UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-QSB

[X] Quarterly report under Section 13 or 15 (d) of the Securities Exchange Act of 1934 for the quarterly period ended September 30, 2005

[  ] Transition report under Section 13 or 15 9d) of the Exchange Act for the Transition Period from ____________ to _______________.

COMMISSION FILE NUMBER 000-14724

TELEMETRIX INC.
(Name of small business issuer in its charter)

DELAWARE	470830931
(State or other jurisdiction	(I.R.S. Employer
of incorporation or organization)	Identification No.)

7105 La Vista Place, Suite 100, Longmont, CO 80503
(Address of principal executive offices) (Zip Code)

(303) 652-3279
(Registrant’s telephone number, including area code)

1225 Sage Street, Gering, Nebraska 69341
(Former name, former address and former fiscal year, if changed since last report)

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  [   ]   No  [X]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes  [   ]   No  [X]

APPLIABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEEDING FIVE YEARS

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

APPLICABLE ONLY TO CORPORATE ISSUERS

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date. 24,999,682 shares of common stock outstanding as of January 23, 2006.

Transitional Small Business Disclosure Format (Check one):   Yes  [   ]   No  [X]

TELEMETRIX INC.
INDEX

	PART I. FINANCIAL INFORMATION
Item 1	Financial Statements
	Consolidated Balance Sheet as of September 30, 2005 (unaudited)	3
	Consolidated Statement of Operations for the
	Three and Nine Months Ended September 30, 2005 and 2004 (unaudited)	4
	Consolidated Statement of Cash Flows for the
	Nine Months Ended September 30, 2005 and 2004 (unaudited)	5
	Notes to Consolidated Financial Statements	6
Item 2	Management’s Discussion and Analysis of Financial Condition
	and Plan of Operations	11
Item 3	Control and Procedures	19
	PART II. OTHER INFORMATION
Item 1	Legal Proceedings	19
Item 2	Unregistered Sale of Equity Securities and Use of Proceeds	19
Item 3	Defaults Upon Senior Securities	20
Item 4	Submission of Matters to a Vote of Securities Holders	20
Item 5	Other Information	20
Item 6	Exhibits and Reports on form 8-K	20
SIGNATURES		21

2

PART I FINANCIAL INFORMATION

Item 1. Financial Statements

Telemetrix, Inc.
Consolidated Balance Sheet
September 30, 2005
(Unaudited)

Assets
Current assets:
Cash	$               --
Accounts receivable	35,592
Other current assets	11,860
Total current assets	47,452
Property and equipment, net	740,236
Other assets:
Licenses	96,923
Total Assets	$      884,611
Liabilities and stockholders’ (deficit)
Current liabilities:
Accounts payable	$   1,742,077
Accrued expenses	675,533
Accounts payable and accrued expenses - affiliates	90,356
Convertible debentures	1,200,000
Notes payable - affiliates	239,000
Convertible term debt	250,000
Current portion of long-term debt	392,387
Total current liabilities	4,589,353
Long-term debt	--
Unissuable common stock - 156,083,686 shares	20,487,554
Stockholders’ (deficit):
Preferred stock, $.001 par value, 5,000,000 shares authorized
none issued or outstanding
Preferred stock, series D, $.001 par value, Convertible,
liquidation preferences $30 per share, 250,000 authorized
none issued or outstanding
Common stock, $.001 par value,
25,000,000 shares authorized,
24,999,682 shares issued and outstanding	25,000
Paid in capital	52,165,736
Accumulated (deficit)	(76,383,032	)
Total stockholders’ (deficit)	(24,192,296	)
Total liabilities and stockholder’s (deficit)	$      884,611

See the accompanying notes to the consolidated financial statements

3

Telemetrix, Inc.
Consolidated Statements of Operations
Three and Nine Months Ended September 30, 2005 and 2004
(Unaudited)

	Three Months Ended			Nine Months Ended
	2005		2004		2005		2004
Revenue:
Pager	$        20,005		$        23,743		$        63,177		$        70,170
Network services	--		--		22,500		221,140
Other	47,833		78,046		163,968		326,581
Total revenue	67,838		101,789		249,645		617,891
Cost of revenue	61,419		62,457		178,305		272,645
Gross margin	6,419		39,332		71,340		345,246
Operating expenses:
Non-cash stock compensation - general and administrative	--		--		--		72,000
Selling, general and administrative expenses	253,957		444,308		693,030		969,499
Total operating expenses	253,957		444,308		693,030		1,041,499
(Loss) from operations	(247,538	)	(404,976	)	(621,690	)	(696,253	)
Other (income) expense:
Other income	--		(35	)	--		(420	)
Gain on the settlement of debt	--		--		(6,500	)	(684	)
Interest expense	61,832		41,958		150,170		158,664
Total other (income) expense	61,832		41,923		143,670		157,560
Net (loss)	$    (309,370	)	$    (446,899	)	$    (765,360	)	$    (853,813	)
Per share information - basic and fully diluted:
Weighted average shares outstanding	24,999,682		18,476,176		24,999,682		18,476,176
Net (loss) per share	$         (0.01	)	$         (0.02	)	$         (0.03	)	$         (0.05	)

See the accompanying notes to the consolidated financial statements

4

Telemetrix, Inc.
Consolidated Statements of Cash Flows
For the Nine Months Ended September 30, 2005 and 2004
(Unaudited)

	2005		2004
Net cash provided by (used in) operating activities	$  (927,185	)	$  (253,182	)
Cash flows from investing activities:
Purchase of property and equipment	--		(861,299	)
Net cash (used in) investing activities	--		(861,299	)
Cash flows from financing activities:
Advances from affiliates	1,064,000		1,250,025
Increase (decrease) in notes payable-affiliates	--		5,007
Payments on long-term debt and notes	(148,461	)	(140,865	)
Net cash provided by financing activities	915,539		1,114,167
Net increase (decrease) in cash	(11,646	)	(314	)
Beginning - cash balance	11,646		34,811
Ending - cash balance	$             --		$      34,497
Supplemental cash flow information:
Cash paid for income taxes	$             --		$             --
Cash paid for interest	$      83,020		$      77,748
Non cash investing and financing activities:
Conversion of related party notes to stock subscriptions	$    300,000		$              --
Conversion of notes to common stock subscriptions	$    300,000		$              --

See the accompanying notes to the consolidated financial statements

5

TELEMETRIX, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
June 30, 2005
(UNAUDITED)

(1)   Basis of Presentation

The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial information and Item 310(b) of Regulation SB. They do not include all of the information and footnotes for complete financial statements as required by GAAP. In management’s opinion, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation have been included. The results of operations for the periods presented are not necessarily indicative of the results to be expected for the full year. For further information, refer to the Company’s financial statements as of December 31, 2004, and for the two years then ended, including notes thereto included in the Company’s Form 10-KSB.

(2)   Earnings Per Share

The Company calculates net income (loss) per share as required by SFAS 128, “Earnings per Share.” Basic earnings (loss) per share are calculated by dividing net income (loss) by the weighted average number of common shares outstanding for the period. Diluted earnings (loss) per share are calculated by dividing net income (loss) by the weighted average number of common shares and dilutive common stock equivalents outstanding. During periods when they are anti-dilutive, common stock equivalents, if any, are not considered in the computation.

(3)   Revenue Recognition

The Company recognizes paging and telemetry revenue, which consists of fees charged to subscribers, when services are provided. Revenue from the sale of paging equipment is recognized upon delivery to the customer. The Company recognizes revenue from network services (switching) which consists of fees for engineering services, equipment sales and fees for wireless mobile telephone interconnection (switching) services upon completion of the service or delivery of the equipment.

(4)   Property and Equipment

The Company has pledged substantially all of this property and equipment as collateral on the notes described in Note 5.

(5)   Convertible Debentures

During October 2003 the Company entered into a funding agreement with a third party whereby the Company would be able to borrow up to $2,000,000 in the form of convertible notes. As of December 31, 2003, the Company was advanced an aggregate of $350,000 pursuant to these demand notes. As of September 30, 2004, the Company was advanced an aggregate of $1,600,025 pursuant to the funding agreement. The notes do not bear interest unless in default in which case interest accrued at the rate of 12% per annum. The notes had a conversion feature which allowed for conversion into the Company’s common shares at $.04 per share, which the Company suspended because of the dispute described in Note 8 with TowerGate and Nyssen. This conversion right was reinstated on November 30, 2004, upon the Company reaching a settlement agreement with TowerGate and Nyssen and the parties agreed to convert their notes in to 40,000,000 common shares (see Note 7). The difference between $.04 per share price and the fair market value of the shares at the time of conversion was $4,399,975 and this amount was charged to non-cash interest during the year ended December 31, 2004. In the same agreement, a entity related to this third party investor received 20,000,000 shares of common stock for non-cash stock compensation for services. The Company recorded a $3,000,000 charge to non-cash compensation during the year ended December 31, 2004 (see Note 7).

6

Provided in the November 30, 2004, agreement, the note holder, its management and associates will invest an additional $300,000 as follows:

$100,000 at $0.02 per share
$200,000 at $0.10 per share

The lender agreed to convert $300,000 of these advances into 7,000,000 shares of the Company’s common stock at June 30, 2005. During the period ended September 30, 2005, this lender advanced the Company $550,000 pursuant to this agreement. The advances in excess of $300,000 are due on demand and bear interest at 15% per annum.

Also provided in the November 30, 2004, agreement, a related party, its management and associates will invest an additional $300,000 as follows:

$200,000 at $0.02 per share
$100,000 at $0.10 per share

The related party agreed to convert $300,000 of these advances into 11,000,000 shares of the Company’s common stock at June 30, 2005. During the period ended September 30, 2005, this party advanced the Company $539,000 pursuant to this agreement. The advances in excess of $300,000 are due on demand and bear interest at 15% per annum.

(6)   Notes payable – related parties

On February 3, 2003, the Company issued a $30,000 term note with interest at 10% per annum payable to a related party which required three installment payments of $10,000 each on March 3, 2003, April 3, 2003 and May 3, 2003. The note provided a penalty that in the event a payment was not received, within 5 days of each due date, the Company would be declared in default. The holder of the note would then be entitled to receive shares of stock of the Company at $0.11 per share, for outstanding principal balance including interest. Additionally, for each 30 days beyond the due date, additional shares would be computed at the rate of ½ of the initial conversion rate. On November 30, 2004, the related party agreed to convert the note plus $4,757 of accrued interest into shares of stock of the Company, at par, with the holder to receive 36,175,000 shares of common stock. The difference in the share price of $.001 and the fair market value of the shares was $5,391,493 which was charged to non-cash stock interest during the year ended December 31, 2004 (see Note 7).

7

(7)   Common Stock

The Company has obligations to issue common shares at September 30, 2005, pursuant to the conversions of various loans and accrued interest, incentive shares, and services as follows:

	Shares	Amount
Officers salary	6,479,479	$     859,000
Loan incentive shares	6,055,762	719,947
Conversion of debt	47,000,000	6,300,000
Services	20,600,000	3,036,000
Conversion of related
party debt	75,948,445	9,572,607
	156,083,686	$20,487,554

The stock subscriptions have been reclassified to Unissuable common stock on the balance sheet as the Company does not have sufficient authorized shares to affect these issuances.

(8)   Commitments and Contingencies

Effective on December 1, 2004, the Company entered into a consulting agreement with a former officer for a monthly fee of $10,000. The agreement may be cancelled upon 30 days notice by either party.

The Company has agreed to issue certain common shares to various related parties. As of September 30, 2005, the Company does not have sufficient authorized shares to affect these issuances (see Note 5, 6 and 7).

On or about September 10, 2001, the company filed a Form S-8 Registration Statement under the Securities Act of 1933 registering 375,000 shares of common stock to be issued in accordance with a consulting agreement. On September 21, 2001, the Company issued the 375,000 shares of common stock. The Company received and acted in reasonable reliance upon legal advice and guidance from legal counsel at the time regarding the issuance, however, it has been recently advised that certain investor relations related services that were to be provided are prohibited under Regulation S-8. As such, the issuance of the 375,000 shares of common stock may have violated the registration provisions of the federal securities laws, specifically Section 5 of the Securities Act of 1933.

(9)   Going Concern

The Company’s financial statements are presented on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business.

The Company has experienced significant losses from operations. For the nine months ended September 30, 2005, the Company incurred a net loss of $765,360. In addition, the Company has an accumulated deficit of $76,383,032 and working capital and stockholders’ deficits of $4,541,901 and $24,192,296 at September 30, 2005.

The Company’s ability to continue as a going concern is contingent upon its ability to expand its service operations secure additional financing. The Company is pursuing financing for its operations and seeking to expand its operations. Failure to secure such financing or expand its operations may result in the Company not being able to continue as a going concern.

8

The financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification of assets or the amounts and classification of liabilities that may result from the possible inability of the Company to continue as a going concern.

(10)   Litigation and Contingencies

On September 10, 2004, the Company filed a Complaint in the United States District Court in the Southern District of New York against Michael Tracy (“Tracy”), Michael L. Glaser (“Glaser”), and William W. Becker (“Becker”), in case number 04CV7255. The Complaint sought an award for compensatory damages, an injunction against Tracy, Glaser and Becker for breach of fiduciary duty, costs and expenses for litigation (except fees and other disbursements) including reasonable attorney’s fees, and against Tracy for conversion, and such other and further relief as may be deemed just and proper.

On September 16, 2004, the Company filed a complaint in the United States District Court for the District of Nebraska, in case number 7:04CV5020, against TowerGate Finance, Ltd., (“TowerGate”) and Nyssen, LP (“Nyssen”). The Complaint alleges fraudulent misrepresentations against TowerGate, fraudulent concealment against Nyssen, breach of fiduciary duty against TowerGate, civil conspiracy against TowerGate and Nyssen, breach of contract against TowerGate, and breach of the covenant of good faith and fair dealings against TowerGate. The Complaint seeks preliminary and permanent injunction, declaratory judgment and an accounting. The Complaint also requests a jury trial.

On December 10, 2004, the Company, Tracy, Glaser and Becker and our other majority shareholders and TowerGate and Nyssen entered into a binding agreement (“Agreement”) dated as of November 30, 2004, in which the parties agreed to dismiss the above described lawsuits, and settle the dispute between them and between the Company and TowerGate and Nyssen. The agreement calls for the appointment of an interim board of directors and stipulated that so long as Becker and affiliated entities and TowerGate/Nyssen hold in excess of 25% of the outstanding voting common shares that they will be entitled to appoint two directors.

All parties to the Settlement Agreement are either beneficial owners of the Company’s common stock, current or proposed members of the Company’s management, and/or are parties or affiliates of parties involved in the Litigation that gave rise to the Settlement Agreement. Despite the filing of a December 21, 2004, Form 8-K related to this litigation, the Company has never disclosed the specific terms of the Settlement Agreement, including the relationships among the parties to the Settlement Agreement, whether and how the terms of the Settlement Agreement will be fulfilled and the existence and substance of potential violations of Delaware law and the Company’s bylaws as a result of the terms contained in the Settlement Agreement.

In the Settlement Agreement, the parties agree that the parties will undertake the following actions:

Increase the Company’s authorized share capital;
Effect material share issuances to Becker Capital Management;
Effect material share issuances to Nyssen LP and Tower Gate Finance Limited; and
Adopt a stock option plan for the Company’s existing and new management.

The Settlement Agreement gives rise to the following unasserted claims, all of which expose the Company to potential shareholder lawsuits or SEC regulatory actions. The Company is attempting to comply with all of the requirements of Delaware law and the SEC requirements, but there can be no assurance that it will be able to do so. In addition, FCC approval is required for certain of the share issuances and if this approval is not obtained by the Company there may be material negative impact on the Company’s financial position and results of operations.

9

Violation of Delaware Law and Corporate Bylaws.

Section 144 of the Delaware Corporation Code states:

“Interested directors; Quorum” provides that any contract or transaction between the Company and one or more of its directors or officers, or between a corporation and any other corporation, partnership, association or other organization in which 1 or more of its directors or officers, are directors or officers, or have a financial interest requires the approval of the contract and related transactions by: (a) a majority of the Company’s disinterested directors; and (b) the Company’s shareholders.

If the Company fails to comply with either requirement above, it is subject to shareholder action. Additionally, Section 144 provides that the Settlement Agreement could potentially be voided unless it is fair to the Company. The action of increasing the Company’s authorized common stock so that it can issue large numbers of shares to the parties to the agreement, who are management, beneficial owners or affiliates, and also adopting a stock option plan for the benefit of management, may be considered unfair to the Company’s shareholders who are not party to the agreement.

The issuances of significant shares (described above) to the Company’s management and beneficial owners as provided for in the Settlement Agreement may be set aside under Delaware Corporation Law. Section 161 imposes limitations on directors’ power to issue authorized shares. Any new stock issuance, such as those provided for in the Settlement Agreement, is subject to the statutory requirements regarding quality and quantity of consideration to be received for the shares. The foregoing actions may require the vote of disinterested shareholders pursuant to Delaware Corporate Code Section 144 because all of the parties to the Settlement Agreement are either the Company’s directors and/or beneficial owners, and/or all are interested directors and/or interested shareholders.

The Company’s bylaws and Delaware corporation law require that directors be elected at any annual meeting of Shareholders.

Because the Company has a class of securities registered pursuant to the Securities Exchange Act of 1934 (“Exchange Act”), the Company must comply with Exchange Act Section 14 disclosure requirements. The Company is required to file a Proxy Statement on Form 14A or an Information Statement on Schedule 14C and will be prohibited from taking the actions set forth in the Settlement Agreement until twenty days after the filing of the Proxy or of its Definitive Information Statement.

The Company is delinquent in filing several reports on Form 10-QSB and failed to timely correct any insufficient and incomplete disclosure in its SEC filings,

The Company is also involved in various legal actions arising in the normal course of business management believes that such matters will not have a material effect upon the financial position of the Company.

10

Subsequent to December 31, 2004, the Company made application with the FCC for approval of the shares to be issued to Becker, Nyssen, TowerGate and Becker Capital Management LLC per the settlement agreement described above. The application is currently pending.

(11)   Subsequent Events

As of September 30, 2005, the note holder described in Note 5 advanced the Company $550,000 and through January 23, 2006, the Company borrowed an additional $140,000. The note holder agreed to convert $300,000 of these advances into 7,000,000 shares of the Company’s common stock at June 30, 2005. The advances in excess of $300,000 bear interest at 15% per annum and are due on demand.

As of June 30, 2005, the related party described in Note 5 advanced the Company $539,000 and through January 23, 2006, the Company borrowed an additional $285,000. The related party agreed to convert $300,000 of these advances into 11,000,000 shares of the Company’s common stock at June 30, 2005. The advances in excess of $300,000 bear interest at 15% per annum and are due on demand.

Item  2.   Management’s Discussion and Analysis of Financial Condition and Plan of Operation

The following discussion should be read in conjunction with our financial statements and related notes appearing elsewhere in this Form 10-QSB and our Annual Report on Form 10-KSB for our fiscal year ended December 31, 2004. The terms “the Company,” “we,” “our” or “us” refer to Telemetrix, Inc. This discussion contains forward-looking statements based on our current expectations, assumptions, and estimates. The words or phrases “believe,” “expect,” “may,” “anticipates” or similar expressions are intended to identify “forward-looking statements.”

Actual results could differ materially from those projected in the forward-looking statements as a result of a number of risks and uncertainties pertaining to our business, including: (a) our history of losses makes it difficult to evaluate our current and future business and our future financial results; (b) our ability to proceed with our operating plan is dependent on our ability to obtain additional financing; (c) even if we obtain additional debt or equity financing, the value of our common stock may be diluted; (d) our ability to continue as a going concern is contingent upon our ability to expand our service operations and secure additional financing; (e) debt obligations of approximately $5 million may negatively affect our ability to expand our operations; (f) whether we will be able to keep pace with the rapid development of technology in the wireless communications services area; (g) whether our existing technology will become obsolete or too expensive to upgrade; (h) the possibility that our business will be subject to increasing government regulation and related increasing costs; and (i) our dependency upon third party providers, including roaming partners and wireless network companies, through which we obtain our interconnections throughout North America and international markets; should we lose the services of these third party providers, our operations may be negatively affected, including interruptions in our service.

Statements are made as of the filing of this Form 10-QSB with the Securities and Exchange Commission and should not be relied upon as of any subsequent date. Unless otherwise required by applicable law, we do not undertake, and we specifically disclaim any obligation, to update any forward-looking statements to reflect occurrences, developments, unanticipated events or circumstances after the date of such statement.

11

Overview

Until August 2002, our revenues were primarily generated from one way wireless communication (paging) services. Beginning in September 2002, we ceased research and development on telemetry related hardware products; instead, we began focusing on using our Personal Communications System network (PCS) to provide Global Systems for Mobile communications (GSM) network access for telemetry devices from third party providers. At that time, we began providing telemetry services, which consist of sending and receiving Short Messages, including actual text messages transmitted to and from wireless modems, the sale of and service for subscriber identity module (SIM) cards, a cost per short message, and an activation fee for subscriber/customers.

We also provide professional, back office, and switch sharing services to medium and smaller size wireless carriers through our Network Services Division.

Divisions

We operate the following divisions:

o Telemetry and Pager Services — Our Telemetry Division offers wholesale and retail messaging services. For businesses and end users, we provide regional paging and cellular roaming services. For wholesale customers, we provide short messaging services (SMS). Wholesale SMS are sold through agreements with agents and resellers that purchase our telemetry and data services at wholesale and then resell such services at retail rates.

o Network Services — Our Network Services Division provides professional, back office, and switch sharing services to medium and smaller size wireless service providers. These services include system upgrades and integration that offer call processing, calling feature enhancements, roamer clearing and settlement, billing and other network services.

Type of Customers

Except for consumer Pager Services contracts, all of our customers are commercial customers. We have three major types of commercial customers:

o Resellers — Our resellers resell our short message services, which are often resold in combination with a specific device that the reseller offers as a part of an integrated hardware/communication service package;

o Wholesale Users — We have wholesale users, such as hardware and software developers that use our short message services for testing and development of hardware and messaging solution services; and

o Wireless Carriers — Wireless carriers purchase our services, such as switch sharing or other service enhancements.

Revenues

Our revenues consist of the following:

o Pager — Pager revenue is derived from monthly paging service contracts with businesses and end consumers.

o Network Services – Network Services revenue is produced by our Network Services Division through incremental charges for the shared use of our central office wireless switch, which enables certain of our customers to operate a remotely located media gateway in their location via a connection with our switch in Gering, Nebraska; and

o Other — Other revenue is derived from the rental of our towers, cellular roaming revenue, and telemetry revenue that results from wholesale contracts with resellers of network access and short message services.

12

During our Fiscal Year 2004 period, our total revenues of $654,688 were derived from the following:

o $ 70,170 from our pager related services; and

o $221,140 from our network services; and

o $363,378 from other revenue.

During the three-month period ending September 30, 2005, our total revenues of $67,838 were derived from the following:

o $20,005 from pager related services;

o $47,833 from other revenue sources.

During the nine-month period ending September 30, 2005, our total revenues of $249,645 were derived from the following:

o $ 63,177 from pager related services;

o $22,500 from network services; and

o $163,968 from other revenue sources.

Our pager related revenues decreased by $48,996 or 41.1% to $70,170 during the year ended December 31, 2004 from $119,166 for the comparable 2003 period. We believe that during the year 2005 pager related revenues will continue to decline, albeit at a slower rate than the 2004 — 2003 period, as the overall North American pager market continues the revenue decline it has experienced over the past several years. This overall decline can be attributed to the increasing usage of other wireless technologies.

We will attempt to expand our revenues by marketing our Telemetry Division’s short message service network data access and through our Network Services division for switch sharing services.

Our revenues are dependent upon the following factors:

o Our ability to secure additional agreements for wholesale reseller customers using our nationwide network access for short message service and data as well as our ability to generate an increase in usage by our existing customers;

o Our Network Service Division’s ability to sell their service offerings and implement the hardware and software for network operations and billing services;

o Our ability to hire and maintain qualified engineering and Information Technology staff that will be able to install and maintain and support the equipment and software necessary for both our Telemetry Division services as well as the Network Services Division;

o Demand for our services;

o Individual economic conditions in our markets; and

o Our general ability to market our services.

Capital Expenditures and Requirements

During 2004, we committed to one significant capital expenditure of approximately $860,000 for a Mobile Switching Center. If we obtain adequate funding, we expect to make the following significant capital expenditures during 2005: $400,000 for network build out.

Critical Accounting Policies and Estimates

The preparation of our financial statements requires us to make estimates and assumptions that affect the reported amounts. These estimates and assumptions are evaluated on an on-going basis and are based on historical experience and various other factors that are believed to be reasonable. Estimates and assumptions include, but are not limited to, fixed asset lives, intangible assets, income taxes, and contingencies, which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. Critical accounting policies affect our more significant judgments and estimates used in the preparation of the financial statements. Our principal critical accounting policies consist of revenue recognition and stock compensation. Our critical accounting policies are outlined in our audited financial statements contained in our Form 10-KSB for the year ended December 31, 2004.

13

Results of Operations

Comparison of Three Months Ended September 30, 2005 and 2004

Revenues. Revenues for the three months ended September 30, 2005 decreased by $33,951 or 33.4% to $67,838 from $101,789 for the three months ended September 30, 2004. The decrease in revenue is primarily attributable to a reduction in other revenue to $47,833 in the three months ended September 30, 2005, from $78,046 for the comparable period in 2004. The decrease is primarily due to decreased short message revenue due to increased competition in short message providers.

Cost of Revenues. Cost of revenues currently consists primarily of equipment repairs and short message processing. Cost of revenues decreased by 1.7% or $1,038 to $61,419 for the three months ended September 30, 2005 from $62,457 for the comparable 2004 period, representing 90.5% and 61.4% of the total revenues for the three months ended September 30, 2005 and 2004, respectively. The decrease in the cost of revenues is attributable to decreased revenues. The percentage increase of cost of revenues to total revenues is due to certain fixed costs associated with short message processing.

Operating Income/(Losses). Operating income for the three months ended September 30, 2005 reflected a loss of ($247,538) compared to an operating loss of ($404,976) during the comparable 2004 period. On a year over year basis for the third quarter, our operating losses decreased by 38.9% or $157,438. The decrease in operating loss was primarily due to decreased selling, general and administrative expenses. This decrease is due to the closing of our Atlanta office in September 2004.

Selling, General and Administrative Expense. General and administrative expense decreased by $190,351 or 42.8% to $253,957 for the three month period ended September 30, 2005, from $444,308 for the three-month period ended September 30, 2004. The decrease in our general and administrative expenses is primarily attributable to decreased staffing expense associated with the network services/switch-sharing office in Atlanta, Georgia that was closed in September 2004.

Interest Expense. Interest expense for the three-month period ended September 30, 2005 increased by $19,874 or 47.4% to $61,832 as compared to $41,958 for the three-month period ended September 30, 2004. The increase in interest expense is due to related party advances that carry interest rates of 10% to 15% as compared to lower rates in 2004.

Net Loss. Net loss for the three-month period ended September 30, 2005 decreased by 30.8% or $137,529 to ($309,370) from ($446,899) for the three months ended September 30, 2004. Net loss per share decreased to $(0.01) for the three months ended September 30, 2005, as compared to ($0.02) for the three months ended September 30, 2004.

Comparison of Nine Months Ended September 30, 2005 and 2004

Revenues. Revenues for the nine months ended September 30, 2005 decreased by $368,246 or 59.6% to $249,645 from $617,891 for the nine months ended September 30, 2004. Our decrease in revenues is attributable (a) decreased network service revenues of $198,640, and (b) decreased other revenue of $162,613. The decrease in network service revenue is primarily attributed to one time charges for network services billed in 2004. The decrease in other revenue is related to declining short message customers attributed to increased competition in the short message service providers. Additionally, our pager revenue declined 10.0% or $6,993 to $63,177 during the first nine months of 2005 vs. $70,170 being reported for the first nine months of 2004. The period to period decline in pager revenue is attributable to the reductions being experienced overall in the North American Pager market as consumers continue migrating to other wireless messaging technologies.

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Cost of Revenue.

Cost of Revenues decreased by $94,340 or 34.6% to $178,305 in the first nine months vs. $272,645 being reported for the first nine months of 2004. Cost of revenue represents 71.4% and 44.1% of the total revenues for the nine months ended September 30, 2005 and 2004, respectively. The decrease in the cost of revenues is attributable to decreased revenues. The percentage increase of cost of revenues to total revenues is due to certain fixed costs associated with short message processing.

Operating Losses.

Operating losses for the nine months ended September 30, 2005 decreased by 10.7% or $74,563 to $621,690 from $696,253 for the nine months ended September 30, 2004. The decrease in operating loss was primarily due to (a) a $273,906 or 79.3% period to period decline in Gross Margin with decreased network services and other revenue driving the change in Gross Margin to $71,340 for the first nine months of 2005 from $345,246 for the first nine months of 2004; and offset by (b) decreased selling, general and administrative of $276,469 due to the closure of our Atlanta, Georgia office in September 2004.

Non-Cash Stock-Based Compensation.

Non-Cash Stock-Based Compensation decreased $72,000 or 100.0% for the nine months ended September 30, 2005, from $72,000 for the nine months ended September 30, 2004. The 2004 charge represented compensation to our then Chief Executive Officer.

Selling, General and Administrative Expense.

General and administrative expense decreased by $276,469 or 28.5% to $693,030 for the nine month period ended September 30, 2005, from $969,499 for the nine month period September 30, 2004. The decrease in our general and administrative expenses is primarily attributable to decreased staffing expense associated with the network services/switch-sharing office in Atlanta, Georgia that was closed in September 2004.

Interest Expense.

Interest expense for the nine month period ended September 30, 2005 decreased $8,494 or 5.4% to $150,170 as compared to $158,664 for the nine month period ended September 30, 2004.

Net Loss.

Net loss for the nine month period ended September 30, 2005 decreased by $88,453 or 10.4% to ($765,360) from ($853,813) for the nine months ended September 30, 2004. Net loss per share decreased to ($0.03) for the nine months ended September 30, 2005 as compared to ($0.05) for the comparable period in 2004.

Balance Sheet

Current Assets. Current Assets amounted to $47,452 as of September 30, 2005 representing an decrease of $1,088 or 2.2% from Current Assets of $48,540 as of December 31, 2004.

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Current Liabilities. As of September 30, 2005, Current Liabilities are $4,589,353 representing an increase of $470,699 or 11.4%, from Current Liabilities of $4,118,654 as of December 31, 2004. Decreases in Accounts Payable and increases in convertible debt and notes payable to related parties account for the majority of the change from year-end 2004.

Liquidity and Capital Resources

Net cash used in operating activities for the period ending September 30, 2005 was ($927,185) compared with ($253,182) for the same period in 2004. This change can be primarily explained by the pay-down of accounts payable in 2005 versus increased accounts payable and accrued expenses for the same period in 2004.

Cash used in investing activities for the period ended September 30, 2005 was $0 compared with $861,299 for the period ended September 30, 2004. The cash expensed in 2004 was for the purchase of property and equipment.

Cash provided by financing activities was for the period ended September 30, 2005 was $915,539 as compared to $1,114,167 for the period ended September 30, 2004. The cash provided in 2005 resulted from the proceeds of convertible notes of $1,064,000, reduced by payments on outstanding debt.

Cash at September 30, 2005 amounted to $0 from $11,646 at December 31, 2004. Cash at January 23, 2006 amounted to $4,000.

Although we plan to make material purchases of capital equipment during 2005 should we obtain adequate financing, we do not currently have material commitments for capital expenditures for the current year. We shall continue to finance our operations mainly from loans and fundraising activities. We do not believe that our future cash flow from operations together with our current cash will be sufficient to finance our activities through the year 2005; therefore, we plan to raise money through a private placement to fund the implementation of an expanding operational plan.

For the year ended December 31, 2004, we incurred net losses of $13,716,022 and we had a working capital deficit of $4,070,114 and stockholders’ deficit of $23,426,934 at December 31, 2004. As of September 30, 2005, we had an accumulated deficit of $76,383,032 and working capital and stockholders’ deficits of $4,541,901 and $24,192,296, respectively.

Our ability to continue as a going concern is contingent upon our ability to attain profitable operations and secure adequate financing.

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We cannot continue to satisfy our current cash requirements for a period of twelve (12) months through our existing capital. We anticipate total estimated operating expenditures of approximately $665,000 over the next six(6) months, in the following areas:

o Salaries and labor = $225,000

o Network operating costs = $150,000

o Network infrastructure = $200,000

o G&A (exclusive of salaries) = $90,000

Our current cash of $0 as of September 30, 2005 as well as our cash of $4,000 as of January 15, 2006 will satisfy our cash requirements for less than a day.

Accordingly, we will be unable to fund our expenses through our existing assets or cash. In order to acquire funding, we may be required to issue shares of our common stock, which will dilute the interest of current shareholders. Moreover, we may still need additional financing through traditional bank financing or a debt or equity offering; however, because we have limited revenues, and a poor financial condition, we may be unsuccessful in obtaining such financing or the amount of the financing may be minimal and therefore inadequate to implement our business plans. In the event that we do not receive financing or our financing is inadequate, we may have to liquidate our business and undertake any or all of the following actions:

o Significantly reduce, eliminate or curtail our business, operating and research and development activities so as to reduce operating costs;

o Sell, assign or otherwise dispose of our assets, if any, to raise cash or to settle claims by creditors;

o Pay our liabilities in order of priority, if we have available cash to pay such liabilities;

o If any cash remains after we satisfy amounts due to our creditors, distribute any remaining cash to our shareholders in an amount equal to the net market value of our net assets;

o File a Certificate of Dissolution with the State of Delaware to dissolve our corporation and close our business;

o Make the appropriate filings with the Securities and Exchange Commission so that we will no longer be required to file periodic and other required reports with the Securities and Exchange Commission, if, in fact, we are a reporting company at that time; and

o Make the appropriate filings with the National Association of Security Dealers to affect a delisting of our stock.

Based upon our current assets, however, we would not have the ability to distribute any cash to our shareholders.

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If we have any liabilities that we are unable to satisfy and we qualify for protection under the U.S. Bankruptcy Code, we may voluntarily file for reorganization under Chapter 11 or liquidation under Chapter 7. Our creditors may also file a Chapter 7 or Chapter 11 bankruptcy action against us. If our creditors or we file for Chapter 7 or Chapter 11 bankruptcy, our creditors will take priority over our shareholders. If we fail to file for bankruptcy under Chapter 7 or Chapter 11 and we have creditors; such creditors may institute proceedings against us seeking forfeiture of our assets, if any. We do not know and cannot determine which, if any, of these actions we will be forced to take. If any of these foregoing events occur, you could lose your entire investment in our shares.

To date, we have funded our activities principally from loans from related parties and loans from third party lenders.

Contractual Obligations and Commercial Commitments

We have no contractual obligations, including lease obligations, apart from agreements in the normal course of our business.

Recent Pronouncements

In November 2004, the Financial Accounting Standards Board (FASB) issued SFAS 151 “Inventory Costs”. This Statement amends the guidance in ARB No. 43, Chapter 4, “Inventory Pricing, to clarify the accounting for abnormal amounts of idle facility expense, freight, handling costs, and wasted material (spoilage). In addition, this Statement requires that allocation of fixed production overhead to the costs of conversion be based on the normal capacity of the production facilities. The provisions of this Statement will be effective for the Company beginning with its fiscal year ending 2005. The Company does not believe that this standard will not have a material impact on the Company’s financial position, results of operations or cash flows.

In December 2004, the FASB issued SFAS 153 “Exchanges of Non monetary Assets — an amendment of APB Opinion No. 29". This Statement amended APB Opinion 29 to eliminate the exception for non monetary exchanges of similar productive assets and replaces it with a general exception for exchanges of non monetary assets that do not have commercial substance. A non monetary exchange has commercial substance if the future cash flows of the entity are expected to change significantly as a result of the exchange. The adoption of this Standard is not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

In December 2004, the FASB issued SFAS 123 (revised 2004) “Share-Based Payment”. This Statement requires that the cost resulting from all share-based transactions be recorded in the financial statements. The Statement establishes fair value as the measurement objective in accounting for share-based payment arrangements and requires all entities to apply a fair-value-based measurement in accounting for share-based payment transactions with employees. The Statement also establishes fair value as the measurement objective for transactions in which an entity acquires goods or services from non-employees in share-based payment transactions. The Statement replaces SFAS 123 “Accounting for Stock-Based Compensation” and supersedes APB Opinion No. 25 “Accounting for Stock Issued to Employees”. The provisions of this Statement will be effective for the Company beginning with its fiscal year ending in 2006. The Company is currently evaluating the impact this new Standard will have on its financial position, results of operations or cash flows.

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In March 2005, the Securities and Exchange Commission (SEC) issued Staff Accounting Bulletin No.107 (SAB 107) which provides guidance regarding the interaction of SFAS 123(R) and certain SEC rules and regulations. The new guidance includes the SEC’s view on the valuation of share-based payment arrangements for public companies and may simplify some of SFAS 123(R)‘s implementation challenges for registrants and enhance the information investors receive.

In March 2005, the FASB issued FIN 47, Accounting for Conditional Asset Retirement Obligations, which clarifies that the term ‘conditional asset retirement obligation’ as used in SFAS 143, Accounting for Asset Retirement Obligations, refers to a legal obligation to perform an asset retirement activity in which the timing and/or method of settlement are conditional on a future event that may or may not be within the control of the entity. FIN 47 requires an entity to recognize a liability for the fair value of a conditional asset retirement obligation if the fair value can be reasonably estimated. FIN 47 is effective no later than the end of the fiscal year ending after December 15, 2005. The Company does not believe that FIN 47 will have a material impact on its financial position, results from operations or cash flows.

     In August 2005, the FASB issued SFAS 154, Accounting Changes and Error Corrections. This statement applies to all voluntary changes in accounting principle and to changes required by an accounting pronouncement if the pronouncement does not include specific transition provisions, and it changes the requirements for accounting for and reporting them. Unless it is impractical, the statement requires retrospective application of the changes to prior periods’ financial statements. This statement is effective for accounting changes and correction of errors made in fiscal years beginning after December 15, 2005. The adoption of this Standard is not expected to have a material impact on the Company’s financial position, results of operations or cash flows.

Item  3.   Controls and Procedures

As of September 30, 2005, an evaluation was performed under the supervision and with the participation of our management, including our Chief Executive Officer and Principal Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on that evaluation, our management, including our Chief Executive Officer and Principal Financial Officer, concluded that our disclosure controls and procedures were effective as of September 30, 2005.

There has not been any change in our internal control over financial reporting during the quarter ended September 30, 2005 that has materially affected or is reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

Item I.   Legal Proceedings

We are not subject to disputes and litigation in the ordinary course of our business. None of these matters, in the opinion of our management, is material or likely to result in a material effect on us based upon information available at this time.

Item 2.    Changes in Securities and Use of Proceeds

None

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Item 3.    Defaults Upon Senior Securities

None

Item 4.    Submission of Matters to a Vote of Securities Holders

None

Item 5.   Other Information

None

Item 6.    Exhibits and Reports on Form 8-K

Exhibits

31.1 Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

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

Reports in Form 8-K

None

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SIGNATURES

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

January 23, 2006

Telemetrix Inc.

By: /s/ William Becker
      William Becker
      Chief Executive Officer
      (Principal Executive Officer)

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