~~Table~~UNITED ~~of Contents~~STATES

~~UNITED~~SECURITIES ~~STATES~~AND EXCHANGE COMMISSION

~~SECURITIES~~Washington, ~~AND~~DC ~~EXCHANGE COMMISSION~~ 20549

~~Washington,~~FORM ~~DC 20549~~ 10-Q

~~FORM~~(Mark ~~10-Q~~ One)

~~(Mark~~x Quarterly ~~One~~Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

xFor ~~Quarterly Report pursuant to Section 13 or 15(d) of~~ the ~~Securities~~quarterly ~~Exchange~~period ~~Act~~ended ofAugust ~~1934~~31, 2011

~~For~~¨ Transition ~~the~~Report ~~quarterly~~pursuant ~~period~~to ~~ended~~13 ~~May 31,~~or ~~2011~~15(d) of the Securities Exchange Act of 1934

¨For ~~Transition Report pursuant to 13 or 15(d) of~~ the ~~Securities~~transition ~~Exchange Act of 1934~~period to

~~For~~Commission ~~the~~File ~~transition~~Number ~~period to~~ 0-29901

~~Commission~~PUBLIC ~~File~~MEDIA ~~Number~~WORKS, ~~0-29901~~ INC.

~~PUBLIC~~(Exact ~~MEDIA~~name ~~WORKS,~~of ~~INC.~~small business issuer as specified in its charter)

(Exact name of small business issuer as specified in its charter)

Delaware		98-4802535
(State or other jurisdiction of		(IRS Employer
incorporation or organization)		Identification No.)

Delaware		98-4802535
(State or other jurisdiction of incorporation or organization)		(IRS Employer Identification No.)

2330 Marinship Way, Ste. #300

~~2330 Marinship Way~~Sausalito, ~~Ste.~~CA ~~#300~~ 94965

~~Sausalito,~~(Address CAof ~~94965~~principal executive offices)

(~~Address of principal executive offices~~415) 331-7700

(~~415)~~Issuer’s ~~331-7700~~telephone number, including area code)

(~~Issuer’s~~Former ~~telephone number, including area code~~address)

Check whether the issuer (~~Former~~1) ~~address~~filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 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 ¨

~~Check~~Indicate by check mark whether the ~~issuer (1) filed~~registrant ~~all~~has ~~reports~~submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be ~~filed~~submitted byand ~~Section 13~~posted orpursuant ~~15(d)~~to Rule 405 of ~~the~~Regulation ~~Exchange~~S-T ~~Act~~(§232.405 of this chapter) during the ~~past~~preceding 12 months (or for such shorter period that the registrant was required to ~~file~~submit ~~such reports),~~ and ~~(2) has~~post ~~been subject to~~ such ~~filing~~ ~~requirements for the past 90 days~~files). YES ~~x NO~~ ¨ NO ¨

Indicate by check mark whether the registrant ~~has~~is ~~submitted~~a ~~electronically~~shell ~~and~~company ~~posted~~(as ondefined ~~its~~in ~~corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to~~ Rule ~~405 of Regulation S~~12b-T2 ~~(§232.405~~ of ~~this chapter) during~~ the ~~preceding~~Exchange ~~12 months (or for such shorter period that the registrant was required to submit and post such files)~~Act.): YES ¨ NO ¨ x

~~Indicate~~On byOctober ~~check~~14, ~~mark~~2011, ~~whether~~ the registrant ishad aoutstanding ~~shell~~38,389,700 ~~company~~shares ~~(as~~of ~~defined~~Common inStock, ~~Rule~~which ~~12b-2~~is of the ~~Exchange Act.): YES ¨ NO x~~registrant’s only class of common equity

OnIndicate ~~July 14,~~by ~~2011,~~check mark whether the ~~registrant~~Registrant ~~had~~is ~~outstanding~~a 35large accelerated filer,~~165~~ an accelerated filer,~~294~~ ~~shares~~a non-accelerated filer, or a smaller reporting Company. See definitions of ~~Common~~“large ~~Stock~~accelerated filer,” ~~which~~“accelerated isfiler” ~~the~~and ~~registrant’s~~“smaller ~~only~~reporting ~~class~~Company” in Rule 12b-2 of ~~common~~the ~~equity~~Exchange Act.

~~Indicate~~Large byaccelerated ~~check~~filer ~~mark~~¨ ~~whether~~Accelerated ~~the~~filer ~~Registrant~~¨ isNon ~~a large~~ accelerated filer, an¨ ~~accelerated~~(Do ~~filer,~~not acheck ~~non-accelerated~~if ~~filer, or~~ a smaller reporting ~~Company.~~ ~~See~~company) ~~definitions~~Smaller ~~of “large accelerated filer,” “accelerated filer” and “smaller~~ reporting ~~Company”~~company ~~in Rule 12b-2 of the Exchange Act.~~ x

~~Large~~Transitional ~~accelerated~~Small ~~filer~~Business ¨Disclosure ~~Accelerated~~Format ~~filer ¨ Non accelerated filer ¨~~ (DoCheck ~~not check if a smaller reporting company~~one): YES ~~Smaller~~¨ NO ~~reporting company~~ x

~~Transitional~~PUBLIC ~~Small~~MEDIA ~~Business~~WORKS, ~~Disclosure Format (Check one): Yes ¨ No x~~ INC.

~~Table~~Form ~~of Contents~~10-Q

~~PUBLIC~~For ~~MEDIA~~the ~~WORKS,~~Three ~~INC.~~and Six Months Ended

~~Form~~August ~~10-Q~~31, 2011

~~For~~TABLE ~~the~~OF ~~Quarter Ended May 31, 2011~~ CONTENTS

~~TABLE~~Page OFPART ~~CONTENTS~~I – FINANCIAL INFORMATION 3 Item 1. Condensed Consolidated Financial Statements 3 Condensed Consolidated Balance Sheets as of August 31, 2011 (Unaudited) and February 28, 2011 3 Condensed Consolidated Statements of Operations for the Three and Six Months ended August 31, 2011 and 2010 (Unaudited) 4 Condensed Consolidated Statements of Cash Flows for the Three and Six Months ended August 31, 2011 and 2010 (Unaudited) 5 Notes to Condensed Consolidated Financial Statements (Unaudited) 6 Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 12 Item 3. Quantitative and Qualitative Disclosures About Market Risk 15 Item 4. Controls and Procedures 15 PART II – OTHER INFORMATION 16 Item 1. Legal Proceedings 16 Item 1A. Risk Factors 16 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 16 Item 3. Defaults Upon Senior Securities 17 Item 4. (Removed and Reserved) 17 Item 5. Other Information 17 Item 6. Exhibits 17 Signatures 17

	Page
PART I – FINANCIAL INFORMATION		3
Item 1. Condensed Consolidated Financial Statements
Condensed Consolidated Balance Sheets as of May 31, 2011 (Unaudited) and February 28, 2011		3
Condensed Consolidated Statements of Operations for the Three Months ended May 31, 2011 and 2010 (Unaudited)		4
Condensed Consolidated Statements of Cash Flows for the Three Months ended May 31, 2011 and 2010 (Unaudited)		5
Notes to Condensed Consolidated Financial Statements (Unaudited)		6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		13
Item 3. Quantitative and Qualitative Disclosures About Market Risk		15
Item 4. Controls and Procedures		15
PART II – OTHER INFORMATION		16
Item 1. Legal Proceedings		16
Item 1A. Risk Factors		17
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		17
Item 3. Defaults Upon Senior Securities		17
Item 4. (Removed and Reserved)		17
Item 5. Other Information		17
Item 6. Exhibits		18
Signatures		18

~~Table~~PART ~~of Contents~~I

~~PART~~PUBLIC I MEDIA WORKS, INC.

~~PUBLIC~~Condensed ~~MEDIA~~Consolidated ~~WORKS,~~Balance ~~INC.~~Sheets (Unaudited)

Condensed Consolidated Balance Sheets

	August 31,			February 28,
	2011			2011
	(Unaudited)
Assets
Current assets:
Cash	$	5,794		$	385,888
Accounts receivable, net		—			6,561
Inventory		45,741			61,564
Prepaid expenses and other assets		3,549			346,728
Total current assets		55,084			800,741
Deposits on kiosks		—			394,206
Equipment, net		168,875			—
Other assets		11,202			11,485
Total assets	$	235,161		$	1,206,432
Liabilities and Stockholders’ Deficit 3
Current liabilities:
Accounts payable and accrued expenses	$	448,531		$	271,562
Notes payable and accrued interest to stockholders		726,287			14,000
Note payable		—			27,090
Total current liabilities		1,174,818			312,652
Notes payable and accrued interest to stockholders and a related party		—			855,185
Total liabilities		1, 174,818			1,167,837
Stockholders’ deficit
Common stock $0.0001 par value, 125,000,000 shares authorized 38,389,700 and 30,208,459 issued and outstanding as of August 31, 2011 and February 28, 2011, respectively		3,839			3,021
Additional paid-in capital		18,268,506			12,901,495
Subscriptions receivable		—			(30,000	)
Accumulated deficit		(19,212,002	)		(12,835,921	)
Total stockholders’ deficit		(939,657	)		38,595
Total liabilities and stockholders’ deficit	$	235,161		$	1,206,432

	May 31, 2011(Unaudited)			February 28,2011
Assets
Current assets:
Cash	$	2,623		$	385,888
Accounts receivable, net		8,562			6,561
Inventory		94,489			61,564
Prepaid expenses and other assets		176,710			346,728
Total current assets		282,384			800,741
Deposits on kiosks		—			394,206
Equipment, net		568,350			—
Other assets		11,372			11,485
Total assets	$	862,106		$	1,206,432
Liabilities and Stockholders’ Deficit
Current liabilities:
Accounts payable and accrued expenses	$	507,196		$	271,562
Due to stockholders		27,000			14,000
Note payable		15,000			27,090
Total current liabilities		549,196			312,652
Notes payable and accrued interest to stockholders and a related party		620,276			855,185
Total liabilities		1,169,472			1,167,837
Stockholders’ deficit
Common stock $0.0001 par value, 100,000,000 shares authorized 33,295,294 and 30,208,459 issued and outstanding as of May 31, 2011 and February 28, 2011, respectively		3,330			3,021
Additional paid-in capital		15,420,938			12,901,495
Subscriptions receivable		—			(30,000	)
Accumulated deficit		(15,731,634	)		(12,835,921	)
Total stockholders’ deficit		(307,366	)		38,595
Total liabilities and stockholders’ deficit	$	862,106		$	1,206,432

The accompanying notes are an integral part of these condensed consolidated financial statements.

~~The accompanying notes are an integral part of these condensed consolidated financial statements.~~ 3

3PUBLIC MEDIA WORKS, INC.

~~Table~~Condensed Consolidated Statements of ~~Contents~~Operations (Unaudited)

PUBLIC MEDIA WORKS, INC.

	Three months ended August 31,						Six months ended August 31,
	2011			2010			2011			2010
Revenue	$	18,881		$	339		$	39,117		$	339
Expenses
Direct operating expenses		105,890			—			169,603			—
Marketing		25,566			61,779			78,418			94,596
General and administrative expenses		1,409,850			380,740			4,014,852			1,690,973
Professional fees		69,766			—			229,507			—
Total expenses		1,611,072			442,519			4,492,380			1,785,569
Loss from operations		(1,592,191	)		(442,180	)		(4,453,263	)		(1,785,230	)
Other expenses:
Interest		10,011			33,390			25,052			219,373
Loss on conversion of debt to equity		1,478,693			—			1,478,693			46,550
Depreciation		29,397			13,288			48,996			14,593
Equipment impairment		370,077						370,077
Total other expenses		1,888,178			46,678			1,922,818			280,516

Loss before income taxes		(3,480,369	)		(488,858	)		(6,376,081	)		(2,065,746	)
Provision for income taxes		—			—			—			—
Net loss	$	(3,480,369	)	$	(488,858	)	$	(6,376,081	)	$	(2,065,746	)

Net loss per common share – basic and diluted	$	(0.10	)	$	(0.03	)	$	(0.19	)	$	(0.15	)

Weighted average number of shares – basic and diluted		36,530,395			15,453,528			34,359,350			13,794,681

~~Condensed~~The ~~Consolidated~~accompanying ~~Statements~~notes are an integral part of ~~Operations~~these -condensed ~~(Unaudited)~~consolidated financial statements.

	Three months ended May 31,
	2011			2010
Revenue:	$	20,236		$	—
Expenses:
Direct operating		63,713			—
Marketing		52,852			32,817
General and administrative		2,624,552			1,225,091
Professional fees		159,741			85,142
Total expenses		2,900,858			1,343,050
Loss from operations		(2,880,622	)		(1,343,050	)
Other expenses:
Interest		15,091			185,983
Loss on conversion of debt to equity		—			46,550
Depreciation		—			1,305
Total other expenses		15,091			233,838
Loss before income taxes		(2,895,713	)		(1,576,888	)
Provision for income taxes		—			—
Net loss	$	(2,895,713	)	$	(1,576,888	)
Net loss per common share - basic and diluted	$	(0.09	)	$	(0.18	)
Weighted average number of shares outstanding - basic and diluted		32,223,740			8,945,616

~~The~~PUBLIC ~~accompanying~~MEDIA ~~notes~~WORKS, ~~are an integral part of these condensed consolidated financial statements~~INC.

4Condensed Consolidated Statements of Cash Flows (Unaudited)

	Six months ended August 31, 2011			Six months ended August 31, 2010
OPERATING ACTIVITIES:
Net loss	$	(6,376,081	)	$	(2,065,746	)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation		48,996			3,805
Amortization		110,834			—
Impairment of equipment		370,077			—
Interest expense accrued but unpaid on convertible of debt		25,052			166,079
Share based compensation		3,527,184			2,583,479
Warrants issued for services		11,086			—
Loss on conversion of debt to equity		1,478,693			46,550
Bad debt expense		7,794			—
Changes in operating assets and liabilities:
Accounts receivable		(1,233	)		—
Prepaid expenses and other assets		33,562			(1,681,674	)
Inventory		(94,728	)		(773	)
Other assets		—			(7,448	)
Accounts payable and accrued expenses and accrued interest		230,502			574,496
Net cash used in operating activities		(628,262	)		(381,232	)
INVESTING ACTIVITIES:
Purchase of equipment		(199,742	)		(49,249	)
Net cash used in investing activities		(199,742	)		(49,249	)
FINANCING ACTIVITIES:
Issuance of common stock for cash		216,000			761,394
Subscriptions receivable		30,000			—
Due to stockholders		164,000			—
Payments on note payable		(27,090	)		—
Notes payable		65,000			—
Payment on note payable to related party		—			(137,923	)
Net cash provided by (used in) financing activities		447,910			623,471
Net increase (decrease) in cash		(380,094	)		192,990
Cash - beginning of period		385,888			44
Cash – end of period	$	5,794		$	193,034
SUPPLEMENTAL DISCLOSURES OF NON CASH FINANCING ACTIVITIES
Common stock issued upon reverse merger	$	—		$	1,171
Conversion of accounts payable to convertible promissory note	$	—		$	50,000
Cancellation of common shares	$	—		$	338
Common stock issued for consulting services	$	468,125		$	1,698,500
Common stock issued to directors, officers and advisors	$	275,000		$	1,125,000
Conversion of notes payable and interest to equity	$	831,758		$	—
Common stock issued as prepayment on kiosks	$	100,000		$	—

~~PUBLIC~~The ~~MEDIA~~accompanying ~~WORKS,~~notes ~~INC.~~are an integral part of these condensed consolidated financial statements.

~~Condensed Consolidated Statements of Cash Flows (Unaudited)~~ 5

	Three months endedMay 31, 2011			Three months endedMay 31, 2010
OPERATING ACTIVITIES:
Net loss	$	(2,895,713	)	$	(1,576,888	)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation		19,598			1,305
Amortization		43,926			—
Interest expense accrued but unpaid on convertible of debt		15,091			166,079
Share based compensation		2,369,664			873,692
Warrants issued for services		11,086			—
Loss on conversion of debt to equity		—			46,550
Changes in operating assets and liabilities:
Accounts receivable		(2,001	)		—
Prepaid expenses and other assets		(13,982	)		(23,002	)
Inventory		(76,738	)		(10,635	)
Other assets		—			(8,275	)
Accounts payable and accrued expenses and accrued interest		235,635			333,082
Net cash used in operating activities		(293,434	)		(198,092	)
INVESTING ACTIVITIES:
Purchase of equipment		(199,741	)		(49,249	)
Net cash used in investing activities		(199,741	)		(49,249	)
FINANCING ACTIVITIES:
Issuance of common stock for cash		79,000			400,894
Subscriptions receivable		30,000			—
Due to stockholders		13,000			—
Note payable		(12,090	)		—
Payment on note payable to related party		—			(137,923	)
Net cash provided by financing activities		109,910			262,971
Net increase (decrease) in cash		(383,265	)		15,630
Cash - beginning of period		385,888			44
Cash - end of period	$	2,623		$	15,674
SUPPLEMENTAL DISCLOSURES OF NON CASH FINANCING ACTIVITIES
Common stock issued upon reverse merger	$	—		$	1,171
Conversion of accounts payable to convertible promissory note	$	—		$	25,000
Cancellation of common shares	$	—		$	338
Common stock issued for consulting services	$	378,125		$	898,500
Common stock issued to directors, officers and advisors	$	275,000		$	125,000
Conversion of notes payable and interest to equity	$	250,000		$	—

PUBLIC MEDIA WORKS, INC.

~~The~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL ~~accompanying notes are an integral part of these condensed consolidated financial statements.~~ STATEMENTS (UNAUDITED)

5August 31, 2011

~~Table~~1. Basis of ~~Contents~~ Presentation

~~NOTES~~The TOaccompanying ~~CONDENSED~~consolidated ~~CONSOLIDATED~~financial ~~FINANCIAL~~statements ~~STATEMENTS~~include the accounts of Public Media Works, Inc. and its wholly-owned subsidiary, EntertainmentXpress, Inc. (~~UNAUDITED~~Collectively, the “Company”). All intercompany accounts and transactions have been eliminated in consolidation.

~~May~~The Company filed a voluntary petition on September 3123, 2011 (the “Petition Date”), for reorganization under Chapter 11 of the Bankruptcy Code (the “Bankruptcy Code”) with the United States Bankruptcy Court for the Central District of California, Riverside Division (the “Bankruptcy Court”).

1The consolidated financial statements as of August 31, 2011 and for the three and six months then ended were prepared in accordance with ASC 852 “reorganizations”, which does not change the application of US GAAP with respect to the preparation of our financial statements. ~~Basis~~ As such, the financial statements for the three and six months ended August 31, 2011 reflect the estimated realizable values of ~~Presentation~~ our assets and estimated fair value of our liabilities, and are therefore not comparable to the financial statements for the three and six months ended August 31, 2010. As part of the Chapter 11 filing and as discussed further below, we anticipate the development and implementation of a plan of reorganization to restructure our debt obligations and business operations. Confirmation of a plan of reorganization would likely materially alter the classifications and amounts reported in our consolidated financial statements. For further information see Footnote 10, Subsequent Events.

The ~~(a)~~ condensed consolidated balance sheet as of February 28, 2011, which was derived from audited financial statements, ~~and~~has ~~(b) the unaudited interim condensed consolidated financial statements have~~ been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and note disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to those rules and regulations, although the Company believes that the disclosures made are adequate to make the information not misleading.

~~The~~In the opinion of management, all adjustments (consisting of normal and recurring adjustments as well as adjustments required for entities in reorganization under the Bankruptcy Code) necessary for a fair presentation of the results of operations have been included in the accompanying condensed consolidated financial statements ~~include~~. ~~the~~These ~~accounts~~condensed ofconsolidated ~~Public~~financial ~~Media~~statements ~~Works,~~should ~~Inc.~~be read in conjunction with the consolidated financial statements and ~~its~~accompanying ~~wholly-owned~~notes ~~subsidiary,~~thereto ~~EntertainmentXpress,~~included ~~Inc.~~in ~~All~~the “Company‘s ~~intercompany~~Annual ~~accounts~~Report on Form 10-K as of and ~~transactions~~for ~~have~~the ~~been~~year ~~eliminated~~ended inFebruary ~~consolidation.~~28, 2011, as filed with the Securities Exchange Commission.

In the opinion of management, all adjustments (consisting only of normal and recurring adjustments) necessary for a fair presentation of the results of operations have been included in the accompanying condensed consolidated financial statements2. ~~Operating results for the three months ended May~~Summary ~~31, 2011, are not necessarily indicative~~ of ~~the results to be expected for other interim periods or for the year ending February~~Significant ~~28,~~Accounting 2012. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and accompanying notes thereto included in the Public Media Works, Inc. (the “Company”) Annual Report on Form 10-K as of and for the year ended February 28, 2011, as filed with the Securities Exchange Commission. Policies

2.Use ~~Summary~~ of ~~Significant Accounting Policies~~ Estimates

~~Use~~The preparation of ~~Estimates~~condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

~~The~~Going ~~preparation~~Concern ~~of condensed consolidated financial statements in conformity with GAAP requires management to make estimates~~ and ~~assumptions~~Liquidity that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Matters

~~Going~~On ~~Concern~~September 23, 2011, the Company filed for protection under Chapter 11 of the Bankruptcy Code and ~~Liquidity~~as ~~Matters~~such, the accompanying consolidated financial statements have been prepared under the assumption that the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities during the normal course of business. Historically, the Company has incurred significant losses, and has not demonstrated the ability to generate sufficient cash flows from operations to satisfy its liabilities and sustain operations.

The accompanying consolidated financial statements have been prepared under the assumption that the Company will continue as a going concern, which contemplates the realization of assets and the satisfaction of liabilities during the normal course of business. Historically, the Company has incurred significant losses, and has not demonstrated the ability to generate sufficient cash flows from operations to satisfy its liabilities and sustain operations. Inventory

Inventory is mainly comprised of our DVD and Blu-ray rental library and merchandise inventories held for rental and resale. Inventory, which is considered finished goods, is stated at the lower of cost or market. Our DVD and Blu-ray library is capitalized and amortized to estimated salvage value (sales value of used DVDs and Blu-ray discs) on a straight-line basis to direct operating expense over the average estimated high usage periods of the DVDs and Blu-rays which is typically four months. The cost of inventory includes the cost of materials and to a lesser extent, the labor and overhead in stocking the DVD and Blu-ray rental inventory. Inventory also includes a small amount of DVD cases and radio frequency identification devices (RFID tags) to be used on future movies. Due to our removing our kiosks from operation and the filing of the bankruptcy petition, at August 31, 2011, the Company wrote all inventory down to its estimated net realizable value and took a charge of $26,000.

Inventory is mainly comprised of our DVD and Blu-ray rental library and merchandise inventories held for rental and resale. Inventory, which is considered finished goods, is stated at the lower of cost or market. Our DVD and Blu-ray library is capitalized and amortized to estimated salvage value (sales value of used DVDs and Blu-ray discs) on a straight-line basis to direct operating expense over the average estimated high usage periods of the DVDs and Blu-rays which is typically four months. The cost of inventory includes the cost of materials and to a lesser extent, the labor and overhead in stocking the DVD and Blu-ray rental inventory. Inventory also includes a small amount of cases and radio frequency identification devices (RFID tags) to be used on future movies. 6

~~Equipment~~PUBLIC MEDIA WORKS, INC.

~~Equipment~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL is stated at cost, less accumulated depreciation. Expenditures for maintenance and repairs are charged to expense as incurred. Included in the cost of the kiosk is the cost to deliver and install the kiosk as well as applicable sales tax. Items of property and equipment with costs greater than $1,000 are capitalized and depreciated on a straight-line basis over the estimated useful lives, as follows: STATEMENTS (UNAUDITED)

Description		Estimated Useful Life
Office equipment and furniture		2 to 5 years
Kiosks		5 years

August 31, 2011

6 Equipment

~~Table~~At February 28, 2011, equipment is stated at cost, less accumulated depreciation. Due to the filing of ~~Contents~~the bankruptcy petition, at August 31, 2011, the Company wrote all equipment down to its estimated net realizable value and in the three and six months ended August 31, 2011, the Company took a charge of $370,077.

~~Revenue~~Expenditures ~~Recognition~~for maintenance and repairs are charged to expense as incurred. Included in the cost of the kiosk is the cost to deliver and install the kiosk as well as applicable sales tax. Items of property and equipment with costs greater than $1,000 are capitalized and depreciated on a straight-line basis over the estimated useful lives, as follows:

The Company recognizes net revenue from DVD and Blu-ray movie rentals on a ratable basis during the term of a consumer’s rental transaction. Revenue from a direct sale out of the kiosk of previously rented movies is recognized at the time of sale. On rental transactions for which the related DVDs and Blu-rays have not yet been returned to the kiosk at month-end, revenue is recognized with a corresponding receivable recorded in the balance sheet, net of a reserve for potentially uncollectible amounts. We record revenue net of refunds and applicable sales taxes collected from consumers.

Description		Estimated Useful Life
Office equipment and furniture		2 to 5 years
Kiosks		5 years

Net Loss per Common Share~~-Based~~ ~~Payment~~– ~~Arrangements~~Basic and Diluted

~~Generally,~~Net ~~all~~loss ~~forms~~per ofcommon share- – basic and diluted is computed based ~~payments, including~~on ~~stock~~the ~~option~~weighted ~~grants,~~average ~~restricted~~number ~~stock~~of ~~grants~~shares ~~and~~outstanding ~~stock~~for ~~appreciation~~the ~~rights~~period. ~~are~~Diluted ~~measured~~net atloss ~~their~~per ~~fair~~common ~~value~~share onis ~~the~~computed ~~awards’~~by ~~grant~~dividing ~~date,~~net ~~based~~loss onby the ~~estimated~~weighted ~~number~~average ofshares ~~awards~~outstanding ~~that~~assuming ~~are~~all ~~ultimately~~dilutive ~~expected~~potential tocommon ~~vest.~~shares ~~Share-based compensation~~were ~~awards~~ issued. toAs ~~non-employees~~of ~~for~~August ~~services~~31, ~~rendered~~2011 ~~are~~and ~~recorded~~February at28, ~~either~~2011, the ~~fair~~Company ~~value~~had 11,595,791 and 8,497,291 warrants outstanding, respectively. As of ~~the~~August ~~services~~31, ~~rendered~~2011 orand February 28, 2011, the ~~fair~~Company ~~value~~had of5,970,000 and 4,005,000 stock options, respectively. Neither was included in the net loss per common share due to the options and warrants being anti-~~based~~dilutive. ~~payment~~Additionally, ~~whichever~~there iswere ~~more~~no ~~readily~~adjustments ~~determinable~~to net loss to determine net loss available to common stockholders. ~~The~~As ~~expenses~~such, ~~resulting~~basic ~~from~~ and diluted net loss per common share~~-based~~ ~~payments~~equals ~~are~~net ~~recorded~~loss, inas ~~operating~~reported, ~~expenses~~divided inby the ~~consolidated~~weighted ~~statement~~average ofcommon ~~operations.~~shares outstanding for the respective periods.

~~Net~~Recent ~~Loss~~Issued ~~per Common Share – Basic~~ and ~~Diluted~~Adopted Accounting Pronouncements

~~Net~~In ~~loss~~January ~~per~~2010, ~~common~~the ~~share~~Financial –Accounting ~~basic~~Standards ~~and~~Board ~~diluted~~(“FASB”) isissued ~~computed~~Accounting ~~based~~Standards onUpdate ~~the~~No. ~~weighted~~2010-19 ~~average~~(“ASU ~~number~~2010-19”), ofNew and Enhanced Disclosures about ~~shares outstanding~~Fair Value ~~for the period~~Measurements. ~~Diluted~~ASU ~~net~~2010-06 ~~loss~~provides ~~per~~amendments ~~common~~to ~~share~~FASB isASC ~~computed~~820-10 bythat ~~dividing~~requires ~~net~~new ~~loss~~fair byvalue ~~the~~disclosures ~~weighted~~and ~~average~~clarifies ~~shares~~existing ~~outstanding~~fair ~~assuming~~value ~~all~~disclosures ~~dilutive~~required ~~potential~~under ~~common~~FASB ~~shares~~ASC ~~were issued~~820-10. AsThe ofnew ~~May 31,~~disclosures ~~2011~~ and ~~February 28,~~clarifications ~~2011, the~~of ~~Company~~existing ~~had~~disclosures ~~9,863,291~~are ~~and~~effective ~~8,497,291~~for ~~warrants~~interim ~~outstanding,~~and ~~respectively.~~annual Asreporting ofperiods ~~May 31,~~beginning ~~2011~~after ~~and~~December ~~February 28~~15, ~~2011~~2009, ~~the~~except ~~Company~~for ~~had~~certain ~~6,370,000~~disclosures ~~and~~about 4purchases,~~005~~ sales,~~000~~ ~~stock options~~issuances, ~~respectively.~~and ~~Neither~~settlements ~~was included~~ in the ~~net~~roll ~~loss~~forward ~~per~~activity ~~common share~~in ~~due~~Level to3 ~~the~~fair ~~options~~value ~~and~~measurements. ~~warrants~~Those ~~being~~disclosures ~~anti-dilutive.~~are ~~Additionally,~~effective ~~there~~for ~~were~~fiscal noyears ~~adjustments~~beginning toafter ~~net~~December ~~loss~~15, to2010, ~~determine~~and ~~net~~for ~~loss~~interim ~~available~~periods towithin ~~common~~those ~~stockholders~~fiscal years. AsThe ~~such,~~adoption ~~basic~~of ~~and~~the ~~diluted~~new ~~net~~provisions ~~loss~~within ~~per~~ASU ~~common~~2010-06 ~~share~~did ~~equals~~not ~~net~~have ~~loss,~~a asmaterial ~~reported, divided~~impact byon ~~the~~our ~~weighted~~consolidated ~~average~~financial ~~common~~position, ~~shares~~results ~~outstanding~~of ~~for~~operations, ~~the~~cash ~~respective~~flows, ~~periods.~~or disclosures.

~~Recent~~3. ~~Issued~~Prepaid expenses and ~~Adopted~~Other ~~Accounting Pronouncements~~ Assets

InPrepaid ~~January~~expenses ~~2010,~~principally ~~the~~consist ~~Financial~~of ~~Accounting~~deferred ~~Standards~~costs ~~Board~~related ~~(“FASB”)~~to ~~issued~~stock ~~Accounting~~compensation ~~Standards Update No. 2010-19 (“ASU 2010-19”), New and Enhanced Disclosures about Fair Value Measurements. ASU 2010-06 provides amendments~~ to ~~FASB~~vendors ~~ASC~~where ~~820-10~~stock ~~that~~has ~~requires~~been ~~new~~issued ~~fair value disclosures and clarifies existing fair value disclosures required under FASB ASC 820-10. The new disclosures and clarifications of existing disclosures are effective~~ for ~~interim~~services ~~and~~to ~~annual~~be ~~reporting~~rendered ~~periods beginning after December 15, 2009, except for certain disclosures about purchases, sales, issuances, and settlements~~ in the ~~roll~~future. ~~forward~~Stock ~~activity~~is insubject ~~Level~~to 3repurchase ~~fair~~if ~~value~~services ~~measurements. Those disclosures~~ are ~~effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. The adoption of the new provisions within ASU 2010-06 did~~ not ~~have a material impact on our consolidated financial position, results of operations, cash flows, or disclosures~~rendered.

3. Prepaid expenses and Other assets

	August 31, 2011		February 28, 2011
Investor relations fees	$	—	$	316,667
Prepayment on kiosks		—		100,000
Deposits		—		2,500
Insurance		500		4,182
Rent		3,049		8,621
Legal retainer		—		5,983
Other		—		8,775
Total prepaid expenses and deposits	$	3,549	$	346,728

Prepaid expenses principally consist of deferred costs related to stock compensation to vendors where stock has been issued for services to be rendered in the future. Stock is subject to repurchase if services are not rendered. Assuming all required services are rendered, these capitalized costs will be amortized within twelve months. 7

	May 31,2011		February 28,2011
Investor relations fees	$	126,666	$	316,667
Deposits		20,500		2,500
Technical support		10,417		—
Insurance		4,967		4,182
Rent		5,335		8,621
Legal retainer		—		5,983
Other		8,825		8,775
Total prepaid expenses and other assets	$	176,710	$	346,728

PUBLIC MEDIA WORKS, INC.

7NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

~~Table~~August of31, ~~Contents~~2011

4The Company has a four to eight week lead time between when it orders a kiosk and when it is delivered for deployment. ~~Deposits~~Upon onorder and again prior to shipment, the Company must make partial payment for the cost of the kiosk. As the manufacturer retains ownership until the kiosk is deployed, these up-front payments are treated as deposits until the kiosks are received. As of August 31, 2011, the Company had no kiosks on order compared to 25 at February 28, 2011.

~~The Company has a four to eight week lead time between when it orders a kiosk and when it is delivered for deployment~~4. Upon order and again prior to shipment, the Company must make partial payment for the cost of the kiosk. As the manufacturer retains ownership until the kiosk is deployed, these up-front payments are treated as deposits until the kiosks are received. As of May 31, 2011, the Company had no kiosks on order compared to 25 at February 28, 2011. Equipment

5. Equipment consisted of the following as of August 31, 2011.

Equipment consisted of the following as of May 31, 2011.

Kiosk equipment	$	587,948
Less: accumulated depreciation and write-down to net realizable value		(419,073	)
	$	168,875

Kiosk equipment	$	587,948
Less: accumulated depreciation		(19,598)
	$	568,350

Kiosk equipment is stated at cost and depreciated on a straight-line basis over an estimated useful life of 5 years. Depreciation expense for the three and six months ended August 31, 2011 amounted to $29,397 and $48,996, respectively. During the three and six months ended August 31, 2011, the Company wrote its equipment down to estimated net realizable value and took a charge of $370,077. As described above, the Company had no Kiosks in place as of February 28, 2011.

~~Kiosk equipment is stated at cost and depreciated on a straight-line basis over an estimated useful life of~~ 5 ~~years~~. ~~Depreciation~~ ~~expense for the three months ended May~~Notes 31Payable, Accrued Interest ~~2011~~and ~~amounted~~Other Short-term Obligations to ~~$19,598. As described above, the Company had no Kiosks in place as of February 28, 2011.~~ Stockholders

6.As ~~Short~~a result of its Chapter 11 filing on September 23, 2011, the Company is in default on all of its notes payable which were previously classified as long-term. At ~~Obligations~~August to31, ~~Stockholders~~2011, the Company classified long-term notes payable and ~~Others~~ accrued interest as current which consisted of the following:

The Company has outstanding current liabilities due to stockholders as of May 31, 2011 and February 28, 2011, in the amount of $27,000 and $14,000, respectively. These amounts represent either a short-term loan or operating expenses paid on the Company’s behalf. These liabilities are interest free and due on demand.

	Principal		Interest		Total
8% Note to George Mainas/Mainas Development Corporation	$	187,384	$	5,387		192,771
9% Line of Credit to George Mainas/Mainas Development Corporation		201,274		4,926		206,200
Advances due George Mainas/Mainas Development Corporation		180,000		—		180,000
10% Note due to Niesar Vestal, LLP		50,000		5,000		55,000
7% Note payable to Steve Davis		25,000		2,316		27,316
Due to other shareholders		65,000		—		65,000

Total notes payable and accrued interest to shareholders	$	708,658	$	17,629	$	726,287

~~The~~In May and June, 2011, the Company ~~also~~entered ~~has~~into ~~short-term~~an ~~notes~~Agreement ~~payable~~with George Mainas, Mainas Development Corporation (collectively “Mainas”) and ~~accrued~~three ~~interest~~entities (“Purchasers”) whereby Purchasers purchased $400,000 of the Company’s debt due to Mainas. The Company agreed to allow the Purchasers the option to convert this debt at a conversion rate of $150.25 per share into 1,600,000 shares of common stock and ~~$27~~ 1,~~090~~600,000 aswarrants to purchase common stock of ~~May~~ the Company for $0.40 per share for three years from the date of the Agreements. In connection with the change in the conversion price and the issuance of the warrants, in the six months ended August 31, 2011, ~~and~~the ~~February 28~~Company recorded an expense of $ 1,054,343. The ~~2011~~conversion agreements allows that, ~~respectively~~should the Company issue new shares for less than $0.25 ~~The~~per share, the investor who converted debt and still own these shares will have additional shares issued to bring his net cost per share for the remaining shares down to this lessor price. Also, in May 31 and June, 2011, ~~balance~~Purchasers ~~consists~~notified the Company that they were exercising this option to convert. The shares of aCompany’s ~~non-interest~~common ~~bearing~~stock ~~note~~will be issued without restriction under the Act under an exemption provided pursuant to ~~Niesar~~Rule ~~Vestal,~~144 ~~LLP~~of the Act. AtThe ~~February 28~~warrants and shares of the Company’s common stock which may be issued upon exercise of the warrants are restricted securities, ~~2011~~and may not be sold, transferred or otherwise disposed without registration under Act, or an exemption thereunder. The securities were offered and sold in reliance on the ~~$27~~exemption from registration under Section 4(2) of the Act and/or Rule 506 of Regulation D under the Act. The offering was not conducted in connection with a public offering,~~090~~ and no public solicitation or advertisement was ~~owed~~made toor ~~Niesar~~relied ~~Vestal~~upon by the individual in connection with the offering. In July 2011, ~~LLP~~the Company issued shares for $0.10 which triggered the repricing discussed above. The Company issued and additional 2,121,750 shares to the three purchases and took a charge of $25424,~~000~~350. All principal and accrued interest under the promissory note may be converted into shares of Company common stock at the election of the holder at any time upon written notice to ~~Imperial~~the ~~Credit~~Company ~~Corp.~~at a price of $24.00 per share,~~090~~ ~~related~~and toall ~~financing~~principal anand ~~insurance~~accrued ~~policy~~interest under the promissory note shall automatically convert into shares of Company common stock in the event that the 10 day trailing VWAP (volume weighted average price) for the Company’s common stock shall exceed $4.00 per share at any time prior to the Maturity Date.

~~7. Long-term Notes Payable and Accrued Interest to Stockholders and a Related Party~~ 8

AtPUBLIC ~~May 31,~~MEDIA ~~2011~~WORKS, ~~long-term notes payable and accrued interest consists of the following:~~ INC.

	Principal		Interest		Total
8% Note to George Mainas		337,385		592		337,977
9% Line of Credit to George Mainas		201,274		397		201,671
7% Note payable to Steve Davis		25,000		1,878		26,878
10% Note due to Niesar Vestal, LLP		50,000		3,750		53,750
Total Long-term notes payable and accrued interest	$	613,659	$	6,617	$	620,276

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

OnAugust ~~May 23~~31, 2011, the Company entered into an Agreement with George Mainas, Mainas Development Corporation (collectively “Mainas”) and Del Rey Management L.P. (“Del Rey”) whereby Del Rey purchased $250,000 of the Company’s debt due to Mainas. The Company agreed to allow Del Rey the option to convert this debt into 1,000,000 shares of common stock and 1,000,000 warrants to purchase common stock of the Company for $0.40 per share for three years from the date of the Agreement. The conversion agreement allows that, should the Company issue new shares for less than $0.25 per share, the investor who converted debt and still own these shares will have additional shares issued to bring his net cost per share for the remaining shares down to this lessor price. Also, on May 23, 2011, Del Rey notified the Company that it was exercising this option to convert. The shares of Company’s common stock will be issued without restriction under the Act under an exemption provided pursuant to Rule 144 of the Act. The warrants and shares of the Company’s common stock which may be issued upon exercise of the warrants are restricted securities, and may not be sold, transferred or otherwise disposed without registration under Act, or an exemption thereunder. The securities were offered and sold in reliance on the exemption from registration under Section 4(2) of the Act and/or Rule 506 of Regulation D under the Act. The offering was not conducted in connection with a public offering, and no public solicitation or advertisement was made or relied upon by the individual in connection with the offering.

8The promissory note to Mr. Steve Davis bears interest at 7% per annum. All principal and accrued interest under the promissory note may be converted into shares of Company common stock at the election of the holder at any time upon written notice to the Company at a price of $4.00 per share, and all principal and accrued interest under the promissory note shall automatically convert into shares of Company common stock in the event that the 10 day trailing VWAP (volume weighted average price) for the Company’s common stock shall exceed $4.00 per share at any time prior to the Maturity Date.

~~Table~~On August 31, 2010, the Company entered into a settlement agreement with Niesar Vestal, LLP for all outstanding obligations. The agreement calls for a series of ~~Contents~~cash payments totaling $45,000 over 12 months plus a convertible note for $50,000. $40,000 of the short-term note has been paid, with $5,000 remaining. The note accrues interest at 10%. The terms of the debt agreement provide for all principal and accrued interest to be converted into shares of common stock at $1.50 per share at any time within the term of the note. All principal and accrued interest under the note shall automatically convert into shares of common stock in the event that the 30 day trailing volume weighted average price for the stock exceeds $2.00 per share at any time after June 1, 2011 and prior to the maturity date.

The ~~promissory~~Company ~~note~~has tooutstanding ~~Mr. Steve~~current ~~Davis~~liabilities ~~bears~~due ~~interest~~to atstockholders ~~7% per~~as ~~annum.~~of ~~The~~August ~~maturity~~31, ~~date~~2011 ~~under~~and ~~the promissory~~February ~~note~~28, ~~is June 30~~2011, ~~2013~~in (the ~~“Maturity~~amount ~~Date”)~~of $180,000 ~~all principal~~ and ~~accrued~~$14,000, ~~interest~~respectively. ~~under~~These ~~the~~amounts ~~promissory~~represent ~~note~~either ~~may~~a beshort-term ~~converted~~loans ~~into~~or ~~shares~~operating ofexpenses ~~Company~~paid ~~common~~on ~~stock at~~ the ~~election of the holder at any time upon written notice to the~~ Company’s ~~at a price of $4~~behalf.00 ~~per~~These ~~share,~~liabilities ~~and~~are ~~all~~interest ~~principal~~free and ~~accrued~~due ~~interest~~on ~~under~~demand. The ~~the~~$180,000 ~~promissory~~is ~~note~~due ~~shall~~Mr. ~~automatically~~Mainas ~~convert~~and ~~into~~is ~~shares~~covered ofby ~~Company~~his ~~common~~security ~~stock~~interest in the ~~event~~assets ~~that~~of the ~~10 day trailing VWAP (volume weighted average price) for the~~ Company~~’s common stock shall exceed $4~~.~~00 per share at any time prior to the Maturity Date.~~

OnThe ~~August 31, 2010, the~~ Company ~~entered~~ ~~into~~also ahas ~~settlement~~short-term ~~agreement~~notes ~~with~~payable ~~Niesar~~and ~~Vestal,~~accrued ~~LLP~~interest ~~for all outstanding obligations. The agreement calls for a series~~ of ~~cash payments totaling~~ $4565,000 ~~over~~and ~~12 months plus a convertible note for~~ $5027,~~000.~~090 ~~$10,000~~as of ~~the~~August ~~short-term note has been paid~~31, ~~with~~2011 ~~the~~and ~~remainder~~February in28, ~~short-term~~2011, ~~debt~~respectively. The ~~long-term~~August ~~note~~31, ~~has~~2011 abalance ~~maturity~~consists ~~date~~ of ~~June 30,~~a ~~2012 and accrues~~ non-interest atbearing ~~10%~~convertible notes. ~~The~~These ~~terms~~notes ofare ~~the~~convertible ~~debt~~by ~~agreement~~either ~~provide~~the ~~for~~Company ~~all~~or ~~principal~~the ~~and~~holder ~~accrued interest to be converted~~ into ~~shares of~~ common stock of the Company at $10.5010 per share at any time ~~within~~before ~~the~~they ~~term~~are ofdue ~~the~~on ~~note.~~October ~~All~~31, ~~principal~~2011. ~~and~~At ~~accrued~~February ~~interest~~28, ~~under~~2011, the ~~note~~$27,090 ~~shall~~was ~~automatically~~owed ~~convert~~to ~~into~~Niesar ~~shares~~Vestal, ofLLP. ~~common~~$25,000 ~~stock~~and into ~~the~~Imperial ~~event~~Credit ~~that the 30 day trailing volume weighted average price for the stock exceeds~~ Corp.$2~~.00 per share at any time after June 1~~,090 ~~2011~~related ~~and prior~~ to ~~the~~financing ~~maturity~~an ~~date.~~insurance policy.

86. Common Stock

On March 7, 2011, the board of directors accelerated the vesting on 583,335 shares due Martin W. Greenwald, CEO and Chairman under an employment agreement between Mr. Greenwald and the Company. The Board also authorized an additional 500,000 fully vested shares to be issued to Mr. Greenwald. The Company recorded $695,646 in expense related to these issuances in the ~~three~~ six months ended ~~May~~ August 31, 2011.

On March 7, 2011, the Company issued 687,500 shares to four consultants for services rendered. The Company recorded $378,125 in consulting expense in the three months ended May 31, 2011 as the grants were for past services and vested immediately to the holder.

On March 7, 2011, the Company executed a common stock and warrant agreement with an accredited investor for $79,000 in cash. The accredited investor received 316,000 common stock and 316,000 warrants to purchase an additional share of the Company at $0.40 within three years. As of ~~May~~ August 31, 2011, the accredited investor held 316,000 warrants related to this purchase.

OnIn May ~~23,~~ and June 2011, the Company agreed to convert $~~250~~400,000 of long-term debt and related interest by issuing 1,~~000~~600,000 common shares and 1,~~000~~600,000 warrants. The investors were granted piggyback registration rights for the shares of common stock and shares underlying the warrants. The shares of the Company’s common stock are freely trading securities, under SEC Rule 144. The warrants have a life of three years and are convertible at $0.40 per share.

9.In ~~Share~~June ~~Based~~2011, ~~Compensation~~ one consultant made a cashless exercise of a stock option and 128,571 shares were issued.

~~The~~In ~~Company~~June ~~has 2007 and 2010 Equity Incentive Plans. The 2007 Equity Incentive Plan~~2011, ~~which permits~~ the ~~grant~~Company ofissued ~~awards in the form of incentive stock options~~200,000 ~~nonstatutory stock options, stock appreciation rights, stock awards and stock units to its key employees for up to 1 million~~ shares of common stock. ~~The Company believes that such awards promote the long-term success of the Company and the creation of stockholder value by offering key employees an opportunity~~ to ~~acquire~~ a ~~proprietary~~supplier. In ~~interest in the success of the Company~~return, ~~or to increase such interest, and to encourage such key employees to continue to provide services to~~ the ~~Company~~supplier ~~and~~agreed to ~~attract~~give ~~new individuals with outstanding qualifications. Awards are generally granted with an exercise price that approximates~~ the ~~market price of the~~ Company’s ~~common~~a ~~stock~~discount aton ~~the~~future ~~date~~purchases of ~~grant~~kiosks.

~~The~~On ~~fair~~August ~~value~~2, of each option award is estimated on the date of grant using the Black-Scholes option valuation model that uses the assumptions noted in the following table. Because the Black-Scholes option valuation model incorporate ranges of assumptions for inputs2011, ~~those ranges are disclosed. Expected volatilities are based on historical volatilities of~~ the Company’s ~~stock.~~issued ~~The~~600,000 ~~Company~~shares ~~uses historical data~~ to ~~estimate~~Salzwedel ~~option~~Financial ~~exercise~~Services ~~and employee~~for ~~termination~~services ~~within the valuation model. The expected term of options granted is derived from estimates and represents the period of time that options granted are expected~~ to be ~~outstanding~~rendered. The ~~risk-free~~Company ~~rate~~expensed ~~for~~this ~~periods~~amount ~~within~~in the ~~contractual~~ ~~life~~period ofended ~~the~~August ~~option~~31, ~~is based on the U~~2011.~~S. Treasury yield curve in effect at the time of grant.~~

9In August 2011, one creditor elected to convert $7,408 of accounts payable into 74,085 shares of common stock of the Company.

~~Table~~In the quarter ending August 31, 2011, the Company executed common stock agreements with five accredited investors for $137,000 in cash. The accredited investors received 1,370,000 shares of ~~Contents~~common stock and one investor received 750,000 warrants to purchase an additional share of the Company at $0.10 within three years. These sales triggered an anti-dilution clause in the aforementioned $400,000 conversion of debt to equity and an additional 2,121,750 shares of common stock were issued.

	Three months endedMay 31, 2011	Three months endedMay 31, 2010
Expected volatility	70%	518.19%
Expected dividends	0%	0%
Expected terms (in years)	1 to 3	2.5
Risk-free rate	0.25% to 1.22%	0.94%
Forfeiture rate	20%	0%

APUBLIC ~~summary~~MEDIA ~~of option activity as of May 31~~WORKS, ~~2011, and changes during the period then ended is presented below:~~ INC.

	Options			Weighted-AverageExercisePrice		AverageRemainingContractualLife (Years)		AggregateIntrinsicValue
Outstanding at February 28, 2011		4,005,000		$	0.99		3.67		205,000
Granted		3,015,000			0.61
Exercised		—			—		—		—
Forfeited or expired		(650,000	)		—		—		—
Outstanding at May 31, 2011		6,370,000			0.82		2.80		155,000
Exercisable at May 31, 2011		3,583,377		$	0.86		1.57	$	155,000

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

~~There~~August ~~were no options exercised during the three months ended May~~ 31, 2011 ~~or 2010.~~

~~The Company has an additional $1,125,400 to expense in future periods for unvested stock options~~7. ~~There was no unvested compensation as of May~~Share ~~31, 2010. During the three months ended May~~Based 31, 2011, the Company issued 3,015,000 stock options to eleven employees or consultants at an exercise price of $0.55. As of May 31, 2011, 1,316,000 stock options issued during the first quarter 2011 will cliff vest in the second quarter 2011. The stock options vest over one to two years from the date of grant. The Company has recorded a stock option expense of $548,519 in three months ended May 31, 2011 in general and administrative expenses. Compensation

~~Warrants~~The Company has 2007 and 2010 Equity Incentive Plans. The 2007 Equity Incentive Plan, which permits the grant of awards in the form of incentive stock options, nonstatutory stock options, stock appreciation rights, stock awards and stock units to its key employees for up to 1 million shares of common stock. The Company believes that such awards promote the long-term success of the Company and the creation of stockholder value by offering key employees an opportunity to acquire a proprietary interest in the success of the Company, or to increase such interest, and to encourage such key employees to continue to provide services to the Company and to attract new individuals with outstanding qualifications. Awards are generally granted with an exercise price that approximates the market price of the Company’s common stock at the date of grant.

The fair value of each ~~warrant~~option award is estimated on the date of grant using the Black-Scholes option valuation model that uses the assumptions noted in the following table. Because the Black-Scholes option valuation model ~~incorporates~~incorporate ranges of assumptions for inputs, those ranges are disclosed. Expected volatilities are based on historical volatilities of the Company’s ~~common~~ stock. The Company uses historical data to estimate option exercise and employee termination ~~and forfeiture rates~~ within the valuation model. The expected term of ~~warrants~~options granted is derived from estimates and represents the period of time that ~~warrants~~options granted are expected to be outstanding. The risk-free rate for periods within the contractual life of the ~~warrant~~option is based on the U.S. Treasury yield curve in effect at the time of grant.

	May 31,2011
	Six months ended August 31,
Expected volatility		70	%
	2011			2010
Expected dividends		—
Expected Volatility		70	%		706.68	%
Expected terms (in years)		3
Expected dividends		0	%		0	%
Risk-free rate		.79	%
Expected terms (in years)	1 to 3				1
Forfeiture rate		0	%
Risk-free rate	0.25% to 1.22		%		.34	%
Forfeiture rate 20%		0	%

A summary of ~~warrant~~ option activity ~~for the three months ended May~~ as of August 31, 2011, isand changes during the period then ended is presented below:

	Warrants			Weighted-AverageExercisePrice		AverageRemainingContractualLife (Years)		AggregateIntrinsicValue
				Weighted-		Average
Outstanding at February 28, 2011		8,497,291		$	0.36		2.81	$	2,379,427
				Average		Remaining		Aggregate
Granted		1,366,000		$	0.37		2.93
				Exercise		Contractual		Intrinsic
Exercised		—		$
	Options			Price		Life (Years)		Value
Forfeited or expired		(168,000	)	$	1.25
Outstanding at February, 2011		4,005,000		$	0.99		3.67	$	205,000
Outstanding at May 31, 2011		9,695,291		$	0.35		2.61	$	1,883,591
Granted		3,015,000			0.61
Exercisable at May 31, 2011		9,695,291		$	0.35		2.61	$	1,883,591
Exercised		(200,000	)		0.10		—		—
Forfeited or expired		(1,050,000	)		1.09		—		—
Outstanding at August 31, 2011		5,970,000			0.85		2.37		—
Exercisable at August 31, 2011		4,476,959		$	0.79		3.06		—

10During the six months ended August 31, 2011, 128,571 shares were issued in connection with the cashless exercise of 200,000 options.

~~Table~~The Company has an additional $912,123 to expense in future periods for unvested stock options. There was no unvested compensation as of ~~Contents~~August 31, 2010. During the six months ended August 31, 2011, 3,015,000 stock options were granted. The Company has recorded a stock option expense of $327,601 and $876,120 in three and six months ended August 31, 2011, respectively, in general and administrative expenses.

There were no warrants exercised during the three months ended May 31, 2011 or 2010. There were no unvested warrants as of May 31, 2010. During the three months ended May 31, 2011, the Company issued 1,366,000 warrants to three investors or consultants at an exercise price of between $0.25 and $0.40. Company has recorded a warrant expense of $11,086 in three months ended May 31, 2011 in general and administrative expenses related to the issuance of 50,000 warrants for services rendered in relation to the debt conversion. Warrants

10The fair value of each warrant is estimated on the date of grant using the Black-Scholes valuation model that uses the assumptions noted in the following table. ~~Income~~Because ~~Taxes~~ the Black-Scholes valuation model incorporates ranges of assumptions for inputs, those ranges are disclosed. Expected volatilities are based on historical volatilities of the Company’s common stock. The Company uses historical data to estimate option exercise and employee termination and forfeiture rates within the valuation model. The expected term of warrants granted is derived from estimates and represents the period of time that warrants granted are expected to be outstanding. The risk-free rate for periods within the contractual life of the warrant is based on the U.S. Treasury yield curve in effect at the time of grant.

The Company has commenced analyzing filing positions in all of the federal and state jurisdictions (California) where it is required to file income tax returns, as well as all open tax years in these jurisdictions.

	August 31,
	2011
Expected volatility		70	%
Expected dividends		—
Expected terms (in years)		3
Risk-free rate		.79	%
Forfeiture rate		0	%

~~Due to the existence of a full valuation allowance against deferred tax assets, future changes in our unrecognized tax benefits will not impact the Company’s effective tax rate.~~ 10

AsPUBLIC aMEDIA ~~corporation~~WORKS, ~~the Company is primarily subject to U~~INC.S. federal and state income tax. The Company’s policy is to recognize interest and penalties related to income tax matters in income tax expense. As of May 31, 2011 and May 31, 2010, the Company had no accruals for interest or penalties related to income tax matters.

~~11.~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL ~~Commitments and Contingencies~~ STATEMENTS (UNAUDITED)

~~Effective~~August ~~May 6~~31, 2010, the Company entered into a lease for 3,040 square feet of office space located at 2330 Marinship Way, #300, Sausalito, California 94965. The term of the lease is 23.5 months commencing May 15, 2010 and the monthly rent is $7,448. 2011

OnA ~~August 31,~~summary ~~2010, the Company entered into a settlement agreement with Niesar Vestal, LLP for all outstanding obligations. The agreement calls for a series~~ of ~~cash~~warrant ~~payments~~activity ~~totaling $45,000 over 12 months plus a convertible note~~ for ~~$50,000. The note has a maturity date of June 30, 2012 and accrues interest at 10%. The terms of~~ the ~~debt~~six ~~agreement~~months ~~provide~~ended ~~for~~August all principal and accrued interest to be converted into shares of common stock at $1.50 per share at any time within the term of the note. All principal and accrued interest under the note shall automatically convert into shares of common stock in the event that the 30 day trailing volume weighted average price for the stock exceeds $2.00 per share at any time after June 131, 2011, ~~and~~is ~~prior~~presented ~~to the maturity date.~~ below:

In November 2010, the Company signed an agreement with Spot Ventures, whereby, effective December 1, 2010, it has an interest in the profits from all kiosks under Spot’s control. The Agreement calls for the Company to provide DVDs for inclusion in kiosks and to pay certain operating expenses of the kiosks, excluding the cost of the kiosk itself. In exchange for this, the Company shall be reimbursed for the cost of the DVDs and the operating expenses out of the revenue from the kiosks and also receive 50% of any profits from the kiosks.

	Warrants			Weighted- Average Exercise Price		Average Remaining Contractual Life (Years)		Aggregate Intrinsic Value
Outstanding at February 28, 2011		8,497,291		$	0.36		2.81	$	2,379,427
Granted		3,316,000		$	0.26.		2.59
Exercised		—		$
Forfeited or expired		(217,500	)	$	1.25
Outstanding at August 31, 2011		11,595,791		$	0.32		2.43		—
Exercisable at August 31, 2011		11,595,791		$	0.32		2.43		—

12There were no warrants exercised during the six months ended August 31, 2011 or 2010. ~~Subsequent~~There ~~Events~~ were no unvested warrants as of August 31, 2011. During the six months ended August 31, 2011, the Company issued 3,316,000 warrants to six investors at an average exercise price $0.26. In relation to 1,600,000 of these warrants, using the Black-Scholes valuation model the Company the recorded a loss on conversion of debt of $392,468.

In preparing these condensed consolidated financial statements, the Company has evaluated events and transactions for potential recognition or disclosure through July 15, 2011, the date the condensed consolidated financial statements were available to be issued8. Income Taxes

OnThe ~~June 7,~~Company ~~2011,~~has commenced analyzing filing positions in all of the ~~shareholders~~federal ~~voted~~and state jurisdictions (California) where it is required to: file income tax returns, as well as all open tax years in these jurisdictions. The last tax return filed by the Company was for the year ended February 28, 2007.

•Due ~~Increase~~to the ~~number~~existence of ~~authorized shares of the company to 125 million and authorize~~ a ~~class~~full ofvaluation ~~blank~~allowance ~~check~~against ~~preferred~~deferred ~~stock,~~tax ~~consisting of 25~~assets,~~000,000~~ ~~authorized~~future ~~shares,~~changes ~~which may be issued~~ in ~~one~~our orunrecognized ~~more~~tax ~~series,~~benefits ~~with~~will ~~such~~not ~~rights,~~impact ~~privileges, preferences and restrictions as may be fixed by~~ the Company’s ~~Board~~effective oftax ~~Directors~~rate.

•As ~~Approve~~a corporation, the ~~2010~~Company ~~stock~~is ~~option~~primarily ~~plan~~subject to U.S. federal and ~~allow~~state ~~the~~income ~~issuance~~tax. ofThe upCompany’s policy is to 6recognize ~~million~~interest ~~shares~~and penalties related to income tax matters in income tax expense. As of ~~common~~August ~~stock~~31, ~~under~~2011 ~~this~~and ~~plan~~August 31, 2010, the Company had no accruals for interest or penalties related to income tax matters.

119. Commitments and Contingencies

~~Table~~Effective May 6, 2010, the Company entered into a lease for 3,040 square feet of ~~Contents~~office space located at 2330 Marinship Way, #300, Sausalito, California 94965. The term of the lease is 23.5 months commencing May 15, 2010 and the monthly rent is $7,752.

•On ~~Change~~August 31, 2010, the Company’s ~~name~~entered into a settlement agreement with Niesar Vestal, LLP for all outstanding obligations. The agreement calls for a series of cash payments totaling $45,000 over 12 months plus a convertible note for $50,000. The note had a maturity date of June 30, 2012 and accrues interest at 10%. The terms of the debt agreement provide for all principal and accrued interest to ~~“Spot~~be ~~Entertainment~~converted into shares of common stock at $1.50 per share at any time within the term of the note. All principal and accrued interest under the note shall automatically convert into shares of common stock in the event that the 30 day trailing volume weighted average price for the stock exceeds $2.00 per share at any time after June 1, ~~Inc~~2011 and prior to the maturity date.” As discussed previously, the Company is in default on this note.

~~On June 3, 2011 the Company converted $150,000 of long-term debt and related interest by issuing 600,000 common shares and 600,000 warrants~~10. The conversion agreements allow that, should the Company issue new shares for less than $0.25 per share, the investors who converted debt and still own these shares will have additional shares issued to bring their net cost per share for the remaining shares down to this lessor price. The investors were also granted piggyback registration rights for the shares of common stock and shares underlying the warrants. The shares of the Company’s common stock are freely trading securities, under SEC Rule 144. The warrants have a life of three years and are convertible at $0.40 per share. Subsequent Events

~~During~~In ~~the~~preparing ~~period~~these ~~commencing~~condensed ~~June 30,~~consolidated ~~2011~~financial ~~through the period ending July 13~~statements, ~~2011,~~ the ~~Company~~ ~~agreed to sell 1,270,000 shares of restricted~~ Company ~~common~~has ~~stock~~evaluated atevents ~~$.10 per share to 4 accredited investors, which resulted in gross proceeds of $127,000 to the Company,~~ and ~~agreed~~transactions tofor ~~issue~~potential ~~$75,000~~recognition inor ~~convertible~~disclosure ~~promissory~~through ~~notes~~August ~~to 3 accredited investors. The convertible promissory notes are due and payable on October~~ 31, 2011; ~~do not accrue any interest;~~ and ~~are~~through ~~convertible~~October ~~into shares of Company common stock at the election of the Company or the holder at $.10 per share. The shares of Company common stock~~17, ~~convertible notes and shares of common stock underlying the convertible notes are restricted securities~~2011, ~~and may not be sold, transferred or otherwise disposed without registration under~~ the ~~Securities~~date ~~Act of 1933, as amended (~~the ~~“Securities~~condensed ~~Act”)~~consolidated orfinancial anstatements ~~exemption there under. The shares of common stock and convertible notes~~ were ~~offered~~available ~~and~~to ~~sold~~be ~~in reliance on the exemption from registration under Section 4(2) of the Securities Act and/or Rule 506 of Regulation D under the Securities Act~~issued. The issuance of shares of common stock and convertible notes were not conducted in connection with a public offering, and no public solicitation or advertisement was made or relied upon by the accredited investors in connection with the transactions.

12Chapter 11 - On September 23, 2011, Public Media Works, Inc. ("we") filed a voluntary petition for relief under Chapter 11 of the United States Bankruptcy Code (the "Chapter 11 Case") in the United States Bankruptcy Court for the Central District of California, Riverside Division (the "Bankruptcy Court"). The Chapter 11 Case Number is: 6:11-bk-40137-MJ . The purpose in filing the Chapter 11 Case is to give the Company time to restructure its debt obligations to its secured and unsecured creditors.. Thereafter, we will prepare a Disclosure Statement and a Plan of Reorganization that describes our plan to emerge from Chapter 11as a viable company. We will file those documents with the Bankruptcy Court and submit them to all creditors for their approval with a view towards obtaining an Order from the Bankruptcy Court confirming our Plan of Reorganization so that we may successfully exit from Court protection.

~~Table of Contents~~11

~~Item~~PUBLIC 2.MEDIA ~~Management’s~~WORKS, ~~Discussion and Analysis of Financial Condition and Results of Operations~~INC.

~~The~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL following discussion and analysis should be read in conjunction with its condensed consolidated financial statements and the related notes. This discussion contains forward-looking statements based upon current expectations that involve risks and uncertainties, such as its plans, objectives, expectations and intentions. Its actual results and the timing of certain events could differ materially from those anticipated in these forward-looking statements. STATEMENTS (UNAUDITED)

~~Overview~~August 31, 2011

~~The~~We ~~Company~~continue ~~and~~to ~~its~~manage ~~wholly-owned~~our ~~subsidiary,~~business ~~EntertainmentXpress,~~as ~~Inc.,~~"debtors-in-possession" aunder ~~California~~the ~~corporation~~jurisdiction ~~(“EntertainmentXpress”),~~of ~~are~~the ~~engaged~~Bankruptcy Court and in accordance with the ~~business~~ applicable provisions of ~~offering~~the ~~self-service~~Bankruptcy ~~Kiosks~~Code ~~which~~and ~~deliver~~orders ~~DVD~~of ~~and~~the ~~Blu~~Bankruptcy Court. We have obtained approval from the Company’s secured Creditors to continue to pay critical vendor post-~~ray~~petition obligations. The kiosks and movies have been removed from retail locations and ~~other~~placed ~~potentially~~in ~~other~~a ~~products~~secure storage facility to ~~consumers.~~protect the value of our only significant tangible assets.

~~Public~~Over ~~Media Works,~~the ~~Inc.~~next ~~has~~few ~~historically~~weeks ~~been~~we ~~engaged~~will intry ~~the~~to ~~development,~~raise ~~production~~$150,000 ~~marketing~~of ~~and~~equity ~~distribution~~or ofDIP ~~film,~~Financing ~~music~~(collectively ~~and~~“Financing”) ~~television~~which ~~entertainment~~should ~~titles.~~fund ~~The~~the Company ~~has~~through anDecember ~~ownership~~31, ~~interest~~2011. If inwe ~~several film and television projects which~~ are ~~currently~~ inable ~~various~~to ~~stages~~raise ofthis ~~development.~~Financing, Aswe ofwill ~~May 4,~~1) ~~2010~~work with ~~the~~secured ~~acquisition~~and ofunsecured ~~Entertainment~~creditors ~~Xpress,~~and ~~Inc.,~~ the ~~Company~~Bankruptcy ~~has~~Court ~~focused~~to ~~exclusively~~restructure onand/or ~~its~~satisfy ~~kiosk~~their ~~business~~claims; and ~~intends~~2) todevelop ~~continue~~an ~~this~~operational ~~focus going forward~~plan.

InWhile ~~order~~we intend to maintain ~~clarity~~business inoperations ~~this~~through ~~report~~the reorganization process, ~~references~~our toliquidity ~~the~~and ~~business~~capital ofresources ~~the~~are ~~Company’s~~significantly ~~subsidiary~~affected ~~EntertainmentXpress~~by ~~will~~the beChapter 11 ~~indicated~~Case, ~~as “EntertainmentXpress”;~~which ~~and~~has ~~references~~resulted toin ~~the~~various ~~“Company,”~~restrictions ~~“we~~on our activities,” ~~“us”~~limitations oron ~~“our”~~financing ~~refer~~and a need to ~~the~~obtain ~~combined~~Bankruptcy ~~businesses~~Court ofapproval ~~Public~~for ~~Media~~various ~~Works~~matters. In particular, ~~Inc.~~we ~~and~~are ~~EntertainmentXpress~~not ~~after~~permitted ~~May 4,~~to ~~2010.~~make any payments on pre-petition liabilities without prior Bankruptcy Court approval.

~~Going~~At ~~Concern~~this time, it is not possible to predict with certainty the effect of the Chapter 11 Case on our business or various creditors, or if or when we will emerge from these proceedings. Future results will depend on both raising the Financing and ~~Liquidity~~upon ~~Matters~~our ability to propose and confirm a Plan of Reorganization. The longer we remain under the jurisdiction of the Bankruptcy Court the more legal and bankruptcy-related costs we incur. These costs are currently having an adverse effect on the results of operations and will continue to do so, until we can emerge from bankruptcy Court protection..

~~The accompanying~~We ~~condensed~~currently ~~consolidated~~have ~~financial~~minimal ~~statements~~cash ofon ~~the~~hand ~~Company~~and ~~have~~no ~~been~~source ~~prepared~~of ~~under~~revenue. ~~the~~Thus, ~~assumption~~if ~~that~~ we ~~will~~are ~~continue~~unable asto araise ~~going concern. Such assumption contemplates~~ the ~~realization~~Financing, ofwe ~~assets~~will ~~and~~be ~~the~~forced ~~satisfaction~~to ofconvert ~~liabilities~~our ~~in the~~case ~~normal~~to a ~~course~~Chapter of7 ~~business~~and liquidation. Our ~~independent~~secured ~~registered~~creditors ~~public~~would ~~accounting~~likely ~~firm’s~~receive ~~report~~all ~~for~~of ~~2011 and 2010 in~~ our ~~Form~~assets, ~~10K~~as ~~filed~~we ~~with~~believe ~~the~~their ~~SEC~~fair onmarket ~~June 3,~~value ~~2011~~is ~~state~~significantly below that ~~our~~of ~~significant~~the ~~net~~amount ~~losses,~~owed ~~negative~~the ~~cash~~secured ~~flows~~creditors. In ~~from~~a ~~operations~~Chapter ~~and accumulated deficit through February 28~~7, ~~2011~~we ~~create~~believe ~~substantial~~that ~~doubt as to~~ the ~~Company’s~~unsecured ~~ability~~creditors toand ~~continue~~shareholders aswould areceive ~~going concern~~nothing.

~~The~~While ~~Company’s~~we ~~continuation~~are asstriving ato ~~going~~raise ~~concern~~Financing isand ~~dependent~~restructure ~~upon~~our ~~its~~debt ~~ability~~through tothe ~~generate~~Chapter 11 ~~sufficient~~Case, there are no guarantees we will be successful. Our cash ~~flow~~is not sufficient to meet ~~its~~our short-term needs let alone our debt obligations onas acurrently ~~timely basis,~~structured or to ~~obtain~~meet ~~additional~~anticipated ~~financing~~operating asand ~~may~~general beand ~~required,~~administrative ~~and~~expenses ~~ultimately~~during tothe ~~attain~~next ~~profitability~~12 months. ~~There~~Thus, ~~can~~if bewe noare ~~assurance~~not ~~that~~successful within the ~~Company~~timeframes ~~will~~imposed beby ~~able~~the Bankruptcy Court to ~~obtain~~raise ~~any~~Financing ~~additional~~and ~~financing,~~propose ora ~~that~~Plan ~~any~~of ~~such~~Reorganization, ~~financing~~our Chapter 11 Case will be ~~available~~converted onto ~~acceptable terms~~a Chapter 7 liquidation. ~~The~~Even ~~condensed~~if ~~consolidated~~we ~~financial~~timely ~~statements~~file a Plan of Reorganization, if our creditors do not ~~include~~approve ~~any~~it ~~adjustments~~or ~~that~~if ~~might~~the Bankruptcy Judge hearing our case refuses to issue and Order confirming our Plan of Reorganization then our Chapter 11 Case would be ~~necessary~~converted ~~should~~to a Chapter 7 liquidation case. Upon a liquidation, we believe that all unsecured creditors and shareholders would receive nothing, as the amount of the claims held by our secured creditors exceeds the value of all of the our assets, and after payment of the secured claims there would be ~~unable~~nothing left over to ~~continue~~distribute asto aany ~~going~~creditors ~~concern~~or shareholders. The Consolidated Financial Statements herein illustrate the point as they include writing down our assets to estimated net realizable value.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations .

~~Revenue~~The following discussion and analysis should be read in conjunction with its condensed consolidated financial statements and the related notes. This discussion contains forward-looking statements based upon current expectations that involve risks and uncertainties, such as its plans, objectives, expectations and intentions. Its actual results and the timing of certain events could differ materially from those anticipated in these forward-looking statements.

The Company has been restructured and is in the `start-up phase of operation. In the quarter ended May 31, 2011 it generated $20,236 in revenue as compared to $0 revenue during the three months ended May 31, 2010. Revenue in the current quarter came principally from 25 kiosks placed in operation during the quarter and going through beta testing. The Company is using a newly manufactured kiosk and operating software. Assuming we are able to close a contemplated financing, we expect to go into full production of the kiosks and version two of the software later this summer. The remainder of revenue during this quarter came from its joint venture in Canada. The Company anticipates that this revenue will decrease as a percent of total revenue in the future as it focuses on increasing the number of Company owned kiosks. Overview

13The Company and its wholly-owned subsidiary, EntertainmentXpress, Inc., a California corporation (“EntertainmentXpress”), were engaged in the business of offering self-service Kiosks which deliver DVD and Blu-ray movies and other potentially other products to consumers.

~~Table~~In order to maintain clarity in this report, references to the business of ~~Contents~~the Company’s subsidiary EntertainmentXpress will be indicated as “EntertainmentXpress”; and references to the “Company,” “we,” “us” or “our” refer to the combined businesses of Public Media Works, Inc. and EntertainmentXpress after May 4, 2010.

~~For~~Going ~~the~~Concern ~~three~~and ~~months~~Liquidity ~~ended May 31, 2011, the Company’s operating expenses increased to $2,900,858, compared to operating expenses of $1,343,050 for the three months ended May 31, 2010.~~ Matters

	Three months ended May 31,
	2011		2010		Increase
Direct operating expenses		63,713		—		63,713
Marketing expenses		52,852		32,817		20,035
General and administrative expenses		2,624,552		1,225,091		1, 399,461
Professional fees		159,741		85,142		74,599

The Company filed a voluntary petition on September 23, 2011 under Chapter 11 of the United States Bankruptcy Code with the United States Bankruptcy Court for the Central District of California, Riverside Division (the “Bankruptcy Court”).

The increase in the direct operating expenses is a direct result of placing the kiosks in operations. Direct operating expenses principally include: amortization of our DVD and Blu-Ray movie inventory; commissions or fees to retailers; credit card fees and field operations support, such as loading and cleaning the kiosks and monitoring the kiosks. 12

~~Marketing~~The ~~expenses~~consolidated ~~increased~~financial ~~61%~~statements as of August 31, 2011 and for the three and six months then ended ~~May 31~~were prepared in accordance with ASC 852 “reorganizations”, ~~2010~~which asdoes ~~compared~~not change the application of US GAAP with respect to the preparation of our financial statements. As such, the financial statements for the three and six months ended ~~May~~ August 31, 2011. Inreflect the ~~quarter~~estimated ~~ended May 31,~~realizable ~~2010~~values of our assets and estimated fair value of our liabilities, weand ~~had~~are ~~marketing~~therefore ~~management~~not ~~but~~comparable noto ~~staff.~~the Infinancial statements for the ~~quarter~~three and six months ended ~~May~~August 31, ~~2011~~2010. As part of the Chapter 11 filing and as discussed further below, we ~~have~~anticipate the development and implementation of a ~~full-time~~plan ~~marketing~~of ~~consultant~~reorganization asto ~~well~~restructure asour debt obligations and business operations. Confirmation of a ~~marketing~~plan ~~firm~~of onreorganization ~~retainer~~would likely alter the classifications and amounts reported in our consolidated financial statements. For further information see Footnote 10, Subsequent Events.

~~General~~The ~~and~~condensed ~~administrative~~consolidated ~~expenses~~balance ~~increased~~sheet ~~$1,399,461 or approximately 114% from the three months ended May 31, 2010~~ as ~~compared~~of toFebruary ~~the three months ended May 31~~28, 2011~~. General and administrative expenses include $2~~,~~325,626~~ inwhich ~~non-cash~~was ~~items~~derived ~~such~~from asaudited ~~stock~~financial ~~compensation to officers $859~~statements,~~271,~~ ~~stock~~and ~~option~~have ~~expense~~been ~~$548,519,~~prepared ~~stock~~pursuant ~~compensation~~ to ~~consultants~~the ~~such~~rules asand ~~our~~regulations ~~investor~~of ~~relations~~the ~~consultants~~Securities ~~$906,750~~ and ~~warrant~~Exchange ~~expense~~Commission. ~~of $11,086~~Certain ~~The~~information ~~warrants~~and ~~were~~note ~~issued~~disclosures tonormally anincluded ~~investment~~in ~~banking~~annual ~~firm~~financial statements prepared in ~~conjunction~~accordance with ~~the~~accounting ~~Mainas~~principles ~~debt~~generally ~~sale~~accepted ~~and~~in ~~subsequent~~the ~~conversion.~~United ~~These~~States ~~increases~~have ~~were~~been acondensed ~~direct~~or ~~result~~omitted ofpursuant ~~our decision~~ to ~~enter~~those ~~the~~rules ~~DVD~~ and ~~Blu-ray rental business and hiring staff paid partially and in one case fully~~regulations, ~~through~~although ~~stock~~the ~~grants~~Company ~~and~~believes ~~stock~~that ~~options.~~the Wedisclosures ~~also~~made ~~hired~~are anadequate ~~investor relations firm~~ to ~~assist~~make ~~in positioning~~ the ~~company~~information tonot ~~investors~~misleading.

~~Professional~~The ~~fees~~accompanying ~~increased~~condensed ~~approximately~~consolidated ~~88%~~financial tostatements ~~$159,741.~~of ~~The~~the ~~principal~~Company ~~components~~have ofbeen ~~professional~~prepared ~~fees~~under ~~were~~the ~~cash~~assumption ~~fees~~that ~~paid~~we towill ~~our~~continue ~~investor~~as ~~relations~~a ~~firm~~going ofconcern. ~~$30,000,~~Such ~~investment~~assumption ~~banking~~contemplates ~~fees~~the ~~related~~realization ~~to our~~of ~~debt~~assets ~~conversion~~and ofthe ~~$20,000,~~satisfaction ~~audit~~of ~~and~~liabilities ~~tax~~in ~~fees~~the ~~and~~normal ~~accruals~~course of ~~$41,059~~business. ~~and~~Our ~~legal~~independent ~~fees~~registered ofpublic ~~$50,578.~~accounting ~~There~~firm’s ~~were~~report nofor ~~investor~~2011 ~~relations~~and ~~fees~~2010 orin ~~investment~~our ~~banking~~Form ~~fees~~10K infiled with the ~~three~~SEC ~~months~~on ~~ended~~June ~~May 31~~3, ~~2010.~~2011 Instate ~~addition,~~that weour ~~accrued~~significant ~~the~~net ~~estimated costs~~losses, ofnegative ~~preparing~~cash flows from operations and ~~filing~~accumulated ~~our~~deficit ~~Federal~~through ~~and~~February ~~California~~28, ~~tax~~2011 ~~returns~~create ~~for~~substantial ~~prior~~doubt ~~years.~~as to the Company’s ability to continue as a going concern.

~~Liquidity~~The Company’s continuation as a going concern is dependent upon its ability to generate sufficient cash flow to meet its obligations on a timely basis, to obtain additional financing as may be required, and ~~Capital~~ultimately ~~Resources~~to attain profitability. There can be no assurance that the Company will be able to obtain any additional financing, or that any such financing will be available on acceptable terms. The condensed consolidated financial statements do not include any adjustments that might be necessary should we be unable to continue as a going concern.

~~Our~~Results ~~primary requirements for working capital are to fund purchases~~ of kiosks and movies, and to cover our operating expenses. In recent years, we have incurred losses from operations and have undertaken several equity financing transactions to provide us with capital as we worked to grow our business. In March 2011, we installed our first 25 kiosks. We believe can reach breakeven cash flow from operations in late 2011 if we are successful in raising additional cash. However, in the event that our revenue or our margins are lower than anticipated, it will take us longer to reach breakeven cash flows. As our kiosks and their operating software are still in beta testing our revenue levels remain difficult to predict and are substantially less than our operating expenses, and we anticipate that we will continue to sustain losses in the near term, and we cannot assure investors that we will be successful in reaching break-even. Operations

As of May 31, 2011, the Company had a cash balance of $2,623. The Company does not currently have sufficient cash on hand to satisfy its operating costs and continued expansion efforts, and will need to raise additional capital. The Company anticipates raising funds through debt, convertible debt, or through the sale of equity. However, there can be no assurance as to whether, when, or upon what terms the Company will be able to consummate any financing. The Company may also raise capital from third parties to fund the installation of kiosks in specific regions of North America. The Company’s inability to raise additional capital to satisfy its operating costs could result in the Company’s need to reduce the number of its employees and curtail or shut down its operations which would have a material adverse impact on the Company and its ability to continue as a going concern. Revenue

14In early 2011, the Company entered the start-up phase of operation. In the three and six months ended August 31, 2011 it generated $18,881 and $39,117 in revenue as compared to $339 in revenue for both the three and six months ended August 31, 2010. Revenue in the three and six months ended August 31, 2011 came principally from 25 kiosks placed in operation in March 2011 and going through beta testing. The Company was using a newly manufactured kiosk and operating software. As the Company was unable to raise additional equity to continue operating the kiosks, in early September, 2011, the Company removed the kiosks and placed them in storage. The remainder of revenue during periods came from a joint venture in Canada. No future revenue is expected from this joint venture.

~~Table~~For the three and six months ended August 31, 2011, the Company’s operating expenses were $1,611,072 and $4,492,380, respectively, compared to operating expenses of ~~Contents~~$442,519 and $1785,569, respectively, for the three and six months ended August 31, 2010.

The Company had net cash uses of $293,434. These funds were used primarily to fund the loss from operations of $2,895,713 less non-cash charges of $2,459,365 for a net cash usage of $436,348. We also purchased approximately $76,738 of DVDs and Blu-ray Discs for our kiosks. Offset against these uses was an increase in accounts payable of $235,635.

	Three months ended August 31,				Six months ended August 31,
	2011		2010		2011		2010
Direct operating expenses		105,890		—		169,603		—
Marketing		25,566		61,779		78,418		94,596
General and administrative expenses		1,409,850		380,740		4,014,852		1,690,973
Professional fees		69,766		—		229,507		—
Total expenses		1,611,072		442,519		4,492,380		1,785,569

The ~~Company~~increase ~~completed~~in the ~~purchase~~direct ofoperating ~~its~~expenses ~~first~~is 25a direct result of placing the kiosks ~~capitalizing~~in ~~$199,741~~operations. Direct operating expenses principally include: amortization of ~~costs~~our ~~related~~DVD and Blu-Ray movie inventory; commissions or fees to ~~these~~retailers; credit card fees and field operations support, such as loading and cleaning the kiosks. ~~These~~and ~~costs~~monitoring ~~included $40~~the kiosks. In addition,~~000~~ in ~~shipping~~the three and ~~installation~~six asmonths ~~well~~ended asAugust ~~$45~~31,~~450~~ 2011, the Company wrote off $16,117 of ~~sales~~prepaid ~~tax.~~support due to its removing the kiosks from retail locations.

~~During~~Marketing expenses decreased 59% for the three months ended ~~May~~ August 31, 2011 as compared to the three months ended August 31, 2010. For the ~~Company~~six ~~raised $79~~months ended August 31,~~000~~ in2011 ~~new~~as ~~equity~~compared to the six months ended August 31, 2010, marketing expenses decreased 17%. For both the three and ~~received~~six ~~$30~~month periods,~~000~~ ~~due~~the itdecreases ~~from~~were ~~shares~~the ~~sold~~result of minimal advertising and promotion costs in ~~February~~the ~~2011.~~current fiscal year due to the Company’s cash constraints.

As previously announced, neither the Company’s teaming agreement with the Asian American Convenience Store Association for the placement of DVD rental kiosks in convenience stores, nor the teaming agreement with Modular Conversions for the placement and financing of DVD rental kiosks in gas station convenience stores, has resulted in the placement or financing of any DVD rental kiosks. 13

ToIn ~~date,~~ the ~~Company~~three ~~has~~and ~~funded~~six ~~its operations~~months ~~primarily~~ended ~~through~~August ~~the~~31, ~~issuance~~2011, ofgeneral ~~common~~and ~~stock~~administrative inexpenses ~~exchange~~included ~~for~~$1,201,643 ~~cash~~ and ~~services~~$3,527,184 asof ~~well~~non-cash ascosts ~~through~~comprised ~~unsecured notes payable to stockholders and third parties.~~ of:

Commitments

	Three months		Six months
Officers stock compensation	$	163,625	$	1,022,896
Stock option expense		327,601		876,120
Stock and warrant compensation consultants and suppliers		710,417		1,628,168
Total non-cash expenses	$	1,201,643	$	3,527,184

~~Please~~The ~~see~~major ~~Item 1~~components ~~Notes~~of tocash ~~Unaudited~~expenses ~~Condensed~~in ~~Consolidated~~General ~~Financial Statements~~& Administrative for the three and six months ended August 31, ~~Footnotes~~2011 were: salaries and related ($84,262 4and $176,291, respectively) travel and 8entertainment ~~for~~($29,704 aand ~~summary~~$75,818, ofrespectively); ~~the~~facilities ~~Company’s~~($16,530 ~~obligations~~and $34,665, respectively); and engineering ~~commitments.~~and product development ($42,829 and $94,955, respectively).

~~USE~~Liquidity OFand ~~ESTIMATES~~Capital ~~AND CRITICAL ACCOUNTING POLICIES~~ Resources

Our ~~discussion~~primary ~~and~~requirements ~~analysis~~for ofworking ~~our~~capital ~~financial~~are ~~condition~~to ~~and~~fund ~~results~~purchases of ~~operations~~kiosks ~~are~~and ~~based~~movies, onand to cover our ~~condensed~~operating ~~consolidated financial~~expenses. ~~statements~~In recent years, ~~which~~we have ~~been~~incurred ~~prepared~~losses infrom ~~accordance~~operations and have undertaken several equity financing transactions to provide us with ~~accounting~~capital ~~principles~~as ~~generally~~we ~~accepted~~worked to grow our business. In March 2011, we installed our first 25 kiosks in ~~the~~test ~~United~~locations ~~States~~in ~~(“US~~Southern ~~GAAP”)~~California.

~~The~~As ~~preparation~~of August 31, 2011, the Company had a cash balance of ~~these~~$5,794. ~~condensed~~The ~~consolidated~~Company ~~financial~~does ~~statements~~not ~~requires~~currently ~~management~~have tosufficient ~~make~~cash ~~estimates~~on ~~and~~hand ~~judgments~~to ~~that~~satisfy ~~affect~~its ~~the~~operating ~~reported~~costs ~~amounts~~and ofcontinued ~~assets~~expansion ~~liabilities~~efforts, and ~~the~~needs ~~disclosure~~to ~~of contingent~~reduce ~~assets~~debt and ~~liabilities~~raise atadditional ~~the~~capital. ~~date~~In ofSeptember 2011, the ~~condensed~~Company ~~consolidated~~decided ~~financial~~to ~~statements~~cease operating the kiosks and place the ~~reported~~kiosks ~~amounts~~in ofa ~~revenues~~safe ~~and~~warehouse ~~expenses~~location ~~during~~while ~~each~~it ~~reporting~~reorganized ~~period.~~under Ona anvoluntary ~~ongoing~~bankruptcy ~~basis,~~filing ~~management~~(Chapter ~~evaluates~~11). ~~its~~The ~~estimates~~Company ~~and~~is ~~assumptions~~seeking $150, ~~including~~000 ~~those~~to ~~related~~allow it to ~~income~~operate ~~taxes,~~under ~~long~~the ~~lived~~protection ~~asset~~of ~~valuation,~~the ~~and~~U.S. ~~stock~~bankruptcy ~~based~~laws ~~compensation.~~while ~~Management~~it ~~bases~~converts most of its ~~estimates~~non-secured ~~and~~debt, ~~judgments~~including onaccounts ~~historical~~payable, ~~experience~~to ofequity ~~operations~~as ~~and~~well onas ~~various~~renegotiating ~~other~~its ~~factors~~agreements ~~that~~with ~~are~~its ~~believed~~secured tocreditor. beFinally, ~~reasonable under~~it ~~the~~will ~~circumstances,~~need ~~the~~to ~~results~~raise ofadditional ~~which~~equity ~~form~~to ~~the~~continue ~~basis~~to ~~for~~fund ~~making~~its ~~judgments~~operations ~~about~~beyond the ~~carrying~~three ~~value~~to offour ~~assets~~months ~~and~~it ~~liabilities~~believes ~~that~~it ~~are~~will ~~not~~take ~~readily~~it ~~apparent~~to ~~from~~go ~~other~~through ~~sources~~the bankruptcy process. However, ~~Actual~~there ~~results~~can ~~may~~be ~~differ~~no ~~from~~assurance ~~these~~as ~~estimates~~to ~~under~~whether, ~~different assumptions~~when, or ~~conditions.~~upon what terms the Company will be able to consummate any additional financing.

~~Recent~~If ~~Accounting~~the ~~Pronouncements~~Company is unable to raise additional equity, it will likely convert its filing to a Chapter 7 liquidation.

~~Please~~The ~~see~~Company ~~Item 1~~had ~~Notes~~net cash used in operating activities of $628,262. These funds were used primarily to ~~Unaudited~~fund ~~Condensed~~the ~~Consolidated~~loss ~~Financial~~from ~~Statements~~operations of $4,453,263 ~~Footnote~~less 2non-cash charges of $4,145,148. ~~Summary~~We also purchased approximately $94,728 of ~~Significant~~DVDs ~~Accounting~~and ~~Policies~~Blu-ray Discs for ~~management’s~~our ~~discussion~~kiosks. Offset against these uses was an increase in accounts payable of $186,377.

~~Off-Balance~~The ~~Sheet~~Company ~~Arrangements~~completed the purchase of its first 25 kiosks capitalizing $199,742 of costs related to these kiosks. These costs included $40,000 in shipping and installation as well as $45,450 of sales tax.

~~The~~ During the six months ended August 31, 2011, the Company ~~does~~raised ~~not~~$216,000 ~~have~~in ~~any~~new ~~off-balance~~equity, ~~sheet~~borrowed ~~arrangements.~~180,000 from a shareholder, $65,000 from two individuals and received $30,000 due from shares sold in February 2011.

~~Item~~To 3.date, ~~Quantitative~~the Company has funded its operations primarily through the issuance of common stock in exchange for cash and ~~Qualitative~~services, ~~Disclosures~~as ~~About~~well ~~Market~~as ~~Risk~~through notes payable to stockholders and third parties.

~~Intentionally~~On ~~omitted~~September ~~pursuant~~23, to2011, ~~Item 305~~the Company filed voluntary petitions for relief under Chapter 11 (eChapter 11 Proceedings) of ~~Regulation~~the U.S-K. Bankruptcy Code (Bankruptcy Code) in the U.S. Bankruptcy Court for the Central District of California (Bankruptcy Court).

~~Item 4. Controls and Procedures.~~Commitments

~~Evaluation~~Please ofsee ~~Disclosure~~Item ~~Controls~~1 ~~and~~Notes ~~Procedures.~~to WeUnaudited ~~conducted~~Condensed anConsolidated ~~evaluation~~Financial ~~under the supervision and with the participation of our management~~Statements, ~~including our Chief Executive Officer and Chief Financial Officer~~Footnotes, of4 ~~the effectiveness of the design~~ and ~~operation~~8 offor ~~our~~a ~~disclosure~~summary ~~controls and procedures pursuant to Rule 13a-15(b)~~ of the ~~Exchange~~Company’s ~~Act.~~obligations ~~The term “disclosure controls~~ and ~~procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information~~ commitments.

15USE OF ESTIMATES AND CRITICAL ACCOUNTING POLICIES

~~Table~~Our discussion and analysis of ~~Contents~~our financial condition and results of operations are based on our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States (“US GAAP”).

required to be disclosed by the company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of May 31, 2011, our disclosure controls and procedures were not effective in ensuring that the information required to be filed or submitted under the Exchange Act is recorded, presented, summarized and reported as specified in the Securities and Exchange Commission’s rules and forms, and accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. We believe, however, that the accompanying condensed consolidated financial statements presented in this Form 10-Q fairly present the financial condition and results of operations for the periods indicated. 14

The ~~identified~~preparation ~~material~~of ~~weaknesses~~these incondensed ~~our internal~~consolidated ~~control~~financial ~~over~~statements requires management to make estimates and judgments that affect the reported amounts of assets liabilities and the disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during each reporting ~~relate~~period. On an ongoing basis, management evaluates its estimates and assumptions, including those related to income taxes, long lived asset valuation, and stock based compensation. Management bases its estimates and judgments on historical experience of operations and on various other factors that are believed to be reasonable under the ~~following~~circumstances, ~~matters:~~the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

•Recent WeAccounting identified a lack of sufficient segregation of duties, particularly in cash disbursements. Specifically, this material weakness is such that the design over the areas of cash disbursements relies primarily on detective controls and could be strengthened by adding preventative controls to properly safeguard company assets.Pronouncements

•Please ~~Management~~see ~~has~~Item ~~identified~~1 aNotes ~~lack of sufficient personnel in the accounting function due~~ to ~~the~~Unaudited ~~limited~~Condensed ~~resources~~Consolidated ofFinancial ~~the Company with appropriate skills~~Statements, ~~training~~Footnote ~~and experience to perform the review of processes to ensure the complete and proper application of generally accepted accounting principles~~2, ~~particularly~~Summary ~~as it relates to taxes, valuation~~ of ~~share~~Significant ~~based~~Accounting ~~payments,~~Policies ~~consolidation~~for ofmanagement’s ~~entities, and equity transactions~~discussion. Specifically, this material weakness lead to segregation of duties issues and resulted in audit adjustments to the annual consolidated financial statements and revisions to related disclosures, share based payments, consolidation of various entities, and other equity transactions.

~~Our~~Off-Balance ~~plan~~Sheet ~~to remediate those material weaknesses remaining as of May 31, 2011 is as follows:~~ Arrangements

• Improve the effectiveness of the accounting group by continuing to augment existing Company resources with additional consultants or employees to improve segregation procedures and to assist in the analysis and recording of complex accounting transactions and preparation of tax disclosures. The Company does not ~~plans~~have toany off-balance ~~mitigate~~sheet ~~the segregation of duties issues by hiring additional personnel in the accounting department once the Company has raised significant additional working capital~~arrangements.

•Item ~~Improve~~3. ~~segregation~~Quantitative ~~procedures by strengthening cross approval of various functions including cash disbursements~~ and ~~quarterly~~Qualitative ~~internal~~Disclosures ~~audit~~About ~~procedures~~Market ~~where appropriate.~~Risk

~~CHANGES~~Intentionally omitted pursuant INto Item 305(e) of Regulation ~~CONTROLS AND PROCEDURES~~ S-K.

AsItem ~~required~~4. byControls ~~Rule 13-15(d) of the Exchange Act, the Company, under the supervision~~ and with the participation of the Company’s management, including the Chief Executive Officer and Chief Financial Officer (principal financial officer), also evaluated whether any changes have occurred to the Company’s internal control over financial reporting during the period covered by this report that have materially affected, or are reasonably likely to materially affect, such controlProcedures.

~~During~~Evaluation of Disclosure Controls and Procedures. We conducted an evaluation under the ~~first~~supervision ~~quarter~~and with the participation of our management, ~~Garrett~~including ~~Cecchini resigned~~our asChief aExecutive ~~director~~Officer and ~~Bryan~~Chief ~~Subotnick~~Financial ~~was~~Officer, ~~appointed~~of tothe effectiveness of the ~~board~~design and operation of ~~directors~~our disclosure controls and procedures pursuant to Rule 13a-15(b) of the Exchange Act. The term “disclosure controls and procedures,” as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, means controls and other procedures of a company that are designed to ensure that information required to be disclosed by the company in the reports it files or submits under the Exchange

~~PART~~Act IIis recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of August 31, 2011, our disclosure controls and procedures were not effective in ensuring that the information required to be filed or submitted under the Exchange Act is recorded, presented, summarized and reported as specified in the Securities and Exchange Commission’s rules and forms, and accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure. We believe, however, that the accompanying condensed consolidated financial statements presented in this Form10- ~~OTHER~~Q ~~INFORMATION~~fairly present the financial condition and results of operations for the periods indicated.

~~Item~~The 1.identified ~~Legal~~material ~~Proceedings.~~weaknesses in our internal control over financial reporting relate to the following matters:

~~There~~• ~~are~~We noidentified ~~material pending legal proceedings to which the Company is~~ a ~~party~~lack or of ~~which~~sufficient ~~any~~segregation of ~~the~~duties, ~~Company’s~~particularly ~~property~~in iscash ~~subject~~disbursements. asSpecifically, ofthis ~~the~~material ~~date~~weakness ofis ~~this~~such ~~report.~~that ~~Further,~~the asdesign ofover the ~~date~~areas of ~~this report,~~cash ~~the~~disbursements ~~Company~~relies isprimarily ~~not~~on ~~aware~~detective ofcontrols ~~any~~and ~~legal~~could ~~proceedings~~be ~~against~~strengthened ~~the~~by ~~Company,~~adding orpreventative ~~its~~controls ~~property~~to ~~contemplated~~properly bysafeguard ~~any~~company ~~governmental authority~~assets.

16• Management has identified a lack of sufficient personnel in the accounting function due to the limited resources of the Company with appropriate skills, training and experience to perform the review of processes to ensure the complete and proper application of generally accepted accounting principles, particularly as it relates to taxes, valuation of share based payments, consolidation of entities, and equity transactions. Specifically, this material weakness lead to segregation of duties issues and resulted in audit adjustments to the annual consolidated financial statements and revisions to related disclosures, share based payments, consolidation of various entities, and other equity transactions.

~~Table~~Our plan to remediate those material weaknesses remaining as of ~~Contents~~August 31, 2011 is as follows:

~~Item~~• 1AImprove the effectiveness of the accounting group by continuing to augment existing Company resources with additional consultants or employees to improve segregation procedures and to assist in the analysis and recording of complex accounting transactions and preparation of tax disclosures. ~~Risk~~The ~~Factors~~Company plans to mitigate the segregation of duties issues by hiring additional personnel in the accounting department once the Company has raised significant additional working capital.

In• ~~addition~~Improve tosegregation ~~the~~procedures ~~other~~by ~~information~~strengthening ~~set~~cross ~~forth~~approval ~~in this report, you should carefully consider the factors discussed in “Part II, Item 6— Management’s Discussion and Analysis~~ of ~~Financial~~various ~~Condition~~functions ~~and~~including Results of Operations—Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended February 28, 2011 which was filed with the SEC on June 3, 2011 (the “Form 10K”). These risks and uncertainties have the potential to materially affect our business, financial condition, results of operations, cash ~~flows,~~disbursements ~~projected results~~ and ~~future~~quarterly ~~prospects.~~internal Asaudit ofprocedures ~~the~~where ~~date of this report, we do not believe that there have been any material changes to the risk factors previously disclosed in our Form 10K~~appropriate.

~~Item~~CHANGES 2.IN ~~Unregistered~~CONTROLS ~~Sales~~AND ~~of Equity Securities and Use of Proceeds.~~PROCEDURES

OnAs ~~March 7,~~required ~~2011,~~by ~~the~~Rule ~~board~~13-15(d) of ~~directors~~the ~~accelerated~~Exchange Act, the ~~vesting~~Company, onunder ~~583,335~~the ~~shares~~supervision ~~due~~and ~~Martin~~with W.the ~~Greenwald,~~participation ~~CEO~~of ~~and~~the ~~Chairman~~Company’s ~~under~~management, anincluding ~~employment~~the ~~agreement~~Chief ~~between~~Executive ~~Mr. Greenwald~~Officer and ~~the~~Chief ~~Company. The~~Financial ~~Board~~Officer ~~also~~(principal ~~authorized~~financial anofficer), ~~additional~~also ~~500,000~~evaluated ~~fully~~whether ~~vested~~any ~~shares~~changes have occurred to bethe ~~issued~~Company’s tointernal ~~Mr. Greenwald.~~control ~~The~~over ~~Company~~financial ~~recorded~~reporting ~~$695,696~~during inthe ~~expense~~period ~~related~~covered toby ~~these~~this ~~issuances~~report inthat ~~the~~have ~~three~~materially ~~months~~affected, ~~ended~~or ~~May 31~~are reasonably likely to materially affect, ~~2011.~~such control.

On March 7, 2011, issued 687,500 shares to four consultants for services rendered. The Company recorded $378,125 in consulting expense in the three months ended May 31, 2011 as the grants were for past services and vested immediately to the holder. 15

OnDuring ~~March 7, 2011,~~ the ~~Company executed~~second aquarter, ~~common~~Joseph ~~stock~~Merhi and ~~warrant~~Edward ~~agreement~~Frumkes ~~with~~resigned ~~an accredited investor for $79,000 in cash~~directors. In ~~The~~September ~~accredited investor received 316~~2011,~~000~~ ~~common stock and 316,000 warrants to purchase an additional share of the Company at $0~~Mr.40 ~~within~~Martin ~~three years~~W. ~~As of~~Greenwald ~~May 31,~~resigned ~~2011,~~as ~~the~~Chief ~~accredited~~Executive ~~investor~~Officer ~~held~~and ~~316,000~~John ~~warrants~~Hackett ~~related~~joined toas ~~this~~Chief ~~purchase.~~Executive Officer.

InOn ~~June~~October 13, 2011, ~~the~~John ~~Company~~Hackett ~~entered~~resigned ~~into Agreements~~as ~~with~~Chief ~~George~~Executive ~~Mainas,~~Officer ~~Mainas~~and ~~Development~~Garrett ~~Corporation~~Cecchini ~~(collectively~~joined ~~“Mainas”)~~as ~~and~~Chief ~~two~~Executive ~~investors~~Officer. From ~~whereby~~2006 ~~the~~through ~~investors purchased $150~~2007,~~000~~ ofMr. ~~the~~Cecchini ~~debt~~was ~~due~~Executive ~~the~~Vice ~~Company~~President, tobusiness ~~Mainas.~~development ~~The~~and ~~Company~~a ~~agreed~~Director toof ~~allow~~Zvue ~~the~~Corp. From ~~investors~~2007 ~~the~~through ~~option to convert this debt into 600~~2009,~~000~~ Mr. ~~shares~~Cecchini ofwas a ~~common~~professional ~~stock~~ investor and ~~600,000~~a Director ~~warrants to purchase common stock~~ of ~~the~~Debut ~~Company~~Broadcasting, ~~for $0~~Corp.40 From ~~per~~2009 ~~share~~through ~~for~~April ~~three~~2010 ~~years~~he ~~from~~was ~~the~~a ~~date~~founder of, ~~the~~and ~~Agreement.~~CEO ~~Also~~of, inEntertainment ~~June~~Express, ~~the~~Inc. ~~investors notified~~ the ~~Company~~predecessor ~~that~~company ~~they~~of ~~were exercising~~Public ~~this~~Media ~~option~~Works, ~~to convert~~Inc. ~~The~~With ~~shares of Company common stock will be issued without restriction under~~ the ~~Act~~Merger, ~~under~~Mr. anCecchini ~~exemption~~became ~~provided~~CEO ~~pursuant~~and toChair ~~Rule 144~~ of the ~~Act.~~Board ~~The warrants and shares~~ of ~~the~~Directors ~~Company’s common stock which may be issued upon exercise~~ of Public ~~the~~Media ~~warrants~~Works. ~~are~~In ~~restricted~~August ~~securities~~2010, ~~and may not be sold, transferred or otherwise disposed without registration under Act, or an exemption thereunder~~Mr. ~~The~~Cecchini ~~securities~~resigned ~~were~~as ~~offered~~CEO and ~~sold~~ in ~~reliance~~March on2011, ~~the~~he ~~exemption~~ resigned from ~~registration under Section 4(2) of~~ the ~~Act~~Board ~~and/or Rule 506~~ of ~~Regulation D under the Act~~Directors. ~~The~~ ~~offering~~In ~~was~~2011, ~~not~~he ~~conducted~~co-founded ~~in connection with a public offering,~~ and nocontinues ~~public~~to ~~solicitation~~be ora ~~advertisement~~partner ~~was~~in ~~made~~Magna orGroup, ~~relied~~LLC, ~~upon~~a bymerchant ~~the individual in connection with the offering~~bank.

~~Item 3. Defaults Upon Senior Securities.~~PART II - OTHER INFORMATION

~~None~~Item 1. Legal Proceedings.

~~Item~~The 4.Company filed a voluntary petition on September 23, 2011 under Chapter 11 of the United States Bankruptcy Code with the United States Bankruptcy Court for the Central District of California, Riverside Division (~~Removed~~the ~~and~~“Bankruptcy ~~Reserved~~Court”).

~~None~~There are no other material pending legal proceedings to which the Company is a party or of which any of the Company’s property is subject as of the date of this report. Further, as of the date of this report, the Company is not aware of any legal proceedings against the Company, or its property contemplated by any governmental authority.

In addition to the other information set forth in this report, you should carefully consider the factors discussed in “Part II, Item 56— Management’s Discussion and Analysis of Financial Condition and Results of Operations—Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended February 28, 2011 which was filed with the SEC on June 3, 2011 (the “Form 10K”). ~~Other~~These ~~Information~~risks and uncertainties have the potential to materially affect our business, financial condition, results of operations, cash flows, projected results and future prospects. As of the date of this report, we believe that the previously discussed bankruptcy filing is a material changes to the risk factors previously disclosed in our Form 10K.

~~During~~Item ~~the period commencing June 30, 2011 through the period ending July 13, 2011, the Company agreed to sell 1,270,000 shares of restricted Company common stock at $~~1A.10 ~~per~~Risk share to 4 accredited investors, which resulted in gross proceeds of $127,000 to the Company, and agreed to issue $75,000 in convertible promissory notes to 3 accredited investors. The convertible promissory notes are due and payable on October 31, 2011; do not accrue any interest; and are convertible into shares of Company common stock at the election of the Company or the holder at $.10 per share. The shares of Company common stock, convertible notes and shares of common stock underlying the convertible notes are restricted securities, and may not be sold, transferred or otherwise disposed without registration under the Securities Act of 1933, as amended (the “Securities Act”) or an exemption there under. The shares of common stock and convertible notes were offered and sold in reliance on the exemption from registration under Section 4(2) of the Securities Act and/or Rule 506 of Regulation D under the Securities Act. The issuance of shares of common stock and convertible notes were not conducted in connection with a public offering, and no public solicitation or advertisement was made or relied upon by the accredited investors in connection with the transactions. Factors

17There has been one material change from risk factors as previously disclosed under the heading “Risk Factors” in the Company’s Annual Report Form on 10-K for the year ended February 28, 2011 and the Quarterly Report Form 10Q for the quarter ended May 31, 2011.

~~Table~~Chapter 11 Bankruptcy. The Company filed a voluntary petition on September 23, 2011 (the “Petition Date”), for reorganization under Chapter 11 of ~~Contents~~the United States Code (the “Bankruptcy Code”) with the United States Bankruptcy Court for the Central District of California (the “Bankruptcy Court”). The Company is seeking debtor in Possession financing. There can be no assurance that such financing will be forthcoming, in which case the Company would need to amend its filing to a Chapter 7 filing for liquidation.

Item 62. ~~Exhibits~~Unregistered Sales of Equity Securities and Use of Proceeds.

(In June 2011, one consultant made a cashless exercise of a stock option and 128,571 shares were issued. The securities were offered and sold in reliance on the exemption from registration under Section 4(2) ~~Exhibits~~of ~~required~~the byAct ~~Item~~and/or ~~601~~Rule 506 of Regulation ~~S-B~~D under the Act. The offering was not conducted in connection with a public offering, and no public solicitation or advertisement was made or relied upon by the individual in connection with the offering.

Exhibit No.		Description
31.1		Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act
31.2		Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act
32.1		Certification of Chief Executive Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2		Certification of Chief Financial Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In June 2011, the Company issued 200,000 shares of common stock to a supplier. In return, the supplier agreed to give the Company a discount on future purchases of kiosks. The Company recorded $100,000 in expenses related to this transaction.

~~SIGNATURES~~In July 2011, the Company issued 2,121,750 shares related to an anti-dilution clause in $400,000 of previously reported debt converted to equity.

~~Pursuant~~On toAugust ~~the~~2, ~~requirements~~2011, of the ~~Securities~~Company ~~Exchange~~issued ~~Act of 1934~~600,000 ~~the~~shares ~~Registrant~~to ~~has~~Salzwedel ~~duly~~Financial ~~caused~~Services ~~this~~for ~~report~~services to be ~~signed~~rendered. onThe ~~its~~Company ~~behalf~~recorded by$90,000 ~~the~~in ~~undersigned,~~expense ~~thereunto~~related ~~duly~~to ~~authorized.~~this transaction.

In August 2011, one creditor elected to convert $7,408 of accounts payable into 74,085 shares of common stock of the Company.

18In the quarter ending August 31, 2011, the Company executed common stock agreements with five accredited investors for $137,000 in cash. The accredited investors received 1,370,000 shares of common stock and one investor received 750,000 warrants to purchase an additional share of the Company at $0.10 within three years.

Item 3. Defaults Upon Senior Securities.

None

Item 4. (Removed and Reserved).

None

Item 5. Other Information.

None

Item 6. Exhibits

Exhibit No.		Description

31.1		Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act

31.2		Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act

32.1		Certification of Chief Executive Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2		Certification of Chief Financial Officer pursuant to 18 U.S.C. §1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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.

		Public Media Works, Inc. (Registrant)

Date: October 17, 2011		/s/ Garrett Cecchini
	By:	Garrett Cecchini
	Title:	Chief Executive Officer

Public Media Works, Inc. (Registrant)

Date: July 15, 2011

/s/ MARTIN W. GREENWALD

Martin W. Greenwald

Chief Executive Officer

Filing Compare · PUBLIC MEDIA WORKS INC