UNITED
STATES SECURITIES AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-Q





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


EXCHANGE ACT OF
1934





For
the quarterly period ended September 30, 2010





OR





 ̈           TRANSITION REPORT PURSUANT TO SECTION
13 OR 15(d) OF THE
SECURITIES


EXCHANGE ACT OF
1934





For
the transition period from __________ to ____________





Commission
File No. 000-53285





IVEDA
CORPORATION


(Exact
name of registrant as specified in its charter)





Nevada
                  98-0611159(State
      or other jurisdiction of incorporation or
                  (I.R.S.
      Employerorganization)
                  Identification
      No.)





1201 South Alma School Road, Suite 4450,
      Mesa,Arizona
                  85210(Address
      of principal executive offices)
                  (Zip
      Code)





Registrant's
telephone number, including area code: (480)
307-8700





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





Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this
chapter) during the preceding 12 months (or such shorter period that the
registrant was required to submit and post such files).


Yes  ̈     No
 ̈





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


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





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





As
of November 1, 2010, 12,945,508 shares of the registrant’s common stock, par
value $0.00001 per share, were outstanding.





TABLE
OF CONTENTS





PagePART
      I - FINANCIAL INFORMATIONITEM
      1.
                  
                  FINANCIAL
      STATEMENTS
                  
                  3ITEM
      2.
                  
                  MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS
                  
                  12ITEM
      3.
                  
                  QUANTITATIVE
      AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
                  
                  16ITEM
      4.
                  
                  CONTROLS
      AND PROCEDURES
                  
                  16PART
      II - OTHER INFORMATIONITEM
      1.
                  
                  LEGAL
      PROCEEDINGS
                  
                  17ITEM 1A.
                  
                  RISK
      FACTORS
                  
                  17ITEM
      2.
                  
                  UNREGISTERED
      SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
                  
                  17ITEM
      3.
                  
                  DEFAULTS
      UPON SENIOR SECURITIES
                  
                  17ITEM
      4.
                  
                  [REMOVED
      AND RESERVED.]ITEM
      5.
                  
                  OTHER
      INFORMATION
                  
                  18ITEM
      6.
                  
                  EXHIBITS
                  
                  18SIGNATURES
                  
                  20


2


PART
I – FINANCIAL INFORMATION





ITEM 1.
            FINANCIAL
      STATEMENTS




IVEDA
CORPORATION


CONDENSED
CONSOLIDATED BALANCE SHEETS


(Amounts
expressed in US Dollars)





September 30, 2010(Unaudited)
                        
                        
                        December 31, 2009ASSETSCURRENT
      ASSETSCash
      and Cash Equivalents
                        
                        $
                        384,285
                        
                        
                        $
                        17,672Accounts
      Receivable
                        
                        
                        82,797
                        
                        
                        
                        36,739Prepaid
      Expenses
                        
                        
                        22,322
                        
                        
                        
                        4,062Inventory
                        
                        
                        2,041
                        
                        
                        
                        -Total
      Current Assets
                        
                        
                        491,445
                        
                        
                        
                        58,473PROPERTY
      AND EQUIPMENTOffice
      Equipment
                        
                        
                        161,051
                        
                        
                        
                        88,299Furniture
      and Fixtures
                        
                        
                        27,805
                        
                        
                        
                        27,805Software
                        
                        
                        41,508
                        
                        
                        
                        36,634Leased
      Equipment
                        
                        
                        245,752
                        
                        
                        
                        226,496Leasehold
      Improvements
                        
                        
                        36,964
                        
                        
                        
                        36,964Total
      Property and Equipment
                        
                        
                        513,080
                        
                        
                        
                        416,198Less:
      Accumulated Depreciation
                        
                        
                        237,199
                        
                        
                        
                        179,648Property
      and Equipment, Net
                        
                        
                        275,881
                        
                        
                        
                        236,550OTHER
      ASSETSDeposits
                        
                        
                        14,230
                        
                        
                        
                        14,230Total
      Assets
                        
                        $
                        781,556
                        
                        
                        $
                        309,253


3


September 30, 2010(Unaudited)
                                    
                                    
                                    December 31, 2009LIABILITIES
      AND STOCKHOLDERS' (DEFICIT) EQUITYCURRENT
      LIABILITIESAccounts
      Payable
                                    
                                    $
                                    133,455
                                    
                                    
                                    $
                                    197,535Accrued
      Expenses
                                    
                                    
                                    93,770
                                    
                                    
                                    
                                    315,864Current
      Portion of Capital Lease Obligations
                                    
                                    
                                    76,210
                                    
                                    
                                    
                                    80,505Due
      to Related Parties
                                    
                                    
                                    -
                                    
                                    
                                    
                                    134,000Convertible
      Debt
                                    
                                    
                                    -
                                    
                                    
                                    
                                    50,000Deferred
      Revenue
                                    
                                    
                                    16,469
                                    
                                    
                                    
                                    14,659Total
      Current Liabilities
                                    
                                    
                                    319,904
                                    
                                    
                                    
                                    792,563LONG-TERM
      LIABILITIESCapital
      Lease Obligations, Net of Current Portion
                                    
                                    
                                    10,183
                                    
                                    
                                    
                                    50,037Total
      Liabilities
                                    
                                    
                                    330,087
                                    
                                    
                                    
                                    842,600STOCKHOLDERS'
      (DEFICIT) EQUITYPreferred
      Stock, $0.00001 par value; 100,000,000 shares authorized; no shares
      outstanding as of September 30, 2010  and December 31,
      2009Common
      Stock, $0.00001 par value; 100,000,000 shares authorized; 12,945,508 and
      12,865,353 shares issued and outstanding, as of September 30, 2010 and
      December 31, 2009 , respectively
                                    
                                    
                                    129
                                    
                                    
                                    
                                    129Additional
      Paid-In Capital
                                    
                                    
                                    6,689,095
                                    
                                    
                                    
                                    4,213,359Accumulated
      Deficit
                                    
                                    
                                    (6,237,755
                                    )
                                    
                                    
                                    (4,746,835
                                    )Total
      Stockholders' (Deficit) Equity
                                    
                                    
                                    451,469
                                    
                                    
                                    
                                    (533,347
                                    )Total
      Liabilities and Stockholders' (Deficit) Equity
                                    
                                    $
                                    781,556
                                    
                                    
                                    $
                                    309,253





See
accompanying Notes to Condensed Consolidated Financial
Statements


4


IVEDA
CORPORATION


CONDENSED
CONSOLIDATED STATEMENT OF OPERATIONS


FOR
THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2010 AND 2009


(Amounts
expressed in US Dollars)





3 Months
                          
                          
                          3 Months
                          
                          
                          9 Months
                          
                          
                          9 MonthsEnding
                          
                          
                          Ending
                          
                          
                          Ending
                          
                          
                          EndingSeptember
                            30, 2010
                          
                          
                          September
                            30, 2009
                          
                          
                          September 30,
                            2010
                          
                          
                          September 30,
                            2009(unaudited)
                          
                          
                          (unaudited)
                          
                          
                          (unaudited)
                          
                          
                          (unaudited)REVENUE
                          
                          $
                          182,416
                          
                          
                          $
                          156,448
                          
                          
                          $
                          488,600
                          
                          
                          $
                          489,436COST
      OF REVENUE
                          
                          
                          115,817
                          
                          
                          
                          123,565
                          
                          
                          
                          337,425
                          
                          
                          
                          386,554GROSS
      PROFIT
                          
                          
                          66,599
                          
                          
                          
                          32,883
                          
                          
                          
                          151,175
                          
                          
                          
                          102,882OPERATING
      EXPENSES
                          
                          
                          604,597
                          
                          
                          
                          335,830
                          
                          
                          
                          1,630,024
                          
                          
                          
                          1,258,983LOSS
      FROM OPERATIONS
                          
                          
                          (537,998
                          )
                          
                          
                          (302,947
                          )
                          
                          
                          (1,478,849
                          )
                          
                          
                          (1,156,101
                          )OTHER
      INCOME (EXPENSE)Interest
      Income
                          
                          
                          302
                          
                          
                          
                          3,033
                          
                          
                          
                          933
                          
                          
                          
                          3,478Interest
      Expense
                          
                          
                          (1,760
                          )
                          
                          
                          (6,706
                          )
                          
                          
                          (13,003
                          )
                          
                          
                          (23,255
                          )Total
      Other Income (Expense)
                          
                          
                          (1,458
                          )
                          
                          
                          (3,673
                          )
                          
                          
                          (12,070
                          )
                          
                          
                          (19,777
                          )LOSS
      BEFORE INCOME TAXES
                          
                          
                          (539,456
                          )
                          
                          
                          (306,620
                          )
                          
                          
                          (1,490,919
                          )
                          
                          
                          (1,175,878
                          )BENEFIT
      FOR INCOME TAXES
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          -
                          
                          
                          
                          -NET
      LOSS
                          
                          $
                          (539,456
                          )
                          
                          $
                          (306,620
                          )
                          
                          $
                          (1,490,919
                          )
                          
                          $
                          (1,175,878
                          )BASIC
      AND DILUTED LOSS PER SHARE
                          
                          $
                          (0.04
                          )
                          
                          $
                          (0.03
                          )
                          
                          $
                          (0.10
                          )
                          
                          $
                          (0.10
                          )





See accompanying
Notes to Condensed Consolidated Financial Statements


5


IVEDA
CORPORATION


CONDENSED
CONSOLIDATED STATEMENT OF CASH FLOWS


FOR
THE NINE MONTHS ENDED SEPTEMBER 30, 2010 AND 2009


(Amounts
expressed in US Dollars)





9 months ending
                      
                      
                      9 months endingSeptember 30, 2010
                      
                      
                      September 30, 2009(Unaudited)
                      
                      
                      (Unaudited)CASH
      FLOWS FROM OPERATING ACTIVITIESNet
      Loss
                      
                      $
                      (1,490,919
                      )
                      
                      $
                      (1,175,878
                      )Adjustments
      to Reconcile Net Loss to Net CashUsed
      by Operating ActivitiesDepreciation
                      
                      
                      57,550
                      
                      
                      
                      59,254Stock
      Compensation
                      
                      
                      217,160
                      
                      
                      
                      29,999(Increase)
      Decrease in Operating Assets:Accounts
      Receivable
                      
                      
                      (46,058
                      )
                      
                      
                      (14,008
                      )Prepaid
      Expense
                      
                      
                      (18,260
                      )
                      
                      
                      8,502Inventory
                      
                      
                      (2,041
                      )
                      
                      
                      9,513Accounts
      Payable
                      
                      
                      (64,080
                      )
                      
                      
                      76,569Accrued
      Expenses
                      
                      
                      (222,094
                      )
                      
                      
                      50,337Deferred
      Revenue
                      
                      
                      1,810
                      
                      
                      
                      (9,823
                      )Net
      cash used in operating activities
                      
                      
                      (1,566,932
                      )
                      
                      
                      (965,535
                      )CASH
      FLOWS FROM INVESTING ACTIVITIESEscrow
      Deposit Reduction
                      
                      
                      -
                      
                      
                      
                      40,000Purchase
      of Property and Equipment
                      
                      
                      (91,583
                      )
                      
                      
                      (9,559
                      )Net
      cash provided by (used in) investing activities
                      
                      
                      (91,583
                      )
                      
                      
                      30,441CASH
      FLOWS FROM FINANCING ACTIVITIESProceeds
      from (Payments to) Related Parties
                      
                      
                      (134,000
                      )
                      
                      
                      424,900Payments
      on Capital Lease Obligations
                      
                      
                      (49,449
                      )
                      
                      
                      (46,822
                      )Common
      Stock Issued, net of Cost of Capital
                      
                      
                      2,208,577
                      
                      
                      
                      223,760Net
      cash provided by financing activities
                      
                      
                      2,025,128
                      
                      
                      
                      601,838NET
      INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
                      
                      
                      366,613
                      
                      
                      
                      (333,256
                      )Cash
      and Cash Equivalents - Beginning of Period
                      
                      
                      17,672
                      
                      
                      
                      335,189CASH
      AND CASH EQUIVALENTS - END OF PERIOD
                      
                      $
                      384,285
                      
                      
                      $
                      1,933SUPPLEMENTAL
      DISCLOSURE OF CASH FLOW INFORMATIONTaxes
      Paid
                      
                      $
                      -
                      
                      
                      $
                      -Debt
      Converted to Stock
                      
                      $
                      50,000
                      
                      
                      $
                      -Common
      Stock Subscription Receivable
                      
                      $
                      -
                      
                      
                      $Interest
      Paid
                      
                      $
                      11,243
                      
                      
                      $
                      23,255Property
      and Equipment Purchased via Capital Lease
                      
                      $
                      5,300
                      
                      
                      $
                      13,036





See accompanying
Notes to Condensed Consolidated Financial Statements


6


IVEDA
CORPORATION


NOTES
TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


FOR
THE NINE MONTHS ENDED SEPTEMBER 30, 2010 AND 2009


(Amounts
expressed in US Dollars)




NOTE 1SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES




BASIS
OF PRESENTATION





These
statements should be read in conjunction with our consolidated financial
statements and notes thereto included in our Annual Report on Form 10-K for
the year ended December 31, 2009. Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with accounting principles generally accepted in the United States (“GAAP”) have
been condensed or omitted.  The operating results and cash flows for
the nine-month period ended September 30, 2010, are not necessarily indicative
of the results that will be achieved for the full fiscal year ending
December 31, 2010 or for future periods.





The
accompanying condensed consolidated financial statements have been prepared
without audit and reflect all adjustments, consisting of normal recurring
adjustments, which are, in the opinion of management, necessary for a fair
statement of financial position and the results of operations for the interim
periods. Preparing financial statements requires management to make estimates
and assumptions that affect the reported amounts of assets, liabilities,
revenue, and expenses. Estimates are used for, but not limited to, the
accounting for the allowance for doubtful accounts, impairment costs,
depreciation and amortization, sales returns and discounts, warranty costs,
uncertain tax positions and the recoverability of deferred tax assets, stock
compensation, contingencies and the fair value of assets and liabilities
disclosed. Actual results and outcomes may differ from management's estimates
and assumptions. The statements have been prepared in accordance with accounting
principles generally accepted in the United States of America ("GAAP") and
pursuant to the rules and regulations of the Securities and Exchange Commission
("SEC"). Certain information and footnote disclosures, normally included in
financial statements prepared in accordance with accounting principles generally
accepted in the United States of America, have been condensed or omitted
pursuant to such SEC rules and regulations.





The
balance sheet at December 31, 2009 has been derived from the audited
financial statements at that date but does not include all of the information
and footnotes required by accounting principles generally accepted in the United
States of America for complete financial statements.




Going
Concern


The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern, which contemplates the realization of assets
and the liquidation of liabilities in the normal course of business. The Company
has generated an accumulated deficit from operations of approximately $6.2
million at September 30, 2010 and has used approximately $1.6 million in cash
from operations through the current nine months ended September 30, 2010. As a
result, a risk exists about our ability to continue as a going
concern.  The financial statements do not include any adjustments
relating to the recoverability and classification of recorded asset amounts or
the amounts and classification of liabilities that might result from this
uncertainty.





A
multi-step plan was adopted by management to enable the company to continue to
operate and begin to report operating profits. The highlights of that plan
are:


7


·
            The
      Company plans to seek additional equity and/or debt
    financing.


·
            Establish
      distributor networks with existing companies to create a reseller network
      to increase the scope of the Company’s marketing activities with low cost
      to the Company.


·
            Launch
      public relations and marketing
campaigns.


·
            The
      Company may evaluate and consider merger and/or acquisition
      activities.





Principles of
Consolidation


The
consolidated financial statements include the financial statements of the
Company and its wholly-owned subsidiary.  All significant
inter-company balances and transactions have been eliminated in
consolidation.





Concentrations


Financial
instruments, which potentially subject the Company to concentrations of credit
risk, consist principally of cash and cash equivalents and trade accounts
receivable.





Substantially
all cash is deposited in one financial institution. At times, amounts on deposit may be in
excess of the FDIC insurance limit.





Accounts
receivable are unsecured and the Company is at risk to the extent such amount
becomes uncollectible. The Company performs periodic credit evaluations of its
customers’ financial condition and generally does not require collateral.
Revenue from three customers represented approximately 55% (34%, 11%, and 10%)
of total revenues for the nine months ended September 30, 2010 and approximately
29% of total accounts receivable at September 30, 2010. No other customers
represented greater than 10% of total revenues or receivables in the nine months
ended September 30, 2010.





Fair Value of Financial
Instruments


Fair
value estimates discussed herein are based upon certain market assumptions and
pertinent information available to management as of December 31,
2009.  The respective carrying value of certain on-balance-sheet
financial instruments, approximate their fair values. These financial
instruments include cash, accounts receivable, accounts payable, accrued
expenses, convertible notes and amounts due to related parties. Fair values were
assumed to approximate carrying values for these financial instruments because
they are short term in nature and their carrying amounts approximate fair values
or they are receivable or payable on demand.





Reclassification


Certain
amounts in 2009 have been reclassified to conform to the 2010
presentation.





NOTE 2
              CONVERTIBLE
      DEBT




The
Company issued $50,000 of unsecured convertible debt in December 2009 that
matured February 28, 2010 bearing an annual interest rate of 8%. The note and
accrued interest were converted into 67,155 shares of Company common stock
(“Common Stock”) in January 2010.


8


NOTE 3
              EQUITY





Preferred
Stock





The
Company has 100,000,000 shares of $0.00001 par value preferred stock authorized
to issue. No shares have been issued and the rights and privileges of this class
of stock have not been defined.





Common
Stock





In July
2010, the Company paid the last installment payment of $50,000 to Mr. Quinn and
Mr. Liggins, the majority shareholders of Charmed Homes, for the purchase of 2.5
million shares of Common Stock as part of the reverse merger consummated on
October 15, 2009. The payment marked the cancellation of 2.5 million shares from
the Company’s total shares outstanding.





During
the nine month period ended September 30, 2010 the Company issued 2,580,155
shares of Common Stock. 2,445,000 shares were related to the private placement
memorandum, 67,155 shares were from convertible debentures, 67,000 shares were
from the exercise of warrants issued during the period and 1,000 shares were
from the exercise of employee stock options.





During
the nine month period ended September 30, 2010 the Company issued and had
outstanding additional warrants to purchase 250,000 shares of Common Stock at
$1.00 and 255,500 shares of Common Stock at $1.10.  These warrants
were issued as a cost of capital.





NOTE 4
              STOCK
      OPTION PLAN




The
Company has also granted non-qualified stock options to employees and
contractors. All non-qualified options are generally issued with an exercise
price that may be less than 100 percent of the fair value of the Common Stock on
the date of the grant as determined by the Company's Board of Directors. Options
may be exercised up to ten years following the date of the grant, with vesting
schedules determined by the Company upon grant. Vesting periods range from 100%
fully vested upon grant to a range of four to five years.  Vested
options may be exercised up to three months following date of termination of the
relationship. The fair values of options are determined using the Black-Scholes
option-pricing model. The estimated fair value of options is recognized as
expense on the straight-line basis over the options’ vesting
periods.





Stock
option transactions during nine months ended September 30, 2010 were as
follows:





Nine months ended September 30,2010Weighted -AverageExerciseShares
                          
                          
                          PriceOutstanding
      at Beginning of Year
                          
                          
                          1,182,729
                          
                          
                          $
                          0.37Granted
                          
                          
                          686,500
                          
                          
                          
                          1.12Exercised
                          
                          
                          (1,000
                          )
                          
                          
                          -Forfeited
      or Canceled
                          
                          
                          (7,250
                          )
                          
                          
                          1.10Outstanding
      at End of Period
                          
                          
                          1,860,979
                          
                          
                          
                          0.64Options
      Exercisable at Period-End
                          
                          
                          1,583,749
                          
                          
                          
                          0.53Weighted-Average
      Fair Value of Options Granted During thePeriod
                          
                          $
                          0.39


9


Information
with respect to stock options outstanding and exercisable at September 30, 2010
is as follows:





Options Outstanding
                                      
                                      
                                      Options ExercisableNumber
                                      
                                      
                                      Weighted -
                                      
                                      
                                      
                                      
                                      
                                      NumberOutstanding
                                      
                                      
                                      Average
                                      
                                      
                                      Weighted -
                                      
                                      
                                      Exercisable
                                      
                                      
                                      Weighted -Range of
                                      
                                      
                                      at
                                      
                                      
                                      Remaining
                                      
                                      
                                      Average
                                      
                                      
                                      At
                                      
                                      
                                      AverageExercise
                                      
                                      
                                      September 30,
                                      
                                      
                                      Contractual
                                      
                                      
                                      Exercise
                                      
                                      
                                      September 30,
                                      
                                      
                                      ExercisePrices
                                      
                                      
                                      2010
                                      
                                      
                                      Life
                                      
                                      
                                      Price
                                      
                                      
                                      2010
                                      
                                      
                                      Price$0.10
      - $1.30
                                      
                                      
                                      
                                      1,860,979
                                      
                                      
                                      8
      Years
                                      
                                      
                                      $
                                      0.64
                                      
                                      
                                      
                                      1,583,749
                                      
                                      
                                      $
                                      0.53





The fair
value of each option granted is estimated on the date of grant using the
Black-Scholes option-pricing model with the following weighted-average
assumptions used for options granted.





2010Expected
      Life
                    
                    5
      yrDividend
      Yield
                    
                    
                    0
                    %Expected
      Volatility
                    
                    
                    39.33
                    %Risk-Free
      Interest Rate
                    
                    
                    2.50
                    %





Expected
volatility was estimated by using the average volatility of three public
companies offering services similar to the Company. The risk-free rate for
periods within the contractual life of the option is based on the U.S. Treasury
yield curve in effect at the grant date. The expected life of options is based
on the average of three public companies offering services similar to the
Company.





NOTE 5
              RELATED
      PARTY TRANSACTIONS




In 2009,
the Company borrowed $134,000 from certain shareholders for use in
operations.  The balance at December 31, 2009 was
$134,000.  The advances bore no interest and were repaid in January
2010.





The
Company has provided surveillance services since 2005 to entities owned by Ross
Farnsworth, either through a family partnership or through his majority-owned
LLC, and subsequently Ross Farnsworth became a shareholder of the Company in
2006.  Mr. Farnsworth’s holdings are less than 5% of the Company, but the
revenue for the period ending September 30, 2010 was $52,406 and no trade
accounts receivable balance at September 30, 2010.


10




On
September 15, 2010, the Company, as borrower, issued a Line of Credit Promissory
Note (the “Note”) to Gregory Omi, a director of the Company, as lender, in the
principal sum of up to Three Hundred Fifty Thousand Dollars
($350,000).  The line of credit will be used for the sole purpose of
purchasing equipment, software, and other infrastructure-related items to
fulfill commitments to SAT Mexico.  The unpaid principal of the line
of credit shall bear simple interest at the rate of 1.5% per month or 18% per
annum.  The principal balance of the Note shall be due and payable no
later than six months after each disbursement.  The Note will be
secured by receivables from SAT Mexico.  As of October 31, 2010, the
balance of the Note is $0.




NOTE 6
              EARNINGS
      (LOSS) PER SHARE




The
following table provides a reconciliation of the numerators and denominators
reflected in the basic and diluted earnings per share computations, as required
by SFAS No. 128, “Earnings Per Share” (“EPS”).





Basic EPS
is computed by dividing reported earnings available to stockholders by the
weighted average shares outstanding.  The Company had net losses for
the three months and nine months ended September 30, 2010 and 2009 and the
effect of including dilutive securities in the earnings per common share would
have been anti-dilutive.  Accordingly, all options to purchase common
shares were excluded from the calculation of diluted earnings per share for
the three months and nine months ended September 30, 2010 and 2009.





3 Months
                
                
                3 Months
                
                
                9 Months
                
                
                9 MonthsEnding
                
                
                Ending
                
                
                Ending
                
                
                EndingSeptember 30,
                  2010
                
                
                September 30,
                  2009
                
                
                September 30,
                  2010
                
                
                September 30,
                  2009Basic EPSNet
      Loss
                
                $
                (539,456
                )
                
                $
                (306,620
                )
                
                $
                (1,490,919
                )
                
                $
                (1,175,878
                )Weighted
      Average Shares
                
                
                14,071,937
                
                
                
                12,254,908
                
                
                
                14,269,205
                
                
                
                12,186,416Basic
      and Diluted Loss Per Share
                
                $
                (0.04
                )
                
                $
                (0.03
                )
                
                $
                (0.10
                )
                
                $
                (0.10
                )




NOTE 7
              SUBSEQUENT
      EVENTS




On
October 25, 2010, the Company entered into an Operating Level Agreement (the
“Agreement”) with Digital Ally and Tecnologia y Diagnosticos Del Norte S.A. de
C.V. (“TDN”) pursuant to which the Company agreed to provide a streaming video
converter to Digital Ally’s in-vehicle surveillance system and video hosting and
video archiving services to a Federal Government Agency in Mexico. The Company
serves as a sub-contractor to TDN pursuant to a separate agreement signed by TDN
and the government agency in Mexico. Gross revenues are $280,000 for upfront
fees and $142,000 for the streaming video converter, plus monthly fees for
remote video hosting, storage, and maintenance for the first phase of the
project, and an additional $100,000 for a second shipment of streaming video
converters and monthly fees for the second phase of the project for a total of
164 vehicles.  A more detailed description of this Agreement was
reported on a Current Report on Form 8-K, filed on October 27,
2010.


11


ITEM 2.
            MANAGEMENT’S DISCUSSION AND
      ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS.




The
following discussion should be read in conjunction with Iveda Corporation's
unaudited financial statements and associated notes appearing elsewhere in this
Form 10-Q.




Note
Regarding Forward-Looking Information




This
Quarterly Report on Form 10-Q, including the following “Management’s Discussion
and Analysis of Financial Condition and Results of Operations,” contains
forward-looking statements, which involve risks and uncertainties, including
statements regarding our capital needs, business strategy, and expectations. Any
statements contained herein that are not statements of historical fact may be
deemed to be forward-looking statements. In some cases, you can identify
forward-looking statements by terminology such as “may,” “should,” “will,”
“expect,” “plan,” “intend,” “anticipate,” “believe,” “estimate,” “predict,”
“potential,” “forecast,” “project” or “continue,” the negative of such terms or
other comparable terminology.





You
should not rely on forward-looking statements as predictions of future events or
results. Any or all of our forward-looking statements may turn out to be wrong.
They can be affected by inaccurate assumptions, risks and uncertainties, and
other factors, which could cause actual events or results to be materially
different from those expressed or implied in the forward-looking statements.
These factors may cause our actual results to differ materially from any
forward-looking statement. In addition, new factors emerge from time to time and
it is not possible for us to predict all factors that may cause actual results
to differ materially from those contained in any forward-looking statements. We
disclaim any obligation to publicly update any forward-looking statements to
reflect events or circumstances after the date of this report, except as
required by applicable law.




Except as
otherwise indicated by the context, references in this Quarterly Report on Form
10-Q to “we,” “our,” “us,” and “Iveda” refer to the combined business of Iveda
Corporation (the “Company”) and its wholly-owned operating subsidiary,
IntelaSight, Inc. (“IntelaSight”), d/b/a Iveda Solutions (“Iveda
Solutions”).  References to Iveda Solutions refer to
IntelaSight.




Critical
Accounting Policies and Estimates




Management’s
Discussion and Analysis of Financial Conditions and Results of Operations is
based upon our financial statements, which have been prepared in accordance with
GAAP. The preparation of these financial statements requires the Company’s
management to make estimates and judgments that affect the reported amounts of
assets, liabilities, revenues and expenses, and related disclosure of contingent
assets and liabilities. We base our estimates on historical experience and on
various other assumptions that we believe to be reasonable under the
circumstances. Actual results may differ from these estimates under different
assumptions or conditions. A description of our critical accounting policies and
related judgments and estimates that affect the preparation of our financial
statements is set forth in Item 7, “Management’s Discussion and Analysis of
Financial Conditions and Results of Operations,” of our Annual Report on Form
10-K for the year ended December 31, 2009. Such policies are
unchanged.


12


Overview




IntelaSight,
Inc. a Washington corporation d/b/a Iveda Solutions, began operations on
January 24, 2005, and became a wholly-owned operating subsidiary of
Iveda Corporation (formerly known as Charmed Homes, Inc.), a Nevada corporation,
on October 15, 2009, through a merger.  All Company operations
are conducted through Iveda Solutions.




The
Company installs video surveillance equipment, primarily for security purposes,
and provides video hosting, archiving, and real-time remote surveillance
services with a proprietary reporting system, DSRTM (Daily Surveillance
Report), to a variety of businesses and organizations. By consolidating computer
power into a single location at the server level, Iveda Solutions creates
efficiencies due to economies of scale leveraging cloud computing, which offers
more features and flexibility compared to traditional box systems. The
Company has a SAFETY Act Designation by the Department of Homeland Security as
an anti-terrorism technology provider. The Company’s principal sources of
revenue are derived from our video hosting real-time surveillance and equipment
sales and installation.




The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern. Since our inception, we have accumulated net
losses in the approximate amount of $6.2 million. As of September 30, 2010, we
had shareholder equity of approximately $451,000, which significantly limits our
ability to absorb continuing operating losses in the future. As a result, our
ability to continue as a going concern is uncertain.




Results
of Operations




Revenue.We recorded revenue of $182,416 for the three months ended September
30, 2010, compared to $156,448 for the three months ended September 30, 2009, an
increase of $25,968 or 17%. In the third fiscal quarter of 2010, our recurring
revenue was $138,061 or 76% of revenue and our equipment sales and installation
revenue was $44,355 or 24% of revenue, compared to recurring service revenue of
$97,981 or 63% of revenue, and equipment sales and installation revenue of
$58,466 or 37% of revenue for the same period in 2009. The increase in revenue
was due to an increase in recurring revenue derived from video hosting and
real-time surveillance services over the past year.




We
recorded revenue of $488,600 for the nine months ended September 30, 2010,
compared to $489,436 for the nine months ended September 30, 2009, a decrease of
$836 or 0.17%. In the first nine months of 2010, our recurring service revenue
was $348,652 or 71% of revenue and our equipment sales and installation revenue
was $139,948 or 29% of revenue, compared to recurring service revenue of
$279,411 or 57% of revenue, and equipment sales and installation revenue of
$210,025 or 43% of revenue for the same fiscal period in 2009. The change in
revenue was due to an increase in recurring revenue derived from video hosting
and real-time surveillance services over the past year and a decrease in
equipment sales in the first nine months of 2010 compared to the first nine
months of 2009.




Cost of
Revenue.Total cost of revenue
was $115,817 (63% of revenues; gross margin of 37%) for the three months ended
September 30, 2010, compared to $123,565 (79% of revenues; gross margin of 21%)
for the three months ended September 30, 2009, a decrease of $7,748 or 6%. The
increase in gross margin for the third fiscal quarter of 2010 to 37% from 21% in
the third fiscal quarter of 2009 was primarily due to the increase in recurring
revenue with higher gross margin. In addition, the increase of revenue resulted
in better utilization of our infrastructure fixed costs.


13


Total
cost of revenue was $337,425 (69% of revenues; gross margin of 31%) for the nine
months ended September 30, 2010, compared to $386,554 (79% of revenues; gross
margin of 21%) for the nine months ended September 30, 2009, a decrease of
$49,129 or 13%. The increase in gross margin for the nine months ended September
30, 2010, to 31% from 21% for the nine months ended September 30, 2009, was
primarily due to the increase in recurring revenue with higher gross margin in
the third fiscal quarter of 2010. In addition, the increase of revenue resulted
in better utilization of our infrastructure fixed costs.




Operating
Expenses.Operating expenses were
$604,597 for the three months ended September 30, 2010, compared to $335,830 for
the three months ended September 30, 2009, an increase of $268,767 or 80%. The
increase in operating expenses was primarily related to an increase in stock
compensation expense of approximately $110,000 over 2009 and increased
marketing, travel, and personnel costs incurred to promote our services
internationally.




Operating
expenses were $1,630,024 for the nine months ended September 30, 2010, compared
to $1,258,983 for the nine months ended September 30, 2009, an increase of
$371,041 or 29%. The increase in operating expenses was primarily related to an
increase in stock compensation expense of approximately $187,000 over 2009 and
increased marketing, travel, and personnel costs incurred to promote our
services internationally.




Loss from
Operations.Notwithstanding the
increases in revenues and related gross profit, there was a greater increase in
operating expenses.  As a result, the loss from operations increased
to $537,998 for the three months ended September 30, 2010, compared to $302,947
for the three months ended September 30, 2009, an increase in loss of
$235,051 or 78%.




As a
result of the increased operating expenses, loss from operations increased to
$1,478,849 for the nine months ended September 30, 2010, compared to $1,156,101
for the nine months ended September 30, 2009, an increase in loss of
$322,748 or 28%.




Other
Expense-Net.Other expense-net was
$1,458 for the three months ended September 30, 2010, compared to
$3,673 for the three months ended September 30, 2009, a decrease of $2,215 or
60%. This was due to the capital raise in January and July 2010, which allowed
us to reduce our debt and, accordingly, reduce our interest expense and increase
our interest income.




Other
expense-net was $12,070 for the nine months ended September 30, 2010, compared
to $19,777 for the nine months ended September 30, 2009, a decrease of $7,707 or
39%. This was due to the capital raise in January and July 2010, which allowed
us to reduce our debt and, accordingly, reduce our interest expense and increase
our interest income.




Net
Loss.The
increase of $232,836 or 76% in the net loss to $539,456 for the three months
ended September 30, 2010, from $306,620 for the three months ended September 30,
2009, was primarily due to an increase in operating expenses related to selling
and marketing and a non-cash charge of approximately $122,000 for stock
compensation for the three months ended September 30, 2010, compared to $10,000
for the three months ended September 30, 2009.




The
increase of $315,041 or 27% in the net loss to $1,490,919 for the nine months
ended September 30, 2010 from $1,175,878 for the nine months ended September 30,
2009, was primarily due to an increase in operating expenses related to selling
and marketing as well as non-cash increase in stock compensation of
approximately $217,000 for the nine months ended September 30, 2010 compared to
$30,000 for the nine months ended September 30, 2009.


14


Liquidity
and Capital Resources




We had
cash and cash equivalents of $384,285 on September 30, 2010. The improvement in
cash on hand from $17,672 as of December 31, 2009 resulted from cash raised
through stock sales made during January and July 2010.




Net cash
used in operating activities during the nine months ended September 30, 2010 and
for the nine months ended September 30, 2009 was $1,566,932 and $965,535,
respectively. Cash used in operating activities for those periods consisted
primarily of funding operations and reducing accounts payable and accrued
expenses.




Net cash
used by investing activities for the nine months ended September 30, 2010, and
the nine months ended September 30, 2009 was $91,583 and $9,558, respectively,
for the purchase of property and equipment. There was $40,000 of net cash
provided by investing activities for the nine months ended September 30, 2009,
related to an escrow deposit reduction.




Net cash
provided by financing activities for the nine months ended September 30, 2010,
was $2,025,128, related primarily to the sale of common stock. Net cash provided
by financing activities for the nine months ended September 30, 2009, was
$601,838, related primarily to the sale of common stock and proceeds from the
issuance of convertible notes.




At
December 31, 2009, we had approximately $4.4 million in net operating loss carry
forwards available for federal and state income tax purposes. We did not
recognize any benefit from these operating loss carry forwards for the year
ended 2009 or through the third fiscal quarter of 2010. Our operating loss carry
forwards expire starting in 2010 and continuing through 2026.




We have
experienced significant operating losses since our inception. We entered into a
new lease agreement in 2008 and increased our occupancy costs as we increased
our lease commitment from 1,411 square feet to 3,667 square feet. Our capital
expenditures and working capital requirements could increase depending on our
operating results and other adjustments to our operating plan as may be needed
to respond to competition or unexpected events.




We
believe that our cash on hand as of September 30, 2010 is insufficient to meet
our anticipated cash needs for working capital and capital expenditures for the
short term. We
continually evaluate our working capital needs, and we are seeking to obtain
additional working capital through debt and equity offerings. There can be no
assurance that additional funds will be available on acceptable terms. In the
event that additional funds are not available on acceptable terms, we may be
required to reduce the scope of, or cease, operations.




The
economic crisis of 2009 resulted in a downturn of spending and a shortage of
credit, which severely curtailed our ability to obtain financing in
2009.  As a result, we raised $1.5 million in equity financing in
January 2010.




If we are
unable to quickly increase our sales, we will need to raise additional capital
during the year and may be required to reduce labor expenses to maintain our
existing operations.




On September 15, 2010, the Company, as
borrower, issued a Line of Credit Promissory Note (the “Note”) to Gregory Omi, a
director of the Company, as lender, in the principal sum of up to Three Hundred
Fifty Thousand Dollars ($350,000).  The line of credit will be used
for the sole purpose of purchasing equipment, software, and other
infrastructure-related items to fulfill commitments to SAT
Mexico.  The unpaid principal of the line of credit shall bear simple
interest at the rate of 1.5% per month or 18% per annum.  The
principal balance of the Note shall be due and payable no later than six months
after each disbursement.  The Note will be secured by receivables from
SAT Mexico.  As of October 31, 2010, the balance of the Note is
$0.


15


Three
customers each represented greater than 10% of total revenue for the three
months ended September 30, 2010. These customers were: Insurance Auto Auctions
(34% of total revenue), Glendale California Police Department (11% of total
revenue), and Farnsworth (10% of total revenue).  Insurance Auto
Auctions and Farnsworth have been customers since 2005 and are no longer under
long-term service contracts. As a result, Insurance Auto Auctions and Farnsworth
could terminate their service with the Company without penalty.  No
other customers represented greater than 10% of total revenues in the nine
months ended September 30, 2010.




Substantially
all cash is deposited in one financial institution. At times, amounts on deposit
may be in excess of the FDIC insurance limit.




Recent
Developments




On
October 25, 2010, the Company entered into an Operating Level Agreement (the
“Agreement”) with Digital Ally and Tecnologia y Diagnosticos Del Norte S.A. de
C.V. (“TDN”) pursuant to which the Company agreed to provide a streaming video
converter to Digital Ally’s in-vehicle surveillance system, and video hosting
and video archiving services to a Federal Government Agency in Mexico. The
Company serves as a sub-contractor to TDN pursuant to a separate agreement
signed by TDN and the government agency in Mexico. Gross revenues are $280,000
for upfront fees and $142,000 for the streaming video converter, plus monthly
fees for remote video hosting, storage, and maintenance for the first phase of
the project, and an additional $100,000 for a second shipment of streaming video
converters and monthly fees for the second phase of the project for a total of
164 vehicles.  A more detailed description of this Agreement was
reported on a Current Report on Form 8-K, filed on October 27,
2010.




ITEM 3.
            QUANTITATIVE AND QUALITATIVE
      DISCLOSURES ABOUT MARKET
RISK.




As a
smaller reporting company, the Company is not required to provide Part I, Item 3
disclosures in this Quarterly Report.




ITEM 4.
            CONTROLS AND
      PROCEDURES.




Evaluation
of Disclosure Controls and Procedures




Under the supervision and with the
participation of our management, including our principal executive officer and
principal financial officer, we conducted an evaluation of the design and
operation of our disclosure controls and procedures, as such term is defined
under Rules 13a-15(e) and 15d-15(e) promulgated under the Exchange Act as
of September 30, 2010. Based on that evaluation, our principal executive officer
and our principal financial officer concluded that the design and operation of
our disclosure controls and procedures were effective in ensuring that
information required to be disclosed in our Exchange Act reports is (1)
recorded, processed, summarized and reported in a timely manner, and (2)
accumulated and communicated to our management, including our principal
executive officer and principal financial officer, as appropriate to allow
timely decisions regarding required disclosure.


16


Changes
in Internal Control over Financial Reporting




Other than hiring a full-time Chief
Financial Officer on July 22, 2010, there have not been any changes in our
internal control over financial reporting (as such term is defined in Rules
13a-15(d) and 15d-15(d) under the Exchange Act) during the most recent fiscal
quarter that have materially affected, or are reasonably likely to materially
affect, our internal control over financial reporting.





The
design of any system of controls is based in part upon certain assumptions about
the likelihood of future events, and there can be no assurance that any design
will succeed in achieving its stated goals under all potential future
conditions, regardless of how remote. However, management believes that our
system of disclosure controls and procedures is designed to provide a reasonable
level of assurance that the objectives of the system will be met.




PART
II. OTHER INFORMATION




ITEM 1.
            LEGAL
      PROCEEDINGS.




None.




ITEM 1A.
            RISK
    FACTORS.




As a smaller reporting
company, the Company is not required to provide Part II, Item 1A disclosures in
this Quarterly Report.




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




In
addition to issuances of equity securities previously reported in Form 8-K, the
Company made the following additional issuances of equity securities during the
reporting period:





·
            On
      September 14, 2010, the Company issued 50,000 shares of the Company’s
      restricted common stock to Sysan LP for cash consideration of
      $50,000.  The proceeds of the sale are being used for working
      capital and general corporate
purposes.




·
            On
      September 29, 2010, the Company issued 17,000 shares of the
      Company’s common stock to John Boesel III upon the exercise of warrants
      granted to Mr. Boesel in exchange for placement
  services.




These
issuances were made pursuant to Section 4(2) of the Securities Act of 1933, as
amended, Regulation D, and Rule 506 promulgated thereunder.





ITEM 3.
            DEFAULT ON SENIOR
      SECURITIES.




None.


17


ITEM 5.
            OTHER
      INFORMATION.




On
September 7, 2010, the Company  held its Annual Meeting of
Shareholders (the “Annual Meeting”) at the Company’s offices located at 1201 S.
Alma School Rd., Suite 4450, Mesa, Arizona 85210, at 1:00 p.m. Mountain
Time.




At the
Annual Meeting, the shareholders unanimously elected Mr. David Ly, Mr. James D.
Staudohar, Mr. Gregory Omi, and Mr. Joseph Farnsworth to serve as directors for
terms expiring on the date of the Company’s 2011 Annual Meeting of Shareholders.
In addition, the shareholders ratified the appointment of Farber Hass Hurley LLP
as the Company’s independent auditors for the fiscal year ending December 31,
2010.




The
following tables show the voting results of the Annual Meeting:




Election
      of Directors:
                
                For
                
                
                WithholdMr.
      David Ly
                
                
                7,925,947
                
                
                
                0Mr.
      James D. Staudohar
                
                
                7,925,947
                
                
                
                0Mr.
      Gregory Omi
                
                
                7,925,947
                
                
                
                0Mr.
      Joseph Farnsworth
                
                
                7,925,947
                
                
                
                0




Ratification of Farber Hass Hurley LLP as theCompany’s independent auditor for the fiscal
                
                
                
                
                
                
                
                
                
                
                Brokeryear ending December 31, 2010:
                
                For
                
                
                Against
                
                
                Abstain
                
                
                Non-Votes7,925,947
                
                
                
                0
                
                
                
                0
                
                
                
                0




On
September 15, 2010, the Company, as borrower, issued a Line of Credit Promissory
Note (the “Note”) to Gregory Omi, a director of the Company, as lender, in the
principal sum of up to Three Hundred Fifty Thousand Dollars
($350,000).  The description of the Note included in Note 5 to the
Condensed Consolidated Financial Statements and in the “Liquidity and Capital
Resources” section of the Management’s Discussion and Analysis of Financial
Condition and Results of Operations of this Quarterly Report on Form 10-Q is
incorporated herein by reference.




ITEM 6.
            EXHIBITS.




Exhibit
                Number
              
              Description3.1
              
              Articles
      of Incorporation of Charmed Homes Inc. (Incorporated by reference to
      Exhibit 3.1 to Form SB-2 filed on 4/27/2007)3.2
              
              Bylaws
      of Charmed Homes Inc. (Incorporated by reference to Exhibit 3.2 to Form
      SB-2 filed on 4/27/2007)3.3
              
              Amendment
      to Bylaws of Charmed Homes Inc. (Incorporated by reference Exhibit 3.1 to
      Form 8-K filed on 12/15/2008)3.4
              
              Amendment
      to Articles of Incorporation, filed with the Nevada Secretary of State on
      September 9, 2009 (Incorporated by reference to Form 8-K filed on
      10/21/2009)4.1
              
              Specimen
      Stock Certificate (Incorporated by reference to Exhibit 4.1 to Form SB-2
      filed on 4/27/2007)4.2
              
              Form
      of Stock Option Agreement under the IntelaSight, Inc. 2008 Stock Option
      Plan (Incorporated by reference to Form S-4/A1 filed on
      7/10/2009)





18





4.3
              
              Form
      of Common Stock Purchase Warrant issued by IntelaSight, Inc. (Incorporated
      by reference to Form S-4/A1 filed on 7/10/2009)4.4
              
              2009
      Stock Option Plan, dated October 15, 2009 (Incorporated by reference
      to Form 8-K filed on 10/21/2009)4.5
              
              Form
      of Common Stock Purchase Warrant issued by Iveda Corporation in
      conjunction with the Merger (Incorporated by reference to Form 8-K filed
      on 10/21/2009)4.6
              
              2010
      Stock Option Plan, dated January 18, 2010 (Incorporated by reference
      to Form S-8 filed on 2/4/2010)10.1
              
              Channel
      Partner Program Membership Agreement dated April 1, 2005 by and
      between Axis Communications Inc. and IntelaSight, Inc. (Incorporated by
      reference to Form S-4/A1 filed on 7/10/2009)10.2
              
              Application
      Development Service Agreement dated July 14, 2006 by and between Axis
      Communications AB and IntelaSight, Inc. (Incorporated by reference to Form
      S-4/A2 filed on 8/22/2009)10.3
              
              Partner
      Agreement dated January 30, 2007 by and between Milestone Systems,
      Inc. and IntelaSight, Inc. (Incorporated by reference to Form S-4/A1 filed
      on 7/10/2009)10.4
              
              Solution
      Partner Agreement dated March 13, 2008 by and between Milestone
      Systems A/S and IntelaSight, Inc. (Incorporated by reference to Form
      S-4/A1 filed on 7/10/2009)10.5
              
              Customer
      Agreement dated March 25, 2008 by and between IAAI — North Hollywood
      and IntelaSight, Inc. (Incorporated by reference to Form S-4/A1 filed on
      7/10/2009)10.6
              
              Channel
      Partner Program Membership Agreement — Gold Solution Partner Level — dated
      June 23, 2009 by and between Axis Communications Inc. and
      IntelaSight, Inc. (Incorporated by reference to Form S-4/A1 filed on
      7/10/2009)10.7
              
              Stock
      Purchase Agreement, dated October 15, 2009, by and among Iveda
      Corporation, IntelaSight, Inc., Ian Quinn and Kevin Liggins (Incorporated
      by reference to Form 8-K filed on 10/21/2009)10.8
              
              Consulting
      Agreement, dated January 4, 2010, by and between Iveda Corporation
      and IEP Services, Inc. (Incorporated by reference to Form S-8 filed on
      2/4/2010)10.9
              
              Consulting
      Agreement, dated January 18, 2010, by and between Iveda Corporation
      and Clemens Titzck (Incorporated by reference to Form S-8 filed on
      2/4/2010)10.10
              
              Subscription
      Agreement, dated July 26, 2010*10.11
              
              Line
      of Credit Promissory Note, dated September 15, 2010*10.12
              
              Agreement
      for Service, dated October 20, 2010*10.13
              
              Consulting
      Agreement, dated October 25, 2010*10.14
              
              Operating
      Level Agreement, dated October 25, 2010*31.1
              
              Certification
      of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
      Act of 2002*31.2
              
              Certification
      of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
      Act of 2002*32.1
              
              Certification
      of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley
      Act of 2002**32.2
              
              Certification
      of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley
      Act of 2002**


* Filed
herewith


**
Furnished herewith


19


SIGNATURES





Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.





IVEDA
      CORPORATION(Registrant)Date: November 12, 2010
                BY:
                /s/ David LyDavid
      LyPresident,
      Chief Executive Officer, and ChairmanDate:
      November 12, 2010
                
                /s/ Steven G. WollachSteven
      G. WollachPrincipal
      Accounting Officer, Chief Financial Officer,
  Treasurer


20