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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 (Mark One)
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2011
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE EXCHANGE ACT
 For the transition period from  to
 Commission file number: 000-26073
 IMMEDIATEK, INC.
  Nevada
    
    86-0881193(State or other jurisdiction of incorporation or
    
    (IRS Employer Identification No.)organization)3301 Airport Freeway, Suite 200Bedford, Texas
    
    76021(Address of principal executive offices)
    
    (Zip code)
 (888) 661-6565  (Issuers telephone number, including area code)
 (Former name, former address and former fiscal year, if changed since last report)
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 o þ




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##### 



IMMEDIATEK, INC.
 TABLE OF CONTENTS
 PageIntroduction
    
    
    1Trademarks and Service Marks
    
    
    1Market and Industry Data and Forecasts
    
    
    1Forward-Looking Statements
    
    
    1Part I  Unaudited Financial Information
    
    
    3Item 1. Unaudited Financial Statements
    
    
    3Unaudited Condensed Consolidated Balance Sheets at March 31, 2011 and December 31, 2010
    
    
    3Unaudited Condensed Consolidated Statements of Operations for the three months
ended March 31, 2011 and 2010
    
    
    4Unaudited Condensed Consolidated Statements of Cash Flows for the three months
ended March 31, 2011 and 2010
    
    
    5Notes to Unaudited Condensed Consolidated Financial Statements
    
    
    6Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    10Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    15Item 4. Controls and Procedures
    
    
    15Part II  Other Information
    
    
    16Item 1. Legal Proceedings
    
    
    16Item 6. Exhibits
    
    
    16Signatures
    
    
    S-1Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2
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##### Table of Contents



INTRODUCTION
  
 TRADEMARKS AND SERVICE MARKS
  
 MARKET AND INDUSTRY DATA AND FORECASTS
  
 FORWARD-LOOKING STATEMENTS
  
    
    our inability to continue as a going concern;
 
    
    our history of losses, which may continue;
 
    
    our inability to utilize the funds received in a manner that is accretive;
 
    
    our inability to generate sufficient funds from operating activities to fund
operations;
 
    
    difficulties in developing and marketing new products;
 
    
    inability to integrate our recently acquired Officeware business;
 
    
    inability to execute our growth and acquisition strategy;
 
    
    dependence on third-party contractors, platforms, software, websites, and
technologies used in the creation and maintenance of the FilesAnywhere service; and
    
    general economic conditions, including among others, the pronounced recession,
rising unemployment, major bank failures and unsettled capital markets.
  1




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PART I  UNAUDITED FINANCIAL INFORMATION
 
 Item 1.
    
    Unaudited Financial Statements.
 Immediatek, Inc.
 
 Unaudited Condensed Consolidated Balance Sheets
 March 31,
    
    
    December 31,2011
    
    
    2010AssetsCurrent assets:Cash
    
    $
    1,702,678
    
    
    $
    1,592,684Accounts receivable, net of allowance for doubtful accounts of $56,385
    
    
    121,298
    
    
    
    112,896Prepaid expenses and other current assets
    
    
    119,251
    
    
    
    114,525Total current assets
    
    
    1,943,227
    
    
    
    1,820,105Fixed assets, net
    
    
    445,902
    
    
    
    494,433Intangible assets, net
    
    
    1,446,884
    
    
    
    1,510,006Goodwill
    
    
    766,532
    
    
    
    766,532Other assets
    
    
    13,432
    
    
    
    4,784Total Assets
    
    $
    4,615,977
    
    
    $
    4,595,860Liabilities, Preferred Stock and Stockholders EquityCurrent liabilities:Accounts payable
    
    $
    92,850
    
    
    $
    97,125Accrued liabilities
    
    
    61,566
    
    
    
    39,346Deferred revenue
    
    
    758,126
    
    
    
    671,952Current portion of capital lease obligations
    
    
    31,882
    
    
    
    40,517Total current liabilities
    
    
    944,424
    
    
    
    848,940Capital lease obligations
    
    
    13,848
    
    
    
    19,821Total liabilities
    
    
    958,272
    
    
    
    868,761Series A convertible preferred stock (conditionally redeemable); $0.001 par value
4,392,286 authorized, issued and outstanding; redemption/liquidation
preference of $3,000,000
    
    
    3,000,000
    
    
    
    3,000,000Series B convertible preferred stock (conditionally redeemable); $0.001 par value
69,726 authorized, issued and outstanding; redemption/liquidation
preference of $500,000
    
    
    500,000
    
    
    
    500,000Stockholders equity:Common stock, $0.001 par value, 500,000,000 shares authorized, 15,865,641 shares
issued and outstanding at March 31, 2011 and December 31, 2010,
Respectively
    
    
    15,865
    
    
    
    15,865Additional paid in capital
    
    
    5,200,272
    
    
    
    5,189,772Accumulated deficit
    
    
    (5,058,432
    )
    
    
    (4,978,538
    )Total stockholders equity
    
    
    157,705
    
    
    
    227,099Total Liabilities, Preferred Stock and Stockholders Equity
    
    $
    4,615,977
    
    
    $
    4,595,860
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Immediatek, Inc.
 
 Unaudited Condensed Consolidated Statements of Operations
 For the Quarter Ended March 31,2011
    
    
    2010Revenues
    
    $
    730,616
    
    
    $
    23Cost of revenues
    
    
    (226,484
    )
    
    
    Gross margin
    
    
    504,132
    
    
    
    23Expenses:Research and development
    
    
    198,095
    
    
    
    98,519Sales and marketing
    
    
    79,942
    
    
    
    General and administrative
    
    
    214,818
    
    
    
    151,447Non-cash consulting expense-related party
    
    
    10,500
    
    
    
    10,500Depreciation and amortization
    
    
    79,972
    
    
    
    592Total expenses
    
    
    583,327
    
    
    
    261,058Net operating loss
    
    
    (79,195
    )
    
    
    (261,035
    )Other income (expense):Other income  related party
    
    
    
    
    
    
    8,788Interest income
    
    
    457
    
    
    
    Interest expense
    
    
    (1,156
    )
    
    
    Interest expense  related party
    
    
    
    
    
    
    (5,624
    )Total other income (expense)
    
    
    (699
    )
    
    
    3,164Net loss
    
    $
    (79,894
    )
    
    $
    (257,871
    )Weighted average number of common
shares outstanding  basic and fully diluted
    
    
    15,865,641
    
    
    
    535,321Basic and diluted loss per common share
attributable to common stockholders
    
    $
    (0.01
    )
    
    $
    (0.48
    )
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Immediatek, Inc.
 
 Unaudited Condensed Consolidated Statements of Cash Flow
 For the Quarter Ended March 31,2011
    
    
    2010Cash flows from operating activitiesNet loss
    
    $
    (79,894
    )
    
    $
    (257,871
    )Adjustments to reconcile net loss to net cash provided
by (used in) operating activities:Depreciation and amortization
    
    
    117,499
    
    
    
    592Non-cash consulting fees  related party
    
    
    10,500
    
    
    
    10,500Adjustments to reconcile net loss to net cash used
in operating activities:Accounts receivable
    
    
    (8,402
    )
    
    
    (6,874
    )Prepaid expenses and other assets
    
    
    (13,374
    )
    
    
    (8,293
    )Accounts payable
    
    
    (4,275
    )
    
    
    (2,109
    )Accrued liabilities
    
    
    22,220
    
    
    
    38,383Deferred revenue
    
    
    86,174
    
    
    
    Net cash provided by (used in) operating activities
    
    
    130,448
    
    
    
    (225,672
    )Cash flows from investing activitiesPurchase of fixed assets
    
    
    (5,846
    )
    
    
    Net cash used in investing activities
    
    
    (5,846
    )
    
    
    Cash flows from financing activitiesPayments on capital leases
    
    
    (14,608
    )
    
    
    Net cash used in financing activities
    
    
    (14,608
    )
    
    
    Net increase in cash
    
    
    109,994
    
    
    
    (225,672
    )Cash at the beginning of the period
    
    
    1,592,684
    
    
    
    278,795Cash at the end of the period
    
    $
    1,702,678
    
    
    $
    53,123Supplemental disclosures:Interest paid
    
    $
    1,156
    
    
    $
    Income taxes paid
    
    $
    
    
    
    $
    
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IMMEDIATEK, INC.
 
 NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 MARCH 31, 2011
 NOTE 1  DESCRIPTION OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 Description of Business:
    Basis of Presentation:
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IMMEDIATEK, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2011
  Goodwill and Intangible Assets:
 Net Loss per Share:
 Comprehensive Loss:
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IMMEDIATEK, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2011
 NOTE 2  MERGER WITH OFFICEWARE CORPORATION
  Cash
    
    $
    1,243,806Accounts receivable, net
    
    
    406,120Prepaid expenses and other current assets
    
    
    47,374Fixed assets
    
    
    486,544Intangible assets
    
    
    1,701,622Goodwill
    
    
    766,532Other assets
    
    
    10,153Accounts payable
    
    
    (34,005
    )Accrued liabilities
    
    
    (92,636
    )Deferred revenue
    
    
    (432,304
    )Capital lease obligations
    
    
    (103,206
    )Net assets acquired with merger
    
    $
    4,000,000
  Trade name
    
    $
    126,808
    
    
    
    10 yearsDeveloped technology
    
    
    729,423
    
    
    
    6 yearsCustomer relationships
    
    
    842,413
    
    
    
    8 yearsDomain name
    
    
    3,728
    
    
    
    Indefinite
   2010Revenues
    
    $
    845,268Net operating income
    
    
    (247,293
    )Net loss
    
    
    (309,024
    )Basic and diluted net loss per share
    
    $
    (0.02
    )
 NOTE 3  ISSUANCE OF COMMON STOCK
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IMMEDIATEK, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 2011
 NOTE 4  RELATED PARTY TRANSACTIONS
 Management Services Agreement.
  Demand Promissory Note
 Officeware Service.
 Consulting Agreements
   Office Space
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Item 2.
    
    Managements Discussion and Analysis of Financial Condition and Results of Operations
 Overview
  
    
    Recent Developments  a description of important events that have recently
occurred.
 
    
    Our Business  a general description of our business, our objectives, our areas of
focus and the challenges and risks of our business.
 
    
    Critical Accounting Policies and Estimates  a discussion of accounting policies
that require critical judgments and estimates.
 
    
    Operations Review  an analysis of our consolidated results of operations for the
periods presented in this Quarterly Report on Form 10-Q.
 
    
    Liquidity, Capital Resources and Financial Position  an analysis of our cash
flows and debt and contractual obligations; and an overview of our financial
condition.
 Recent Developments
     10




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Our Business
 General
      History of Operating Losses
  For the Three Months Ended March 31,2011
    
    
    2010(unaudited)
    
    
    (unaudited)Net loss
    
    $
    (79,894
    )
    
    $
    (257,871
    )Net cash provided by (used in)
operating activities
    
    $
    130,448
    
    
    $
    (225,672
    )
  11




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Our Objectives and Areas of Focus
 Officeware  Increase Users
 Acquisitions
 Challenges and Risks
 see
 Utilizing Funds on Hand in a Manner that is Accretive
 Growing Users
 Competition
   Critical Accounting Policies and Estimates
  
    
    Revenue Recognition. Officeware generates revenue primarily from monthly fees for
the services and products that it offers. While revenues for Officewares
FilesAnywhere.com product are often received in advance of providing the applicable
service, the Company defers recognizing such revenues until the service has been
performed. Revenues for Officewares custom products for large enterprises are often
received after such services are provided. The Company recognizes such revenues when
service has been provided and collection is reasonably assured.
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Operations Review
 The Three Months Ended March 31, 2011 Compared to
the Three Months Ended March 31, 2010
 For the Three Months Ended March 31,
    
    
    2011 vs. 20102011
    
    
    2010
    
    
    Change
    
    
    % ChangeRevenues
    
    $
    730,616
    
    
    $
    23
    
    
    $
    730,593
    
    
    
    3,176,491
    %Cost of revenues
    
    
    (226,484
    )
    
    
    
    
    
    
    (226,484
    )
    
    
    0
    %Gross margin
    
    
    504,132
    
    
    
    23
    
    
    
    504,109
    
    
    
    2,191,778
    %Expenses:Research and development
    
    
    198,095
    
    
    
    98,519
    
    
    
    99,576
    
    
    
    101
    %Sales and marketing
    
    
    79,942
    
    
    
    
    
    
    
    79,942
    
    
    
    (1
    %)General and administrative
    
    
    214,818
    
    
    
    151,447
    
    
    
    63,371
    
    
    
    42
    %Non-cash consulting expense-related party
    
    
    10,500
    
    
    
    10,500
    
    
    
    
    
    
    
    0
    %Depreciation and amortization
    
    
    79,972
    
    
    
    592
    
    
    
    79,380
    
    
    
    13,409
    %Total expenses
    
    
    583,327
    
    
    
    261,058
    
    
    
    322,269
    
    
    
    123
    %Net operating loss
    
    
    (79,195
    )
    
    
    (261,035
    )
    
    
    181,840
    
    
    
    70
    %Other income (expense):Other income  related party
    
    
    
    
    
    
    8,788
    
    
    
    (8,788
    )
    
    
    (100
    %)Interest income
    
    
    457
    
    
    
    
    
    
    
    457
    
    
    
    100
    %Interest expense
    
    
    (1,156
    )
    
    
    
    
    
    
    (1,156
    )
    
    
    (100
    %)Interest expense  related party
    
    
    
    
    
    
    (5,624
    )
    
    
    5,624
    
    
    
    (100
    %)Net loss
    
    $
    (79,894
    )
    
    $
    (257,871
    )
    
    $
    177,977
    
    
    
    69
    %Weighted average number of common shares
outstanding  basic and fully diluted
    
    
    15,865,641
    
    
    
    535,321
    
    
    
    15,330,320
    
    
    
    2,864
    %Basic and diluted loss per common share
attributable to common stockholders
    
    $
    (0.01
    )
    
    $
    (0.48
    )
    
    $
    0.47
    
    
    
    98
    %
  Liquidity and Capital Resources and Financial Position
 General
    13




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Operating Activities
 Investing Activities
 Financing Activities
 Liquidity
   14




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Item 3.
    
    Quantitative and Qualitative Disclosures about Market Risk
  
 Item 4.
    
    Controls and Procedures
 Evaluation of Disclosure Controls and Procedures
  Changes in internal controls
  15




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PART II  OTHER INFORMATION
 
 Item 1.
    
    Legal Proceedings.
   
 Item 6.
    
    Exhibits.
  ExhibitNumber

    
    Description of Exhibit3.1
    
    
    Amended and Restated Articles of Incorporation of the Registrant,
dated as of June 2, 2006 and filed with the Secretary of State of
the State of Nevada on June 5, 2006 (filed as Exhibit 3.1 to the
Registrants Quarterly Report on Form 10-QSB for quarter ended
March 31, 2006 (filed on June 26, 2006) and incorporated herein by
reference).3.2
    
    
    Bylaws of the Registrant (filed as Exhibit 3.2 to the Registrants
Annual Report on Form 10-KSB for year ended December 31, 2005
(filed on May 11, 2006) and incorporated herein by reference).4.1
    
    
    Form of common stock certificate of the Registrant (filed as
Exhibit 4.1 to the Registrants Annual Report on Form 10-KSB for
year ended December 31, 2005 (filed on May 11, 2006) and
incorporated herein by reference).4.2
    
    
    Amended and Restated Certificate of Designation, Rights and
Preferences of Series A Convertible Preferred Stock of the
Registrant, dated as of October 13, 2009 and filed with the
Secretary of State of the State of Nevada on October 15, 2009
(filed as Exhibit 4.1 to the Registrants Form 8-K (filed on
October 19, 2009) and incorporated herein by reference).4.3
    
    
    Form of stock certificate for Series A Convertible Preferred Stock
(filed as Exhibit 4.8 to the Registrants Quarterly Report on Form
10-QSB for quarter ended March 31, 2006 (filed on June 26, 2006)
and incorporated herein by reference).4.4
    
    
    Amended and Restated Certificate of Designation, Rights and
Preferences of Series B Convertible Preferred Stock of the
Registrant, dated as of October 13, 2009 and filed with the
Secretary of State of the State of Nevada on October 15, 2009
(filed as Exhibit 4.2 to the Registrants Form 8-K (filed on
October 19, 2009) and incorporated herein by reference).4.5
    
    
    Form of stock certificate for Series B Convertible Preferred Stock
(filed as Exhibit 4.5 to the Registrants Annual Report on Form
10-K for year ended December 31, 2008 (filed on March 31, 2009)
and incorporated herein by reference).10.1
    
    
    Management Services Agreement, dated March 17, 2011, between
Immediatek, Inc. and Radical Ventures LLC (filed as Exhibit 10.1
to the Registrants Current Report on Form 8-K (filed on March 17,
2011) and incorporated herein by reference).
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ExhibitNumber

    
    Description of Exhibit10.2
    
    
    Commercial Lease, by and between Officeware Corporation and Chow
Family LLC dated March 17, 2011(filed as Exhibit 10.1 to the
Registrants Current Report on Form 8-K (filed on March 23, 2011)
and incorporated herein by reference).31.1
    **
    
    Certification of Principal Executive Officer pursuant to Rule
13a-14(a) of the Securities Exchange Act.31.2
    **
    
    Certification of Principal Financial Officer pursuant to Rule
13a-14(a) of the Securities Exchange Act.32.1
    **
    
    Certification Required by 18 U.S.C. Section 1350 (as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002).32.2
    **
    
    Certification Required by 18 U.S.C. Section 1350 (as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002).
 
 **
    
    Indicates document filed herewith.  17




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SIGNATURES
  Date:  May 16, 2011
    IMMEDIATEK, INC.,
a Nevada corporationBy:
    /s/ TIMOTHY RICEName:
    Timothy RiceTitle:
    Chief Executive Officer (On behalf of the Registrant and as Principal Executive Officer)  S-1




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INDEX TO EXHIBITS
 ExhibitNumber

    
    Description of Exhibit3.1
    
    
    Amended and Restated Articles of Incorporation of the Registrant,
dated as of June 2, 2006 and filed with the Secretary of State of
the State of Nevada on June 5, 2006 (filed as Exhibit 3.1 to the
Registrants Quarterly Report on Form 10-QSB for quarter ended
March 31, 2006 (filed on June 26, 2006) and incorporated herein by
reference).3.2
    
    
    Bylaws of the Registrant (filed as Exhibit 3.2 to the Registrants
Annual Report on Form 10-KSB for year ended December 31, 2005
(filed on May 11, 2006) and incorporated herein by reference).4.1
    
    
    Form of common stock certificate of the Registrant (filed as
Exhibit 4.1 to the Registrants Annual Report on Form 10-KSB for
year ended December 31, 2005 (filed on May 11, 2006) and
incorporated herein by reference).4.2
    
    
    Amended and Restated Certificate of Designation, Rights and
Preferences of Series A Convertible Preferred Stock of the
Registrant, dated as of October 13, 2009 and filed with the
Secretary of State of the State of Nevada on October 15, 2009
(filed as Exhibit 4.1 to the Registrants Form 8-K (filed on
October 19, 2009) and incorporated herein by reference).4.3
    
    
    Form of stock certificate for Series A Convertible Preferred Stock
(filed as Exhibit 4.8 to the Registrants Quarterly Report on Form
10-QSB for quarter ended March 31, 2006 (filed on June 26, 2006)
and incorporated herein by reference).4.4
    
    
    Amended and Restated Certificate of Designation, Rights and
Preferences of Series B Convertible Preferred Stock of the
Registrant, dated as of October 13, 2009 and filed with the
Secretary of State of the State of Nevada on October 15, 2009
(filed as Exhibit 4.2 to the Registrants Form 8-K (filed on
October 19, 2009) and incorporated herein by reference).4.5
    
    
    Form of stock certificate for Series B Convertible Preferred Stock
(filed as Exhibit 4.5 to the Registrants Annual Report on Form
10-K for year ended December 31, 2008 (filed on March 31, 2009)
and incorporated herein by reference).10.1
    
    
    Management Services Agreement, dated March 17, 2011, between
Immediatek, Inc. and Radical Ventures LLC (filed as Exhibit 10.1
to the Registrants Current Report on Form 8-K (filed on March 17,
2011) and incorporated herein by reference).10.2
    
    
    Commercial Lease, by and between Officeware Corporation and Chow
Family LLC dated March 17, 2011(filed as Exhibit 10.1 to the
Registrants Current Report on Form 8-K (filed on March 23, 2011)
and incorporated herein by reference).31.1
    **
    
    Certification of Principal Executive Officer pursuant to Rule
13a-14(a) of the Securities Exchange Act.31.2
    **
    
    Certification of Principal Financial Officer pursuant to Rule
13a-14(a) of the Securities Exchange Act.32.1
    **
    
    Certification Required by 18 U.S.C. Section 1350 (as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002).32.2
    **
    
    Certification Required by 18 U.S.C. Section 1350 (as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002).
 
 **
    
    Indicates document filed herewith.  Exhibit Index