SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

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

ACT OF 1934

FOR THE ~~QUARTERLY~~QUARTERLYLY PERIOD ENDED ~~SEPTEMBER~~DECEMBER 3031, 2012

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

OF 1934

FOR THE TRANSITION FROM _______ TO ________.

COMMISSION FILE NUMBER 333-147932

VIDAROO CORPORATION

(Exact Name of Registrant as Specified in its Charter)

Nevada		26-1358844
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
8 N. Highland Ave., Winter Garden, FL		34787
370 Center Pointe Cir. Suite 1166, Altamonte Springs, FL		32701
(Address of principal executive offices)		(Zip code)

Issuer's telephone number: (321) 293-3360

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

Indicate by check mark whether the registrant 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 for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

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

Large accelerated filer o	Accelerated filer o

Non-accelerated filer o	Smaller 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 ¨ No x

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS

DURING THE PRECEDING FIVE YEARS

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

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date: As of ~~November~~February 48, ~~2012~~2013 there were 67,455,867 outstanding shares of the Registrant's Common Stock, $.001 par value.

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VIDAROO CORPORATION

~~SEPTEMBER~~DECEMBER 3031, ~~2012~~20112 QUARTERLY REPORT ON FORM 10-Q

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~~Page~~ PART I - FINANCIAL INFORMATION Page Item 1. Financial Statements 3 Item 2. Management’s Discussion and Analysis of Results of Operations and Financial Condition 1415 Item 4T. Controls and Procedures 1617 PART II -– OTHER INFORMATION Item 1. Legal Proceedings 1819 Item 1A. Risk Factors 1819 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 1819 Item 3. Defaults Upon Senior Securities 1819 Item 4T. Submission of Matters to a Vote of Security Holders 1819 Item 5. Other Information 1819 Item 6. Exhibits 1819 SIGNATURES 1920

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VIDAROO CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

	September 30, 2012			June 30, 2012
	December 31, 2012 (UNAUDITED)			June 30, 2012
Assets	~~(UNAUDITED)~~
Current:
Cash and cash equivalents	$	5226,~~344~~205		$	67,911
Accounts Receivable		183,~~728~~979			105,876
Other Current Assets		58,~~101~~232			5,101
Total Current Assets		7638,~~173~~416			178,888
Furniture and Equipment:
Computer equipment		~~114~~116,~~582~~816			114,582
Office furniture and fixtures		14,252			14,252
		128,834			128,834
		131,068			128,834
Less Accumulated depreciation		(~~110~~112,~~006~~028	)		(106,~~711~~701	)
Net Furniture and Equipment		1819,~~828~~040			22,123
Other Assets – Deposits		4,872			4,872
Total Assets	$	9962,~~873~~328		$	205,883
Liabilities and Stockholders' Deficit
Current Liabilities:
Accounts Payable	$	~~489~~212,~~759~~212		$	534,408
Accrued Salaries		~~247~~340,~~785~~594			167,060
Deferred revenue		3231,~~320~~867			35,099
Accrued Interest		12,835			10,433
Accrued interest		19,565			10,433
Convertible secured promissory notes – Current portion		1714,~~923~~117			10,291
Promissory Notes and Notes payable – Current portion		139,~~933~~301			16,000
Total Current Liabilities		~~814~~627,~~555~~656			773,291
Convertible secured promissory notes		4921,~~113~~223			66,690
Promissory Notes and Notes payable		113,~~248~~931			38,121
Total Liabilities		~~874~~652,~~916~~810			878,102
Callable Preferred Stock, $0.001 par value; Callable at $0.10; Issued and Outstanding 35,428,867 and 33,778,173 shares at September 30 and June 30, 2012, respectively		541,736			515,325
Callable Preferred Stock, $0.001 par value; Callable at $0.10; Issued and Outstanding
35,428,867 and 33,778,173 shares at December 31 and June 30, 2012, respectively		541,736			515,325
Stockholders' (Deficit) Equity:
Common stock, $.001 par value; 200,000,000 shares authorized;
Common stock, $0.001 par value; 200,000,000 shares authorized;
67,455,867 and 67,437,365 issued and outstanding at September 30 and June 30, 2012, respectively		67,456			67,437
67,455,867 and 67,437,365 issued and outstanding at December 31 and June 30, 2012, respectively		67,456			67,437
Additional paid in capital		6,~~918~~923,~~529~~081			6,909,490
Accumulated Deficit		(8,~~311~~131,~~164~~155	)		(8,176,291	)
Vidaroo Corporation and subsidiaries Stockholders’ (Deficit)		(1,~~325~~140,~~179~~618	)		(1,199,364	)
Noncontrolling Interest		8,400			11,820
Total Stockholders’ Deficit		(1,~~316~~132,~~779~~218	)		(1,187,544	)
Total Liabilities and Stockholders’ Deficit	$	9962,~~873~~328		$	205,883

See accompanying notes to consolidated financial statements.

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VIDAROO CORPORATION AND SUBSIDIARY

CONSOLIDATED STATEMENT OF OPERATIONS (UNAUDITED)

	3 Months Ended			3 Months Ended
	Quarter Ended			Quarter Ended			6 Months Ended			6 Months Ended
	9/30/12			9/30/11
	12/31/12			12/31/11			12/31/12			12/31/11
REVENUES	$	248,~~871~~339		$	~~308~~416,~~290~~544		$	497,211		$	724,834
Cost of Sales		(84,076	)		(41,957	)
Cost of sales		(86,366	)		(81,246	)		(170,443	)		(123,203	)
Operating Margin		164,795			266,333
Operating margin		161,973			335,298			326,768			601,631
Operating Expenses
Operating expenses
Selling, General and Administrative		300,308			318,713
Selling, general and administrative		287,294			395,721			592,945			740,235
Depreciation and Amortization		3,295			6,396
Depreciation and amortization		2,023			6,216			5,317			12,612
Stock based compensation		5,079			25,801
Total expenses		289,317			401,937			598,262			752,847
Total Operating expenses		308,682			350,910
Loss from operations		(127,344	)		(66,639	)		(271,494	)		(151,216	)
Loss from Operations		(143,887	)		(84,577	)
Interest expense		(8,867	)		(50,298	)		(24,131	)		(108,188	)
Interest expense		(15,527	)		(57,890	)
Nonoperating gains:
Nonoperating gains(losses): Realized gain on troubled debt restructuring		49,853			-
Realized gain on troubled debt restructuring		-			-			49,853			-
Unrealized (loss) gain on adjustment to fair market value of financial instruments		(25,312)			544,577
Gain on adjustment to fair market value of financial instruments		316,220			116,401			290,908			660,978
NET INCOME (LOSS) TO COMMON SHAREHOLDERS OF VIDAROO CORPORATION	$	~~(134~~180,~~873~~009	)	$	~~402,110~~(536	)	$	45,136		$	401,574
BASIC AND DILUTED NET INCOME (LOSS) PER COMMON SHARE	$	0.00		$	0.0100		$	0.00		$	0.01
WEIGHTED AVERAGE SHARES OUTSTANDING		67,~~446~~455,~~822~~867			66,~~239~~442,~~449~~767			67,451,550			66,316,976

See accompanying notes to consolidated financial statements.

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VIDAROO CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF SHAREHOLDERS' DEFICIT/EQUITY

(UNAUDITED)

	Class A				Additional
	Common Stock				Paid-In		Accumulated			Noncontrolling
	Shares		Amount		Capital		Deficit			Interest			Total
Balance at June 30, 2012		67,437,365	$	67,437	$	6,909,490	$	(8,176,291	)	$	11,820		$	(1,187,544	)
Stock based compensation cost for Employees		18,502		19		59,~~060~~612		-			-			59,~~079~~631
Stock based compensation issued relative to debt conversion		-		-		3,979		-			-			3,979
Unrealized gain on fair value adjustment to noncontrolling interest		-		-		-		-			(3,420)	)		(3,420)	)
Net loss		-		-		-		(134,873)			-			(134,873)
Net Income		-		-		-		45,136			-			45,136
Balance at September 30, 2012		67,455,867	$	67,456	$	6,918,529	$	(8,311,164	)	$	8,400		$	(1,316,779	)
Balance at December 31, 2012		67,455,867	$	67,456	$	6,923,081	$	(8,131,155	)	$	8,400		$	(1,132,218	)

See accompanying notes to consolidated financial statements.

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VIDAROO CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS(UNAUDITED)

	3 Months Ended			3 Months Ended
	6 Months Ended			6 Months Ended
	9/30/12			9/30/11
	12/31/12			12/31/11
Cash Flows from Operating Activities:
Net Income (loss)	$	(134,873	)	$	402,110
Net Income	$	45,136		$	401,574
Adjustments to reconcile net income (loss) to net cash used
Adjustments to reconcile net income to net cash used
by operating activities:
Depreciation		35,~~295~~317			612,~~396~~615
Officer salary forgiveness		-			5,148
Accretion of accrued salaries		-			10,296
Stock-based compensation		5,079			25,802
Realized gain on troubled debt restructuring		(49,853	)		-
Loss (gain) on adjustment to Fair market value of financial instruments		25,312			(544,577	)
Gain on adjustment to fair market value of financial instruments		(290,908	)		(660,978	)
Stock-based compensation		9,631			75,734
Net changes in:
Other current assets		-(3,131	)		23,~~469~~570
Accrued Salaries		80,725			6,699
Accrued salaries		173,534			6,178
Accounts receivable		87,148			37,380
Accrued interest		24,375			106,263
Accounts payable and accrued expenses		(44,649	)		16,218
Accounts receivable		101,897			76
Accrued interest		15,509			56,995
Accounts payable and accrued expenses		(51,513	)		70,264
Deferred revenue		(23,~~779~~232	)		(4651,~~625~~002	)
Net Cash Used By Operating Activities		(1538,~~086~~747	)		(3125,~~985~~410	)
Cash Flows from Investing Activities:
Deposits		-			(3,312	)
Net Cash Used By Investing Activities		-			(3,312	)
Purchase of furniture and equipment		(2,234	)		-
Net Cash Used By Investing Activities		(2,234	)		(3,312	)
Cash Flows from Financing Activities:
Repayment of Promissory Notes and Notes Payable		(481	)		-
Repayments of notes payable		(725	)		-
Net Cash Used By Financing Activities		(~~481~~725	)		-
Net Decrease in Cash and Cash Equivalents		(1541,~~567~~706	)		(3528,~~297~~722	)
Cash and Cash Equivalents, Beginning		67,911			73,598
Cash and Cash Equivalents, Ending	$	5226,~~344~~205		$	3844,~~301~~876
Supplemental cash flow information:
Noncash Financing Activities:
Other disclosures:
Promissory Notes and Notes Payable and Accrued Interest converted into Preferred Stock and Warrants to purchase Common Stock	$	80,243		$	-
Interest Paid	$	276		$	1,925
Other:
Interest Paid		269			895

See accompanying notes to consolidated financial statements.

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NOTE 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Description of Business

The accompanying financial statements include Vidaroo Corporation (“Vidaroo” or the “Entity”) and its consolidated subsidiaries: E360, LLC (“E360”); Media Evolutions, Inc., d/b/a Vidaroo Productions (“MEV”); Vidaroo Licensing, LLC; Vidaroo Intellectual Property, Inc.; Vidaroo Support Services, LLC. Vidaroo was formed in May 2007 as a Nevada Corporation and was named Gen2Media until April 26, 2010. Vidaroo has a majority ownership interest in E360. Vidaroo has a management agreement with MEV that provides Vidaroo with control of MEV’s operations.

Vidaroo is a video technology company. Vidaroo has developed an online video platform (OVP) that is licensed under a Software-as-a-Service model. Vidaroo also provides video production services that are performed for clients either on location or in Vidaroo’s professional production studio.

Basis of Presentation

Unaudited Interim Financial Statements

The accompanying unaudited consolidated quarterly financial statements have been prepared on a basis consistent with generally accepted accounting principles in the United States (“GAAP”) for interim financial information and pursuant to the rules of the Securities and Exchange Commission (“SEC”). In the opinion of management, the accompanying unaudited financial statements reflect all adjustments, consisting of only normal and recurring adjustments, necessary for a fair presentation of the results of operations, financial position and cash flows for the periods presented. The results of operations for the periods presented are not necessarily indicative of the results expected for the full year or any future period. These statements should be read in conjunction with the Entity’s Annual Report on Form 10-K for the year ended June 30, 2012, as filed with the SEC on October 1, 2012 (the “2012 Annual Report”).

Use of Estimates

Preparing financial statements in conformity with GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities as of the dates presented and the reported amounts of revenues and expenses during the reporting periods presented. Significant estimates inherent in the preparation of the accompanying consolidated financial statements include estimates of revenues and related receivables expected to be collected, valuations of intangible assets and stock-based compensation. Estimates are based on past experience and other considerations reasonable under the circumstances. Actual results may differ from these estimates.

Basis of Consolidation

The accompanying consolidated financial statements include the accounts and transactions of Vidaroo and its subsidiaries E360, MEV, Vidaroo Licensing, LLC, Vidaroo Intellectual Property, Inc., and Vidaroo Support Services, LLC. Vidaroo has a 98% and 95% interest in E360, as of ~~September~~December 3031, 2012 and 2011, respectively. Ownership was acquired by Vidaroo in a stock exchange. MEV is controlled by Vidaroo pursuant to a management agreement between the two companies. All significant inter-entity accounts and transactions are eliminated in consolidation.

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NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revenue Recognition

Revenue is generated from monthly subscription fees from subscribers to the OVP. Revenue is recognized ratably over the contract period for each subscriber. Revenue is also generated ~~from professional services rendered~~ in connection with the production of video content. Revenue is recognized when services are rendered ~~or advertising has been delivered~~ in accordance with the terms of the agreement provided that the collection of the associated receivable is reasonably assured and there are no remaining significant obligations.

Long-Lived Assets

The Entity evaluates the recoverability of its long−lived assets, including intangibles, for possible impairment whenever events or circumstances indicate that the carrying amount of such assets may not be recoverable. If such review indicates that the carrying amount of long−lived assets is not recoverable, the carrying amount of such assets is reduced to fair value. No impairment charges were incurred during the ~~three~~six months ended ~~September~~December 3031, 2012 and 2011.

Computer equipment and Office furniture and fixtures are recorded at cost depreciated on a straight line basis over their expected useful lives of 5 and 7 years, respectively.

~~Noncontrolling~~ Minority Interest

Minority interest represents the portion of E360 not owned by Vidaroo.

Stock-Based Compensation

The Entity provides stock based compensation to both its employees and vendors under certain circumstances. The Entity is required to measure the cost of employee service received in exchange for an award of equity instruments, including stock options, based on the grant-date fair value of the award and to recognize it as compensation expense over the period the employee is required to provide service in exchange for the award, usually the vesting period.

Income Taxes

Income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred taxes resulting from temporary differences less estimated valuation allowances. Such temporary differences result from differences in the carrying value of assets and liabilities for tax and financial reporting purposes. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. Income tax expense is the tax payable or refundable for the period plus or minus change during the period in deferred tax assets and liabilities and valuation allowances.

Earnings per Common share

Basic earnings per common share excludes potentially dilutive securities and is computed by dividing net earnings(loss) by the weighted average number of common shares outstanding during the period. Fully diluted earnings per share are not displayed as the impact of including those shares would be anti-dilutive. For the quarters ended September 30, 2012 and 2011 the Entity had 65,853,927 and 20,556,233 potentially dilutive common shares, respectively, which were not included in the calculation of diluted loss per share.

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Earnings per Common share

Basic earnings per common share excludes potentially dilutive securities and is computed by dividing net earnings(loss) by the weighted average number of common shares outstanding during the period. Fully diluted earnings per share are not displayed as the impact of including those shares would be anti-dilutive. For the six months ended December 31, 2012 and 2011 the Entity had 63,404,912 and 22,494,115 potentially dilutive common shares, respectively, which were not included in the calculation of diluted income (loss) per share.

Financial Instruments

The entity reports its financial and non-financial assets and liabilities that are re-measured and reported at fair value at each reporting period. Three levels of inputs may be used to measure fair value:

	●	Level 1 - Active market provides quoted prices for identical assets or liabilities;
	●	Level 2 - Inputs other than quoted prices included within Level 1 that are either directly or indirectly observable with market data; and
	●	Level 3 - Unobservable inputs that are supported by little or no market activity, therefore requiring an entity to develop its own assumptions about the assumption that market participants would use in pricing.

Fair value estimates discussed herein are based upon certain market assumptions and pertinent information available to management as of ~~September~~December 3031, 2012.

The Entity uses the market approach to measure fair value for its Level 1 financial assets and liabilities. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities. The respective carrying value of certain on-balance-sheet financial instruments approximated their fair values. These financial statements which include cash, trade receivables, borrowings, related party notes payable, accounts payable and certain accrued liabilities are valued using Level 1 inputs and are immediately available without market risk to principal. Fair values were assumed to approximate carrying values for these financial instruments since they are short term in nature and their carrying amounts approximate fair values or they are receivable or payable on demand.

The Entity considers its Debt instruments and certain accrued liabilities to have Level 3 inputs. Those inputs include the fair value of Vidaroo’s common stock and the number of shares the Entity ishas ~~offering~~offered to convert its ~~current~~ outstanding debt and accrued interest to equity of the Entity.

Research and Development

Based on the nature of the Entity’s software development methodology, costs incurred are considered to be connected with the establishment of technological feasibility in accordance with ASC 985-20-25 “Costs of Software to Be Sold, Leased or Marketed” and therefore are considered Research and Development.

NOTE 3. RECENT ACCOUNTING STANDARDS

On June 16, 2011, the FASB issued ASU No. 2011-05, “Presentation of Comprehensive Income (Topic 220),” which requires companies to report total net income, each component of comprehensive income, and total comprehensive income on the face of the income statement, or as two consecutive statements. The components of comprehensive income will not be changed, nor does the ASU affect how earnings per share is calculated or reported. These amendments will be reported retrospectively upon adoption. The adoption of the ASU will be required for the Company’s March 31, 2012 Form 10-Q filing, and is not expected to have a material impact on the Company.

In May 2011, the FASB issued an accounting standard update which works to achieve common fair value measurement and disclosure requirements in GAAP and International Financial Reporting Standards. The update both clarifies the FASB’s intent about the application of existing fair value guidance, and also changes certain principles regarding measurement and disclosure. The update is effective prospectively and is effective for annual periods beginning after December 15, 2011. Early application is permitted for interim periods beginning after December 15, 2011. The Company is currently evaluating the effect the update will have on its consolidated financial statements.

In January 2010, the FASB issued an accounting standard update on fair value measurements and disclosures. The update requires more robust disclosures about (1) the different classes of assets and liabilities measured at fair value, (2) the valuation techniques and inputs used, (3) the activity in Level 3 fair value measurements, and (4) the transfers between Levels 1, 2, and 3. The new disclosures and clarifications of existing disclosures are effective for interim and annual reporting periods beginning after December 15, 2009; except for the disclosures about purchases, sales, issuances, and settlements in the roll forward of activity in Level 3 fair value measurements. Those disclosures are effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. The adoption of this update did not have an effect on the Company’s consolidated financial statements.

The recent accounting standards disclosed shall be read in conjunction with the disclosures made in the Entity's Annual Report on form 10-K for the fiscal year ended June 30, 2012.

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NOTE 43. ~~RELATED PARTY TRANSACTIONS~~ DEBT

As of September 30, 2012, the Entity has an outstanding obligation to both Mark Argenti and Ian McDaniel of $39,478 for incentive compensation under each individual’s employment contract of which $8,223 was earned in the quarter ended September 30, 2012.

Also as of September 30, 2012 and 2011, the Entity had an outstanding payroll obligation of $50,000 and $15,417 to its Officers

NOTE 5. DEBT

Notes Payable

In connection with the management agreement entered into with MEV, Vidaroo became obligated for the repayment of certain notes payable outstanding at the time of the initiation of the management agreement. These notes were guaranteed by Mark Argenti and Ian McDaniel along with a third party obligor. During June, 2010 the third party obligor exercised his right as guarantor on these loans and satisfied the original obligation. During the year ended June 30, 2012, Vidaroo agreed to interest and repayment terms with the obligor. This Note Payable now carries interest at 12% and will begin a repayment schedule commencing on April 1, 2013 and carry equal monthly payments of $2,000 until satisfaction of the both the principal and interest

Convertible Secured Promissory Notes Payable

During the year ended June 30, 2009 the Entity issued debt instruments in the form of promissory notes with a face value of $600,000 (the “Notes”). The Notes carry interest at 12% and are due and payable in full at the earlier of either minimum equity financing of $1 million or one year. Interest can be received monthly or accrued and paid at maturity at the option of the holder. The Notes are secured by all assets of the Entity.

The holders of the Notes have the option, but not the obligation, to convert the outstanding principal into common stock at any time under any of the following terms: A conversion price of $0.25 per share; a conversion price of 30% less than price per share obtained in the next round of financing completed by the Entity; a conversion price of 30% less than the price per share paid in the event of a sale of the Entity, or $0.13 per share in the event the Entity does not raise a minimum of $1 million in additional financing within one year of issuance.

The notes contain warrants to purchase shares valued at 20% of the face value of the note assuming a stock value of $0.25 per share and an exercise price of $0.001 per share. If the value of common stock at the time of conversion is less than $0.25, the payee shall receive additional warrants to bring the total value of warrants issued under this program to be equal to 20% of the face value of the Note. The Notes also included a beneficial conversion feature as the obligations can convert into equity for an exercise price less than the share price at the time of issuance at the option of the holder. Based on these features, the proceeds from debt were split between the value of the warrants and the debt. Further, the debt obligation must have value assigned to the beneficial conversion feature. These valuations cause the proceeds from these notes to be allocated to additional paid capital with $248,953 assigned to the value of the warrants and the remaining $351,047 assigned to the beneficial conversion feature. The face value of the debt will be accreted to interest expense over the 1-year term of the debt. ~~During the year ended June 30, 2011 and 2010, $0 and $342,479, respectively, was accreted to interest.~~

During the year ended June 30, 2010, the Entity and the holders of the Notes agreed to extend the terms of repayment for these notes. The notes were either extended through August 1, 2010, March 31, or June 30, 2011. Under the terms of the extensions, the holders were provided with additional consideration. Those Note holders that extended through August were provided with additional shares of Common Stock and those that extended through 2011 received an increase in the interest rate from 12% to 13%.

As of June 30, 2011, the Entity defaulted on its obligation to pay interest and repay principal on these Notes.

During the year ended June 30, 2012, Vidaroo and the holders of the Convertible Secured Promissory Notes came to agreement to restructure the terms of the Notes. Of the $590,000 outstanding, holders of $390,000 of the Notes agreed to accept 10,499,922 shares of preferred stock plus 3,658,549 warrants to purchase Common Stock of Vidaroo at an exercise price of $0.10 ~~in exchange for $290,000 outstanding plus accrued interest~~.

Also during the year ended June 30, 2012, the holders of $200,000 of the Convertible Secured Promissory Notes agreed to a repayment schedule starting in April, 2013 and the conversion of accrued interest into 1,837,920 shares of preferred stock and 640,397 warrants to purchase shares of common stock at an exercise price of $0.10.

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Promissory Notes Payable

During the years ended June 30, 2011 and 2010 the Entity issued debt instruments in the form of promissory notes with a face value of $538,000 and $331,500, respectively (the “Promissory Notes”) and bear interest at 12%. These Promissory Notes were issued in two traunches. Traunch I had an original face value of $231,500 and was due and payable one year from issuance. Traunch I was issued during the fourth quarter of the year ended June 30, 2009 and therefore was originally due during the quarter ending June 30, 2010. Traunch II has a face value of $638,000 and was originally due and payable on December 31, 2010. Monthly interest payments were required.

During the year ended June 30, 2011, the Entity defaulted on its obligation to pay interest and repay principal on these Notes.

During the year ended June 30, 2012, the Entity negotiated with the holders of these notes to restructure the terms of the obligation. The Entity and certain holders of the Notes agreed to convert $760,000 of the $863,570 still outstanding plus the related accrued interest into 19,782,796 shares of Preferred Stock and 6,893,034 warrants to purchase its Common Stock exercisable at $0.10 as of June 30, 2012. During the ~~three~~six months ended ~~September~~December 3031, 2012, the Entity finalized agreements with holders of an additional $65,000 of the obligation plus accrued interest into 1,650,693 shares of Preferred Stock and 575,161 warrants to purchase its Common also exercisable at $0.10.

The remaining balance of $34,000 was unable to be negotiated and shall remain a short-term obligation of Vidaroo.

NOTE 64. FAIR VALUE MEASUREMENTS

The Notes Payable, Convertible Secured Promissory Notes and Promissory Notes are stated at fair value. Fair value is as follows:

Face value

Adjustment to face value

Fair value as of ~~September~~December 3031, 2012

Promissory Notes and Notes Payable

7574,~~129~~885

(4961,~~948~~653

)

2513,~~181~~232

Convertible Secured Promissory Notes Payable

200,000

(~~132~~164,~~964~~660

)

6735,~~036~~340

Accrued interest

3847,~~293~~160

(2527,~~458~~595

)

1219,~~835~~565

Total

~~313~~322,~~422~~045

(~~208~~253,~~370~~908

)

~~105~~68,~~052~~137

The Level 3 inputs used include the number of shares offered to the holders of the Notes along with fair value of the Company’s Common Stock for those Note holders that converted these debt instruments into Equity during the year ended June 30, 2012 and the ~~three~~six months ended ~~September~~December 3031, 2012.

Noncontrolling interest is also stated at fair value. Fair value is as follows:

		Face value				Adjustment to face value				Fair value as of ~~September~~December 3031, 2012
Noncontrolling interest		$	110,400			$	(102,000	)		$	8,400

The Level 3 inputs used include the number of shares provided to the holders of the Noncontrolling interest that converted into Vidaroo’s Common Stock during the year ended June 30, 2012, along with fair value of the Company’s Common Stock.

~~NOTE 7. CAPITAL STOCK~~11

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Certain accrued expenses are considered to be stated at fair value through the use of Level 3 inputs. Fair value is as follows:

		Face value				Adjustment to face value				Fair value as of December 31, 2012
Accrued expenses		$	330,908			$	(270,683	)		$	60,225

Fair value for the certain accrued expenses included above are estimated based on the potential number of shares that would be offered to the Entity’s creditors for settlement of these obligations along with the fair value of such shares.

NOTE 5. CAPITAL STOCK

The Entity’s authorized capital stock consists of 200,000,000 shares of Class A common stock with a par value of $0.001. The Entity also has authorized 100,000,000 shares of preferred stock with a par value of $0.001.

The Entity has previously filed a registration statement with the SEC that went effective July 11, 2008 and is therefore a reporting public company. The Entity filed a form 15c2-11 with FINRA and requested permission to trade on the OTC Bulletin Board. The Entity’s stock began trading on October 3, 2008.

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NOTE 86. STOCK BASED COMPENSATION

The following table represents activity for the Entity’s outstanding ~~stock~~ options and warrants as of and for the ~~three~~six months ended ~~September~~December 3031, 2012:

	Number of Shares Outstanding Under Options and Warrants			Weighted Average Exercise Price
Balance, June 30, 2012		62,616,180		$	0.08
Granted		575,155			0.10
Forfeited or expired		(1,520,000	)		0.05
Balance, September 30, 2012		61,671,335		$	0.09
Balance, December 31, 2012		61,671,335		$	0.09
Exercisable, September 30, 2012		56,520,180		$	0.09
Exercisable, December 31, 2012		57,049,001			0.09

The following table is a summary of the Entity’s non-vested stock options

	Number of shares			Weighted-Average Grant-Date Fair Value
Non-vested balance, June 30, 2012		7,065,392		$	0.08
Granted		575,155			0.10
Vested		(1,~~100~~629,~~642~~463	)		0.0807
Forfeited/Expired		(1,388,750)	)		0.05
Non-vested balance, September 30, 2012		5,151,155		$	0.05
Non-vested balance, December 31, 2012		4,622,334		$	0.05

Unrecognized compensation cost related to unvested stock options and warrants at ~~September~~December 3031, 2012 was $4540,~~155~~603 and ~~are~~is expected to be recognized over a weighted average period of 2118 months.

The total intrinsic value of options exercised during the ~~three~~six months ended ~~September~~December 3031, 2012 and 2011 and was $0. The aggregate intrinsic value of the outstanding options and warrants at ~~September~~December 3031, 2012 and 2011 was $0.

12NOTE 7. RELATED PARTY TRANSACTIONS

As of December 31, 2012, the Entity has an outstanding obligation to both Mark Argenti and Ian McDaniel of $47,178 for incentive compensation under each individual’s employment contract of which $14,223 was earned in the six months ended December 31, 2012.

Also as of December 31, 2012 and 2011, the Entity had an outstanding payroll obligation of $110,000 and $78,047, respectively to its Officers.

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NOTE 98. INCOME TAXES

Income taxes are provided for the tax effects of transactions reported in the financial statements and consist of taxes currently due plus deferred taxes resulting from temporary differences. Such temporary differences result from differences in the carrying value of assets and liabilities for tax and financial reporting purposes. The deferred tax assets and liabilities represent the future tax consequences of those differences, which will either be taxable or deductible when the assets and liabilities are recovered or settled. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized.

The components of deferred tax assets are as follows:

	9/30/12			6/30/12
	12/31/12			6/30/12
Accumulated Net loss	$	8,~~311~~131,~~164~~155		$	8,~~176~~587,~~291~~957
Valuation allowance		(8,~~311~~131,~~164~~155	)		(8,~~176~~587,~~291~~957	)
Net deferred tax assets	$	–-		$	-

NOTE 109. GOING CONCERN

Through ~~September~~December 3031, 2012, the Entity has accumulated losses of $8,~~311~~131,~~164~~155. The Entity expects to generate revenues from its SaaS platform and Production service offerings. The Entity will either ~~receive~~need agenerate substantial revenue from receiving monthly ~~fee~~subscription fees for its software platform ~~and~~or ~~engagement~~raise ~~fees~~capital ~~for~~to maintain its ~~production services~~operations.

The Entity faces all the risks common to companies in their early stages of operations including under capitalization and uncertainty of funding sources, high initial expenditure levels, uncertain revenue streams, and difficulties in managing growth. In view of these conditions, the ability of the Entity to continue as a going concern is in substantial doubt and dependent upon achieving a profitable level of operations and on the ability of the Entity to obtain necessary financing to fund ongoing operations. The Entity’s financial statements do not reflect any adjustments that might result from the outcome of this uncertainty. The future of the Entity hereafter will depend in large part on the Entity’s ability to monetize its investment in its technology and services, and successfully raise capital from external sources to pay for planned expenditures. The Entity continues to seek other sources of financing in order to support existing operations and expand the range and scope of its business. However, there are no assurances that any such financing can be obtained on acceptable terms, if at all.

NOTE 1110. CONTRACTUAL OBLIGATIONS

Given the cash flow difficulties of the Entity, there are various contractual obligations under which the Entity has not met its economic requirements. The economic impact of these instances of noncompliance have been accounted for in the Entity’s Consolidated Financial Statements. Management does not believe that any of the individual instances of noncompliance other than those disclosed herein would have a material adverse effect on the Entity and therefore require further disclosure.

13NOTE 11. SUBSEQUENT EVENTS

Effective January 1, 2013, Vidaroo appointed Thomas Moreland as Chairman of the Board and Chief Executive Officer, in addition to his pre-existing duties as Chief Financial Officer, Secretary and Treasurer. Concurrent with this appointment, Vidaroo accepted the resignation of Mark Argenti as Chairman and Chief Executive Officer, Micheal Morgan as President and Chief Technology Officer and Ian McDaniel as Production President.

Effective with the management transition that took place on January 1, 2013, Vidaroo has elected to pursue software licensing as its sole source of revenue. Production services accounted for $254,508 and $486,665 in revenue for the six months ended December 31, 2012 and 2011, respectively.

Subsequent to December 31, 2012, Vidaroo’s licensing agreement for its online video platform with Emmis Communication’s was terminated in the normal course of business with an effective date of February 28, 2013 consistent with its contractual terms. Prior to its termination, Vidaroo earned a monthly fee of $28,655 from this license.

Also subsequent to December 31, 2012, Vidaroo engaged the services of Sales Outsourcing Specialists to lead its efforts in sales on a fully outsourced basis for a monthly retainer plus a percentage of sales as incentive compensation.

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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Vidaroo is a ~~full~~video ~~service~~technology ~~provider~~company. The ofEntity alicenses ~~proprietary~~its ~~digital~~Online ~~media~~Video ~~network~~Platform, and ~~related~~performs ~~online~~professional ~~digital~~video ~~strategies~~production. Vidaroo’s ~~for~~Online ~~leading~~Video ~~media~~Platform ~~and~~(“OVP”) ~~entertainment~~is ~~companies.~~licensed ~~Vidaroo~~under ~~engages~~a ~~audiences~~Software-as-a-Service on(“SaaS”) ~~digital~~model. The ~~platforms~~SaaS ~~through~~model ~~provision~~allows ofthe ~~media~~Company ~~content~~to ~~either~~generate ~~directly~~monthly orrecurring ~~through~~revenue ~~collaboration~~that ~~with~~is ~~channel~~scalable ~~partners~~and stable. ~~Through~~The aOVP’s ~~combination~~functionality ofallows ~~original~~both users and ~~acquired~~representatives ~~programming~~or ~~and~~affiliates ~~other~~of ~~entertainment~~the ~~content,~~Entity ~~Vidaroo~~to isuse ~~focused~~or promote the OVP based on ~~providing~~automated ~~content~~interfaces ~~that~~independent ~~appeals~~of topersonal ~~key~~contact ~~demographics~~with ~~attractive~~the toEntity. Our ~~advertisers~~Production capabilities include creation and ~~distributors or~~support ~~radio,~~of ~~printed~~video ~~news,~~imagery ~~cable~~for ~~television,~~top ~~satellite,~~line ~~mobile~~names ~~and~~in ~~digital~~the entertainment business. We also provide support of video production for traditional media ~~platforms~~and corporate presentations, ~~and~~as ~~consumer~~well ~~products~~as in-house production of content.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this report. References in this section to "Vidaroo Corporation," “Vidaroo,” the "Entity," "we," "us," and "our" refer to Vidaroo Corporation and our direct and indirect subsidiaries on a consolidated basis unless the context indicates otherwise.

This ~~quarterly~~Quarterly report contains forward looking statements relating to our Entity's future economic performance, plans and objectives of management for future operations, projections of revenue mix and other financial items that are based on the beliefs of, as well as assumptions made by and information currently known to, our management. The words "expects," "intends," "believes," "anticipates," "may," "could," "should" and similar expressions and variations thereof are intended to identify forward-looking statements. The cautionary statements set forth in this section are intended to emphasize that actual results may differ materially from those contained in any forward looking statement.

The following discussion and analysis should be read in conjunction with the consolidated financial statements, included herewith. This discussion should not be construed to imply that the results discussed herein will necessarily continue into the future, or that any conclusion reached herein will necessarily be indicative of actual operating results in the future. Such discussion represents only the best present assessment of our management.

Overview

You should read the following discussion and analysis of our financial condition and results of operations together with our financial statements and the related notes appearing in this Report. Some of the information contained in this discussion and analysis or set forth elsewhere in this Report, including information with respect to our plans and strategy for our business and related financing, includes forward-looking statements that involve risks and uncertainties. You should review the “Risk Factors” section of this Report for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

RESULTS OF OPERATIONS

THREE AND SIX MONTHS ENDED ~~SEPTEMBER~~DECEMBER 3031, 2012 COMPARED TO THE THREE AND SIX MONTHS ENDED ~~SEPTEMBER~~DECEMBER 3031, 2011. Our fiscal year runs from July 1 to June 30.

Revenue

Revenue decreased by $59168,~~419~~205 to $248,~~871~~339 and $227,623 to $497,211 in the ~~quarter~~three and six months ended ~~September~~December 3031, 2012 as compared to 2011, respectively. ~~While~~ The ~~there~~decrease isin anrevenue ~~overall~~for ~~decrease~~both inthe ~~Revenue,~~quarter ~~SaaS~~and ~~revenue~~six ~~increased~~months ~~from~~was ~~$119,000~~driven toby ~~$127~~production services,~~000. While~~ ~~the~~which ~~increase~~fell inby ~~revenue~~$163,025 isand 7%$232,157, werespectively. SaaS ~~have~~revenue ~~seen~~for athe ~~shift~~three inand ~~the~~six ~~number~~months ofended ~~clients~~December ~~served~~31, ~~with~~2012 awas ~~60%~~$125,067 ~~growth~~and in$251,588, ~~the~~respectively, ~~number~~growing ofby ~~on-demand~~$3,625 ~~accounts~~and on$10,945, arespectively ~~year~~ over ~~year basis~~2011. ~~The~~ This ~~year~~growth ~~over~~was ~~year~~largely ~~revenue~~due ~~decrease~~to ~~was~~low ~~predominantly~~cost ~~driven~~web-based bypromotional ~~slower~~activities, ~~demand~~direct ~~for~~sales ~~our~~from ~~Production~~the ~~services. The~~Entity’s ~~episodic~~affiliates ~~nature~~without ofthe ~~these~~use of ~~these~~external ~~services~~capital ~~caused~~or ~~lower~~resources ~~revenue~~to ~~with~~leverage amarketing ~~smaller number of engagements than in the prior year~~initiatives.

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Cost of Sales

During the ~~quarter~~three and six months, the Entity incurred cost of sales in conjunction with the direct provision of services to our clients. These expenses consist of bandwidth to deliver licensing of the online video platform, sales commissions, and production personnel as well as equipment to facilitate the provision of our production services. Cost of sales increased by $425,~~119~~120 to $8486,~~076~~366 and $47,240 to $170,443 in the ~~quarter~~three and six months, respectively, ended ~~September~~December 3031, 2012 as compared to 2011. The increase was due predominantly to acosts ~~higher~~associated ~~cost~~with ~~structure~~our ~~required for the current year~~ production services, ~~which~~as ~~included~~the ~~additional~~cost ~~professional services~~ of ~~$22,000~~providing ~~and~~our ~~incentive~~software ~~compensation~~licensing ofremained ~~$16,000~~stable ~~which~~between ~~was not incurred in~~ the ~~prior year~~periods.

Operating Margin

The operating margin generated by the services and technologies provided ~~during~~decreased ~~the~~by ~~quarter~~$173,325 ~~ended~~to ~~September 30~~$161,973 ~~2012~~and ~~decreased by~~ $~~101~~274,~~538~~863 to $~~164~~326,~~795~~768 induring ~~comparison~~the tothree ~~the~~and ~~quarter~~six months ended ~~September~~December 3031, 2012, respectively, in comparison 2011. The operating margin on the services and technologies produced an Operating ~~Margin~~Margins of 6665% and 55% in ~~comparison~~the three and six months ended December 31, 2012, respectively. This compares unfavorably to ~~86%~~Operating inMargins from the prior year of 80% and 83% in the three and six months ended December 31, 2011, respectively. ~~The~~ Lower Margins in addition to lower revenue earned in the Production business account for the decrease in ~~Margin~~year ~~was~~over ~~predominantly~~year ~~driven~~Margins byas the ~~increased~~current year engagements had a higher variable cost ~~related~~structure tofor ~~production~~the ~~services~~Entity aswhile the ~~Software~~Margins ~~licensing~~in ~~service~~Software ~~remained~~Licensing were stable with a minor increase year over year.

Selling General and Administrative

Selling General and Administrative costs generally consist of salaries, including stock-based compensation, professional fees, office expenses and other administrative costs. These costs decreased by $18108,~~405~~427 to $~~300~~287,~~308~~294 and $147,380 to $592,945 for the ~~quarter~~three and six months ended ~~September~~December 3031, 2012, asrespectively, ~~compared~~in comparison to 2011. ~~This~~The ~~decrease~~reduction relates primarily to ~~reduced~~stock based compensation and professional fees. Stock ~~from~~based ~~the~~compensation ~~prior~~decreased ~~year~~by $45,380 ~~specifically~~and ~~related~~$66,102 tofor ~~legal~~the ~~fees~~three inand ~~the~~six ~~prior~~month ~~year~~periods, respectively, as ~~well~~a asdirect ~~lower~~result ~~occupancy~~of ~~costs~~the ascontracting wewith Executive Officers completed ~~our~~in ~~move~~prior toyears. Professional afees ~~lower~~decreased ~~cost~~by ~~facility~~$39,409 inand $48,929 for the ~~prior~~three ~~year. These~~and ~~decreases~~six ~~were~~months, ~~offset~~respectively, ~~somewhat~~which bywas ~~additional~~a ~~advertising~~result ~~expense~~of ~~associated~~the ~~with~~litigation outstanding in the ~~promotion~~prior ofyear, ~~our~~which ~~OVP~~has since been resolved.

~~Stock~~Loss ~~based~~from ~~Compensation~~operations

~~Stock~~The ~~based~~degradation ~~compensation~~in ~~decreased~~Loss byfrom ~~$20,722~~Operations tofor ~~$5,079. The~~the ~~expense~~three ~~associated~~and ~~with~~six ~~stock~~months ~~based~~ended ~~compensation~~December in31, ~~the~~2012 ~~prior~~was ~~year~~a ~~quarter~~direct ~~had~~result ~~higher amounts~~ of ~~vesting~~the ~~related~~decrease toin ~~awards~~revenue ~~for~~produced ~~recruitment~~from ofour ~~certain~~production ~~officers~~services. While ~~whereas~~we ~~the~~have ~~current~~been ~~year~~able ~~quarter relates~~ to ~~ongoing~~keep ~~recognition~~discretionary ofspending ~~vesting~~to at a ~~lower~~minimum ~~level. This~~the ~~was~~decrease ~~due~~in toboth ~~the~~revenue ~~renegotiation~~and ofoperating ~~Executive~~margin ~~Officer~~from ~~contracts~~production inservices ~~the~~has ~~fourth~~directly ~~quarter~~impacted of the ~~year~~Loss ~~ended~~from ~~June 30, 2012~~Operations.

Loss from Operations

Loss from Operations increased by $59,310 to $143,887. The increase in the loss was driven by the lower Operating Margin, offset somewhat by the decreased Operating Expenses.

Interest expense

Interest expense decreased by $42,381 to $15,509. The decrease is due to the conversion of a significant portion of the outstanding indebtedness into Equity during the fourth quarter of the year ended June 30, 2012.

Nonoperating Gains

The realized gain on troubled debt restructuring did not exist in the prior year as the debt was converted into Equity on the fourth quarter of the year ended June 30, 2012 with continuation of a portion of the settlement into the ~~three~~six months ended ~~September~~December 3031, 2012.

Unrealized gain on adjustment to the fair market value of financial instruments ~~decreased~~increased by $~~519~~199,~~265~~819 to $25316,~~312~~220 for the three months while decreasing by $370,070 to $290,908 for the six months ended December 31, 2012 in comparison to 2011. For the three months ended December 31, 2012, the increase relates to the further evaluation of certain accrued expenses by using Level 3 inputs for valuation where Level 1 inputs were used previously. The decrease for the six months ended December 31, 2012 relates to the nature of the troubled debt restructuring. While ongoing negotiations caused the larger gain onin the prior year, the significant reduction in the outstanding balance of our debt during the year ended June 30, 2012 caused the current year adjustment to be much lower.

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Liquidity and Capital Resources

The Entity had net working capital of $(~~738~~589,~~382~~240) at ~~September~~December 3031, 2012, aan ~~degradation~~improvement of $~~143~~5,~~979~~163 compared to June 30, 2012. The ~~degradation~~improvement is due to the gain on adjustment to the fair market value of outstanding indebtedness offset by the Entity’s Operating losses ~~sustain~~which ~~during~~have ~~the~~been ~~three~~absorbed ~~months~~into ~~ended~~working ~~September~~capital ~~30,~~through ~~2012~~increased short term liabilities or decrease short term assets.

The Entity has incurred operating losses since its inception. The Entity’s auditor has emphasized uncertainty regarding our ability to continue as a going concern in his audit report for the year ended June 30, 2012. As shown in the accompanying financial statements, while the Entity ~~has~~realized net income of $45,136 for the six months ended December 31, 2012 it was driven by the fair market value adjustment to the Entity’s debt while there remains an accumulated deficit of $8,~~311~~131,~~164~~155 as of ~~September~~December 3031, 2012.

Other components of the Entity’s working capital and changes therein are discussed as follows:

Cash and Cash Equivalents. For the ~~three~~six month period ended ~~September~~December 3031, 2012, cash and cash equivalents decreased to $5226,~~344~~205 from $67,911 at June 30, 2012 primarily due to cash used in operating activities.

Cash Flows from Operating Activities. Net cash used by operating activities was $1538,~~086~~747 for the ~~three~~six months ended ~~September~~December 3031, 2012, aan ~~decrease~~increase of $1613,~~899~~337 over the first ~~quarter~~six months of the prior year. ~~The~~While ~~change~~ in ~~cash~~aggregate ~~flows~~the ~~from~~changes ~~operating~~between ~~activities~~the istwo ~~primarily~~years ~~attributable~~is tonot significant, the ~~use~~current ofyear ~~working~~result ~~capital~~was ~~assets~~aided ~~and~~by ~~liabilities~~the increase in accrued salaries due to ~~support~~lack ~~our~~of ~~Operating~~payment ~~Losses~~of certain executive salaries.

Cash Flows from Financing Activities. Net cash used by financing activities was $481 for the three months ended September 30, 2012, and consisted solely of the repayment of a small amount of our outstanding debt.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

N/A.

ITEM 4T. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (“Exchange Act”), as of ~~September 30~~December 31, 2012. Disclosure controls and procedures are those controls and procedures designed to provide reasonable assurance that the information required to be disclosed in our Exchange Act filings is (1) recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission’s rules and forms, and (2) accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Based on that evaluation, the Chief Executive Officer and Chief Financial Officer concluded that, as of ~~September~~December 3031, 2012, our disclosure controls and procedures were ineffective due to the lack of segregation of duties and the lack of audit committee oversight. Upon the acquisition of adequate capital the Entity intends to remediate the deficiencies through the deployment of additional personnel and implementation of an audit committee.

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Management’s Quarterly Report on Internal Control Over Financial Reporting

Management, including our Chief Executive Officer and Chief Financial Officer, is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a – 15(f). Management conducted an assessment as of ~~September~~December 3031, 2012 of the effectiveness of our internal control over financial reporting based on the framework in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Based on that evaluation, management concluded that our internal control over financial reporting was ineffective as of ~~September~~December 3031, 2012.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements should they occur. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the control procedure may deteriorate.

This Quarterly Report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit us to provide only management’s report in this Quarterly Report. As required by SEC Rule 13a-15(b), our company carried out an evaluation, under the supervision and with the participation of management, including our Chief Executive Officer, of the effectiveness of its disclosure controls and procedures as of the end of the period covered by this Quarterly Report. Based on this evaluation, management concluded that our disclosure controls and procedures were ineffective at the reasonable assurance level.

Changes in Internal Control Over Financial Reporting

None.

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PART II

OTHER INFORMATION

ITEM 1 - LEGAL PROCEEDINGS

In August, 2011, a judgment in favor of our former lessor was granted in the amount of $151,924. The Entity does not dispute that the premises were vacated prior to lease termination and is currently in settlement discussions. This case was originally filed by Sand Lake West Business Park, Inc. on May 25, 2011 in the Circuit Court of the Ninth Judicial Circuit in and for Orange County, Florida.

ITEM 1A. RISK FACTORS

None.

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

None

ITEM 3 - DEFAULTS UPON SENIOR SECURITIES

As of ~~September~~December 3031, 2012, we have $2934,000 of outstanding Promissory Notes that we have not met our contractual obligation for the payment of principal and interest. We have attempted to convert these Notes into Equity, similar to the conversions that occurred in the year ended June 30, 2012 but have been unable to come to terms with the Note holders.

ITEM 4 - SUBMISSION OF MATTERS TO VOTE OF SECURITY HOLDERS

None.

ITEM 5 - OTHER INFORMATION

~~This report is required to be filed by November 14, 2012~~None. Under the provisions of the Securities Exchange Act of 1934, Release No. 68224 issued on November 14, 2012, this report will be filed on or before November 21, 2012 and considered to be timely filed. The delay is due to the Chief Financial Officer being delayed in his travel back to our headquarters due to the effects of Hurricane Sandy and its aftermath.

There were no material changes to the procedures by which security holders may recommend nominees to the registrant’s board of directors.

ITEM 6 - EXHIBITS

Exhibit Number		Description
31.1		Certification by Chief Executive Officer, required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act.
31.2		Certification by Chief Financial Officer, required by Rule 13a-14(a) or Rule 15d-14(a) of the Exchange Act.
32.1		Certification by Chief Executive Officer, required by Rule 13a-14(b) or Rule 15d-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code.
32.2		Certification by Chief Financial Officer, required by Rule 13a-14(b) or Rule 15d-14(b) of the Exchange Act and Section 1350 of Chapter 63 of Title 18 of the United States Code.
EX-101.INS**		XBRL INSTANCE DOCUMENT
EX-101.SCH**		XBRL TAXONOMY EXTENSION SCHEMA DOCUMENT
EX-101.CAL**		XBRL TAXONOMY EXTENSION CALCULATION LINKBASE
EX-101.DEF**		XBRL TAXONOMY EXTENSION DEFINITION LINKBASE
EX-101.LAB**		XBRL TAXONOMY EXTENSION LABELS LINKBASE
EX-101.PRE**		XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE

EX-101.INS**		XBRL INSTANCE DOCUMENT
EX-101.SCH**		XBRL TAXONOMY EXTENSION SCHEMA DOCUMENT
EX-101.DEF**		XBRL TAXONOMY EXTENSION DEFINITION LINKBASE
EX-101.LAB**		XBRL TAXONOMY EXTENSION LABELS LINKBASE
EX-101.PRE**		XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE

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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.

	VIDAROO CORPORATION
DATE: November 14, 2012	By:	/s/ Mark Argenti
DATE: February 21, 2013	By:	/s/ Thomas Moreland
		Mark Argenti
		Thomas Moreland
		Chief Executive Officer (principal executive officer)
		Chief Executive and Financial Officer (Principal executive, financial and accounting officer)

~~By: /s/ Thomas Moreland Thomas Moreland Chief Financial Officer and Treasurer (Principal financial and accounting officer)~~20

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