854Merger and distribution-related
    costs


2,761



Acquisition-related costs






646Other costs


365



415Total operating expenses


100,239



81,492Operating income


21,690



19,827Interest income


969



987Interest expense


(1,576
)


(369
)Other expense


(386
)


(1,032
)Income before income taxes, equity
    in earnings of affiliates and minority interest


20,697



19,413Income tax expense


13,914



8,700Income before equity in earnings
    of affiliates and minority interest


6,783



10,713Equity in earnings (loss) of
    affiliates


(1,859
)


428Minority interest


1,323



(662
)Net income


6,247



10,479Dividends on preferred stock


(912
)


(912
)Net income available to common
    stockholders

$
5,335


$
9,567Income per share:Basic income per share

$
0.06


$
0.10Diluted income per share

$
0.06


$
0.10Average number of common shares
    outstanding:Basic


96,804,899



92,215,135Diluted


96,957,605



96,206,139     (1)
    
    See Note 1 to the Unaudited Condensed Consolidated
    Financial Statements   4




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##### Table of Contents



CKX,
    INC
  CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
    (UNAUDITED)
  Six MonthsSix Months


EndedEnded


June 30, 2006June 30, 2007


(as Restated)(1)(In thousands)Cash flows from operating
    activities:Net income

$
6,247


$
10,479Adjustments to reconcile net income
    to net cash provided by operating activities:Depreciation and amortization


11,098



9,854Unrealized foreign currency gains
    and losses


365



1,032Unrealized gains and losses on
    derivatives


377



Share-based payments


654



496Equity in earnings (losses) of
    affiliates, net of cash received


2,607



95Deferred income taxes


(2,791
)


(1,897
)Non-cash interest expense


806



65Provision for accounts receivable
    allowance


223



35Provision for inventory allowance


138



97Minority interest


(1,323
)


662Changes in operating assets and
    liabilities:Receivables


(25,658
)


(22,258
)Inventory


(156
)


396Prepaid expenses


(1,129
)


359Prepaid income taxes


7,014



1,502Other assets


(3,576
)


(6,632
)Accounts payable and accrued
    expenses


10,857



8,514Deferred revenue


772



(2,997
)Income taxes payable


8,417



9,618Other


(84
)


1,839Net cash provided by operating
    activities


14,858



11,259Cash flows from investing
    activities:Transaction costs related to
    acquisition of FXLR


(306
)


Purchases of businesses, net of
    cash acquired






(54,111
)Acquisition of certain assets of
    Elvis-themed museum






(3,888
)Proceeds from sale of marketable
    securities






42,625Purchases of property and equipment


(9,050
)


(3,931
)Net cash used in investing
    activities


(9,356
)


(19,305
)Cash flows from financing
    activities:Borrowings under revolving credit
    facility for acquisition of FXLR


100,000



Debt issuance costs for amending
    the revolving credit facility


(92
)


(3,086
)Proceeds from exercise of warrants


243



Distributions to minority interest
    shareholders


(900
)


(986
)Principal payments on debt


(613
)


(425
)Dividends paid on preferred stock


(912
)


(912
)Net cash provided by (used in)
    financing activities


97,726



(5,409
)Effect of exchange rate changes on
    cash


600



1,373Net increase (decrease) in cash
    and equivalents


103,828



(12,082
)Cash and cash
    equivalents  beginning of period


36,610



36,979Cash and cash
    equivalents  end of period

$
140,438


$
24,897Supplemental cash flow
    data:Cash paid during the period for:Interest

$
785


$
197Income taxes


1,170



979     (1)
    
    See Note 1 to the Unaudited Condensed Consolidated
    Financial Statements   5




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##### Table of Contents



Supplemental
    Cash Flow Information
      Accrued but unpaid Series B
    Convertible Preferred Stock Dividends

$
456Dividend of 50% of CKXs
    interests in FXLR to the Distribution Trusts (as defined)


50,829     Issuance of note in connection
    with the acquisition of certain assets of Elvis-themed museum

$
750Common stock issued in connection
    with acquisitions


599Accrued but unpaid Series B
    Convertible Preferred Stock Dividends


456    6




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##### Table of Contents



CKX,
    INC.
  NOTES TO UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS
  1.
    Overview
    and Basis of Presentation  General
  IDOLS American Idol IDOLS American
    Idol
  Form 10-K
    Restatement
  Foreign Currency
    Translation
   7




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##### Table of Contents



CKX,
    INC.
  NOTES TO
    UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS  (Continued)
  Form 10-K
  Three Months Ended


Six Months EndedJune 30, 2006


June 30, 2006As Previously





As PreviouslyStatement of Operations

Reported


As Restated


Reported


As RestatedOther costs

$



$
124


$



$
415Total operating expenses


45,787



45,911



81,077



81,492Operating income


14,423



14,299



20,242



19,827Other income (expense)


(125
)


(881
)


(416
)


(1,032
)Income before income taxes, equity
    in earnings of affiliates and minority interest


14,312



13,432



20,444



19,413Income tax expense


6,344



5,954



9,159



8,700Income before equity in earnings
    of affiliates and minority interest


7,968



7,478



11,285



10,713Net income


7,998



7,508



11,051



10,479Net income available to common
    stockholders


7,542



7,052



10,139



9,567Basic income per common share


0.08



0.08



0.11



0.10Diluted income per common share


0.08



0.07



0.11



0.10   Six Months EndedJune 30, 2006As PreviouslyStatement of Cash Flows

Reported


As RestatedAdjustments to reconcile net
    income to net cash provided by operating activities:Unrealized foreign currency gains
    and losses

$



$
1,032Changes in operating assets and
    liabilities:Income taxes payable


10,077



9,618   2.
    Merger
    Agreement    Description
    of Merger Offer
   8




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##### Table of Contents



CKX,
    INC.
  NOTES TO
    UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS  (Continued)
    Form 8-K,
  3.
    Investment
    in FX Luxury Realty, LLC and License Agreements       9




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##### Table of Contents



CKX,
    INC.
  NOTES TO
    UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS  (Continued)
      Form 8-K,
    Reorganization
    of FXLR and Dividend of FX Luxury Real Estate Shares to CKX
    Stockholders
        
    CKX irrevocably transferred and assigned a 9.5% common
    membership interest in FXLR to Distribution Trust I; 10




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##### Table of Contents



CKX,
    INC.
  NOTES TO
    UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS  (Continued)
   
    CKX contributed a 15.5% common membership interest in FXLR to FX
    Luxury Real Estate in exchange for shares of common stock of FX
    Luxury Real Estate in step one of the Reorganization; and
    CKX irrevocably transferred and assigned the shares of FX Luxury
    Real Estate that it received in step one of the Reorganization
    to Distribution Trust II.             11




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##### Table of Contents



CKX,
    INC.
  NOTES TO
    UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS  (Continued)
    (In thousands)Current assets, primarily cash

$
8,652Investments in Riv Shares and Riv
    Option


46,061Investment in Park Central
    Properties


88,269Assets acquired


142,982Current liabilities


2,577Debt


31,443Liabilities assumed


34,020Minority interest


7,305Net assets acquired

$
101,657     Affiliated
    Elements of Transaction
      Repurchase
    Agreement
   12




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##### Table of Contents



CKX,
    INC.
  NOTES TO
    UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS  (Continued)
    Service
    Agreements
    Summarized
    Financial Information
    Current assets

$
65,330Non-current assets


282,435Current liabilities


30,077Non-current liabilities, including
    long-term debt


371,185Revenue


1,816Operating loss


(1,824
)Net loss


(4,920
)   Pro
    Forma Information
    Six Months EndedJune 30,2007


2006(In thousands, exceptper share information)Revenue

$
121,929


$
101,319Net income available to common
    stockholders

$
8,677


$
6,654Net income per common share:Basic

$
0.09


$
0.07Diluted

$
0.09


$
0.07  13




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##### Table of Contents



CKX,
    INC.
  NOTES TO
    UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS  (Continued)
  4.
    Accounting
    Policies  Form 10-K
  Accounting for Uncertainty in Income Taxes Accounting for Income Taxes
  Consolidation of Variable Interest Entities Consolidated Financial Statements
  Accounting for Certain Investments in Debt and Equity
    Securities
  Accounting for
    Derivative Instruments and Hedging Activities
  5.
    Comprehensive
    Income    Three Months Ended


Six Months EndedJune 30,


June 30,2007


2006


2007


2006Net income

$
2,891


$
7,508


$
6,247


$
10,479Other comprehensive income:Unrealized gain (loss) on
    marketable securities


(142
)






(142
)


Foreign currency translation
    adjustments


4,710



9,279



5,111



11,280Comprehensive income

$
7,459


$
16,787


$
11,216


$
21,759  14




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##### Table of Contents



CKX,
    INC.
  NOTES TO
    UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS  (Continued)
    6.
    Earnings
    Per Share/Common Shares Outstanding  Earnings Per Share
    Three Months Ended June 30,


Six Months Ended June 30,2007


2006


2007


2006(In thousands, except share and per share information)Basic income per share computation:Net income applicable to common
    shareholders

$
2,435


$
7,052


$
5,335


$
9,567Basic common shares outstanding
    (including redeemable restricted common stock)


96,857,748



92,225,921



96,804,899



92,215,135Basic income per share

$
0.03


$
0.08


$
0.06


$
0.10Diluted income per share
    computation:Net income applicable to common
    shareholders

$
2,435


$
7,052


$
5,335


$
9,567Basic common shares outstanding
    (including redeemable restricted common stock)


96,857,748



92,225,921



96,804,899



92,215,135Incremental shares for assumed
    exercise of warrants and stock options


92,105



3,999,582



152,706



3,991,004Diluted common shares outstanding
    (including redeemable restricted common stock)


96,949,853



96,225,503



96,957,605



96,206,139Diluted income per share

$
0.03


$
0.07


$
0.06


$
0.10  15




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##### Table of Contents



CKX,
    INC.
  NOTES TO
    UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS  (Continued)
  7.
    Intangible
    Assets and Goodwill    WeightedAverage

Gross





NetRemaining

Carrying


Accumulated


CarryingUseful Life

Amount


Amortization


AmountDefinite Lived Intangible Assets:Presley record, music publishing,
    film and video rights

12.6 years

$
28,900


$
(4,438
)

$
24,462Other Presley intangible assets

14.7 years


13,622



(3,352
)


10,27019 Entertainment IDOLS television
    programming, merchandising and sponsorship contracts

4.8 years


81,162



(25,141
)


56,02119 Entertainment other artist
    management, recording, merchandising, and sponsorship contracts

1.9 years


16,423



(9,354
)


7,069MBST artist contracts, profit
    participation rights and other intangible assets

4.4 years


4,270



(1,406
)


2,864$
144,377


$
(43,691
)

$
100,686Indefinite Lived Intangible Assets:Trademarks, publicity rights and
    other intellectual property











$
90,764     Gross





NetCarrying


Accumulated


CarryingAmount


Amortization


AmountDefinite Lived Intangible Assets:Presley record, music publishing,
    film and video rights

$
28,900


$
(3,466
)

$
25,434Other Presley intangible assets


13,622



(2,715
)


10,90719 Entertainment IDOLS television
    programming, merchandising and sponsorship relationships


79,340



(18,812
)


60,52819 Entertainment other artist
    management, recording, merchandising, and sponsorship
    relationships


16,054



(7,126
)


8,928MBST artist contracts, profit
    participation rights and other intangible assets


4,270



(1,026
)


3,244$
142,186


$
(33,145
)

$
109,041Indefinite Lived Intangible Assets:Trademarks, publicity rights and
    other intellectual property









$
90,764  16




---



##### Table of Contents



CKX,
    INC.
  NOTES TO
    UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS  (Continued)
    (In thousands)For the remaining six months of
    2007

$
9,800For the years ending
    December 31,2008


18,4002009


16,7002010


16,0002011


14,900     2007ForeignBalance at


Currency





Balance atDecember 31,


Translation


Other


June 30,2006


Adjustment


Adjustments


2007Presley royalties and licensing

$
2,432


$



$



$
2,432Presley Graceland operations


7,675











7,67519 Entertainment


123,742



2,806



(2,006
)


124,542MBST


10,097











10,097Ali Business










4,474



4,474Total

$
143,946


$
2,806


$
2,468


$
149,220     8.
    Debt     17




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##### Table of Contents



CKX,
    INC.
  NOTES TO
    UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS  (Continued)
              9.
    Stockholders
    Equity    10.
    Income
    Taxes     18




---



##### Table of Contents



CKX,
    INC.
  NOTES TO
    UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS  (Continued)
                  Accounting for
    Uncertainty in Income Taxes an
    interpretation of FASB Statement No. 109
     19




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##### Table of Contents



CKX,
    INC.
  NOTES TO
    UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS  (Continued)
    11.
    Commitments
    and Contingencies      45-day Form 8-K Form 8-K.
       20




---



##### Table of Contents



CKX,
    INC.
  NOTES TO
    UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS  (Continued)
    12.
    Segment
    Information      21




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##### Table of Contents



CKX,
    INC.
  NOTES TO
    UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS  (Continued)
  Presley BusinessRoyalties and


Graceland


19





CorporateSegment Information

Licensing


Operations


Entertainment


Ali Business


and Other


Total(Amounts in thousands)Three months ended
    June 30, 2007:Revenue

$
5,333


$
10,831


$
52,628


$
1,920


$
1,619


$
72,331Operating income (loss)

$
1,961


$
1,681


$
16,166


$
688


$
(6,926
)

$
13,570Depreciation and amortization

$
646


$
516


$
4,122


$
13


$
229


$
5,526OIBDAN

$
2,616


$
2,215


$
20,352


$
705


$
(6,434
)

$
19,454Three months ended
    June 30, 2006:Revenue

$
3,568


$
9,198


$
42,503


$
2,666


$
2,275


$
60,210Operating income (loss)

$
1,698


$
1,351


$
13,240


$
1,245


$
(3,235
)

$
14,299Depreciation and amortization

$
646


$
494


$
3,726


$
31


$
220


$
5,117OIBDAN

$
2,349


$
1,854


$
17,021


$
1,276


$
(2,843
)

$
19,657Six months ended June 30,
    2007:Revenue

$
9,092


$
16,993


$
90,034


$
3,293


$
2,517


$
121,929Operating income (loss)

$
2,592


$
426


$
29,808


$
1,404


$
(12,540
)

$
21,690Depreciation and amortization

$
1,291


$
1,018


$
8,311


$
22


$
456


$
11,098OIBDAN

$
3,899


$
1,473


$
38,238


$
1,434


$
(11,602
)

$
33,442Six months ended June 30,
    2006:Revenue

$
6,615


$
14,375


$
73,882


$
2,666


$
3,781


$
101,319Operating income (loss)

$
3,044


$
220


$
22,513


$
1,245


$
(7,195
)

$
19,827Depreciation and amortization

$
1,291


$
836


$
7,274


$
31


$
422


$
9,854OIBDAN

$
4,342


$
1,070


$
29,887


$
1,276


$
(6,397
)

$
30,178Asset Information:Segment assets at June 30,
    2007

$
72,313


$
69,170


$
247,618


$
59,851


$
298,439


$
747,391Segment assets at
    December 31, 2006

$
73,705


$
62,440


$
222,122


$
54,806


$
61,572


$
474,645    22




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##### Table of Contents



CKX,
    INC.
  NOTES TO
    UNAUDITED CONDENSED CONSOLIDATED
 FINANCIAL
    STATEMENTS  (Continued)
    Three Months Ended


Six Months EndedJune 30,


June 30,2007


2006


2007


2006(Amounts in thousands)OIBDAN

$
19,454


$
19,657


$
33,442


$
30,178Depreciation and amortization


(5,526
)


(5,117
)


(11,098
)


(9,854
)Non-cash compensation


(358
)


(241
)


(654
)


(497
)Interest income


679



248



969



987Interest expense


(1,160
)


(234
)


(1,576
)


(369
)Equity in earnings (loss) of
    affiliates


(2,236
)


530



(1,859
)


428Other income (expense)


(388
)


(881
)


(386
)


(1,032
)Income tax expense


(9,105
)


(5,954
)


(13,914
)


(8,700
)Minority interest


1,531



(500
)


1,323



(662
)Net income

$
2,891


$
7,508


$
6,247


$
10,479   13.
    Related
    Party Transactions    14.
    Subsequent
    Events   23




---



##### Table of Contents



Item 2.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  Managements discussion and analysis of financial
    condition and results of operations should be read in
    conjunction with the historical financial statements and
    footnotes of the registrant included in its Annual Report on
    Form 10-K
    for the year ended December 31, 2006. Our future results of
    operations may change materially from the historical results of
    operations reflected in our historical financial statements.
  In addition to historical information, this
    Form 10-Q
    (this Quarterly Report) contains forward-looking
    statements within the meaning of Section 27A of the
    Securities Act of 1933, as amended, and Section 21E of the
    Securities Exchange Act of 1934, as amended. Forward-looking
    statements are those that predict or describe future events or
    trends and that do not relate solely to historical matters. You
    can generally identify forward-looking statements as statements
    containing the words believe, expect,
    will, anticipate, intend,
    estimate, project, assume or
    other similar expressions, although not all forward-looking
    statements contain these identifying words. All statements in
    this Quarterly Report regarding our future strategy, future
    operations, projected financial position, estimated future
    revenue, projected costs, future prospects, and results that
    might be obtained by pursuing managements current plans
    and objectives are forward-looking statements. You should not
    place undue reliance on our forward-looking statements because
    the matters they describe are subject to known and unknown
    risks, uncertainties and other unpredictable factors, many of
    which are beyond our control. Our forward-looking statements are
    based on the information currently available to us and speak
    only as of the date on which this Quarterly Report was filed
    with the Securities and Exchange Commission (SEC).
    We expressly disclaim any obligation to issue any updates or
    revisions to our forward-looking statements, even if subsequent
    events cause our expectations to change regarding the matters
    discussed in those statements. Over time, our actual results,
    performance or achievements will likely differ from the
    anticipated results, performance or achievements that are
    expressed or implied by our forward-looking statements, and such
    difference might be significant and materially adverse to our
    stockholders.
  Restatement
  Form 10-Q.
  General
  IDOLS American
    Idol IDOLS American Idol
   24




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##### Table of Contents



Merger
    Agreement
    Description
    of Merger Offer
    Form 8-K,
  Investment
    in FX Luxury Realty, LLC and License Agreements
     25




---



##### Table of Contents



Form 8-K,
    Reorganization
    of FXLR and Dividend of FX Luxury Real Estate Shares to CKX
    Stockholders
        
    CKX irrevocably transferred and assigned a 9.5% common
    membership interest in FXLR to Distribution Trust I;
    CKX contributed a 15.5% common membership interest in FXLR to FX
    Luxury Real Estate in exchange for shares of common stock of FX
    Luxury Real Estate in step one of the Reorganization; and 26




---



##### Table of Contents




    CKX irrevocably transferred and assigned the shares of FX Luxury
    Real Estate that it received in step one of the Reorganization
    to Distribution Trust II.          Repurchase
    Agreement
    Service
    Agreements
    Presley
    Business
  and/or and/or
 27




---



##### Table of Contents



and/or
  19
    Entertainment
    IDOLS IDOLS IDOLS IDOLS IDOLS IDOLS
  IDOLS American Idol 1 American Idol 4 American Idol 4 IDOLS
  American Idol IDOLS
 28




---



##### Table of Contents



IDOLS American Idol IDOLS American Idol American Idol American Idol (2008-2009), American Idol
  American Idol So You Think You Can Dance American Idol IDOLS So You Think You Can
    Dance
    Ali
    Business
       29




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##### Table of Contents



Other
        Use of
    OIBDAN
      Consolidated
    Operating Results Three Months Ended June 30,
    2007
  Compared
    to Three Months Ended June 30, 2006
  Three Months


Three MonthsEnded


EndedJune 30,


June 30,2007


2006


Variance(In thousands)Revenue

$
72,331


$
60,210


$
12,121Operating expenses


58,761



45,911



12,850Operating income


13,570



14,299



(729
)Income tax expense


9,105



5,954



3,151Net income


2,891



7,508



(4,617
)Operating income


13,570



14,299



(729
)Depreciation and amortization


5,526



5,117



409Non-cash compensation


358



241



117OIBDAN

$
19,454


$
19,657


$
(203
)   American Idol
 30




---



##### Table of Contents



Presley
    Business  Royalties and Licensing
    Three Months


Three MonthsEnded


EndedJune 30,


June 30,2007


2006


Variance(In thousands)Revenue

$
5,333


$
3,568


$
1,765Cost of sales


(547
)


(65
)


482Selling, general and
    administrative expense, excluding non-cash compensation


(2,170
)


(1,154
)


1,016OIBDAN

$
2,616


$
2,349


$
267OIBDAN

$
2,616


$
2,349


$
267Depreciation and amortization


(646
)


(646
)


Non-cash compensation


(9
)


(5
)


(4
)Operating income

$
1,961


$
1,698


$
263     Presley
    Business  Graceland Operations
    Three Months


Three MonthsEnded


EndedJune 30,


June 30,2007


2006


Variance(In thousands)Revenue

$
10,831


$
9,198


$
1,633Cost of sales


(1,783
)


(1,535
)


248Selling, general and
    administrative expense, excluding non-cash compensation


(6,833
)


(5,809
)


1,024OIBDAN

$
2,215


$
1,854


$
361OIBDAN

$
2,215


$
1,854


$
361Depreciation and amortization


(516
)


(494
)


(22
)Non-cash compensation


(18
)


(9
)


(9
)Operating income

$
1,681


$
1,351


$
330    31




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##### Table of Contents



19
    Entertainment
      Three Months Ended June 30, 2007

Revenue


Cost of Sales(In thousands)American Idol(including television
    production, foreign syndication, sponsorship, merchandise and
    touring)

$
27,169


$
(4,081
)

$
23,088Other IDOLStelevision
    programs (including license fees and sponsorship)


2,518



(67
)


2,451So You Think You Can Danceand other television
    productions


18,742



(15,461
)


3,281Recorded music, management clients
    and other


4,199



(2,037
)


2,162$
52,628


$
(21,646
)

$
30,982Selling, general and
    administrative expenses and other costs, excluding non-cash
    compensation










(10,630
)OIBDAN









$
20,352OIBDAN









$
20,352Depreciation and amortization










(4,122
)Non-cash compensation










(64
)Operating income









$
16,166   32




---



##### Table of Contents



Three Months Ended June 30, 2006

Revenue


Cost of Sales(In thousands)American Idol(including television
    production, foreign syndication, sponsorship, merchandise and
    touring)

$
21,205


$
(2,616
)

$
18,589Other IDOLStelevision
    programs (including license fees and sponsorship)


2,963



(33
)


2,930So You Think You Can Danceand other television
    productions


15,314



(12,915
)


2,399Recorded music, management clients
    and other


3,021



(1,978
)


1,043$
42,503


$
(17,542
)

$
24,961Selling, general and
    administrative expenses and other costs, excluding non-cash
    compensation










(7,940
)OIBDAN









$
17,021OIBDAN









$
17,021Depreciation and amortization










(3,726
)Non-cash compensation










(55
)Operating income









$
13,240   American Idol So You Think
    You Can Dance
  American Idol 6 American Idol 5 IDOLS So You Think You Can Dance
  American
    Idol
  Ali
    Business
    Corporate
    and Other
  MBST
   33




---



##### Table of Contents



Corporate
    Expenses and Other Costs
        Interest
    Income/Expense
    Other
    Income (Expense)
    Income
    Taxes
           34




---



##### Table of Contents



Accounting for
    Uncertainty in Income Taxes an
    interpretation of FASB Statement No. 109
        Equity
    in Earnings (Losses) of Affiliates
    Minority
    Interest
     35




---



##### Table of Contents



Consolidated
    Operating Results Six Months Ended June 30, 2007
  Compared
    to Six Months Ended June 30, 2006
  Six Months


Six MonthsEnded


EndedJune 30,


June 30,2007


2006


Variance(In thousands)Revenue

$
121,929


$
101,319


$
20,610Operating expenses


100,239



81,492



18,747Operating income


21,690



19,827



1,863Income tax expense


13,914



8,700



5,214Net income


6,247



10,479



(4,232
)Operating income

$
21,690


$
19,827


$
1,863Depreciation and amortization


11,098



9,854



1,244Non-cash compensation


654



497



157OIBDAN

$
33,442


$
30,178


$
3,264   American Idol
  Presley
    Business  Royalties and Licensing
    Six Months


Six MonthsEnded


EndedJune 30,


June 30,2007


2006


Variance(In thousands)Revenue

$
9,092


$
6,615


$
2,477Cost of sales


(864
)


(78
)


786Selling, general and
    administrative expense, excluding non-cash compensation


(4,329
)


(2,195
)


2,134OIBDAN

$
3,899


$
4,342


$
(443
)OIBDAN

$
3,899


$
4,342


$
(443
)Depreciation and amortization


(1,291
)


(1,291
)


Non-cash compensation


(16
)


(7
)


(9
)Operating income

$
2,592


$
3,044


$
(452
)    36




---



##### Table of Contents



Presley
    Business  Graceland Operations
    Six Months


Six MonthsEnded


EndedJune 30,


June 30,2007


2006


Variance(In thousands)Revenue

$
16,993


$
14,375


$
2,618Cost of sales


(2,843
)


(2,591
)


252Selling, general and
    administrative expense, excluding non-cash compensation


(12,677
)


(10,714
)


1,963OIBDAN

$
1,473


$
1,070


$
403OIBDAN

$
1,473


$
1,070


$
403Depreciation and amortization


(1,018
)


(836
)


(182
)Non-cash compensation


(29
)


(14
)


(15
)Operating income

$
426


$
220


$
206        37




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##### Table of Contents



19
    Entertainment
      Six Months Ended June 30, 2007

Revenue


Cost of Sales(In thousands)American Idol(including television
    production, foreign syndication, sponsorship, merchandise and
    touring)

$
47,371


$
(9,590
)

$
37,781Other IDOLStelevision
    programs (including license fees and sponsorship)


6,357



(146
)


6,211So You Think You Can Danceand other television
    productions


19,094



(16,158
)


2,936Recorded music, management clients
    and other


17,212



(5,782
)


11,430$
90,034


$
(31,676
)

$
58,358Selling, general and
    administrative expenses and other costs, excluding non-cash
    compensation










(20,120
)OIBDAN









$
38,238OIBDAN









$
38,238Depreciation and amortization










(8,311
)Non-cash compensation










(119
)Operating income









$
29,808   Six Months Ended June 30, 2006

Revenue


Cost of Sales(In thousands)American Idol(including television
    production, foreign syndication, sponsorship, merchandise and
    touring)

$
35,072


$
(6,782
)

$
28,290Other IDOLStelevision
    programs (including license fees and sponsorship)


5,389



(62
)


5,327So You Think You Can Danceand other television
    productions


16,546



(14,054
)


2,492Recorded music, management clients
    and other


16,875



(8,822
)


8,053$
73,882


$
(29,720
)

$
44,162Selling, general and
    administrative expenses and other costs, excluding non-cash
    compensation










(14,275
)OIBDAN









$
29,887OIBDAN









$
29,887Depreciation and amortization










(7,274
)Non-cash compensation










(100
)Operating income









$
22,513   American Idol So You Think
    You Can Dance
 38




---



##### Table of Contents



American Idol 6 American Idol 5 IDOLS So You Think You Can
    Dance
  American Idol So You Think You
    Can Dance
  Ali
    Business
    Corporate
    and Other
  MBST
    Corporate
    Expenses and Other Costs
        Interest
    Income/Expense
   39




---



##### Table of Contents



Other
    Income (Expense)
    Income
    Taxes
                  Accounting for
    Uncertainty in Income Taxes an
    interpretation of FASB Statement No. 109
 40




---



##### Table of Contents



Equity
    in Earnings (Losses) of Affiliates
    Minority
    Interest
      Liquidity
    and Capital Resources
  Revolving Credit Facility 
 41




---



##### Table of Contents



FXLR Additional Financing 
  Flag Promissory Notes 
  Credit Suisse Loan 
  Purchase of additional 50% interest in Park Central
    Properties 
    and/or
 42




---



##### Table of Contents



Cash
    Flows for the six months ended June 30, 2007 and
    2006
  Operating
    Activities
      Investing
    Activities
      Financing
    Activities
      Uses
    of Capital
     43




---



##### Table of Contents



Capital
    Expenditures
        Future
    Acquisitions
    Dividends
      Commitments
    and Contingencies
       44




---



##### Table of Contents



45-day Form 8-K Form 8-K,
          Inflation
    Critical
    Accounting Policies
  Form 10-K
  Consolidation of Variable Interest Entities Consolidated Financial
    Statements
 45




---



##### Table of Contents



Accounting for Certain Investments in Debt and Equity
    Securities
  Accounting for
    Derivative Instruments and Hedging Activities
  Off
    Balance Sheet Arrangements
     Item 3.
    Quantitative
    And Qualitative Disclosure About Market Risk    Interest
    Rate Risk
        Foreign
    Exchange Risk
       46




---



##### Table of Contents



19
    Entertainment Put Option
     Item 4.
    Controls
    and Procedures  Evaluation
    of Disclosure Controls and Procedures
  Rules 13a-15 15d-15
  Changes
    in Internal Controls over Financial Reporting
   Part II 
    Other Information  Item 1.
    Legal
    Proceedings    45-day
 47




---



##### Table of Contents



Form 8-K Form 8-K.
    Item 4.
    Submission
    of Matters to a Vote of Security Holders     48




---



##### Table of Contents



Proposal 1 
    Election of Directors
  Number of


Number ofShares Voted for


Shares WithheldRobert F.X. Sillerman


90,282,187



74,707Michael G. Ferrel


89,830,831



526,063Simon Fuller


90,279,622



77,272Mitchell J. Slater


89,830,231



526,663Howard J. Tytel


87,274,414



3,082,480Edwin M. Banks


90,304,527



52,367Edward Bleier


90,303,882



53,012Jerry L. Cohen


90,304,727



52,167Carl D. Harnick


89,778,288



578,606Jack Langer


89,778,263



578,631John D. Miller


90,136,391



220,503Bruce Morrow


78,601,432



11,755,462   Proposal 2 
    Ratification of the Appointment of Deloitte & Touche
    LLP to serve as the Companys Independent Registered Public
    Accounting Firm for its fiscal year ending December 31,
    2007.
  For


Against


Abstain90,181,362



150,091



25,441     Item 6.
    Exhibits  ExhibitNo.

Description2
.1

Agreement and Plan of Merger,
    dated as of June 1, 2007, by and among 19X, Inc., 19
    Acquisition Corp. and CKX, Inc. (Previously filed as
    Exhibit 2.1 to the
    Form 8-K
    filed June 1, 2007, and incorporated herein by reference).
    (Pursuant to Item 601(b)(2) of
    Regulation S-K,
    the Company agrees to furnish, supplementally, a copy of any
    exhibit or schedule omitted from the Merger Agreement to the SEC
    upon request.)2
.2

Management Cooperation Agreement,
    dated as of June 1, 2007, by and among CKX, Inc. and each
    of the stockholders set forth on Schedule I thereto
    (Previously filed as Exhibit 2.2 to the
    Form 8-K
    filed June 1, 2007, and incorporated herein by reference).2
.3

Amendment, dated July 18,
    2007, to the Management Cooperation Agreement, dated
    June 1, 2007, by and among CKX, Inc. and each of the
    stockholders set forth on Schedule I to the Management
    Cooperation Agreement (Filed herewith).2
.4

Membership Interest Purchase
    Agreement, dated as of June 1, 2007, by and among FX Luxury
    Realty, LLC, CKX, Inc., and Flag Luxury Properties, LLC
    (Previously filed as Exhibit 2.3 to the
    Form 8-K
    filed June 1, 2007, and incorporated herein by reference).2
.5

Amendment No. 1 dated as of
    June 18, 2007 to Membership Interest Purchase Agreement,
    dated as of June 1, 2007, by and among FX Luxury Realty,
    LLC, CKX, Inc., and Flag Luxury Properties, LLC (Previously
    filed as Exhibit 2.1 to the
    Form 8-K
    filed June 18, 2007, and incorporated herein by reference).2
.6

Repurchase Agreement, dated as of
    June 1, 2007, by and among FX Luxury Realty, LLC, CKX,
    Inc., Flag Luxury Properties, LLC, Robert F.X. Sillerman, Brett
    Torino and Paul C. Kanavos (Previously filed as Exhibit 2.4
    to the
    Form 8-K
    filed June 1, 2007, and incorporated herein by reference). 49




---



##### Table of Contents



ExhibitNo.

Description2
.7

Amendment No. 1 dated as of
    June 18, 2007 to Repurchase Agreement, dated as of
    June 1, 2007, by and among FX Luxury Realty, LLC, CKX,
    Inc., Flag Luxury Properties, LLC, Robert F.X. Sillerman,
    Brett Torino and Paul C. Kanavos (Previously filed as
    Exhibit 2.2 to the
    Form 8-K
    filed June 18, 2007, and incorporated herein by reference).3
.1

Certificate of Incorporation
    (Previously filed as Exhibit 3.1 to the
    Form 10-KSB
    filed September 30, 2005, and incorporated herein by
    reference).3
.2

By-Laws (Previously filed as
    Exhibit 3.2 to the
    Form 10-KSB
    filed September 30, 2005, and incorporated herein by
    reference).4
.1

Registration Rights Agreement,
    dated March 17, 2005, by and among the Company, Simon
    Robert Fuller and Fuller Nominees Limited (Previously filed as
    Exhibit 4.2 to the
    Form 10-QSB
    for the period ended September 30, 2005, and incorporated
    herein by reference).4
.2

Registration Rights Agreement,
    dated February 7, 2005 between the Company and The Huff
    Alternative Fund, L.P. (Previously filed as Exhibit 4.4 to
    the
    Form 8-K/A
    filed February 11, 2005, and incorporated herein by
    reference).4
.3

Letter Agreement dated
    June 6, 2005, among the Company, The Huff Alternative Fund,
    L.P. and The Huff Alternative Parallel Fund, L.P. (Previously
    filed as Exhibit 4.9 to Amendment No. 3 to
    Form S-1/A
    (Registration Statement
    No. 333-123995)
    filed June 21, 2005 and incorporated herein by reference).4
.4

Registration Rights Agreement,
    dated February 7, 2005 between the Company and The
    Promenade Trust (Previously filed as Exhibit 4.5 to the
    Form 8-K/A
    filed February 11, 2005, and incorporated herein by
    reference).4
.5

Form of Common Stock Purchase
    Warrant, dated as of February 7, 2005, to purchase shares
    of Common Stock of the Company (previously filed as
    Exhibit 4.6 to the Form 8-K/A filed February 11, 2005,
    and incorporated herein by reference).4
.6

Form of Promissory Term Note made
    on February 7, 2005, payable to Priscilla Presley
    (Previously filed as Exhibit 4.8 to the
    Form 8-K/A
    filed February 11, 2005, and incorporated herein by
    reference).10
.1

License Agreement between Elvis
    Presley Enterprises, Inc. and FX Luxury Realty, LLC, dated as of
    June 1, 2007 (Filed herewith).10
.2

License Agreement between Muhammad
    Ali Enterprises LLC and FX Luxury Realty, LLC, dated as of
    June 1, 2007 (Filed herewith).31
.1

Certification of Principal
    Executive Officer (Filed herewith).31
.2

Certification of Principal
    Financial Officer (Filed herewith).32
.1

Section 1350 Certification of
    Principal Executive Officer (Filed herewith).32
.2

Section 1350 Certification of
    Principal Financial Officer (Filed herewith).  50




---



##### Table of Contents



SIGNATURES
    Inc.
  BY:
    /s/  Robert
    F.X. Sillerman   Title:
    Chief Executive Officer and Chairman of the Board
  BY:
    /s/  Thomas
    P. Benson   Title:
    Chief Financial Officer, Executive Vice President and Treasurer
   51




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##### Table of Contents



INDEX TO
    EXHIBITS
  ExhibitNo.

Description2
.3

Amendment, dated July 18,
    2007, to the Management Cooperation Agreement, dated
    June 1, 2007, by and among CKX, Inc. and each of the
    stockholders set forth on Schedule I to the Management
    Cooperation Agreement.10
.1

License Agreement between Elvis
    Presley Enterprises, Inc. and FX Luxury Realty, LLC, dated as of
    June 1, 2007. (Pursuant to Item 601(b)(2) of
    Regulation S-K,
    the Company agrees to furnish, supplementally, a copy of any
    exhibit or schedule omitted from the Merger Agreement to the SEC
    upon request.)10
.2

License Agreement between Muhammad
    Ali Enterprises LLC and FX Luxury Realty, LLC, dated as of
    June 1, 2007. (Pursuant to Item 601(b)(2) of
    Regulation S-K,
    the Company agrees to furnish, supplementally, a copy of any
    exhibit or schedule omitted from the Merger Agreement to the SEC
    upon request.)31
.1

Certification of Principal
    Executive Officer.31
.2

Certification of Principal
    Financial Officer.32
.1

Section 1350 Certification of
    Principal Executive Officer.32
.2

Section 1350 Certification of
    Principal Financial Officer.