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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 10-Q

(Mark One)

For the quarterly period ended November 30, 2009

For the transition period              to             

Commission File Number 0-29901

PUBLIC MEDIA WORKS, INC.

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

10250 Constellation Blvd., Suite 2300

Los Angeles, California, 90067

(Address of principal executive offices)

(310) 358-3213

(Issuer’s telephone number, including area code)

(Former address)

Check whether the issuer (1) 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  þ    NO  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    YES  ¨    NO  ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.):    YES  ¨    NO  þ

On January 4, 2010, the registrant had outstanding 5,286,440 shares of Common Stock, which is the registrant’s only class of common equity

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

Transitional Small Business Disclosure Format (Check one):    Yes  ¨    No  þ

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PUBLIC MEDIA WORKS, INC.

Form 10-Q

November 30, 2009

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PART I

PUBLIC MEDIA WORKS, INC.

Condensed Balance Sheets

See accompanying notes, which are an integral part of the financial statements.

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PUBLIC MEDIA WORKS, INC.

Condensed Statements of Operations (Unaudited)

See accompanying notes, which are an integral part of these financial statements

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PUBLIC MEDIA WORKS, INC.

Condensed Statements of Cash Flows (Unaudited)

See accompanying notes, which are an integral part of these financial statements

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PUBLIC MEDIA WORKS, INC.

NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED)

November 30, 2009

1. Basis of Presentation

The accompanying unaudited condensed financial statements of Public Media Works, Inc. (“We” or the “Company”), have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial statements and with instructions to Form 10-Q pursuant to the rules and regulations of Securities and Exchange Commission. In the opinion of management, all adjustments considered necessary (consisting of normal recurring adjustments) for a fair presentation are included herein. Operating results for the three and nine-month period November 30, 2009 are not indicative of the results that maybe expected for the fiscal year ending February 28, 2010. These unaudited condensed financial statements should be read in conjunction with the condensed financial statements and the notes thereto included in the Company’s Annual Report to Shareholders on Form 10-K for the fiscal year ended February 28, 2009.

The preparation of unaudited condensed financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and recording / or disclosures of contingent assets and liabilities at the date of the condensed financial statements and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. Such estimates relate primarily to the estimated lives of film development costs, certain accruals, deferred tax accounts and related valuation allowance and the fair value of equity instruments issued.

2. Going Concern and Liquidity Matters

The accompanying 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 in 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 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 ultimately 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 financial statements do not include any adjustment that might be necessary should we be unable to continue as a going concern.

The financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern.

3. Revenue Recognition

The Company’s revenues are recorded in accordance with the SEC Staff Accounting Bulletin No. 104, “Revenue Recognition.” The Company recognizes revenue when persuasive evidence of an arrangement exists, delivery has occurred, the fee is fixed or determinable, and collectability is reasonably assured. In instances where final acceptance of the product is specified by the customer or is uncertain, revenue is deferred until all acceptance criteria have been met.

The Company’s revenues during the current quarter were derived from a one-time payment under a consulting arrangement with a third party in which the Company agreed to assist the third party with its desired investment in a media company in exchange for $50,000 in cash and an ownership position in the investment. The ownership position in the investment has not been received as of November 30, 2009.

4. Recent Accounting Developments

In June 2009, the FASB issued authoritative guidance on the consolidation of variable interest entities, which is effective for us beginning January 1, 2010. The new guidance requires revised evaluations of whether entities represent variable interest entities, ongoing assessments of control over such entities, and additional disclosures for variable interests. We believe adoption of this new guidance will not have a material impact on our condensed consolidated financial statements.

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Other recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

5. Net Loss per Common Share – Basic and Diluted

Net loss per common share – basic and diluted is computed based on the weighted average number of shares outstanding for the period. Diluted loss per common share is computed by dividing net loss by the weighted average shares outstanding assuming all dilutive potential common shares were issued. As of August 31, 2009 and 2008, the Company had 800,000 and 925,000 stock options, respectively, that were not included in the net loss per common share due to the options being anti-dilutive. Additionally, there were no adjustments to net loss to determine net loss available to common stockholders. As such, basic and diluted loss per common share equals net loss, as reported, divided by the weighted average common shares outstanding for the respective periods.

6. Film Development Costs

On April 8, 2008, the Company paid $25,000 for a 50% interest in the option to develop, produce and exploit an original feature length motion picture based on the book “Without A Badge” by Jerry Speziale, which was capitalized in accordance with SOP 00-2. The interest in Without A Badge has been written off during the three and nine months ended November 30, 2009 since the option had expired as of November 1, 2009.

7. Common Stock

On April 17, 2009, $15,000 of accrued salary recorded as of February 28, 2009 for the CEO of the Company was converted into 75,000 shares of common stock at $0.20 / share.

On April 8, 2008, the Company issued 250,000 shares of its common stock at $0.10 per share for a total amount of $25,000.

On April 22, 2008, the Company entered into an investor relations and consulting agreement with CRG Partners, Inc. The agreement requires the Company to issue 60,000 shares of its common stock upon signing the agreement and 300,000 shares if the Company renews the agreement during the renewal period. The 60,000 shares issued on April 22, 2008 were valued at $.13 per share or $7,800 and has been expensed in the statement of operations. The Company has not yet renewed the agreement.

On May 21, 2008, the Company issued 100,000 shares of its common stock at $.25 per share for a total amount of $25,000.

On June 2, 2008, the Company executed a debt conversion agreement with George Mainas, a Company director and principal stockholder and debt holder, for the conversion of $30,000 in Company debt into 120,000 shares of the Company’s common stock for $.25 per share. The issuance of the Company’s shares of common stock to Mr. Mainas was exempt from registration under the Securities Act pursuant to Section 4(2) thereof. The shares of the Company’s Common Stock to issued to Mr. Mainas are restricted shares, and may not be sold, transferred or otherwise disposed without registration under the Securities Act or an exemption thereunder. As the fair value of the common stock issued amounted to $60,000 on the date of the agreement, the conversion resulted in a loss on the issuance of common stock of $30,000, which is reflected in the accompanying consolidated statement of operations for the six months ended August 31, 2008.

On August 1, 2008, the Company raised $40,000 through the sale of a total of 200,000 shares of common stock at $.20 per share to two accredited investors, directors and stockholders of the Company. The issuance of the Company’s shares of common stock was exempt from registration under the Securities Act pursuant to Section 4(2) thereof. The shares of the Company’s common stock issued are restricted shares, and may not be sold, transferred or otherwise disposed without registration under the Securities Act or an exemption thereunder.

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8. Share Based Compensation

The Company’s 2007 Equity Incentive Plan (the “Plan”), which is not yet shareholder-approved, permits the grant of share options and shares to its employees and affiliates for up to one million shares of common stock. The Company believes that such awards better align the interests of its employees and affiliates with those of its shareholders. Option awards are generally granted with an exercise price that approximates the market price of the Company’s stock at the date of grant.

The fair value 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 inputs, those ranges are disclosed. Expected volatilities are based on implied volatilities from traded options on the Company’s stock, historical volatility of the Company’s stock, and the other factors. The Company uses historical data to estimate option exercise and employee termination 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. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant.

A summary of option activity as of November 30, 2009, and changes during the period then ended is presented below:

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There were no options exercised during the nine months ended November 30, 2009 or 2008. There is no unvested compensation as of November 30, 2009.

10. Income Taxes

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

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.

As a corporation, the Company is primarily subject to U.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 November 30, 2009 and November 30, 2008, the Company had no accruals for interest or penalties related to income tax matters.

11. Subsequent Events

Effective December 31, 2009, George Mainas and Mainas Development Corporation agreed to extend the repayment period to February 28, 2010 under the Loan Modification and Security Agreement dated August 14, 2009.

The following discussion and analysis of should be read in conjunction with its 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.

Overview

Public Media Works, Inc. (the “Company” or “PMW” or “we” or “our”) is engaged in the development, production, marketing and distribution of film, music and television entertainment media.

Going Concern and Liquidity Matters

The accompanying condensed financial statements of PMW have been prepared under the assumption that we will continue as a going concern. Such assumption contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Our independent accountants report for 2009 and 2008 in our Form 10K filed with the SEC on May 29, 2009 state that our significant net losses, negative cash flows from operations and accumulated deficit through February 28, 2009 create substantial doubt as to the Company’s ability to continue as a going concern.

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 ultimately 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 financial statements do not include any adjustments that might be necessary should we be unable to continue as a going concern.

Plan of Operations

The Company generated $50,000 in revenues during the nine months ended November 30, 2009, and no revenues during the nine months ended November 30, 2008. The Company’s revenues during the nine month period ended November 30, 2009 were derived from a one-time payment under a consulting arrangement with a third party in which the Company agreed to assist the third party with its desired investment in a media company in exchange for $50,000 and an ownership position in the investment. The ownership position in the investment has not been received as of November 30, 2009.

For the nine months ended November 30, 2009, the Company’s operating loss amounted to $82,939, compared to an operating loss of $486,358 for the nine months ended November 30, 2008. The reduction in the operating loss resulted from the revenues generated during the nine month period as discussed above, and a reduction in general and administrative operating expense and professional fees from the nine months ended November 30, 2008, which was primarily due to sale of the various projects in the second quarter of August 31, 2008.

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The Company has reported a cumulative net loss of $5,131,340 from its inception on March 3, 2000 through November 30, 2009.

Liquidity and Capital Resources

At November 30, 2009, our total assets and current assets were $47 and our current liabilities were $1,146,563. Our stockholders’ deficit at November 30, 2009 was $1,146,516, compared to stockholders’ deficit at February 28, 2009 of $1,081,317.

As of November 30, 2009, the Company had a cash balance of $47. The Company does not currently have sufficient cash on hand to satisfy its operating costs and continued development 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 specific television, film and other projects.

To date, the Company has funded its operations primarily through the issuance of common stock in exchange for cash and services, as well as through unsecured notes payable to stockholders and third parties. As of November 30, 2009, the Company has aggregate outstanding notes payable and accrued interest balances of $1,099,071, under the following obligations:

1. On August 30, 2000, the Company and George Mainas, a member of the Board of Director’s of the Company and a shareholder, entered into a promissory note bearing interest at 8% per annum. As of November 30, 2009, the Company had an outstanding balance of $716,202 under the promissory note, including accrued interest. The promissory note is due and payable on February 28, 2010.

2. On August 19, 2004, the Company entered into a line of credit with Mainas Development Corporation, which is wholly-owned by George Mainas. The non-revolving line of credit has a maximum draw-down of $250,000, bears interest of 9% annually, does not maintain an outstanding balance limitation, and is due and payable on February 28, 2010. The outstanding balance on this account as of November 30, 2009 was $288,118 including accrued interest.

3. In July 2008, the Company entered into a promissory obligation to George Mainas to borrow $42,000 bearing interest at 7% per annum. As of November 30, 2009, the Company had an outstanding balance of $67,619 under the obligation, including accrued interest. The promissory obligation is due and payable on February 28, 2010.

Effective August 14, 2009, the Company executed a Loan Modification and Security Agreement with George Mainas and Mainas Development Corporation, a corporation wholly-owned by George Mainas, pursuant to which George Mainas and Mainas Development Corporation agreed to extend the repayment date for the Company’s outstanding loan obligations to them described above until December 31, 2009, in consideration of the Company granting a security interest in the Company’s assets to secure repayment of the loan obligations. The description of the terms of the Loan Modification and Security Agreement is qualified by reference to the complete copy of the agreement which is filed as an exhibit to the Company’s Form 8-K filed with the SEC on August 18, 2009 and incorporated herein by reference. Effective December 31, 2009, George Mainas and Mainas Development Corporation agreed to extend the repayment period to February 28, 2010 under the Loan Modification and Security Agreement.

4. In May 2002, the Company entered into an unwritten, unsecured promissory obligation to Denis Shusterman, a stockholder, in exchange for his payment of $16,715 in general and administrative expenses on behalf of the Company. This obligation is payable upon demand and bears no interest. As of November 30, 2009, the outstanding balance under this obligation was $16,715. On May 18, 2007, the Company received a Writ of Garnishment from the U.S. Department of Justice related to a judgment due from Denis Shusterman to the United States. The Company expects the U.S. Department of Justice to make demand for repayment of the amounts due and owing under the Company’s obligation to Denis Shusterman.

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5. The Company entered into note payable agreement to settle an outstanding rental obligation for $10,000, which is effective as of July 1, 2009 and due within twelve months. As of November 30, 2009, the Company had an outstanding balance of $10,417 under the obligation, including accrued interest.

The Board of Directors of the Company has passed a corporate resolution in September 2005 providing that 50% of all future Company revenues, or debt or equity financing proceeds, will be used to pay down the Company’s obligations under the Company’s outstanding debt obligations; provided, however, to date the Board of Directors has waived the application of this resolution.

Company Interest in Limited Liability Companies For Projects

On August 26, 2008, the Company executed a Purchase Agreement with Corbin Bernsen, and an entity owned by him, providing for the sale of certain Company limited liability company interests and projects. The agreement provided for the sale of the Company’s entire membership interests in DOD, LLC and Dead Air, LLC and for the Company to resign as the manager of each; the Company’s sale of one-half of its 40% interest in the production of the film “Car Pool Guy”; and the Company’s sale of one-half interest in the script for the film “3 Day Test”. In consideration for the assets, Mr. Bernsen agreed to forgive all of the Company debt to him (in the approximate amount of $55,000) and agreed to pay the Company future royalty payments from the projects. The Company received the right to receive royalty payments in the amount of 12.5% of any future distributions from DOD, LLC and 10% of any future distributions from Dead Air, LLC. DOD, LLC owns and develops the film “Donna On Demand” and Dead Air, LLC owns and develops the film “Dead Air”. As of the date of this report, the Company has not received any royalty payments from these projects, and there can be no assurance that the Company will receive any royalty payments from these projects in the future.

USE OF ESTIMATES AND CRITICAL ACCOUNTING POLICIES

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

The preparation of these financial 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 financial statements and the reported amounts of revenues and expenses during each reporting period. On an ongoing basis, management evaluates its estimates and assumptions, including those related to film development costs, income taxes, long lived asset valuation, and stock based compensation. Management basis its estimates and judgments on historical experience of operations and on various other factors that are believed to be reasonable under the circumstances, 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.

Management believes the following critical accounting policies, among others, will affect its more significant judgments and estimates used in the preparation of our financial statements.

Film Development Costs. Included in film development costs are films produced by the Company, capitalized costs include all direct production and financing costs, capitalized interest and production overhead. Film development costs are stated at the lower of amortized cost or estimated fair value. The valuation of investment in films and television programs is reviewed on a title-by-title basis, when an event or change in circumstances indicates that the fair value of a film or television program is less than its unamortized cost. The fair value of the film or television program is determined using management’s future revenue and cost estimates and a discounted cash flow approach. Additional amortization is recorded in the amount by which the unamortized costs exceed the estimated fair value of the film or television program. Estimates of future revenue involve measurement uncertainty and it is therefore possible that reductions in the carrying value of investment in films may be required as a consequence of changes in management’s future revenue estimates. Management evaluates the valuation of Film Development Costs on a quarterly basis. For the nine months ended November 30, 2009, we recognized approximately $25,000 (2008 - $9,050) of film development cost impairments.

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Income Taxes. In determining the carrying value of the Company’s net deferred tax assets, PMW must assess the likelihood of sufficient future taxable income in certain tax jurisdictions, based on estimates and assumptions, to realize the benefit of these assets. If these estimates and assumptions change in the future, PMW may record a reduction in the valuation allowance, resulting in an income tax benefit in the Company’s Statements of Operations. Management evaluates the realizability of the deferred tax assets and assesses the valuation allowance quarterly.

Effective March 1, 2007, we adopted the provisions of Accounting for Uncertainty in Income Taxes and the implementation had no significant impact on the Company’s financial statements.

Stock-Based Compensation. On January 1, 2006, we adopted Share Based Payment using the modified prospective method. PMW measures the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. That cost is recognized over the period during which an employee is required to provide service in exchange for the award – the requisite service period. We determine the grant-date fair value of employee share options using the Black-Scholes option-pricing model.

Recent Accounting Pronouncements

Please see Item 1 Notes to the Condensed Financial Statements, Footnote 4, Accounting Pronouncements for management’s discussion.

Off-Balance Sheet Arrangements

The Company does not have any off-balance sheet arrangements.

Intentionally omitted pursuant to Item 305(e) of Regulation S-K.

Evaluation of Disclosure Controls and Procedures. We conducted an evaluation under the supervision and with the participation of our management, including our Chief Executive Officer who is also our acting principal financial officer, of the effectiveness of the design and operation of 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 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 has concluded that, as of November 30, 2009, 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 who is also acting as our principal financial officer, as appropriate to allow timely decisions regarding required disclosure. We believe, however, that the accompanying financial statements presented in this Form 10-Q fairly present the financial condition and results of operations for the periods indicated.

The identified material weaknesses in our internal control over financial reporting relate to the following matters:

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Our plan to remediate those material weaknesses remaining as of November 30, 2009 is as follows:

CHANGES IN CONTROLS AND PROCEDURES

As required by 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 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 control. Based on the evaluation, there have been no such changes during the period covered by this report.

PART II – OTHER INFORMATION

There are no 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 6 – 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, 2009 which was filed with the SEC on May 29, 2009 (the “Form 10K”). These 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 do not believe that there have been any material changes to the risk factors previously disclosed in our Form 10K.

None

None

None

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Effective as of January 4, 2010, Al Hayes resigned as an officer and director of the Company. Mr. Hayes’ resignations were not due to any disagreements with the Company.

None.

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.

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